UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 26, 2021 (
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Explanatory Note
As previously disclosed, on March 25, 2021, BowX Acquisition Corp., a Delaware corporation (“BowX”), BowX Merger Subsidiary Corp., a Delaware corporation and a direct, wholly owned subsidiary of BowX (“Merger Sub”), and New WeWork Inc., a Delaware corporation formerly known as WeWork Inc. (“Prior WeWork”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which, among other transactions, on October 20, 2021, Merger Sub merged with and into Prior WeWork (the “First Merger”), with Prior WeWork surviving the First Merger as a wholly owned subsidiary of BowX (Prior WeWork, in its capacity as the surviving corporation of the First Merger, is sometimes referred to as the “Surviving Corporation”). Immediately following and as part of the same overall transaction as the First Merger, the Surviving Corporation merged with and into BowX Merger Subsidiary II, LLC (“Merger Sub II”), a Delaware limited liability company and a direct wholly owned subsidiary of BowX (the “Second Merger” and, together with the First Merger and with the other transactions described in the Merger Agreement, the “Business Combination”), with Merger Sub II being the surviving entity of the Second Merger. In connection with the closing of the Business Combination, BowX changed its name to WeWork Inc.
On October 19, 2021, BowX held a special meeting of its stockholders (the “Special Meeting”) in connection with the Business Combination. BowX’s stockholders voted to approve its business combination with Prior WeWork.
Unless the context otherwise requires, “we,” “us,” “our” and the “Company” refer to BowX and its consolidated subsidiaries prior to the completion (the “Closing”) of the Business Combination and WeWork Inc. and its consolidated subsidiaries following the Closing. All references herein to the “Board” refer to the board of directors of BowX or WeWork Inc., as applicable.
As a result of and upon the Closing, which occurred on October 20, 2021, among other things, all outstanding shares of Prior WeWork capital stock immediately prior to the effective time of the First Merger (the “Effective Time”) (other than (A) shares of Class C common stock of Prior WeWork, which were converted into the right to receive a number of shares of Company Class C common stock, par value $0.0001 per share (the “Class C Common Stock”), equal to (x) the exchange ratio under the Merger Agreement (which was equal to 0.82619) (the “Exchange Ratio”) multiplied by (y) the number of shares of Class C common stock of Prior WeWork held by such holder as of immediately prior to the Closing, (B) treasury shares, (C) dissenting shares and (D) shares of capital stock of Prior WeWork subject to stock awards) were cancelled in exchange for the right to receive a portion of an aggregate of 655,300,000 shares of Company Class A common stock, par value $0.0001 (the “Class A Common Stock”) (at a deemed value of $10.00 per share) representing a pre-transaction equity value of Prior WeWork of approximately $6.553 billion. Upon Closing, the Company received approximately $1.3 billion in gross cash proceeds consisting of approximately $333.0 million from the BowX trust account, $150.0 million from the previously announced backstop investment by DTZ Worldwide Limited, a parent company to Cushman & Wakefield U.S., Inc. (the “Backstop Investor”), and $800.0 million from the PIPE Investment (as defined below).
Prior to the Special Meeting, a total of 15,006,786 shares of Class A Common Stock were presented for redemption for cash at a price of $10.00 per share in connection with the Special Meeting (the “Redemptions”). As previously disclosed, the Backstop Investor committed to subscribe for the number of shares of Class A Common Stock equal to the amount of the Redemptions, subject to a cap of 15,000,000 shares of Class A Common Stock (the “Cap”). The purchase price for such shares of Class A Common Stock was equal to $10.00 per share multiplied by the number of Redemptions, subject to the Cap, for an aggregate purchase price of up to $150,000,000 (the “Backstop Investment”). Substantially concurrently with the Closing, the Backstop Investor subscribed for 15,000,000 shares of Class A Common Stock for $150,000,000. So long as the Backstop Investor continues to hold a specified amount of shares of Class A Common Stock, then the Backstop Investor has the right to designate a board observer.
Immediately after giving effect to the Business Combination, there were 696,492,801 issued and outstanding shares of Class A Common Stock and 19,938,089 issued and outstanding shares of Class C Common Stock. BowX’s public units separated into their component securities upon consummation of the Business Combination and, as a result, no longer trade as a separate security and were delisted from the Nasdaq Stock Market LLC (“Nasdaq”). As of the date of the Closing, our post-Closing directors and executive officers and their respective affiliated entities beneficially owned approximately 4.1% of the outstanding shares of Class A Common Stock,
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which represents approximately 4.0% of the total voting power of our outstanding shares, and no outstanding shares of Class C Common Stock, and the securityholders of BowX immediately prior to the Closing (which includes Vivek Ranadivé, who is one of our post-Closing directors) beneficially owned post-Closing approximately 6.1% of the outstanding shares of Class A Common Stock, which represents approximately 5.9% of the total voting power of our outstanding shares, and no outstanding shares of Class C Common Stock.
| Item 1.01 | Entry into a Material Definitive Agreement |
Amended and Restated Registration Rights Agreement
On October 20, 2021, in connection with the consummation of the Business Combination and as contemplated by the Merger Agreement, the Company entered into the Amended and Restated Registration Rights Agreement (the “Registration Rights Agreement”) with BowX Sponsor, LLC (the “Sponsor”), certain stockholders of BowX and certain stockholders of Prior WeWork. Pursuant to the Registration Rights Agreement, the Company agreed to register for resale, pursuant to Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), certain shares of Class A Common Stock and other equity securities of the Company that are held by the parties thereto from time to time. In certain circumstances, various parties to the Registration Rights Agreement can collectively demand up to nine underwritten offerings and are entitled to piggyback registration rights, in each case subject to certain limitations set forth in the Registration Rights Agreement. The material terms of the Registration Rights Agreement are described beginning on page 122 of the final prospectus and definitive proxy statement, dated September 20, 2021 (the “Proxy Statement/Prospectus”), entitled “The Business Combination - Related Agreements - Registration Rights Agreement.”
Stockholders Agreement
On October 20, 2021, in connection with the consummation of the Business Combination and as contemplated by the Merger Agreement, the Company entered into the Stockholders Agreement (the “Stockholders Agreement”) with the Sponsor, SB WW Holdings (Cayman) Limited (“SBWW”), SVF Endurance (Cayman) Limited (“SVF”) and Benchmark Capital Partners VII (AIV), L.P. Pursuant to the Stockholders Agreement, so long as each such holder of Class A Common Stock continues to hold a specified amount of Class A Common Stock, then each such holder has the right to designate for nomination by the Board the number of candidates for election to the Board specified in the Stockholders Agreement. The Stockholders Agreement also provides that (i) so long as certain Insight Partners investors continue to hold a specified amount of Class A Common Stock, then Insight Partners has the right to designate a director and (ii) so long as certain Starwood Capital investors continue to hold a specified amount of Class A Common Stock, then Starwood Capital has the right to designate a board observer. The material terms of the Stockholders Agreement are described beginning on page 125 of the Proxy Statement/Prospectus, entitled “The Business Combination - Related Agreements - Stockholders Agreement.”
Third Amended and Restated Agreement of Exempted Limited Partnership of The We Company Management Holdings L.P.
On October 20, 2021, in connection with the consummation of the Business Combination and as contemplated by the Merger Agreement, the Company, in its capacity as the parent company of The We Company MC LLC (“TWC MC”) and not as a partner in The We Company Management Holdings L.P. (the “Partnership”), entered into the Third Amended and Restated Agreement of Exempted Limited Partnership of the Partnership (the “LPA”) with TWC MC, The We Company Management LLC, Euclid WW Holdings Inc. and The We Company PI LP. Pursuant to the LPA, certain mechanical changes were implemented to reflect the conversion of shares of capital stock of Prior WeWork to shares of Class A Common Stock (including the conversion of shares of Class C common stock of Prior WeWork into shares of Class C Common Stock).
Specifically, the number of outstanding limited partnership interests in the Partnership, including the limited partnership interests in the Partnership issued to certain former members of Prior WeWork’s senior management team in 2019 (the “WeWork Partnership Profits Interests Units”), was adjusted to equal the number of shares of the corresponding class of Company Common Stock (which, in the case of the WeWork Partnership Profits Interests Units, is the Class C Common Stock), taking into account the Exchange Ratio. The distribution threshold and catch-up base amount for the WeWork Partnership Profits Interests Units were also equitably adjusted
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to maintain the pre-Business Combination economics of the WeWork Partnership Profits Interests Units. The distribution threshold for Adam Neumann’s WeWork Partnership Profits Interests Units was adjusted downwards based on the closing date pricing of the Business Combination, as required by the settlement agreement and previously disclosed.
First Warrants
On October 20, 2021, the Company issued to (i) SBWW a warrant (the “SBWW Warrant”) to purchase a number of shares of Class A Common Stock (rounded to the nearest whole share) equal to 35,038,960 multiplied by the Exchange Ratio (which product is equal to 28,948,838 shares of Class A Common Stock), subject to the terms set forth therein, at a price per share equal to $0.01 divided by the Exchange Ratio (rounded to the nearest full cent) (which quotient is equal to a price per share equal to $0.01) and (ii) SVF a warrant (the “SVF Warrant” and, together with the SBWW Warrant, the “First Warrants”) to purchase a number of shares of Class A Common Stock (rounded to the nearest whole share) equal to 12,327,444 multiplied by the Exchange Ratio (which product is equal to 10,184,811 shares of Class A Common Stock), subject to the terms set forth therein, at a price per share equal to $0.01 divided by the Exchange Ratio (rounded to the nearest full cent) (which quotient is equal to a price per share equal to $0.01). The First Warrants will expire on the tenth anniversary of the Closing. Although the First Warrants were issued by the Company, solely for purposes of calculating the Exchange Ratio used in the Business Combination, the First Warrants are treated in the same manner as a hypothetical outstanding warrant to purchase 47,366,404 shares of Prior WeWork Class A common stock at an exercise price of $0.01 per share.
The First Warrants issued to SBWW and SVF are an inducement to obtain SBWW’s and SVF’s, and their respective affiliates’, support in effectuating the automatic conversion of Prior WeWork preferred stock on a one-to-one basis to Prior WeWork common stock.
At the Exchange Ratio, the SBWW Warrant enables SBWW to purchase 28,948,838 shares of Class A Common Stock. Assuming a price of $10 per share, the SBWW Warrant has an estimated fair value of approximately $289.5 million. At the Exchange Ratio, the SVF Warrant enables SVF to purchase 10,184,811 shares of Class A Common Stock. Assuming a price of $10 per share, the SBWW Warrant has an estimated fair value of approximately $101.8 million.
The foregoing description of the Registration Rights Agreement, Stockholders Agreement, the LPA, the SBWW Warrant and the SVF Warrant and the transactions and documents contemplated thereby, is not complete and is subject to and qualified in its entirety by reference to the Registration Rights Agreement, Stockholders Agreement, the LPA, the SBWW Warrant and the SVF Warrant, copies of which are attached hereto as Exhibit 10.1, Exhibit 10.2, Exhibit 10.3, Exhibit 4.3 and Exhibit 4.4, respectively, and the terms of which are incorporated by reference herein.
Indemnification of Directors and Officers
The Company has entered into separate indemnification agreements with its directors and executive officers. These agreements, among other things, require the Company to indemnify its directors and executive officers for certain liabilities and expenses, including attorneys’ fees, judgments, fines, and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of their services as one of its directors or executive officers or any other company or enterprise to which the person provides services at its request. Further information about the indemnification of the Company’s directors and executive officers is set forth beginning on page 304 of the Proxy Statement/Prospectus in the section titled “Management of New WeWork Following the Business Combination — Corporate Governance - Limitation on Liability and Indemnification of Directors and Officers” and that information is incorporated herein by reference.
The foregoing description of the indemnification agreements is not complete and is subject to and qualified in its entirety by reference to the form of indemnification agreement, a copy of which is attached hereto as Exhibit 10.6 and the terms of which are incorporated by reference herein.
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| Item 2.01 | Completion of Acquisition or Disposition of Assets |
The disclosure set forth in the “Explanatory Note” above is incorporated into this Item 2.01 by reference.
FORM 10 INFORMATION
Item 2.01(f) of Form 8-K states that if the predecessor registrant was a shell company, as BowX was immediately before the Business Combination, then the registrant must disclose the information that would be required if the registrant were filing a general form for registration of securities on Form 10. Accordingly, the Company, as the successor issuer to BowX, is providing the information below that would be included in a Form 10 if the Company were to file a Form 10. Please note that the information provided below relates to the Company as the combined company after the consummation of the Business Combination, unless otherwise specifically indicated or the context otherwise requires.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements made in this Current Report on Form 8-K are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” with respect to the transaction between Prior WeWork and BowX include statements regarding the benefits of the transaction and expectations regarding the combined company’s position to serve the multi-trillion office space market and enable the future of work. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “pipeline,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this Current Report on Form 8-K, including but not limited to: (i) the effect of the announcement of the transaction on the Company’s business relationships, operating results, and business generally, (ii) risks that the transaction disrupts current plans and operations of the Company and potential difficulties in Company employee retention as a result of the transaction, (iii) the outcome of any legal proceedings that may be instituted against the Company related to the Merger Agreement or the transaction, (iv) the ability to maintain the listing of the Company’s securities on a national securities exchange, (v) the price of the Company’s securities may be volatile due to a variety of factors, including changes in the competitive and regulated industries in which the Company operates, variations in operating performance across competitors, changes in laws and regulations affecting the Company’s business, the Company’s inability to implement its business plan or meet or exceed its financial projections and changes in the combined capital structure, (vi) changes in general economic conditions, including as a result of the COVID-19 pandemic, and (vii) the ability to implement business plans, forecasts, and other expectations after the completion of the transaction, and identify and realize additional opportunities. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the registration statement on Form S-4, the Proxy Statement/Prospectus and other documents filed or that may be filed by the Company from time to time with the Securities and Exchange Commission (the “SEC”). These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward- looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. The Company gives no assurance that it will achieve its expectations.
Business
The businesses of BowX and Prior WeWork prior to the Business Combination and the Company following the Business Combination are described in the Proxy Statement/Prospectus in the sections titled “Combined Business Summary - The Parties to the Business Combination” beginning on page 1, “Information about BowX” beginning on page 207 and “Information about WeWork” beginning on page 228 and that information is incorporated herein by reference.
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Risk Factors
The risk factors related to the Company’s business and operations and the Business Combination are set forth beginning on page 31 of the Proxy Statement/Prospectus in the section titled “Risk Factors” and that information is incorporated herein by reference.
Financial Information
Reference is made to the disclosure set forth in Item 9.01 of this Current Report on Form 8-K concerning the financial information of the Company and Prior WeWork. Reference is further made to the disclosure contained in the Proxy Statement/Prospectus in the sections titled “Selected Historical Financial Information of BowX” beginning on page 21, “Selected Historical Financial Information of WeWork” beginning on page 23, “Selected Unaudited Pro Forma Condensed Combined Financial Information” beginning on page 26, “Comparative Per Share Data” beginning on page 28, “Unaudited Pro Forma Condensed Combined Financial Information” beginning on page 187 and “Notes to Unaudited Pro Forma Condensed Combined Financial Information” beginning on page 196, which are incorporated herein by reference.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Reference is made to the disclosure contained in the Proxy Statement/Prospectus in the sections titled “BowX’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” beginning on page 221 and “WeWork’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” beginning on page 237, which are incorporated herein by reference.
Quantitative and Qualitative Disclosures about Market Risk
Reference is made to the disclosure beginning on page 295 of the Proxy Statement/Prospectus in the section titled “WeWork’s Management’s Discussion and Analysis of Financial Condition and Results of Operations - Quantitative and Qualitative Disclosures about Market Risks - Interest Rate Risk,” which is incorporated herein by reference.
Properties
The properties of the Company are described beginning on page 234 of the Proxy Statement/Prospectus in the section titled “Information About WeWork - Properties” and that information is incorporated herein by reference.
BENEFICIAL OWNERSHIP OF SECURITIES
The following table sets forth the beneficial ownership of Class A Common Stock immediately following consummation of the Business Combination by:
| • | each person who is the beneficial owner of more than 5% of Class A Common Stock; |
| • | each person who is an executive officer or director of the Company; and |
| • | all executive officers and directors of the Company, as a group. |
Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security or the right to acquire such power within 60 days.
There were 696,492,801 shares of Class A Common Stock issued and outstanding and 19,938,089 shares of Class C Common Stock outstanding immediately following the consummation of the Business Combination.
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Unless otherwise indicated, the Company believes that all persons named below have sole voting and investment power with respect to the voting securities indicated in the table below and the corresponding footnotes as being beneficially owned by them.
| Name and Address of |
Number of Shares of Class A Common Stock |
Percentage of Shares of Class A Common Stock |
||||||
| 5% Holders |
||||||||
| Entities affiliated with SBGA(2) |
354,304,605 | 48.5 | ||||||
| Entities affiliated with SBIA UK(3) |
91,262,729 | 13.1 | ||||||
| Adam Neumann(4) |
58,369,174 | 8.4 | ||||||
| Directors and Executive Officers |
||||||||
| Vivek Ranadivé(5) |
7,171,066 | 1.0 | ||||||
| Sandeep Mathrani |
— | — | ||||||
| Bruce Dunlevie(6) |
20,471,310 | 2.9 | ||||||
| Jeff Sine |
— | — | ||||||
| Michel Combes |
— | — | ||||||
| Marcelo Claure |
— | — | ||||||
| Véronique Laury |
— | — | ||||||
| Kirthiga Reddy |
— | — | ||||||
| Deven Parekh |
— | — | ||||||
| Benjamin “Ben” Dunham(7) |
102,721 | * | ||||||
| Anthony Yazbeck(8) |
126,144 | * | ||||||
| Maral Kazanjian(9) |
48,986 | * | ||||||
| Jared DeMatteis(10) |
84,211 | * | ||||||
| Lauren Fritts(11) |
44,824 | * | ||||||
| Peter Greenspan(12) |
129,420 | * | ||||||
| Hamid Hashemi(13) |
81,075 | * | ||||||
| Scott Morey |
— | — | ||||||
| Roger Solé Rafols(14) |
206,547 | * | ||||||
| All Company directors and executive officers as a group (eighteen individuals) |
28,466,304 | 4.1 | ||||||
| * | Less than one percent |
| (1) | Unless otherwise noted, the business address of each of those listed in the table above is c/o WeWork Inc., 575 Lexington Avenue, New York NY 10022. |
| (2) | Represents (i) 320,298,461 shares held by SB WW Holdings (Cayman) Limited, (ii) 28,948,838 shares issuable to SB WW Holdings (Cayman) Limited, or its designee, upon exercise of the First Warrant and (iii) 5,057,306 shares issuable to SVF II WW (DE) LLC upon exercise of the Penny Warrants. SoftBank Vision Fund II-2 L.P. is the sole limited partner of SVF II Aggregator (Jersey) L.P., which is the sole member of SVF II Holdings (DE) LLC, which is the sole member of SVF II WW (DE) LLC. SB WW Holdings (Cayman) Limited is a wholly owned subsidiary of SVF II WW (DE) LLC. SB Global Advisers Limited (“SBGA”) has been appointed as manager and is exclusively responsible for making all final decisions related to the acquisition, structuring, financing and disposal of SoftBank Vision Fund II-2 L.P.’s investments, including as held by SVF II WW (DE) LLC and SB WW Holdings (Cayman) Limited. The address for SB WW Holdings (Cayman) Limited is Walkers Corporate Limited, 190 Elgin Avenue, George Town, Grand Cayman KY1-9008, Cayman Islands. The address SVF II WW (DE) LLC is 251 Little Falls Drive, Wilmington, DE 19808. |
| (3) | Represents 81,077,918 shares held by SVF Endurance (Cayman) Limited (“SVFE”) and 10,184,811 shares issuable to SVFE, or its designee, upon exercise of the First Warrant. SVFE is a wholly owned subsidiary of SoftBank Vision Fund (AIV M1) L.P. (“SVF”). SB Investment Advisers (UK) Limited (“SBIA UK”) has been appointed as alternative investment fund manager (“AIFM”) and is exclusively responsible for managing SVF in accordance with the Alternative Investment Fund Managers Directive and is authorized and regulated by the UK Financial Conduct Authority accordingly. As AIFM of SVF, SBIA UK is exclusively responsible for making all decisions related to the acquisition, structuring, financing, voting and disposal of SVF’s investments. The address for SVF Endurance (Cayman) Limited is Walkers Corporate Limited, 190 Elgin Avenue, George Town, Grand Cayman KY1-9008, Cayman Islands. |
| (4) | Represents 544,353 shares held, in the aggregate, by ANINCENTCO1 LLC, ANINCENTCO2 LLC and ANINCENTCO3 LLC, of which Adam Neumann is the managing member, and 57,824,821 shares held by WE Holdings LLC. Adam Neumann (through an entity he controls) and Miguel McKelvey are the managing members of WE Holdings LLC and have shared dispositive power over all of the shares held by WE Holdings LLC, and Miguel McKelvey may be deemed to be a beneficial owner of such shares on that basis. Adam Neumann has sole voting power over all of the shares held by WE Holdings LLC. The address for WE Holdings LLC is 154 Grand Street, New York, New York 10013. Adam Neumann also holds 19,896,032 WeWork Partnerships Profits Interest Units and an equal number of shares of Class C Common Stock, which carry one vote per share. Including such shares of Class C Common Stock, Mr. Neumann’s total voting power is 10.9%. |
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| (5) | Represents (i) 4,564,484 shares held by Mr. Ranadivé and (ii) 2,606,582 shares issuable to The Ranadivé GRAT A dated May 20, 2020, a trust for the benefit of Mr. Ranadivé, upon the exercise of warrants. |
| (6) | Represents shares held by Benchmark Capital Partners VII (AIV), L.P. (“BCP AIV”), as nominee for BCP AIV, Benchmark Founders’ Fund VII, L.P. (“BFF VII”) and Benchmark Founders’ Fund VII-B, L.P. (“BFF VII-B”). Benchmark Capital Management Co. VII, L.L.C. (“BCMC VII”) is the general partner of each of BCP AIV, BFF VII and BFF VII-B and may be deemed to have shared voting and dispositive power over the shares held by BCP AIV. Matthew R. Cohler, Bruce W. Dunlevie, Peter H. Fenton, J. William Gurley, Kevin R. Harvey, Mitchell H. Lasky and Steven M. Spurlock, the managing members of BCMC VII, may be deemed to have shared voting and dispositive power over the shares held by BCP AIV, although each of such managing members disclaims beneficial ownership of any such shares except to the extent of its pecuniary interest therein. The address for each of these entities is c/o Benchmark, 2965 Woodside Road, Woodside, CA 94062. |
| (7) | Represents shares over which Mr. Dunham has the right to acquire dispositive power upon the exercise of stock options exercisable as of or within 60 days after October 20, 2021. |
| (8) | Represents 48,534 shares over which Mr. Yazbeck has dispositive power and 77,610 shares over which Mr. Yazbeck has the right to acquire dispositive power upon the exercise of stock options exercisable as of or within 60 days after October 20, 2021. |
| (9) | Represents shares over which Ms. Kazanjian has the right to acquire dispositive power upon the exercise of stock options exercisable as of or within 60 days after October 20, 2021. |
| (10) | Represents 438 shares over which Mr. DeMatteis has dispositive power and 83,773 shares over which Mr. DeMatteis has the right to acquire dispositive power upon the exercise of stock options exercisable as of or within 60 days after October 20, 2021. |
| (11) | Represents shares over which Ms. Fritts has the right to acquire dispositive power upon the exercise of stock options exercisable as of or within 60 days after October 20, 2021. |
| (12) | Represents shares over which Mr. Greenspan has the right to acquire dispositive power upon the exercise of stock options exercisable as of or within 60 days after October 20, 2021. |
| (13) | Represents shares over which Mr. Hashemi has the right to acquire dispositive power upon the exercise of stock options exercisable as of or within 60 days after October 20, 2021. |
| (14) | Represents shares over which Mr. Rafols has the right to acquire dispositive power upon the exercise of stock options exercisable as of or within 60 days after October 20, 2021. |
Directors and Executive Officers
The Company’s directors and executive officers after the Closing are described beginning on page 297 of the Proxy Statement/Prospectus in the section titled “Management of New WeWork Following the Business Combination” and that information is incorporated herein by reference.
Director Independence
Information with respect to the independence of the Company’s directors is set forth beginning on page 302 of the Proxy Statement/Prospectus in the section titled “Management of New WeWork Following the Business Combination — Corporate Governance - Director Independence” and that information is incorporated herein by reference.
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Committees of the Board of Directors
Information with respect to the composition of the Board immediately after the Closing is set forth in the Proxy Statement/Prospectus in the section titled “Management of New WeWork Following the Business Combination — Corporate Governance - Composition of the Board of Directors” beginning on page 302 and “Management of New WeWork Following the Business Combination — Corporate Governance - Committees of the Board of Directors” beginning on page 302 and that information is incorporated herein by reference, subject to the updates set forth in Item 5.02 below, which is incorporated by reference into this Item 2.01.
Executive Compensation
A description of the compensation of the named executive officers of Prior WeWork before the consummation of the Business Combination is set forth beginning on page 313 of the Proxy Statement/Prospectus in the section titled “Executive Compensation,” and that information is incorporated herein by reference.
At the Special Meeting, BowX stockholders approved the WeWork Inc. 2021 Equity Incentive Plan (the “Equity Incentive Plan”). The description of the Equity Incentive Plan is set forth beginning on page 166 of the Proxy Statement/Prospectus section entitled “Equity Incentive Plan Proposal,” which is incorporated herein by reference. The description of the Equity Incentive Plan is not complete and is subject to and qualified in its entirety by reference to the Equity Incentive Plan, a copy of which is attached hereto as Exhibit 10.4 and the terms of which are incorporated by reference herein. Following the consummation of the Business Combination, the Company expects that the Board will approve grants of awards under the Equity Incentive Plan to eligible participants, as described beginning on page 167 of the Proxy Statement/Prospectus in the section titled “Equity Incentive Plan Proposal — Summary of the 2021 Plan - Awards.”
On September 19, 2021, the Board approved the WeWork Inc. 2021 Employee Stock Purchase Plan (the “ESPP”), effective as of and contingent on the consummation of the Business Combination, and subject to approval of BowX stockholders. The ESPP was approved by BowX stockholders on October 19, 2021 and the Business Combination was consummated as of the Closing. As a result, the Company is authorized to offer eligible employees the ability to purchase shares of Class A Common Stock at a discount, subject to various limitations.
The ESPP is designed to allow eligible employees of the Company to purchase shares of Class A Common Stock with their accumulated payroll deductions. The ESPP is administered by the Board or an authorized committee thereof comprised of non-employee directors (the “ESPP administrator”). The ESPP is divided into two components: the “423 Component” and the “Non-423 Component.” The 423 Component is intended to qualify under Section 423 of the Internal Revenue Code of 1986, as amended (the “Code”). The Non-423 Component is not intended to qualify under Section 423 of the Code and may generally be used to grant stock options to certain non-U.S. employees and other employees designated by the ESPP administrator. The purpose of the ESPP is to assist eligible employees in acquiring a stock ownership interest in the Company, to align such employees’ interests with those of our stockholders, and to encourage such employees to remain in the employment of the Company. The equity offers under the ESPP are intended to assist the Company in recruiting and retaining highly qualified employees.
The description of the ESPP is set forth beginning on page 172 of the Proxy Statement/Prospectus section entitled “ESPP Proposal,” which is incorporated herein by reference. The foregoing description of the ESPP is not complete and is subject to and qualified in its entirety by reference to the ESPP, a copy of which is attached hereto as Exhibit 10.5 and the terms of which are incorporated by reference herein.
Director Compensation
A description of the compensation of the directors of Prior WeWork before the consummation of the Business Combination is set forth beginning on page 313 of the Proxy Statement/Prospectus in the section titled “Executive Compensation,” and that information is incorporated herein by reference.
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Employment Agreements
A description of the employment agreements that a subsidiary of the Company has entered into with certain Company officers is set forth beginning on page 318 of the Proxy Statement/Prospectus in the section titled “Executive Compensation - Executive Employment Agreements,” and that information is incorporated herein by reference.
Certain Relationships and Related Party Transactions
Certain relationships and related party transactions of the Company are described beginning on page 329 of the Proxy Statement/Prospectus in the section titled “Certain Relationships and Related Persons Transactions” and that information is incorporated herein by reference.
Legal Proceedings
Reference is made to the disclosure regarding legal proceedings in the section of the Proxy Statement/Prospectus titled “Information About BowX — Legal Proceedings” beginning on page 219 and “Information about WeWork — Legal Proceedings” beginning on page 236 and that information is incorporated herein by reference.
Market Price of and Dividends on the Registrant’s Common Stock and Related Stockholder Matters
BowX’s publicly-traded Class A common stock, units and warrants were historically listed on the Nasdaq under the symbols “BOWXU,” “BOWX” and “BOWXW,” respectively. On October 21, 2021, the Class A Common Stock and warrants outstanding upon the Closing began trading on the NYSE under the symbols “WE” and “WE WS,” respectively. At the Closing, each of BowX’s public units separated into its components consisting of one share of common stock and one-third of one redeemable warrant and, as a result, the units no longer trade as a separate security.
The Company currently intends to retain its future earnings, if any, to finance the further development and expansion of its business and does not intend to pay cash dividends in the foreseeable future. Any future determination to pay dividends will be at the discretion of the Board and will depend on the Company’s financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as its Board deems relevant. As a result, you may not receive any return on an investment in Class A Common Stock unless you sell Class A Common Stock for a price greater than that which you paid for it. See the section beginning on page 30 of the Proxy Statement/Prospectus entitled “Market Price and Dividend Information” and such information is incorporated herein by reference.
Recent Sales of Unregistered Securities
Reference is made to the disclosure set forth below under Item 3.02 of this Current Report on Form 8-K concerning the issuance and sale by the Company of certain unregistered securities, which is incorporated herein by reference.
Description of Registrant’s Securities to Be Registered
The description of the Company’s securities is contained beginning on page 347 of the Proxy Statement/Prospectus in the section titled “Description of BowX Securities” and that information is incorporated herein by reference.
Indemnification of Directors and Officers
The disclosure set forth in Item 1.01 of this Current Report on Form 8-K under the heading “Indemnification of Directors and Officers” is incorporated into this Item 2.01 by reference.
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Financial Statements and Exhibits
The information set forth under Item 9.01 of this Current Report on Form 8-K is incorporated herein by reference.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
The information set forth under Item 4.01 of this Current Report on Form 8-K is incorporated herein by reference.
| Item 3.02 | Unregistered Sales of Equity Securities. |
Shares of Common Stock
In connection with the Business Combination, the Company increased the total number of authorized shares of all classes of capital stock to 1,625,041,666 shares, consisting of (a) 1,500,000,000 shares of Class A Common Stock, (b) 25,041,666 shares of Class C Common Stock, and (c) 100,000,000 shares of Preferred Stock.
PIPE Investment
As previously announced, on March 25, 2021, concurrently with the execution of the Merger Agreement, BowX entered into subscription agreements (the “Subscription Agreements”) with certain existing stockholders of WeWork and certain other third-party investors (collectively, the “PIPE Investors”), pursuant to which, and on the terms and subject to the conditions of which, the PIPE Investors collectively subscribed for 80,000,000 shares of Class A Common Stock for $10.00 per share for an aggregate purchase price equal to $800,000,000 (the “PIPE Investment”). The PIPE Investment was consummated substantially concurrently with the Closing.
The shares issued to the PIPE Investors in the private placement were issued pursuant to and in accordance with the exemption from registration under the Securities Act, under Section 4(a)(2) promulgated under the Securities Act.
Backstop Investment
As previously disclosed, the Backstop Investor committed to subscribe for the number of shares of Class A Common Stock equal to the amount of the Redemptions, subject to the Cap of 15,000,000 shares of Class A Common Stock. The purchase price for such shares of Class A Common Stock was equal to $10.00 per share multiplied by the number of Redemptions, subject to the Cap, for an aggregate purchase price of up to $150,000,000. Substantially concurrently with the Closing, the Backstop Investor subscribed for 15,000,000 shares of Class A Common Stock for $150,000,000.
The shares issued to the Backstop Investor were issued pursuant to and in accordance with the exemption from registration under the Securities Act, under Section 4(a)(2) promulgated under the Securities Act.
Warrants
The disclosure set forth in Item 1.01 above under the heading “First Warrants” is incorporated into this Item 2.01 by reference.
Additionally, as a result of and upon the Closing, in accordance with the applicable terms of the warrants to purchase Class A common stock of Prior WeWork and the warrants to purchase Series H-3 preferred stock of Prior WeWork and/or Series H-4 preferred stock of Prior WeWork (collectively, the “Company Warrants”), the Company Warrants were converted into the right to receive a warrant to purchase shares of Class A Common Stock upon the same terms and conditions as are in effect with respect to such Company Warrants immediately prior to the Effective Time (the “Converted Company Warrants”) except that (i) such Converted Company Warrants relate to
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that whole number of shares of Class A Common Stock (rounded down to the nearest whole share) equal to the number of shares of Prior WeWork capital stock subject to such Company Warrants, multiplied by the Exchange Ratio, and (ii) the exercise price per share for each such Converted Company Warrants is equal to the exercise price per share of such Company Warrants in effect immediately prior to the Effective Time, divided by the Exchange Ratio (the exercise price per share, as so determined, being rounded up to the nearest full cent).
Information regarding unregistered sales of the Company’s securities is set forth in: Part II, Item 5 of the Company’s Annual Report on Form 10-K filed with the SEC on March 24, 2021 incorporated herein by reference.
The First Warrants and the Converted Company Warrants were issued pursuant to and in accordance with the exemption from registration under the Securities Act, under Section 4(a)(2) and/or Regulation D promulgated under the Securities Act.
WeWork Partnership Profits Interest Units
In 2019, the WeWork Partnership Profits Interests Units were issued. These WeWork Partnership Profits Interests Units are intended to qualify as “profits interests” for U.S. federal income tax purposes. The Company no longer grants these types of awards.
Holders of vested WeWork Partnership Profits Interest Units may receive value from their awards in two ways - (i) by receiving distributions or (ii) by, at the election of the holder, (a) converting their WeWork Partnership Profits Interest Units into WeWork Partnerships Class A Common Units (as defined in the LPA), or (b) exchanging (along with the corresponding shares of Class C Common Stock) their WeWork Partnership Profits Interest Units for (at the Company’s election) shares of Class A Common Stock or cash of an equivalent value.
The WeWork Partnership Profits Interests Units were issued pursuant to and in accordance with the exemption from registration under the Securities Act, under Section 4(a)(2) and/or Regulation D promulgated under the Securities Act.
| Item 3.03 | Material Modification to Rights of Security Holders. |
In connection with the Business Combination, on October 20, 2021, the Company filed a Certificate of Incorporation (the “Certificate of Incorporation”) with the Delaware Secretary of State, and also adopted Bylaws on October 20, 2021 (the “Bylaws”), which replace BowX’s certificate of incorporation and bylaws in effect as of such time. The material terms of the Certificate of Incorporation and the Bylaws and the general effect upon the rights of holders of the Company’s common stock are discussed in the Proxy Statement/Prospectus in the sections titled “Proposal No. 2 — Organizational Documents Proposal A” beginning on page 158, “Proposal No.3 — Organizational Documents Proposal B” beginning on page 158, “Proposal No. 4 — Organizational Documents Proposal C” beginning on page 159 and “Proposal No. 5 — Organizational Documents Proposal D” beginning on page 159.
The Company’s common stock and public warrants are listed for trading on the NYSE under the symbols “WE” and “WE WS,” respectively. On the date of the Closing, the CUSIP numbers relating to the Company’s common stock and warrants changed to 96209A 104 and 96209A 112, respectively.
The foregoing description of the Certificate of Incorporation and the Bylaws is not complete and is subject to and qualified in its entirety by reference to the Certificate of Incorporation and the Bylaws, copies of which are attached hereto as Exhibits 3.1 and 3.2 and the terms of which are incorporated by reference herein.
| Item 5.01 | Changes in Control of Registrant. |
Reference is made to the disclosure beginning on page 101 of the Proxy Statement/Prospectus in the section titled “Proposal No. 1 — The BCA Proposal — The Merger Agreement,” which is incorporated herein by reference. Further reference is made to the information contained in the “Explanatory Note” above and Item 2.01 to this Current Report on Form 8-K, which is incorporated herein by reference.
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As of the date of the Closing, our post-Closing directors and executive officers and their respective affiliated entities beneficially owned approximately 4.1% of the outstanding shares of Class A Common Stock, which represents approximately 4.0% of the total voting power of our outstanding shares, and no outstanding shares of Class C Common Stock, and the securityholders of BowX immediately prior to the Closing (which includes Vivek Ranadivé, who is one of our post-Closing directors) beneficially owned post-Closing approximately 6.1% of the outstanding shares of Class A Common Stock, which represents approximately 5.9% of the total voting power of our outstanding shares, and no shares of Class C Common Stock.
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
On the date of the Closing, and in accordance with the terms of the Merger Agreement, the Board became comprised of nine directors: Marcelo Claure, Michel Combes, Bruce Dunlevie, Véronique Laury, Sandeep Mathrani, Deven Parekh, Vivek Ranadivé, Kirthiga Reddy and Jeffrey Sine. Immediately following the consummation of the Business Combination, the following individuals became the executive officers of the Company: Sandeep Mathrani, Benjamin “Ben” Dunham, Anthony Yazbeck, Jared DeMatteis, Lauren Fritts, Peter Greenspan, Hamid Hashemi, Maral Kazanjian, Scott Morey and Roger Solé Rafols. Concurrently with the consummation of the Business Combination, BowX’s officers and directors, other than Mr. Ranadivé (who serves as a director of the Company following the Business Combination), resigned from their respective positions at BowX.
On the date of the Closing, the Company’s audit committee consisted of Véronique Laury, Vivek Ranadivé and Jeffrey Sine with Jeffrey Sine serving as the chair of the committee. The Board determined that each of these individuals meets the independence requirements of the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act, Rule 10A-3 under the Exchange Act and the applicable listing standards of the NYSE. The Board determined that Jeffrey Sine qualified as an audit committee financial expert within the meaning of SEC regulations and met the financial sophistication requirements of the rules.
On the date of the Closing, the Company’s compensation committee consisted of Bruce Dunlevie, Véronique Laury and Deven Parekh with Deven Parekh serving as chair of the committee. The Board determined that each of these individuals is “independent” as defined under the applicable listing standards of NYSE and SEC rules and regulations.
On the date of the Closing, the Company’s nominating and corporate governance committee consisted of Véronique Laury, Deven Parekh and Vivek Ranadivé with Véronique Laury serving as chair of the committee. The Board determined that each of these individuals is “independent” as defined under the applicable listing standards of NYSE and SEC rules and regulations.
The disclosure set forth in Item 2.01 of this Current Report on Form 8-K under the headings “Executive Compensation,” “Director Compensation,” “Employment Agreements,” “Certain Relationships and Related Party Transactions” and “Indemnification of Directors and Officers” is incorporated in this Item 5.02 by reference. Additionally, the disclosure set forth in Item 1.01 of this Current Report on Form 8-K under the heading “Stockholders Agreement” is incorporated in this Item 5.02 by reference.
| Item 5.06 | Change in Shell Company Status. |
Upon the Closing, the Company ceased to be a shell company. The material terms of the Business Combination are described beginning on page 101 of the Proxy Statement/Prospectus in the sections titled “Proposal No. 1 — The BCA Proposal,” and are incorporated herein by reference.
| Item 7.01 | Regulation FD Disclosure. |
The information in this Item 7.01, including Exhibit 99.1, is furnished and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to liabilities under that section, and shall not be deemed to be incorporated by reference into the filings of the Company under the Securities Act or the Exchange Act, regardless of any general incorporation language in such filings. On October 20, 2021, the Company issued a press release announcing the Closing. The press release is furnished as Exhibit 99.1 to this Current Report.
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| Item 9.01 | Financial Statements and Exhibits. |
(a) Financial statements of businesses acquired
Information responsive to Item 9.01(a) of Form 8-K is set forth in the financial statements included in the Proxy Statement/Prospectus on pages F-3 through F-222, which are incorporated herein by reference.
(b) Pro forma financial information.
Certain pro forma financial information of the Company is attached hereto as Exhibit 99.2 and is incorporated herein by reference.
(c) Exhibits.
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| 99.1 | Press Release, dated October 20, 2021. | |
| 99.2 | Unaudited Pro Forma Condensed Combined Financial Information. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |
| * | Certain schedules to this Exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K of the Exchange Act. The Company hereby agrees to hereby furnish supplementally a copy of all omitted schedules to the SEC upon request. |
| + | Indicates a management or compensatory plan. |
| ^ | Certain portions of this Exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The Company hereby agrees to furnish supplementally an unredacted copy of the exhibit to the SEC upon its request. |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.
| WEWORK INC. | ||||||||
| By: | /s/ Jared DeMatteis | |||||||
| Date: October 26, 2021 | Name: Jared DeMatteis | |||||||
| Title: Chief Legal Officer | ||||||||
Exhibit 3.1
SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
BOWX ACQUISITION CORP.
Pursuant to Sections 242 and 245 of the
General Corporation Law of the State of Delaware
October 20, 2021
BowX Acquisition Corp. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware (the “DGCL”), does hereby certify as follows:
1. The name of the Corporation is BowX Acquisition Corp. The original Certificate of Incorporation of the Corporation was filed with the office of the Secretary of State of the State of Delaware (the “Delaware Secretary”) on May 19, 2020. The Amended and Restated Certificate of Incorporation of the Corporation was filed with the Delaware Secretary on August 4, 2020.
2. This Second Amended and Restated Certificate of Incorporation was duly adopted in accordance with Section 242 and Section 245 of the DGCL.
3. This Second Amended and Restated Certificate of Incorporation restates and integrates and further amends the Amended and Restated Certificate of Incorporation of the Corporation, as heretofore amended or supplemented.
4. The text of the Amended and Restated Certificate of Incorporation is hereby amended and restated to read in its entirety as set forth in Exhibit A attached hereto.
[Signature page follows]
IN WITNESS WHEREOF, the Corporation has caused this Second Amended and Restated Certificate of Incorporation to be duly executed by an authorized officer this 20th day of October, 2021.
| BOWX ACQUISITION CORP. | ||
| By: | /s/ Vivek Ranadivé | |
| Name: Vivek Ranadivé | ||
| Title: Chairman and Co-Chief Executive Officer | ||
[Signature Page to Second Amended and Restated Certificate of Incorporation]
SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
WEWORK INC.
ARTICLE I
The name of the corporation is WeWork Inc. (the “Corporation”).
ARTICLE II
The address of the Corporation’s registered office in the State of Delaware is 251 Little Falls Drive, in the City of Wilmington, County of New Castle, Delaware 19808, and the name of its registered agent at such address is Corporation Service Company.
ARTICLE III
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “DGCL”) as it now exists or may hereafter be amended and supplemented.
ARTICLE IV
The Corporation is authorized to issue three classes of stock to be designated, respectively, “Class A Common Stock”, “Class C Common Stock” and “Preferred Stock.” The total number of shares of capital stock that the Corporation shall have authority to issue is 1,625,041,666. The total number of shares of Class A Common Stock that the Corporation is authorized to issue is 1,500,000,000 , having a par value of $0.0001 per share, the total number of shares of Class C Common Stock that the Corporation is authorized to issue is 25,041,666, having a par value of $0.0001 per share and the total number of shares of Preferred Stock that the Corporation is authorized to issue is 100,000,000, having a par value of $0.0001 per share.
Upon the effective time of the filing of this Second Amended and Restated Certificate of Incorporation (the “Effective Time”), and without any further action of the Corporation or any stockholder of the Corporation, each share of the series of common stock of the Corporation designated “Class A Common Stock”, par value $0.0001 per share (“Former Class A Common Stock”) and each share of the series of common stock of the Corporation designated as “Class B Common Stock”, par value $0.0001 per share (“Former Class B Common Stock”), that is issued and outstanding immediately prior to the Effective Time shall be automatically reclassified and converted into one (1) share of the class of Class A Common Stock. Each stock certificate or book-entry position that, immediately prior to the Effective Time, represented shares of Former Class A Common Stock or Former Class B Common Stock shall, from and after the Effective Time, automatically and without the necessity of presenting the same for the exchange, represent that number of shares of Class A Common Stock into which the shares formerly represented by such certificate or book-entry position have been automatically reclassified and converted pursuant to this Article IV.
ARTICLE V
The designations and the powers, privileges and rights, and the qualifications, limitations or restrictions thereof in respect of each class of capital stock of the Corporation are as follows:
A. Class A Common Stock.
1. General. The voting, dividend, liquidation and other rights and powers of the Class A Common Stock are subject to and qualified by the rights, powers and preferences of any series of Preferred Stock as may be designated by the Board of Directors of the Corporation (the “Board of Directors”) and outstanding from time to time.
2. Voting. Except as otherwise provided herein or expressly required by law, each holder of Class A Common Stock, as such, shall be entitled to vote as a single class with the holders of Class C Common Stock on each matter submitted to a vote of stockholders and shall be entitled to one vote for each share of Class A Common Stock held of record by such holder as of the record date for determining stockholders entitled to vote on such matter. Except as otherwise required by law, holders of Class A Common Stock, as such, shall not be entitled to vote on any amendment to this Second Amended and Restated Certificate of Incorporation (including any Certificate of Designation (as defined below)) that relates solely to the rights, powers, preferences (or the qualifications, limitations or restrictions thereof) or other terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to this Second Amended and Restated Certificate of Incorporation (including any Certificate of Designation) or pursuant to the DGCL. Subject to the rights of any holders of any outstanding series of Preferred Stock, the number of authorized shares of Class A Common Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote, irrespective of the provisions of Section 242(b)(2) of the DGCL.
3. Dividends. Subject to applicable law and the rights and preferences of any holders of any outstanding series of Preferred Stock, the holders of Class A Common Stock, as such, shall be entitled to the payment of dividends on the Class A Common Stock when, as and if declared by the Board of Directors in accordance with applicable law.
4. Liquidation. Subject to the rights and preferences of any holders of any shares of any outstanding series of Preferred Stock, in the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the funds and assets of the Corporation that may be legally distributed to the Corporation’s stockholders shall be distributed among the holders of the then outstanding Class A Common Stock pro rata in accordance with the number of shares of Class A Common Stock held by each such holder.
5. Transfer Rights. Subject to applicable law, shares of Class A Common Stock and the rights and obligations associated therewith shall be fully transferable to any transferee.
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6. Reservation of Stock Issuable on Conversion. The Corporation will at all times reserve and keep available out of its authorized but unissued shares of Class A Common Stock, solely for the purpose of issuance to a direct or indirect equity holder in an OP (as defined below) pursuant to the terms of an OP Agreement (as defined below), such number of shares of Class A Common Stock as shall from time to time be required to effect any such issuance.
7. Voting Terms of Class A Common Stock.
(i) Notwithstanding any provision herein to the contrary, if at any meeting of the stockholders of the Corporation the aggregate number of voting securities held by the SoftBank Holders (as defined below) would otherwise represent more than 49.90% of the voting securities present (in person or by proxy) at such meeting with respect to any vote or election submitted to the holders of shares of capital stock of the Corporation for approval (each, a “Stockholder Vote”), then the SoftBank Holders shall only be entitled to vote 49.90% of the voting securities present (in person or by proxy) and voting in such Stockholder Vote, with SBG not voting the minimum number of its shares of Class A Common Stock (such minimum number of shares, the “Subject Shares”) as is required to reduce the combined voting power exercised by the SoftBank Holders to no more than 49.90% (rounded down to the nearest whole share) of the voting securities present (in person or by proxy) and voting at such Stockholder Vote. The Subject Shares shall automatically become subject to the Subject Shares Proxy (as defined below) in respect of such Stockholder Vote.
(ii) SBG irrevocably appoints the WW Executive (as defined below) as its attorney and proxy, to the full extent of its voting rights with respect to the Subject Shares in such applicable Stockholder Vote, to vote all the Subject Shares in proportion to the votes cast by the stockholders of the Corporation (other than the SoftBank Holders) in such Stockholder Vote (the “Subject Shares Proxy”). For the avoidance of doubt, SBG retains all economic and all other non-voting rights, powers and preferences in the Subject Shares.
(iii) For the avoidance of doubt, shares of Class A Common Stock transferred by a SoftBank Holder to a third party who is not a SoftBank Holder will not be subject to this Article V, Part A, Section 7.
(iv) Upon the second anniversary of this Second Amended and Restated Certificate of Incorporation, the voting power of shares of Class A Common Stock shall no longer be subject to the terms and conditions of subclauses (i)-(ii) of this Article V, Part A, Section 7 (the “Voting Restriction Sunset”); provided, however, that if SBG provides written notice (an “Extension Notice”) to the Corporation as of any date that is prior to the first anniversary of this Second Amended and Restated Certificate of Incorporation stating that the voting power of such shares of Class A Common Stock shall continue to be subject to the terms and conditions of subclauses (i)-(ii) of this Article V, Part A, Section 7, the Voting Restriction Sunset shall not occur until the date that is 24 months following the date of such Extension Notice (the “Extended Voting Restriction Sunset”). SBG shall be permitted to provide an unlimited number of Extension Notices (which, in each case, must be delivered as of any date that is prior to the date that is twelve months prior to the Extended Voting Restriction Sunset then in effect), and upon the delivery of each such Extension Notice to the Corporation, the Extended Voting Restriction Sunset will be the date that is 24 months following the date of such Extension Notice.
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(v) For purposes of this this Article V, Part A, Section 7: (a) “Affiliate” means a person or entity that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, another person or entity; (b) “conflicted” means any person that has a direct relationship or arrangement with any Softbank Holder; (c) “control” (including the terms “controlling”, “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity, whether through the ownership of voting securities, by contract or otherwise; (d) “SBG” means SoftBank Group Corp. and its Affiliates (excluding, for the avoidance of doubt, the Corporation and its controlled Affiliates and SVF and its Affiliates); (e) “SoftBank Holders” means SBG and SVF; (f) “SVF” means SVF Endurance (Cayman) Limited and its Affiliates (excluding, for the avoidance of doubt, the Corporation and its controlled Affiliates and SBG and its Affiliates); and (g) “WW Executive” means (w) a President of the Corporation, unless such President is conflicted in respect of the matter being voted upon, (x) if all Presidents of the Corporation are conflicted, the Treasurer of the Corporation, unless such Treasurer is conflicted in respect of the matter being voted upon, (y) if all Presidents and the Treasurer of the Corporation are conflicted, the Secretary of the Corporation.
(vi) As long as SBG is a stockholder of the Corporation, the Corporation shall not, either directly or indirectly by amendment, merger, consolidation or otherwise, without the affirmative vote of SBG, amend, alter or repeal this Article V, Part A, Section 7.
B. Class C Common Stock.
1. General. The voting, dividend, liquidation and other rights and powers of the Class C Common Stock are subject to and qualified by the rights, powers and preferences of any series of Preferred Stock as may be designated by the Board of Directors and outstanding from time to time.
2. Voting. Except as otherwise provided herein or expressly required by law, each holder of Class C Common Stock, as such, shall be entitled to vote on each matter submitted to a vote of stockholders as a single class with the holders of Class A Common Stock and shall be entitled to one vote for each share of Class C Common Stock held of record by such holder as of the record date for determining stockholders entitled to vote on such matter. Except as otherwise required by law, holders of Class C Common Stock, as such, shall not be entitled to vote on any amendment to this Second Amended and Restated Certificate of Incorporation (including any Certificate of Designation) that relates solely to the rights, powers, preferences (or the qualifications, limitations or restrictions thereof) or other terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one or more other such series, to vote thereon pursuant to this Second Amended and Restated Certificate of Incorporation (including any Certificate of Designation) or pursuant to the DGCL. Subject to the rights of any holders of any outstanding series of Preferred Stock, the number of authorized shares of Class C Common Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote, irrespective of the provisions of Section 242(b)(2) of the DGCL.
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3. Dividends. The shares of Class C Common Stock are a non-economic interest in the Corporation. The holders of Class C Common Stock shall not be entitled to receive any dividends (including of cash, property or stock) in respect of their shares of Class C Common Stock except that, in the event that any dividend or distribution payable in securities of the Corporation is declared and paid on the Class A Common Stock, the same dividend or distribution with the same record date and payment date shall be declared and paid on the shares of Class C Common Stock; provided, however, that all dividends and distributions payable in securities of the Corporation on the shares of Class C Common Stock shall be payable in shares of Class C Common Stock, or rights to acquire shares of Class C Common Stock.
4. Liquidation. Holders of Class C Common Stock shall have no right to receive a share of the funds and assets of the Corporation in the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary.
5. Redemption. The shares of Class C Common Stock shall be redeemable by the Corporation for no consideration in connection with the exercise, redemption or exchange of convertible securities issued by an OP for shares of Class A Common Stock. Class C Common Stock is not redeemable at the option of the holder thereof. No share or shares of Class C Common Stock acquired by the Corporation by reason of redemption, purchase, conversion or otherwise shall be reissued, and all such shares shall be cancelled, retired and eliminated from the shares that the Corporation shall be authorized to issue.
6. Stock Adjustments. If the Corporation in any manner reclassifies, subdivides or combines the outstanding shares of Class A Common Stock, then all outstanding shares of Class C Common Stock will concurrently therewith be proportionately reclassified, subdivided or combined in a manner that maintains the same proportionate equity ownership and voting rights among the holders of the outstanding shares of Class A Common Stock and the holders of the outstanding shares of Class C Common Stock on the record date for such reclassification, subdivision or combination.
7. Definitions. As used in this Second Amended and Restated Certificate of Incorporation:
(i) “OP” means any direct or indirect subsidiary of the Corporation or any aggregator entity controlled by the Corporation or any direct or indirect subsidiary of the Corporation that has in place a governing agreement (including a limited partnership agreement or limited liability company agreement) that provides the right or option to hold, own or acquire shares of Class A Common Stock or securities convertible into or exchangeable for shares of Class A Common Stock.
(ii) “OP Agreement” means the governing agreement (including a limited partnership agreement or limited liability company agreement) of an OP.
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C. Preferred Stock.
1. Shares of Preferred Stock may be issued from time to time in one or more series, each of such series to have such terms as stated or expressed herein and in the resolution or resolutions providing for the creation and issuance of such series adopted by the Board of Directors as hereinafter provided.
2. Preferred Stock may be issued from time to time in one or more series. The Board of Directors is expressly authorized, by adopting a resolution or resolutions providing for the issuance of the shares thereof and by filing a certificate of designation relating thereto in accordance with the DGCL (a “Certificate of Designation”), to provide, out of unissued shares of Preferred Stock that have not been designated as to series, for series of Preferred Stock and, with respect to each series, to determine and fix the number of shares of such series and such voting powers, full or limited, or no voting powers, and such designations, preferences and relative participating, optional or other special rights, and qualifications, limitations or restrictions thereof, including without limitation thereof, dividend rights, conversion rights, redemption privileges and liquidation preferences, and to increase or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series as shall be stated and expressed in such resolutions, all to the fullest extent now or hereafter permitted by the DGCL. Without limiting the generality of the foregoing, the resolution or resolutions providing for the creation and issuance of any series of Preferred Stock may provide that such series shall be superior or rank equally or be junior to any other series of Preferred Stock to the extent permitted by law and this Second Amended and Restated Certificate of Incorporation (including any Certificate of Designation). Except as otherwise required by law, holders of any series of Preferred Stock shall be entitled only to such voting rights, if any, as shall expressly be granted thereto by this Second Amended and Restated Certificate of Incorporation (including any Certificate of Designation). Any shares of any series of Preferred Stock purchased, exchanged, converted or otherwise acquired by the Corporation, in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock, without designation as to series, and may be reissued as part of any series of Preferred Stock created by resolution or resolutions of the Board of Directors, subject to the conditions and restrictions on issuance set forth in this Second Amended and Restated Certificate of Incorporation (including any Certificate of Designation) or in such resolution or resolutions.
3. Subject to the rights of any holders of any outstanding series of Preferred Stock, the number of authorized shares of Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the stock of the Corporation entitled to vote, irrespective of the provisions of Section 242(b)(2) of the DGCL.
ARTICLE VI
For the management of the business and for the conduct of the affairs of the Corporation it is further provided that: 6
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A. Except as otherwise expressly provided by the DGCL or this Second Amended and Restated Certificate of Incorporation, the business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. The number of directors of the Corporation shall be as from time to time fixed by, or in the manner provided in, the Bylaws of the Corporation (as such Bylaws may be amended from time to time, the “Bylaws”).
B. Subject to the special rights of the holders of one or more outstanding series of Preferred Stock to elect directors, except as otherwise provided by law, any vacancies on the Board of Directors resulting from death, resignation, disqualification, retirement, removal or other causes and any newly created directorships resulting from any increase in the number of directors shall be filled exclusively by the affirmative vote of a majority of the directors then in office, even if less than a quorum, or by a sole remaining director (other than any directors elected by the separate vote of one or more outstanding series of Preferred Stock), and shall not be filled by the stockholders. Notwithstanding the foregoing, if at any time that the voting restrictions set forth in Article V, Part A, Section 7 remain in effect, if a vacancy on the Board of Directors arises by reason of the death, removal or resignation of a director (x) who was not nominated by a stockholder of the Corporation pursuant to Section 2.2 or Section 2.3 of the Stockholders Agreement, dated as of the effective date of this Second Amended and Restated Certificate of Incorporation, among the Corporation and certain stockholders of the Corporation party thereto (as it may be amended from time to time, the “Stockholders Agreement”) or (y) pursuant to the first sentence of Section 2.4(b) of the Stockholders Agreement, then a committee of the Board of Directors shall be created consisting of all of the directors other than any directors designated by the SB Investor or the VF Investor (as defined in the Stockholders Agreement) and any such vacancy shall be filled by a majority vote of such committee. Any director appointed in accordance with the preceding two sentences shall hold office until the expiration of his or her term or until his or her earlier death, resignation, retirement, disqualification or removal.
C. Whenever the holders of any one or more series of Preferred Stock issued by the Corporation shall have the right, voting separately as a series or separately as a class with one or more such other series, to elect directors at an annual or special meeting of stockholders, the election, term of office, removal and other features of such directorships shall be governed by the terms of this Second Amended and Restated Certificate of Incorporation (including any Certificate of Designation) and the Bylaws. Notwithstanding anything to the contrary in this Article VI, the number of directors that may be elected by the holders of any such series of Preferred Stock shall be in addition to the number fixed pursuant to paragraph A of this Article VI, and the total number of directors constituting the whole Board of Directors shall be automatically adjusted accordingly. Except as otherwise provided in the Certificate of Designation(s) in respect of one or more series of Preferred Stock, whenever the holders of any series of Preferred Stock having such right to elect additional directors are divested of such right pursuant to the provisions of such Certificate of Designation(s), the terms of office of all such additional directors elected by the holders of such series of Preferred Stock, or elected to fill any vacancies resulting from the death, resignation, disqualification or removal of such additional directors, shall forthwith terminate (in which case each such director thereupon shall cease to be qualified as, and shall cease to be, a director) and the total authorized number of directors of the Corporation shall automatically be reduced accordingly.
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D. In furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized to adopt, amend or repeal the Bylaws, subject to the power of the stockholders of the Corporation entitled to vote with respect thereto to adopt, amend or repeal the Bylaws.
E. The directors of the Corporation need not be elected by written ballot unless the Bylaws so provide.
ARTICLE VII
A. Any action required or permitted to be taken by the stockholders of the Corporation must be effected at an annual or special meeting of the stockholders of the Corporation, and shall not be taken by written consent in lieu of a meeting. Notwithstanding the foregoing, any action required or permitted to be taken by the holders of any series of Preferred Stock, voting separately as a series or separately as a class with one or more other such series, may be taken without a meeting, without prior notice and without a vote, to the extent expressly so provided by the applicable Certificate of Designation relating to such series of Preferred Stock, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares of the relevant series of Preferred Stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the Corporation in accordance with the applicable provisions of the DGCL.
B. Subject to the special rights of the holders of one or more series of Preferred Stock, and to the requirements of applicable law, special meetings of the stockholders of the Corporation may be called for any purpose or purposes, at any time only by or at the direction of the Board of Directors, the Chairperson of the Board of Directors, the Executive Chairman of the Board of Directors, the Chief Executive Officer or a President, in each case, in accordance with the Bylaws, and shall not be called by any other person or persons. Any such special meeting so called may be postponed, rescheduled or cancelled by the Board of Directors or other person calling the meeting.
C. Advance notice of stockholder nominations for the election of directors and of other business proposed to be brought by stockholders before any meeting of the stockholders of the Corporation shall be given in the manner provided in the Bylaws. Any business transacted at any special meeting of stockholders shall be limited to matters relating to the purpose or purposes identified in the notice of meeting.
ARTICLE VIII
No director of the Corporation shall have any personal liability to the Corporation or its stockholders for monetary damages for any breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL or other applicable law as the same exists or hereafter may be amended. Any amendment, repeal or modification of this Article VIII, or the adoption of any provision of this Second Amended and Restated Certificate of Incorporation inconsistent with this Article VIII, shall not adversely affect
8
any right or protection of a director of the Corporation with respect to any act or omission occurring prior to such amendment, repeal, modification or adoption. If the DGCL or other applicable law is amended after approval by the stockholders of this Article VIII to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL or other applicable law as so amended.
ARTICLE IX
The Corporation shall indemnify, to the fullest extent authorized or permitted by applicable law, as now or hereafter in effect, any person who is made or threatened to be made a party to or is otherwise involved (as a witness or otherwise) in any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (hereinafter, a “proceeding”), by reason of the fact that such person is or was a director or officer of the Corporation, against expenses (including attorneys’ fees), judgments, fines (including ERISA excise taxes or penalties) and amounts paid in settlement actually and reasonably incurred by him or her in connection with such proceeding if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful, and such right to indemnification shall continue as to a person who has ceased to be a director or officer of the Corporation and shall inure to the benefit of his or her heirs, executors and personal and legal representatives; provided, however, that, except for proceedings to enforce rights to indemnification, the Corporation shall not be obligated to indemnify (or advance expenses to) any director or officer (or his or her heirs, executors or personal or legal representatives) in connection with a proceeding (or part thereof) initiated by such person or in defending any counterclaim, cross-claim, affirmative defense, or like claim by the Corporation in such a proceeding unless such proceeding (or part thereof) was authorized or consented to by the Board. The right to indemnification conferred by this Article IX shall include the right to be paid by the Corporation the expenses incurred in defending or otherwise participating in any proceeding in advance of its final disposition upon receipt by the Corporation of an undertaking by or on behalf of the director or officer receiving advancement to repay the amount advanced if it shall ultimately be determined that such person is not entitled to be indemnified by the Corporation under this Article IX. The Corporation may, to the extent authorized from time to time by the Board, provide rights to indemnification and to the advancement of expenses to employees and agents of the Corporation similar to those conferred in this Article IX to directors and officers of the Corporation. The rights to indemnification and to the advancement of expenses conferred in this Article IX shall not be exclusive of any other right which any person may have or hereafter acquire under this Second Amended and Restated Certificate of Incorporation, the Bylaws, any statute, agreement, vote of stockholders or disinterested directors or otherwise. Any repeal or modification of this Article IX by the stockholders of the Corporation shall not adversely affect any rights to indemnification and to the advancement of expenses of a director or officer of the Corporation (collectively, the “Covered Persons”) existing at the time of such repeal or modification with respect to any acts or omissions occurring prior to such repeal or modification.
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The Corporation hereby acknowledges that certain Covered Persons may have rights to indemnification and advancement of expenses (directly or through insurance obtained by any such entity) provided by one or more third parties (collectively, the “Other Indemnitors”), and which may include third parties for whom such Covered Person serves as a manager, member, officer, employee or agent. The Corporation hereby agrees and acknowledges that notwithstanding any such rights that a Covered Person may have with respect to any Other Indemnitor(s), (i) the Corporation is the indemnitor of first resort with respect to all Covered Persons and all obligations to indemnify and provide advancement of expenses to Covered Persons, (ii) the Corporation shall be required to indemnify and advance the full amount of expenses incurred by the Covered Persons, to the fullest extent required by law, the terms of this Second Amended and Restated Certificate of Incorporation, the Bylaws, any agreement to which the Corporation is a party, any vote of the stockholders or the Board, or otherwise, without regard to any rights the Covered Persons may have against the Other Indemnitors and (iii) to the fullest extent permitted by law, the Corporation irrevocably waives, relinquishes and releases the Other Indemnitors from any and all claims for contribution, subrogation or any other recovery of any kind in respect thereof. The Corporation further agrees that no advancement or payment by the Other Indemnitors with respect to any claim for which the Covered Persons have sought indemnification from the Corporation shall affect the foregoing, and the Other Indemnitors shall have a right of contribution and/or subrogation to the extent of any such advancement or payment to all of the rights of recovery of the Covered Persons against the Corporation. These rights shall be a contract right, and the Other Indemnitors are express third party beneficiaries of the terms of this paragraph. Notwithstanding anything to the contrary herein, the obligations of the Corporation under this paragraph shall only apply to Covered Persons in their capacity as Covered Persons.
ARTICLE X
A. Unless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery (the “Chancery Court”) of the State of Delaware (or, in the event that the Chancery Court does not have jurisdiction, the federal district court for the District of Delaware or other state courts of the State of Delaware) and any appellate court thereof (the “Chosen Courts”) shall, to the fullest extent permitted by law, be the sole and exclusive forum for (i) any derivative action, suit or proceeding brought on behalf of the Corporation, (ii) any action, suit or proceeding asserting a claim of breach of a fiduciary duty owed by any director, officer, employee or stockholder of the Corporation to the Corporation or to the Corporation’s stockholders, (iii) any action, suit or proceeding arising pursuant to any provision of the DGCL, the Bylaws or this Second Amended and Restated Certificate of Incorporation (as any of the foregoing may be amended from time to time), (iv) any action, suit or proceeding as to which the DGCL confers jurisdiction on the Chancery Court, or (v) any action, suit or proceeding asserting a claim governed by the internal affairs doctrine. If any action, suit or proceeding the subject matter of which is within the scope of the immediately preceding sentence is filed in a court other than the Chosen Courts (a “Foreign Action”) in the name of any stockholder, such stockholder shall be deemed to have consented to (a) the personal jurisdiction of the Chosen Courts in connection with any action brought in any such court to enforce the provisions of the immediately preceding sentence and (b) having service of process made upon such stockholder in any such action by service upon such stockholder’s counsel in the Foreign Action as agent for such stockholder.
B. Unless the Corporation consents in writing to the selection of an alternative forum, to the fullest extent permitted by law, the federal district courts of the United States of America shall be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended (and as may be further amended from time to time).
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C. Notwithstanding the foregoing, the provisions of paragraph A of this Article X shall not apply to suits brought to enforce any liability or duty created by the Securities Exchange Act of 1934 or any other claim over which the federal courts of the United States have exclusive jurisdiction.
D. Any person or entity purchasing or otherwise acquiring or holding any interest in any security of the Corporation (including, but not limited to, shares of capital stock of the Corporation) shall be deemed to have notice of and consented to the provisions of this Article X.
ARTICLE XI
A. Except as otherwise provided in this Second Amended and Restated Certificate of Incorporation, the Corporation reserves the right to amend, alter, change or repeal any provision contained in this Second Amended and Restated Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation.
B. If any provision or provisions of this Second Amended and Restated Certificate of Incorporation shall be held to be invalid, illegal or unenforceable as applied to any circumstance for any reason whatsoever: (i) the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Second Amended and Restated Certificate of Incorporation (including, without limitation, each portion of any paragraph of this Second Amended and Restated Certificate of Incorporation containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not, to the fullest extent permitted by applicable law, in any way be affected or impaired thereby and (ii) to the fullest extent permitted by applicable law, the provisions of this Second Amended and Restated Certificate of Incorporation (including, without limitation, each such portion of any paragraph of this Second Amended and Restated Certificate of Incorporation containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to permit the Corporation to protect its directors, officers, employees and agents from personal liability in respect of their good faith service to or for the benefit of the Corporation to the fullest extent permitted by law.
* * * * *
11
Exhibit 3.2
Amended and Restated Bylaws
of
WeWork Inc.
(a Delaware corporation)
Effective October 20, 2021
Table of Contents
| Page | ||||||
| Article I - Corporate Offices |
1 | |||||
| 1.1 |
Registered Office | 1 | ||||
| 1.2 |
Other Offices | 1 | ||||
| Article II - Meetings of Stockholders |
1 | |||||
| 2.1 |
Place of Meetings | 1 | ||||
| 2.2 |
Annual Meeting | 1 | ||||
| 2.3 |
Special Meeting | 1 | ||||
| 2.4 |
Notice of Business to be Brought before a Meeting | 2 | ||||
| 2.5 |
Notice of Nominations for Election to the Board of Directors | 5 | ||||
| 2.6 |
Additional Requirements for Valid Nomination of Candidates to Serve as Director and, if Elected, to be Seated as Directors | 7 | ||||
| 2.7 |
Notice of Stockholders’ Meetings | 9 | ||||
| 2.8 |
Quorum | 9 | ||||
| 2.9 |
Adjourned Meeting; Notice | 9 | ||||
| 2.10 |
Conduct of Business | 9 | ||||
| 2.11 |
Voting | 10 | ||||
| 2.12 |
Record Date for Stockholder Meetings and Other Purposes | 10 | ||||
| 2.13 |
Proxies | 11 | ||||
| 2.14 |
List of Stockholders Entitled to Vote | 11 | ||||
| 2.15 |
Inspectors of Election | 12 | ||||
| 2.16 |
Delivery to the Corporation | 12 | ||||
| Article III - Directors |
12 | |||||
| 3.1 |
Powers | 12 | ||||
| 3.2 |
Number of Directors | 13 | ||||
| 3.3 |
Chairperson of the Board; Vice | 13 | ||||
| Chairperson of the Board; Executive Chairman. | 13 | |||||
| 3.4 |
Election, Qualification and Term of Office of Directors | 13 | ||||
| 3.5 |
Resignation and Vacancies | 13 | ||||
| 3.6 |
Place of Meetings; Meetings by Telephone | 14 | ||||
| 3.7 |
Regular Meetings | 14 | ||||
| 3.8 |
Special Meetings; Notice | 14 | ||||
| 3.9 |
Quorum | 15 | ||||
| 3.10 |
Board Action without a Meeting | 15 | ||||
| 3.11 |
Fees and Compensation of Directors | 15 | ||||
| Article IV - Committees |
15 | |||||
| 4.1 |
Committees of Directors | 15 | ||||
| 4.2 |
Meetings and Actions of Committees | 16 | ||||
| 4.3 |
Subcommittees | 16 | ||||
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TABLE OF CONTENTS
(continued)
| Page | ||||||
| Article V - Officers |
17 | |||||
| 5.1 |
Officers | 17 | ||||
| 5.2 |
Appointment of Officers | 17 | ||||
| 5.3 |
Subordinate Officers | 17 | ||||
| 5.4 |
Removal and Resignation of Officers | 17 | ||||
| 5.5 |
Vacancies in Offices | 17 | ||||
| 5.6 |
Representation of Shares of Other Corporations | 17 | ||||
| 5.7 |
Authority and Duties of Officers | 18 | ||||
| 5.8 |
Compensation | 18 | ||||
| Article VI - Records |
18 | |||||
| Article VII - General Matters |
18 | |||||
| 7.1 |
Execution of Corporate Contracts and Instruments | 18 | ||||
| 7.2 |
Stock Certificates | 18 | ||||
| 7.3 |
Special Designation of Certificates | 19 | ||||
| 7.4 |
Lost Certificates | 19 | ||||
| 7.5 |
Shares Without Certificates | 19 | ||||
| 7.6 |
Construction; Definitions | 19 | ||||
| 7.7 |
Dividends | 20 | ||||
| 7.8 |
Fiscal Year | 20 | ||||
| 7.9 |
Seal | 20 | ||||
| 7.10 |
Transfer of Stock | 20 | ||||
| 7.11 |
Stock Transfer Agreements | 20 | ||||
| 7.12 |
Registered Stockholders | 20 | ||||
| 7.13 |
Waiver of Notice | 21 | ||||
| Article VIII - Notice |
21 | |||||
| 8.1 |
Delivery of Notice; Notice by Electronic Transmission | 21 | ||||
| Article IX - Indemnification |
22 | |||||
| 9.1 |
Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation | 22 | ||||
| 9.2 |
Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation | 22 | ||||
| 9.3 |
Authorization of Indemnification | 23 | ||||
| 9.4 |
Good Faith Defined | 23 | ||||
| 9.5 |
Indemnification by a Court | 23 | ||||
| 9.6 |
Expenses Payable in Advance | 24 | ||||
| 9.7 |
Nonexclusivity of Indemnification and Advancement of Expenses | 24 | ||||
| 9.8 |
Insurance | 24 | ||||
| 9.9 |
Certain Definitions | 24 | ||||
| 9.10 |
Survival of Indemnification and Advancement of Expenses | 25 | ||||
| 9.11 |
Limitation on Indemnification | 25 | ||||
ii
TABLE OF CONTENTS
(continued)
| Page | ||||||
| 9.12 |
Indemnification of Employees and Agents | 25 | ||||
| 9.13 |
Primacy of Indemnification | 25 | ||||
| Article X - Amendments |
25 | |||||
| Article XI - Definitions |
26 | |||||
iii
Amended and Restated
Bylaws
of
WeWork Inc.
Article I - Corporate Offices
1.1 Registered Office.
The address of the registered office of WeWork Inc. (the “Corporation”) in the State of Delaware, and the name of its registered agent at such address, shall be as set forth in the Corporation’s certificate of incorporation, as the same may be amended and/or restated from time to time (the “Certificate of Incorporation”).
1.2 Other Offices.
The Corporation may have additional offices at any place or places, within or outside the State of Delaware, as the Corporation’s board of directors (the “Board”) may from time to time establish or as the business of the Corporation may require.
Article II - Meetings of Stockholders
2.1 Place of Meetings.
Meetings of stockholders shall be held at any place within or outside the State of Delaware, designated by the Board. The Board may, in its sole discretion, determine that a meeting of stockholders shall not be held at any place, but may instead be held solely by means of remote communication as authorized by Section 211(a)(2) of the General Corporation Law of the State of Delaware (the “DGCL”). In the absence of any such designation or determination, stockholders’ meetings shall be held at the Corporation’s principal executive office.
2.2 Annual Meeting.
The Board shall designate the date and time of the annual meeting. At the annual meeting, directors shall be elected and other proper business properly brought before the meeting in accordance with Section 2.4 of these bylaws may be transacted. The Board may postpone or reschedule any previously scheduled annual meeting of stockholders.
2.3 Special Meeting.
Special meetings of the stockholders may be called, postponed, rescheduled or cancelled only by such persons and only in such manner as set forth in the Certificate of Incorporation.
No business may be transacted at any special meeting of stockholders other than the business specified in the notice of such meeting.
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2.4 Notice of Business to be Brought before a Meeting.
(i) At an annual meeting of the stockholders, only such business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting, business must be (i) specified in a notice of meeting given by or at the direction of the Board of Directors, (ii) if not specified in a notice of meeting, otherwise brought before the meeting by the Board of Directors, the Executive Chairman of the Board or Chairperson of the Board or (iii) otherwise properly brought before the meeting by a stockholder present in person who (A) (1) was a record owner of shares of the Corporation both at the time of giving the notice provided for in this Section 2.4 and at the time of the meeting, (2) is entitled to vote at the meeting, and (3) has complied with this Section 2.4 in all applicable respects or (B) properly made such proposal in accordance with Rule 14a-8 under the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder (as so amended and inclusive of such rules and regulations, the “Exchange Act”). The foregoing clause (iii) shall be the exclusive means for a stockholder to propose business to be brought before an annual meeting of the stockholders. For purposes of this Section 2.4, “present in person” shall mean that the stockholder proposing that the business be brought before the annual meeting of the Corporation, or a qualified representative of such proposing stockholder, appear at such annual meeting. A “qualified representative” of such proposing stockholder shall be a duly authorized officer, manager or partner of such stockholder or any other person authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as proxy at the meeting of stockholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of stockholders. Stockholders seeking to nominate persons for election to the Board of Directors must comply with Section 2.5 and Section 2.6, and this Section 2.4 shall not be applicable to nominations except as expressly provided in Section 2.5 and Section 2.6.
(ii) Without qualification, for business to be properly brought before an annual meeting by a stockholder, the stockholder must (i) provide Timely Notice (as defined below) thereof in writing and in proper form to the Secretary of the Corporation and (ii) provide any updates or supplements to such notice at the times and in the forms required by this Section 2.4. To be timely, a stockholder’s notice must be delivered to, or mailed and received at, the principal executive offices of the Corporation not less than 90 days nor more than 120 days prior to the one-year anniversary of the preceding year’s annual meeting (which, in the case of the first annual meeting of stockholders following the filing and effectiveness of the Second Amended and Restated Certificate of Incorporation of the Corporation, the date of the preceding year’s annual meeting shall be deemed to be May 4, 2021); provided, however, that if the date of the annual meeting is more than 30 days before or more than 60 days after such anniversary date, notice by the stockholder to be timely must be so delivered, or mailed and received, not later than the 90th day prior to such annual meeting or, if later, the 10th day following the day on which public disclosure of the date of such annual meeting was first made by the Corporation (such notice within such time periods, “Timely Notice”). In no event shall any adjournment or postponement of an annual meeting or the announcement thereof commence a new time period for the giving of Timely Notice as described above.
(iii) To be in proper form for purposes of this Section 2.4, a stockholder’s notice to the Secretary shall set forth:
(a) As to each Proposing Person (as defined below), (1) the name and address of such Proposing Person (including, if applicable, the name and address that appear on the Corporation’s books and records); and (2) the class or series and number of shares of the Corporation that are, directly or indirectly, owned of record or beneficially owned (within the meaning of Rule 13d-3 under the Exchange Act) by such Proposing Person, except that such Proposing Person shall in all events be deemed to beneficially own any shares of any class or series of the Corporation as to which such Proposing Person has a right to acquire beneficial ownership at any time in the future (the disclosures to be made pursuant to the foregoing clauses (1) and (2) are referred to as “Stockholder Information”);
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(b) As to each Proposing Person, (1) the full notional amount of any securities that, directly or indirectly, underlie any “derivative security” (as such term is defined in Rule 16a-1(c) under the Exchange Act) that constitutes a “call equivalent position” (as such term is defined in Rule 16a-1(b) under the Exchange Act) (“Synthetic Equity Position”) and that is, directly or indirectly, held or maintained by such Proposing Person with respect to any shares of any class or series of shares of the Corporation; provided that, for the purposes of the definition of “Synthetic Equity Position,” the term “derivative security” shall also include any security or instrument that would not otherwise constitute a “derivative security” as a result of any feature that would make any conversion, exercise or similar right or privilege of such security or instrument becoming determinable only at some future date or upon the happening of a future occurrence, in which case the determination of the amount of securities into which such security or instrument would be convertible or exercisable shall be made assuming that such security or instrument is immediately convertible or exercisable at the time of such determination; and, provided, further, that any Proposing Person satisfying the requirements of Rule 13d-1(b)(1) under the Exchange Act (other than a Proposing Person that so satisfies Rule 13d-1(b)(1) under the Exchange Act solely by reason of Rule 13d-1(b)(1)(ii)(E)) shall not be deemed to hold or maintain the notional amount of any securities that underlie a Synthetic Equity Position held by such Proposing Person as a hedge with respect to a bona fide derivatives trade or position of such Proposing Person arising in the ordinary course of such Proposing Person’s business as a derivatives dealer, (2) any rights to dividends on the shares of any class or series of shares of the Corporation owned beneficially by such Proposing Person that are separated or separable from the underlying shares of the Corporation, (3) any material pending or threatened legal proceeding in which such Proposing Person is a party or material participant involving the Corporation or any of its officers or directors, or any affiliate of the Corporation, (4) any other material relationship between such Proposing Person, on the one hand, and the Corporation, or any of its officers or directors, or any affiliate of the Corporation, on the other hand, (5) any direct or indirect material interest in any material contract or agreement of such Proposing Person with the Corporation or any affiliate of the Corporation (including, in any such case, any employment agreement, collective bargaining agreement or consulting agreement), (6) a representation that such Proposing Person intends or is part of a group which intends to deliver a proxy statement or form of proxy to holders of at least the percentage of the Corporation’s outstanding capital stock required to approve or adopt the proposal or otherwise solicit proxies from stockholders in support of such proposal and (7) any other information relating to such Proposing Person that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies or consents by such Proposing Person in support of the business proposed to be brought before the meeting pursuant to Section 14(a) of the Exchange Act (the disclosures to be made pursuant to the foregoing clauses (1) through (7) are referred to as “Disclosable Interests”); provided, however, that Disclosable Interests shall not include any such disclosures with respect to the ordinary course business activities of any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the stockholder directed to prepare and submit the notice required by these bylaws on behalf of a beneficial owner; and
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(c) As to each item of business that the Proposing Person proposes to bring before the annual meeting, (1) a brief description of the business desired to be brought before the annual meeting, the reasons for conducting such business at the annual meeting and any material interest in such business of each Proposing Person, (2) the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend the bylaws of the Corporation, the language of the proposed amendment), and (3) a reasonably detailed description of all agreements, arrangements and understandings (x) between or among any of the Proposing Persons or (y) between or among any Proposing Person and any other record or beneficial holder(s) or persons(s) who have a right to acquire beneficial ownership at any time in the future of the shares of any class or series of the Corporation or any other person or entity (including their names) in connection with the proposal of such business by such stockholder; and (4) any other information relating to such item of business that would be required to be disclosed in a proxy statement or other filing required to be made in connection with solicitations of proxies in support of the business proposed to be brought before the meeting pursuant to Section 14(a) of the Exchange Act; provided, however, that the disclosures required by this paragraph (iii) shall not include any disclosures with respect to any broker, dealer, commercial bank, trust company or other nominee who is a Proposing Person solely as a result of being the stockholder directed to prepare and submit the notice required by these bylaws on behalf of a beneficial owner.
For purposes of this Section 2.4, the term “Proposing Person” shall mean (i) the stockholder providing the notice of business proposed to be brought before an annual meeting, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the business proposed to be brought before the annual meeting is made, and (iii) any participant (as defined in paragraphs (a)(ii)-(vi) of Instruction 3 to Item 4 of Schedule 14A) with such stockholder in such solicitation.
(iv) A Proposing Person shall update and supplement its notice to the Corporation of its intent to propose business at an annual meeting, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 2.4 shall be true and correct as of the record date for stockholders entitled to vote at the meeting and as of the date that is 10 business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five business days after the record date for stockholders entitled to vote at the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight business days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of 10 business days prior to the meeting or any adjournment or postponement thereof). For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Section of these bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or enable or be deemed to permit a stockholder who has previously submitted notice hereunder to amend or update any proposal or to submit any new proposal, including by changing or adding matters, business or resolutions proposed to be brought before a meeting of the stockholders.
(v) Notwithstanding anything in these bylaws to the contrary, no business shall be conducted at an annual meeting that is not properly brought before the meeting in accordance with this Section 2.4. The presiding officer of the meeting shall, if the facts warrant, determine that the business was not properly brought before the meeting in accordance with this Section 2.4, and if he or she should so determine, he or she shall so declare to the meeting and any such business not properly brought before the meeting shall not be transacted.
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(vi) This Section 2.4 is expressly intended to apply to any business proposed to be brought before an annual meeting of stockholders other than any proposal made in accordance with Rule 14a-8 under the Exchange Act and included in the Corporation’s proxy statement. In addition to the requirements of this Section 2.4 with respect to any business proposed to be brought before an annual meeting, each Proposing Person shall comply with all applicable requirements of the Exchange Act with respect to any such business. Nothing in this Section 2.4 shall be deemed to affect the rights of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 under the Exchange Act.
(vii) For purposes of these bylaws, “public disclosure” shall mean disclosure in a press release reported by a national news service, in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act or by such other means as is reasonably designed to inform the public or securityholders of the Corporation in general of such information including, without limitation, posting on the Corporation’s investor relations website.
2.5 Notice of Nominations for Election to the Board of Directors.
(i) Subject in all respects to the provisions of the Certificate of Incorporation, nominations of any person for election to the Board of Directors at an annual meeting or at a special meeting (but only if the election of directors is a matter specified in the notice of meeting given by or at the direction of the person calling such special meeting) may be made at such meeting only (x) by or at the direction of the Board of Directors, including by any committee or persons authorized to do so by the Board of Directors or these bylaws, or (y) by a stockholder present in person (A) who was a record owner of shares of the Corporation both at the time of giving the notice provided for in this Section 2.5 and at the time of the meeting, (B) is entitled to vote at the meeting, and (C) has complied with this Section 2.5 and Section 2.6 as to such notice and nomination. For purposes of this Section 2.5, “present in person” shall mean that the stockholder proposing that the business be brought before the meeting of the Corporation, or a qualified representative of such stockholder, appear at such meeting. A “qualified representative” of such proposing stockholder shall be a duly authorized officer, manager or partner of such stockholder or any other person authorized by a writing executed by such stockholder or an electronic transmission delivered by such stockholder to act for such stockholder as proxy at the meeting of stockholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of stockholders. The foregoing clause (y) shall be the exclusive means for a stockholder to make any nomination of a person or persons for election to the Board of Directors at an annual meeting or special meeting.
(ii) Without qualification, for a stockholder to make any nomination of a person or persons for election to the Board of Directors at an annual meeting, the stockholder must (1) provide Timely Notice (as defined in Section 2.4) thereof in writing and in proper form to the Secretary of the Corporation, (2) provide the information, agreements and questionnaires with respect to such stockholder and its candidate for nomination as required to be set forth by this Section 2.5 and Section 2.6 and (3) provide any updates or supplements to such notice at the times and in the forms required by this Section 2.5 and Section 2.6.
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(a) Without qualification, if the election of directors is a matter specified in the notice of meeting given by or at the direction of the person calling a special meeting in accordance with the Certificate of Incorporation, then for a stockholder to make any nomination of a person or persons for election to the Board of Directors at a special meeting, the stockholder must (i) provide timely notice thereof in writing and in proper form to the Secretary of the Corporation at the principal executive offices of the Corporation, (ii) provide the information with respect to such stockholder and its candidate for nomination as required by this Section 2.5 and Section 2.6 and (iii) provide any updates or supplements to such notice at the times and in the forms required by this Section 2.5. To be timely, a stockholder’s notice for nominations to be made at a special meeting must be delivered to, or mailed and received at, the principal executive offices of the Corporation not earlier than the 120th day prior to such special meeting and not later than the 90th day prior to such special meeting or, if later, the 10th day following the day on which public disclosure (as defined in Section 2.4) of the date of such special meeting was first made.
(b) In no event shall any adjournment or postponement of an annual meeting or special meeting or the announcement thereof commence a new time period for the giving of a stockholder’s notice as described above.
(c) In no event may a Nominating Person provide Timely Notice with respect to a greater number of director candidates than are subject to election by shareholders at the applicable meeting. If the Corporation shall, subsequent to such notice, increase the number of directors subject to election at the meeting, such notice as to any additional nominees shall be due on the later of (i) the conclusion of the time period for Timely Notice, (ii) the date set forth in Section 2.5(ii)(a), or (iii) the tenth day following the date of public disclosure (as defined in Section 2.4) of such increase.
(iii) To be in proper form for purposes of this Section 2.5, a stockholder’s notice to the Secretary shall set forth:
(a) As to each Nominating Person (as defined below), the Stockholder Information (as defined in Section 2.4(iii)(a), except that for purposes of this Section 2.5 the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Section 2.4(iii)(a));
(b) As to each Nominating Person, any Disclosable Interests (as defined in Section 2.4(iii)(b), except that for purposes of this Section 2.5 the term “Nominating Person” shall be substituted for the term “Proposing Person” in all places it appears in Section 2.4(iii)(b) and the disclosure with respect to the business to be brought before the meeting in Section 2.4(iii)(b) shall be made with respect to the election of directors at the meeting); and
(c) As to each candidate whom a Nominating Person proposes to nominate for election as a director, (A) all information with respect to such candidate for nomination that would be required to be set forth in a stockholder’s notice pursuant to this Section 2.5 and Section 2.6 if such candidate for nomination were a Nominating Person, (B) all information relating to such candidate for nomination that is required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to Section 14(a) under the Exchange Act (including such candidate’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected), (C) a description of any direct or indirect material interest in any material contract or agreement between or among any Nominating Person, on the one hand, and each candidate for nomination or his or her
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respective associates or any other participants in such solicitation, on the other hand, including, without limitation, all information that would be required to be disclosed pursuant to Item 404 under Regulation S-K if such Nominating Person were the “registrant” for purposes of such rule and the candidate for nomination were a director or executive officer of such registrant (the disclosures to be made pursuant to the foregoing clauses (A) through (C) are referred to as “Nominee Information”), and (D) a completed and signed questionnaire, representation and agreement as provided in Section 2.6(i).
For purposes of this Section 2.5, the term “Nominating Person” shall mean (i) the stockholder providing the notice of the nomination proposed to be made at the meeting, (ii) the beneficial owner or beneficial owners, if different, on whose behalf the notice of the nomination proposed to be made at the meeting is made, and (iii) any other participant in such solicitation.
(iv) A stockholder providing notice of any nomination proposed to be made at a meeting shall further update and supplement such notice, if necessary, so that the information provided or required to be provided in such notice pursuant to this Section 2.5 shall be true and correct as of the record date for stockholders entitled to vote at the meeting and as of the date that is 10 business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation not later than five business days after the record date for stockholders entitled to vote at the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight business days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of 10 business days prior to the meeting or any adjournment or postponement thereof). For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Section of these bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or enable or be deemed to permit a stockholder who has previously submitted notice hereunder to amend or update any nomination or to submit any new nomination.
(v) In addition to the requirements of this Section 2.5 with respect to any nomination proposed to be made at a meeting, each Nominating Person shall comply with all applicable requirements of the Exchange Act with respect to any such nominations.
2.6 Additional Requirements for Valid Nomination of Candidates to Serve as Director and, if Elected, to be Seated as Directors.
(i) To be eligible to be a candidate for election as a director of the Corporation at an annual or special meeting, a candidate must be nominated in the manner prescribed in Section 2.5 and the candidate for nomination, whether nominated by the Board of Directors or by a stockholder of record, must have previously delivered (in accordance with the time period prescribed for delivery in a notice to such candidate given by or on behalf of the Board of Directors) to the Secretary at the principal executive offices of the Corporation (i) a completed written questionnaire (in a form provided by the Corporation) with respect to the background, qualifications, stock ownership and independence of such proposed nominee, and such additional information with respect to such proposed nominee as would be required to be provided by the Corporation pursuant to Schedule 14A if such proposed nominee were a participant in the solicitation of proxies by the Corporation in connection with such annual or special meeting and (ii) a written representation and agreement (in form provided by the Corporation) that such candidate for nomination (A) is not and, if elected as a director during his or her term of office, will not become a party to (1) any agreement, arrangement or understanding with, and has not given and will not give any commitment or
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assurance to, any person or entity as to how such proposed nominee, if elected as a director of the Corporation, will act or vote on any issue or question (a “Voting Commitment”) or (2) any Voting Commitment that could limit or interfere with such proposed nominee’s ability to comply, if elected as a director of the Corporation, with such proposed nominee’s fiduciary duties under applicable law, (B) is not, and will not become a party to, any agreement, arrangement or understanding with any person or entity other than the Corporation with respect to any direct or indirect compensation or reimbursement for service as a director that has not been disclosed therein or to the Corporation, (C) if elected as a director of the Corporation, will comply with all applicable corporate governance, conflict of interest, confidentiality, stock ownership and trading and other policies and guidelines of the Corporation applicable to directors and in effect during such person’s term in office as a director (and, if requested by any candidate for nomination, the Secretary of the Corporation shall provide to such candidate for nomination all such policies and guidelines then in effect), (D) if elected as director of the Corporation, intends to serve the entire term until the next meeting at which such candidate would face re-election and (E) consents to being named as a nominee in the Corporation’s proxy statement pursuant to Rule 14a-4(d) under the Exchange Act and any associated proxy card of the Corporation and agrees to serve if elected as a director.
(ii) The Board of Directors may also require any proposed candidate for nomination as a Director to furnish such other information as may reasonably be requested by the Board of Directors in writing prior to the meeting of stockholders at which such candidate’s nomination is to be acted upon in order for the Board of Directors to determine the eligibility of such candidate for nomination to be an independent director of the Corporation in accordance with the Corporation’s Corporate Governance Guidelines.
(iii) A candidate for nomination as a director shall further update and supplement the materials delivered pursuant to this Section 2.6, if necessary, so that the information provided or required to be provided pursuant to this Section 2.6 shall be true and correct as of the record date for stockholders entitled to vote at the meeting and as of the date that is 10 business days prior to the meeting or any adjournment or postponement thereof, and such update and supplement shall be delivered to, or mailed and received by, the Secretary at the principal executive offices of the Corporation (or any other office specified by the Corporation in any public announcement) not later than five business days after the record date for stockholders entitled to vote at the meeting (in the case of the update and supplement required to be made as of such record date), and not later than eight business days prior to the date for the meeting or, if practicable, any adjournment or postponement thereof (and, if not practicable, on the first practicable date prior to the date to which the meeting has been adjourned or postponed) (in the case of the update and supplement required to be made as of 10 business days prior to the meeting or any adjournment or postponement thereof). For the avoidance of doubt, the obligation to update and supplement as set forth in this paragraph or any other Section of these bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or enable or be deemed to permit a stockholder who has previously submitted notice hereunder to amend or update any proposal or to submit any new proposal, including by changing or adding nominees, matters, business or resolutions proposed to be brought before a meeting of the stockholders.
(iv) No candidate shall be eligible for nomination as a director of the Corporation unless such candidate for nomination and the Nominating Person seeking to place such candidate’s name in nomination has complied with Section 2.5 and this Section 2.6, as applicable. The presiding officer at the meeting shall, if the facts warrant, determine that a nomination was not properly made in accordance with Section 2.5 and this Section 2.6, and if he or she should so determine, he or she shall so declare such determination to the meeting, the defective nomination shall be disregarded and any ballots cast for the candidate in question (but in the case of any form of ballot listing other qualified nominees, only the ballots cast for the nominee in question) shall be void and of no force or effect.
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(v) Notwithstanding anything in these bylaws to the contrary, no candidate for nomination shall be eligible to be seated as a director of the Corporation unless nominated and elected in accordance with Section 2.5 and this Section 2.6.
2.7 Notice of Stockholders’ Meetings.
Unless otherwise provided by law, the Certificate of Incorporation or these bylaws, the notice of any meeting of stockholders shall be sent or otherwise given in accordance with Section 8.1 of these bylaws not less than 10 nor more than 60 days before the date of the meeting to each stockholder entitled to vote at such meeting. The notice shall specify the place, if any, date and time of the meeting, the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called.
2.8 Quorum.
Unless otherwise provided by law, the Certificate of Incorporation or these bylaws, the holders of a majority in voting power of the stock issued and outstanding and entitled to vote, present in person, or by remote communication, if applicable, or represented by proxy, shall constitute a quorum for the transaction of business at all meetings of the stockholders. A quorum, once established at a meeting, shall not be broken by the withdrawal of enough votes to leave less than a quorum. If, however, a quorum is not present or represented at any meeting of the stockholders, then either (i) the person presiding over the meeting or (ii) a majority in voting power of the stockholders entitled to vote at the meeting, present in person, or by remote communication, if applicable, or represented by proxy, shall have power to recess the meeting or adjourn the meeting from time to time in the manner provided in Section 2.9 of these bylaws until a quorum is present or represented. At any recessed or adjourned meeting at which a quorum is present or represented, any business may be transacted that might have been transacted at the meeting as originally noticed.
2.9 Adjourned Meeting; Notice.
When a meeting is adjourned to another time or place, unless these bylaws otherwise require, notice need not be given of the adjourned meeting if the time, place, if any, thereof, and the means of remote communications, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken. At any adjourned meeting, the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than 30 days, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. If after the adjournment a new record date for determination of stockholders entitled to vote is fixed for the adjourned meeting, the Board shall fix as the record date for determining stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote at the adjourned meeting, and shall give notice of the adjourned meeting to each stockholder of record entitled to vote at such meeting as of the record date so fixed for notice of such adjourned meeting.
2.10 Conduct of Business.
The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the person presiding over the meeting. The Board may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board, the person presiding over any meeting of stockholders shall have the right and
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authority to convene and (for any or no reason) to recess and/or adjourn the meeting, to prescribe such rules, regulations and procedures (which need not be in writing) and to do all such acts as, in the judgment of such presiding person, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board or prescribed by the person presiding over the meeting, may include, without limitation, the following: (i) the establishment of an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present (including, without limitation, rules and procedures for removal of disruptive persons from the meeting); (iii) limitations on attendance at or participation in the meeting to stockholders entitled to vote at the meeting, their duly authorized and constituted proxies or such other persons as the person presiding over the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. The presiding person at any meeting of stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting (including, without limitation, determinations with respect to the administration and/or interpretation of any of the rules, regulations or procedures of the meeting, whether adopted by the Board or prescribed by the person presiding over the meeting), shall, if the facts warrant, determine and declare to the meeting that a matter of business was not properly brought before the meeting and if such presiding person should so determine, such presiding person shall so declare to the meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered. Unless and to the extent determined by the Board or the person presiding over the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.
2.11 Voting.
Except as may be otherwise provided in the Certificate of Incorporation or the DGCL, each stockholder shall be entitled to one vote for each share of capital stock held by such stockholder.
Except as otherwise provided by the Certificate of Incorporation, at all duly called or convened meetings of stockholders at which a quorum is present, for the election of directors, a plurality of the votes cast shall be sufficient to elect a director. Except as otherwise provided by the Certificate of Incorporation, these bylaws, the rules or regulations of any stock exchange applicable to the Corporation, or applicable law or pursuant to any regulation applicable to the Corporation or its securities, each other matter presented to the stockholders at a duly called or convened meeting at which a quorum is present shall be decided by the affirmative vote of the holders of a majority in voting power of the votes cast (excluding abstentions and broker non-votes) on such matter.
2.12 Record Date for Stockholder Meetings and Other Purposes.
In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board, and which record date shall, unless otherwise required by law, not be more than 60 days nor less than 10 days before the date of such meeting. If the Board so fixes a date, such date shall also be the record date for determining the stockholders entitled to vote at such meeting unless the Board determines, at the time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination. If no record date is fixed by the Board, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be the close of business on the day immediately preceding the day on which notice is first given, or, if notice is waived, at the close of business on the day immediately preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the
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meeting; provided, however, that the Board may fix a new record date for determination of stockholders entitled to vote at the adjourned meeting; and in such case shall also fix as the record date for stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote in accordance herewith at the adjourned meeting.
In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment or any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of capital stock, or for the purposes of any other lawful action, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than 60 days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto.
2.13 Proxies.
Each stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act for such stockholder by proxy authorized by an instrument in writing or by a transmission permitted by law filed in accordance with the procedure established for the meeting, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Section 212 of the DGCL. A proxy may be in the form of an electronic transmission that sets forth or is submitted with information from which it can be determined that the transmission was authorized by the stockholder.
2.14 List of Stockholders Entitled to Vote.
The Corporation shall prepare, at least 10 days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting (provided, however, that if the record date for determining the stockholders entitled to vote is less than 10 days before the date of the meeting, the list shall reflect the stockholders entitled to vote as of the tenth day before the meeting date), arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. The Corporation shall not be required to include electronic mail addresses or other electronic contact information on such list. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting for a period of at least 10 days prior to the meeting: (i) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (ii) during ordinary business hours, at the Corporation’s principal executive office. In the event that the Corporation determines to make the list available on an electronic network, the Corporation may take reasonable steps to ensure that such information is available only to stockholders of the Corporation. If the meeting is to be held at a place, then the list shall be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. If the meeting is to be held solely by means of remote communication, then the list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting. Such list shall presumptively determine the identity of the stockholders entitled to vote at the meeting and the number of shares held by each of them. Except as otherwise provided by law, the stock ledger shall be the only evidence as to who are the stockholders entitled to examine the list of stockholders required by this Section 2.14 or to vote in person or by proxy at any meeting of stockholders.
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2.15 Inspectors of Election.
Before any meeting of stockholders, the Corporation shall appoint an inspector or inspectors of election to act at the meeting or its adjournment and make a written report thereof. The Corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. If any person appointed as inspector or any alternate fails to appear or fails or refuses to act, then the person presiding over the meeting shall appoint a person to fill that vacancy.
Such inspectors shall:
(i) determine the number of shares outstanding and the voting power of each, the number of shares represented at the meeting and the validity of any proxies and ballots;
(ii) count all votes or ballots;
(iii) count and tabulate all votes;
(iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspector(s); and
(v) certify its or their determination of the number of shares represented at the meeting and its or their count of all votes and ballots.
Each inspector, before entering upon the discharge of the duties of inspector, shall take and sign an oath faithfully to execute the duties of inspection with strict impartiality and according to the best of such inspector’s ability. Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein. The inspectors of election may appoint such persons to assist them in performing their duties as they determine.
2.16 Delivery to the Corporation.
Whenever this Article II requires one or more persons (including a record or beneficial owner of stock) to deliver a document or information to the Corporation or any officer, employee or agent thereof (including any notice, request, questionnaire, revocation, representation or other document or agreement), such document or information shall be in writing exclusively (and not in an electronic transmission) and shall be delivered exclusively by hand (including, without limitation, overnight courier service) or by certified or registered mail, return receipt requested, and the Corporation shall not be required to accept delivery of any document not in such written form or so delivered. For the avoidance of doubt, the Corporation expressly opts out of Section 116 of the DGCL with respect to the delivery of information and documents to the Corporation required by this Article II.
Article III - Directors
3.1 Powers.
Except as otherwise provided by the Certificate of Incorporation or the DGCL, the business and affairs of the Corporation shall be managed by or under the direction of the Board.
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3.2 Number of Directors.
Subject to the Certificate of Incorporation, the total number of directors constituting the Board shall initially be nine directors and shall be determined from time to time by resolution of the Board. No reduction of the authorized number of directors shall have the effect of removing any director before that director’s term of office expires.
3.3 Chairperson of the Board; Vice Chairperson of the Board; Executive Chairman.
The Board may appoint, in its discretion, from its members a Chairperson of the Board and a Vice Chairperson of the Board, neither of whom need be an employee or officer of the Corporation. The Board may appoint, in its discretion, from its members an Executive Chairman who shall not be an employee or officer of the Corporation. If the Board appoints a Chairperson of the Board, such Chairperson shall perform such duties and possess such powers as are assigned by the Board. If the Board appoints an Executive Chairman, the Executive Chairman shall be delegated the primary responsibility for overseeing and advising the senior management of the Corporation and shall perform such other duties and possess such powers as are assigned by the Board; provided that notwithstanding anything to the contrary herein, the Executive Chairman shall not have charge over the non-delegable duties of the Board. If the Board of Directors appoints a Vice Chairperson of the Board, such Vice Chairperson shall perform such duties and possess such powers as are assigned by the Board. Unless otherwise provided by the Board of Directors, the Chairman of the Board or, in the Chairman’s absence, the Vice Chairman of the Board, if any, shall preside at all meetings of the Board of Directors.
3.4 Election, Qualification and Term of Office of Directors.
Except as provided in Section 3.5 of these bylaws, and subject to the Certificate of Incorporation, each director, including a director elected to fill a vacancy or newly created directorship, shall hold office until the expiration of the term of the class, if any, for which elected and until such director’s successor is elected and qualified or until such director’s earlier death, resignation, disqualification, retirement or removal in accordance with the Certificate of Incorporation and applicable law. Directors need not be stockholders. The Certificate of Incorporation or these bylaws may prescribe qualifications for directors.
3.5 Resignation and Vacancies.
Any director may resign at any time upon notice given in writing or by electronic transmission to the Corporation. The resignation shall take effect at the time specified therein or upon the happening of an event specified therein, and if no time or event is specified, at the time of its receipt. When one or more directors so resigns and the resignation is effective at a future date or upon the happening of an event to occur on a future date, a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective, and each director so chosen shall hold office as provided in Section 3.4.
Unless otherwise provided in the Certificate of Incorporation or these bylaws, vacancies resulting from the death, resignation, disqualification, retirement or removal of any director, and newly created directorships resulting from any increase in the authorized number of directors shall be filled only by a majority of the directors then in office, even if less than a quorum, or by a sole remaining director. Notwithstanding the foregoing, if at any time that the voting restrictions set forth in Article V, Part A, Section 7 of the Certificate of Incorporation remain in effect, if a vacancy on the Board arises by reason of the death, removal or resignation of a director (x) who was not nominated by a stockholder of the
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Corporation pursuant to Section 2.2 or Section 2.3 of the Stockholders Agreement, dated as of the effective date of the Certificate of Incorporation, among the Corporation and certain stockholders of the Corporation party thereto (as it may be amended from time to time, the “Stockholders Agreement”) or (y) pursuant to the first sentence of Section 2.4(b) of the Stockholders Agreement, then a committee of the Board shall be created consisting of all of the directors other than any directors designated by the SB Investor or the VF Investor (as defined in the Stockholders Agreement) and any such vacancy shall be filled by a majority vote of such committee.
3.6 Place of Meetings; Meetings by Telephone.
The Board may hold meetings, both regular and special, either within or outside the State of Delaware.
Unless otherwise restricted by the Certificate of Incorporation or these bylaws, members of the Board, or any committee designated by the Board, may participate in a meeting of the Board, or any committee, by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting pursuant to this bylaw shall constitute presence in person at the meeting.
3.7 Regular Meetings.
Regular meetings of the Board may be held within or outside the State of Delaware and at such time and at such place as which has been designated by the Board and publicized among all directors, either orally or in writing, by telephone, including a voice-messaging system or other system designed to record and communicate messages, facsimile, or by electronic mail or other means of electronic transmission. No further notice shall be required for regular meetings of the Board.
3.8 Special Meetings; Notice.
Special meetings of the Board for any purpose or purposes may be called at any time by the Chairperson of the Board, the Executive Chairman of the Board, the Chief Executive Officer, a President, the Secretary or a majority of the total number of directors constituting the Board.
Notice of the time and place of special meetings shall be:
(i) delivered personally by hand, by courier or by telephone;
(ii) sent by United States first-class mail, postage prepaid;
(iii) sent by facsimile or electronic mail; or
(iv) sent by other means of electronic transmission,
directed to each director at that director’s address, telephone number, facsimile number or electronic mail address, or other address for electronic transmission, as the case may be, as shown on the Corporation’s records.
If the notice is (i) delivered personally by hand, by courier or by telephone, (ii) sent by facsimile or electronic mail, or (iii) sent by other means of electronic transmission, it shall be delivered or sent at least 24 hours before the time of the holding of the meeting. If the notice is sent by U.S. mail, it shall be deposited in the U.S. mail at least four days before the time of the holding of the meeting. The notice need not specify the place of the meeting (if the meeting is to be held at the Corporation’s principal executive office) nor the purpose of the meeting.
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3.9 Quorum.
At all meetings of the Board, unless otherwise provided by the Certificate of Incorporation, a majority of the total number of directors shall constitute a quorum for the transaction of business. The vote of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board, except as may be otherwise specifically provided by statute, the Certificate of Incorporation or these bylaws. If a quorum is not present at any meeting of the Board, then the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum is present.
Notwithstanding the foregoing, in the event that (a) directors designated by the SB Investor and the VF Investor (pursuant to designation rights set forth in the Stockholders Agreement) constitute 50% of the then-serving number of directors on the Board, (b) the voting restrictions set forth in Article V, Part A, Section 7 of the Certificate of Incorporation remain in effect, and (c) the directors are divided with respect to a matter submitted for approval by the Board such that the required vote for action by the Board cannot be obtained because the number of votes in favor of a matter equals the number of votes against (which shall be deemed to include abstentions) such matter (each, a “Deadlock Matter”), then a committee of the Board shall be created consisting of all of the directors other than any directors designated by the SB Investor or the VF Investor to consider and/or approve on any such Deadlock Matter.
3.10 Board Action without a Meeting.
Unless otherwise restricted by the Certificate of Incorporation or these bylaws, any action required or permitted to be taken at any meeting of the Board, or of any committee thereof, may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing or by electronic transmission. After an action is taken, the consent or consents relating thereto shall be filed with the minutes of the proceedings of the Board, or the committee thereof, in the same paper or electronic form as the minutes are maintained. Such action by written consent or consent by electronic transmission shall have the same force and effect as a unanimous vote of the Board.
3.11 Fees and Compensation of Directors.
Unless otherwise restricted by the Certificate of Incorporation or these bylaws, the Board shall have the authority to fix the compensation, including fees and reimbursement of expenses, of directors for services to the Corporation in any capacity, subject to any applicable limit set forth in the Company’s equity compensation plan as in effect from time to time.
Article IV - Committees
4.1 Committees of Directors.
The Board may designate one or more committees, each committee to consist of one or more of the directors of the Corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any
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meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board or in these bylaws, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers that may require it. However, no such committee shall have the power or authority to (i) approve or adopt, or recommend to the stockholders, any action or matter (other than the election or removal of directors) expressly required by the DGCL to be submitted to stockholders for approval, or (ii) adopt, amend or repeal any bylaw of the Corporation.
4.2 Meetings and Actions of Committees.
Meetings and actions of committees shall be governed by, and held and taken in accordance with, the provisions of:
(i) Section 3.6 (place of meetings; meetings by telephone);
(ii) Section 3.7 (regular meetings);
(iii) Section 3.8 (special meetings; notice);
(iv) Section 3.10 (board action without a meeting); and
(v) Section 7.13 (waiver of notice),
with such changes in the context of those bylaws as are necessary to substitute the committee and its members for the Board and its members. However:
(i) the time of regular meetings of committees may be determined either by resolution of the Board or by resolution of the committee;
(ii) special meetings of committees may also be called by resolution of the Board or the chairperson of the applicable committee; and
(iii) the Board may adopt rules for the governance of any committee to override the provisions that would otherwise apply to the committee pursuant to this Section 4.2, provided that such rules do not violate the provisions of the Certificate of Incorporation or applicable law.
4.3 Subcommittees.
Unless otherwise provided in the Certificate of Incorporation, these bylaws, the resolutions of the Board designating the committee or the charter of such committee adopted by the Board, a committee may create one or more subcommittees, each subcommittee to consist of one or more members of the committee, and delegate to a subcommittee any or all of the powers and authority of the committee.
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Article V - Officers
5.1 Officers.
The officers of the Corporation shall include a Chief Executive Officer, one or more Presidents and a Secretary. The Corporation may also have, at the discretion of the Board, a Chief Financial Officer, a Treasurer, one or more Vice Presidents, one or more Assistant Vice Presidents, one or more Assistant Treasurers, one or more Assistant Secretaries, and any such other officers as may be appointed in accordance with the provisions of these bylaws. Any number of offices may be held by the same person. No officer need be a stockholder or director of the Corporation.
5.2 Appointment of Officers.
The Board shall appoint the officers of the Corporation, except such officers as may be appointed in accordance with the provisions of Section 5.3 of these bylaws.
5.3 Subordinate Officers.
The Board may appoint, or empower the Chief Executive Officer or, in the absence of a Chief Executive Officer, a President, to appoint, such other officers and agents as the business of the Corporation may require. Each of such officers and agents shall hold office for such period, have such authority, and perform such duties as are provided in these bylaws or as the Board may from time to time determine.
5.4 Removal and Resignation of Officers.
Subject to the rights, if any, of an officer under any contract of employment, any officer may be removed, either with or without cause, by the Board or, except in the case of an officer chosen by the Board, by any officer upon whom such power of removal may be conferred by the Board.
Any officer may resign at any time by giving written notice to the Corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice. Unless otherwise specified in the notice of resignation, the acceptance of the resignation shall not be necessary to make it effective. Any resignation is without prejudice to the rights, if any, of the Corporation under any contract to which the officer is a party.
5.5 Vacancies in Offices.
Any vacancy occurring in any office of the Corporation shall be filled as provided in Section 5.2 or Section 5.3, as applicable.
5.6 Representation of Shares of Other Corporations.
The Chairperson of the Board, the Chief Executive Officer or a President of this Corporation, or any other person authorized by the Board, the Chief Executive Officer or a President, is authorized to vote, represent and exercise on behalf of this Corporation all rights incident to any and all shares or voting securities of any other corporation or other person standing in the name of this Corporation. The authority granted herein may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by such person having the authority.
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5.7 Authority and Duties of Officers.
All officers of the Corporation shall respectively have such authority and perform such duties in the management of the business of the Corporation as may be provided herein or designated from time to time by the Board and, to the extent not so provided, as generally pertain to their respective offices, subject to the control of the Board.
5.8 Compensation.
The compensation of the officers of the Corporation for their services as such shall be fixed from time to time by or at the direction of the Board. An officer of the Corporation shall not be prevented from receiving compensation by reason of the fact that he or she is also a director of the Corporation.
Article VI - Records
A stock ledger consisting of one or more records in which the names of all of the Corporation’s stockholders of record, the address and number of shares registered in the name of each such stockholder, and all issuances and transfers of stock of the Corporation shall be recorded in accordance with Section 224 of the DGCL and shall be administered by or on behalf of the Corporation. Any records administered by or on behalf of the Corporation in the regular course of its business, including its stock ledger, books of account, and minute books, may be kept on, or by means of, or be in the form of, any information storage device, or method, or one or more electronic networks or databases (including one or more distributed electronic networks or databases), provided that the records so kept can be converted into clearly legible paper form within a reasonable time and, with respect to the stock ledger, that the records so kept (i) can be used to prepare the list of stockholders specified in Sections 219 and 220 of the DGCL, (ii) record the information specified in Sections 156, 159, 217(a) and 218 of the DGCL, and (iii) record transfers of stock as governed by Article 8 of the Uniform Commercial Code as adopted in the State of Delaware.
Article VII - General Matters
7.1 Execution of Corporate Contracts and Instruments.
The Board, except as otherwise provided in these bylaws, may authorize any officer or officers, or agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the Corporation; such authority may be general or confined to specific instances.
7.2 Stock Certificates.
The shares of the Corporation shall be represented by certificates, provided that the Board by resolution may provide that some or all of the shares of any class or series of stock of the Corporation shall be uncertificated. Certificates for the shares of stock, if any, shall be in such form as is consistent with the Certificate of Incorporation and applicable law. Every holder of stock represented by a certificate shall be entitled to have a certificate signed by, or in the name of the Corporation by, any two officers authorized to sign stock certificates representing the number of shares registered in certificate form. The Executive Chairman, Chairperson or Vice Chairperson of the Board, Chief Executive Officer, a President, the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of the Corporation shall be specifically authorized to sign stock certificates. Any or all of the signatures on the certificate may be a facsimile or other electronic means. In case any officer, transfer agent or registrar who has signed or whose facsimile or other electronic signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.
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The Corporation may issue the whole or any part of its shares as partly paid and subject to call for the remainder of the consideration to be paid therefor. Upon the face or back of each stock certificate issued to represent any such partly paid shares, or upon the books and records of the Corporation in the case of uncertificated partly paid shares, the total amount of the consideration to be paid therefor and the amount paid thereon shall be stated. Upon the declaration of any dividend on fully paid shares, the Corporation shall declare a dividend upon partly paid shares of the same class, but only upon the basis of the percentage of the consideration actually paid thereon.
7.3 Special Designation of Certificates.
If the Corporation is authorized to issue more than one class of stock or more than one series of any class, then the powers, the designations, the preferences and the relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or on the back of the certificate that the Corporation shall issue to represent such class or series of stock (or, in the case of uncertificated shares, set forth in a notice provided pursuant to Section 151 of the DGCL); provided, however, that except as otherwise provided in Section 202 of the DGCL, in lieu of the foregoing requirements, there may be set forth on the face of back of the certificate that the Corporation shall issue to represent such class or series of stock (or, in the case of any uncertificated shares, included in the aforementioned notice) a statement that the Corporation will furnish without charge to each stockholder who so requests the powers, the designations, the preferences and the relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.
7.4 Lost Certificates.
Except as provided in this Section 7.4, no new certificates for shares shall be issued to replace a previously issued certificate unless the latter is surrendered to the Corporation and cancelled at the same time. The Corporation may issue a new certificate of stock or uncertificated shares in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the Corporation may require the owner of the lost, stolen or destroyed certificate, or such owner’s legal representative, to give the Corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares.
7.5 Shares Without Certificates
The Corporation may adopt a system of issuance, recordation and transfer of its shares of stock by electronic or other means not involving the issuance of certificates, provided the use of such system by the Corporation is permitted in accordance with applicable law.
7.6 Construction; Definitions.
Unless the context requires otherwise, the general provisions, rules of construction and definitions in the DGCL shall govern the construction of these bylaws. Without limiting the generality of this provision, the singular number includes the plural and the plural number includes the singular.
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7.7 Dividends.
The Board, subject to any restrictions contained in either (i) the DGCL or (ii) the Certificate of Incorporation, may declare and pay dividends upon the shares of its capital stock. Dividends may be paid in cash, in property or in shares of the Corporation’s capital stock.
The Board may set apart, out of any of the funds of the Corporation available for dividends, a reserve or reserves for any proper purpose and may abolish any such reserve. Such purposes shall include but not be limited to equalizing dividends, repairing or maintaining any property of the Corporation, and meeting contingencies.
7.8 Fiscal Year.
The fiscal year of the Corporation shall be the calendar year unless otherwise fixed by resolution of the Board, and may be changed by the Board.
7.9 Seal.
The Corporation may adopt a corporate seal, which shall be adopted and which may be altered by the Board. The Corporation may use the corporate seal by causing it or a facsimile or other electronic version thereof to be impressed or affixed or in any other manner reproduced.
7.10 Transfer of Stock.
Shares of stock of the Corporation shall be transferred on the books of the Corporation only by the holder of record thereof or by such holder’s attorney duly authorized in writing, upon surrender to the Corporation of the certificate or certificates representing such shares endorsed by the appropriate person or persons (or by delivery of duly executed instructions with respect to uncertificated shares), with such evidence of the authenticity of such endorsement or execution, transfer, authorization and other matters as the Corporation may reasonably require, and accompanied by all necessary stock transfer stamps. No transfer of stock shall be valid as against the Corporation for any purpose until it shall have been entered in the stock records of the Corporation by an entry showing the names of the persons from and to whom it was transferred.
7.11 Stock Transfer Agreements.
The Corporation shall have power to enter into and perform any agreement with any number of stockholders of any one or more classes or series of stock of the Corporation to restrict the transfer of shares of stock of the Corporation of any one or more classes owned by such stockholders in any manner not prohibited by the DGCL or other applicable law.
7.12 Registered Stockholders.
The Corporation:
(i) shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends and to vote as such owner; and
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(ii) shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of another person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of the State of Delaware.
7.13 Waiver of Notice.
Whenever notice is required to be given under any provision of the DGCL, the Certificate of Incorporation or these bylaws, a written waiver, signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time of the event for which notice is to be given, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the Certificate of Incorporation or these bylaws.
Article VIII - Notice
8.1 Delivery of Notice; Notice by Electronic Transmission.
Without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders given by the Corporation under any provisions of the DGCL, the Certificate of Incorporation, or these bylaws may be given in writing directed to the stockholder’s mailing address (or by electronic transmission directed to the stockholder’s electronic mail address, as applicable) as it appears on the records of the Corporation and shall be given (1) if mailed, when the notice is deposited in the U.S. mail, postage prepaid, (2) if delivered by courier service, the earlier of when the notice is received or left at such stockholder’s address or (3) if given by electronic mail, when directed to such stockholder’s electronic mail address unless the stockholder has notified the Corporation in writing or by electronic transmission of an objection to receiving notice by electronic mail. A notice by electronic mail must include a prominent legend that the communication is an important notice regarding the Corporation.
Without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders given by the Corporation under any provision of the DGCL, the Certificate of Incorporation or these bylaws shall be effective if given by a form of electronic transmission consented to by the stockholder to whom the notice is given. Any such consent shall be revocable by the stockholder by written notice or electronic transmission to the Corporation. Notwithstanding the provisions of this paragraph, the Corporation may give a notice by electronic mail in accordance with the first paragraph of this section without obtaining the consent required by this paragraph.
Any notice given pursuant to the preceding paragraph shall be deemed given:
| (i) | if by facsimile telecommunication, when directed to a number at which the stockholder has consented to receive notice; |
| (ii) | if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of (A) such posting and (B) the giving of such separate notice; and |
| (iii) | if by any other form of electronic transmission, when directed to the stockholder. |
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Notwithstanding the foregoing, a notice may not be given by an electronic transmission (including electronic mail) from and after the time that (1) the Corporation is unable to deliver by such electronic transmission two consecutive notices given by the Corporation and (2) such inability becomes known to the Secretary or an Assistant Secretary of the Corporation or to the transfer agent, or other person responsible for the giving of notice, provided, however, the inadvertent failure to discover such inability shall not invalidate any meeting or other action.
An affidavit of the Secretary or an Assistant Secretary or of the transfer agent or other agent of the Corporation that the notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein.
Article IX - Indemnification
9.1 Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation.
Subject to Section 9.3 and Section 9.11, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to or is otherwise involved (as a witness or otherwise) in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation), by reason of the fact that such person is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that such person’s conduct was unlawful.
9.2 Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation.
Subject to Section 9.3 and Section 9.11, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to or is otherwise involved (as a witness or otherwise) in any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that such person is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the Court of Chancery of the State of Delaware or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.
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9.3 Authorization of Indemnification.
Any indemnification under this Article IX (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the present or former director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 9.1 or Section 9.2, as the case may be. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (i) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (ii) by a committee of such directors designated by a majority vote of such directors, even though less than a quorum, or (iii) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion or (iv) by the stockholders. Such determination shall be made, with respect to former directors and officers, by any person or persons having the authority to act on the matter on behalf of the Corporation. To the extent, however, that a present or former director or officer of the Corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding described above, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith, without the necessity of authorization in the specific case.
9.4 Good Faith Defined.
For purposes of any determination under Section 9.3, a person shall be deemed to have acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, or, with respect to any criminal action or proceeding, to have had no reasonable cause to believe such person’s conduct was unlawful, if such person’s action is based on the records or books of account of the Corporation or another enterprise, or on information supplied to such person by the officers of the Corporation or another enterprise in the course of their duties, or on the advice of legal counsel for the Corporation or another enterprise or on information or records given or reports made to the Corporation or another enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Corporation or another enterprise. The provisions of this Section 9.4 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth in Section 9.1 or 9.2, as the case may be.
9.5 Indemnification by a Court.
Notwithstanding any contrary determination in the specific case under Section 9.3, and notwithstanding the absence of any determination thereunder, any director or officer may apply to the Court of Chancery of the State of Delaware or any other court of competent jurisdiction in the State of Delaware for indemnification to the extent otherwise permissible under Section 9.1 or 9.2; provided, that if no determination has been made pursuant to Section 9.3, no such application shall be permitted unless and until thirty (30) days shall have elapsed from the date such director or officer shall have notified the Corporation in writing requesting such determination. The basis of such indemnification by a court shall be a determination by such court that indemnification of the director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 9.1 or Section 9.2, as the case may be. Neither a contrary determination in the specific case under Section 9.3 nor the absence of any determination thereunder shall be a defense to such application or create a presumption that the director or officer seeking indemnification has not met any applicable standard of conduct. Notice of any application for indemnification pursuant to this Article IX shall be given to the Corporation promptly upon the filing of such application. If successful, in whole or in part, the director or officer seeking indemnification shall also be entitled to be paid the expense of prosecuting such application.
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9.6 Expenses Payable in Advance.
Subject to Section 9.11, expenses (including attorneys’ fees) incurred by a director or officer in defending any civil, criminal, administrative or investigative action, suit or proceeding shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the Corporation as authorized in this Article IX. Such expenses (including attorneys’ fees) incurred by former directors and officers or other employees and agents may be so paid upon such terms and conditions, if any, as the Corporation deems appropriate.
9.7 Nonexclusivity of Indemnification and Advancement of Expenses.
The indemnification and advancement of expenses provided by, or granted pursuant to, this Article IX shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under the Certificate of Incorporation, these bylaws, agreement, vote of stockholders or disinterested directors or otherwise, it being the policy of the Corporation that indemnification of the persons specified in Section 9.1 or 9.2 shall be made to the fullest extent permitted by law. The provisions of this Article IX shall not be deemed to preclude the indemnification of any person who is not specified in Section 9.1 or Section 9.2 but whom the Corporation has the power or obligation to indemnify under the provisions of the DGCL, or otherwise.
9.8 Insurance.
The Corporation may purchase and maintain insurance on behalf of any person who is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the Corporation would have the power or the obligation to indemnify such person against such liability under the provisions of this Article IX.
9.9 Certain Definitions.
For purposes of this Article IX, references to “the Corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors or officers, so that any person who is or was a director or officer of such constituent corporation, or is or was a director or officer of such constituent corporation serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under the provisions of this Article IX with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued. The term “another enterprise” as used in this Article IX shall mean any other corporation or any partnership, joint venture, trust, employee benefit plan or other enterprise of which such person is or was serving at the request of the Corporation as a director, officer, employee or agent. For purposes of this Article IX, references to “fines” shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to “serving at the request of the Corporation” shall include any service as a director, officer, employee or agent of the Corporation which imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Corporation” as referred to in this Article IX.
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9.10 Survival of Indemnification and Advancement of Expenses.
The indemnification and advancement of expenses provided by, or granted pursuant to, this Article IX shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such a person.
9.11 Limitation on Indemnification.
Notwithstanding anything contained in this Article IX to the contrary, except for proceedings to enforce rights to indemnification (which shall be governed by Section 9.5), the Corporation shall not be obligated to indemnify any director or officer (or his or her heirs, executors or personal or legal representatives) or advance expenses in connection with a proceeding (or part thereof) initiated by such person or in defending any counterclaim, cross-claim, affirmative defense, or like claim by the Corporation in such proceeding unless such proceeding (or part thereof) was authorized or consented to by the Board of Directors of the Corporation.
9.12 Indemnification of Employees and Agents.
The Corporation may, to the extent authorized from time to time by the Board of Directors, provide rights to indemnification and to the advancement of expenses to employees and agents of the Corporation similar to those conferred in this Article IX to directors and officers of the Corporation.
9.13 Primacy of Indemnification.
Notwithstanding that a director or officer (or, to the extent authorized pursuant to Section 9.12 from time to time, an employee or agent) of the Corporation (collectively, the “Covered Persons”) may have certain rights to indemnification, advancement of expenses and/or insurance provided by other persons (collectively, the “Other Indemnitors”), with respect to the rights to indemnification, advancement of expenses and/or insurance set forth herein, the Corporation: (i) shall be the indemnitor of first resort (i.e., its obligations to Covered Persons are primary and any obligation of the Other Indemnitors to advance expenses or to provide indemnification for the same expenses or liabilities incurred by Covered Persons are secondary); and (ii) shall be required to advance the full amount of expenses incurred by Covered Persons and shall be liable for the full amount of all liabilities, without regard to any rights Covered Persons may have against any of the Other Indemnitors. No advancement or payment by the Other Indemnitors on behalf of Covered Persons with respect to any claim for which Covered Persons have sought indemnification from the Corporation shall affect the immediately preceding sentence, and the Other Indemnitors 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 Covered Persons against the Corporation. Notwithstanding anything to the contrary herein, the obligations of the Corporation under this Section 9.13 shall only apply to Covered Persons in their capacity as Covered Persons.
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Article X - Amendments
The Board is expressly empowered to adopt, amend or repeal the bylaws of the Corporation. The stockholders also shall have power to adopt, amend or repeal the bylaws of the Corporation; provided, however, that such action by stockholders shall require, in addition to any other vote required by the Certificate of Incorporation or applicable law, the affirmative vote of the holders of at least two-thirds of the voting power of all the then-outstanding shares of voting stock of the Corporation with the power to vote generally in an election of directors, voting together as a single class.
Article XI - Definitions
As used in these bylaws, unless the context otherwise requires, the following terms shall have the following meanings:
An “electronic transmission” means any form of communication, not directly involving the physical transmission of paper, including the use of, or participation in, one or more electronic networks or databases (including one or more distributed electronic networks or databases), that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.
An “electronic mail” means an electronic transmission directed to a unique electronic mail address (which electronic mail shall be deemed to include any files attached thereto and any information hyperlinked to a website if such electronic mail includes the contact information of an officer or agent of the Corporation who is available to assist with accessing such files and information).
An “electronic mail address” means a destination, commonly expressed as a string of characters, consisting of a unique user name or mailbox (commonly referred to as the “local part” of the address) and a reference to an internet domain (commonly referred to as the “domain part” of the address), whether or not displayed, to which electronic mail can be sent or delivered.
The term “person” means any individual, general partnership, limited partnership, limited liability company, corporation, trust, business trust, joint stock company, joint venture, unincorporated association, cooperative or association or any other legal entity or organization of whatever nature, and shall include any successor (by merger or otherwise) of such entity.
* * * * *
Adopted as of: October 20, 2021
Last amended as of: N/A
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Exhibit 4.1
| [Certificate_Number] | Incorporated Under the Laws of the State of Delaware May 19, 2020 |
[Number_of_Shares] |
WeWork Inc.
The corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.
THIS IS TO CERTIFY THAT [Holder_Name] is the registered owner of [Shares_Written_Out] Shares of the [Stock_Designation_Name] of
WeWork Inc.
transferable only on the books of the Corporation by the holder hereof in person or by Attorney, upon surrender of this Certificate properly endorsed.
IN WITNESS WHEREOF, the said Corporation has caused this certificate to be signed by its duly authorized officers this [_]th day of [_], 20[_].
|
Assistant Secretary |
Secretary |
SEE REVERSE SIDE FOR RESTRICTIVE LEGENDS, IF ANY
Exhibit 4.3
Confidential
THIS WARRANT AND ANY SHARES ACQUIRED UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER SUCH ACT OR QUALIFICATION OR EXEMPTION THEREFROM UNDER SAID ACT PURSUANT TO AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
WEWORK INC.
WARRANT TO PURCHASE COMMON STOCK
Warrant No. 102 October 20, 2021
THIS CERTIFIES THAT, for good and valuable consideration, and pursuant to the terms and conditions set forth in this Warrant to Purchase Common Stock (as amended or otherwise modified from time to time, this “Warrant”), SB WW Holdings (Cayman) Limited or its designee (the “Initial Holder” and, together with any of its successors, transferees or assignees, a “Holder”), is entitled to purchase the Exercise Shares (defined below) at the per share Exercise Price (defined below).
A G R E E M E N T
1. DEFINITIONS. As used herein, the following terms shall have the following respective meanings:
(a) “Affiliate” means, with respect to any specified Person (i) any Person that directly or indirectly Controls, is Controlled by, or is under common Control with such specified Person and shall include, without limitation, any general partner, managing member, officer or director of such Person or any venture capital fund, investment fund or account now or hereafter existing that is Controlled by one or more general partners or managing members of, or shares the same management company or investment adviser with, or is otherwise affiliated with, such Person or (ii) if the specified Person is an individual, any member of the Immediate Family of the specified Person.
(b) “Aggregate Exercise Price” is defined in Section 2.2(b).
(c) “Alternative Consideration” is defined in Section 4.5.
(d) “Business Day” means any day other than (i) a Saturday or a Sunday or (ii) a day on which banking institutions are authorized or required by law to be closed in New York, New York or Tokyo, Japan.
(e) “Cashless Exercise” is defined in Section 2.3.
(f) “Change in Control” means (i) any transaction or series of related transactions which results in a “person” or “group” (within the meaning of Section 13(d) and 14(d) of the Exchange Act) becoming the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of more than fifty percent (50%) of the outstanding voting securities of the Company having the right to vote for the election of members of the Board of Directors of the Company, (ii) any reorganization, merger or consolidation of the Company, other than a transaction or series of related transactions in which the holders of the voting securities of the Company outstanding immediately prior to such transaction or series of related transactions retain, immediately after such transaction or series of related transactions, at
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least a majority of the total voting power represented by the outstanding voting securities of the Company or such other surviving, resulting or purchasing entity or (iii) any sale, lease, license or other disposition of all or substantially all of the assets of the Company. For the avoidance of doubt, the transactions contemplated by the Merger Agreement shall not constitute a Change in Control.
(g) “Charter” means the Certificate of Incorporation of the Company, as it may be amended from time to time.
(h) “Common Stock” means the Company’s Class A common stock, par value $0.0001 per share.
(i) “Company” means WeWork Inc., a Delaware corporation, including such entity under any subsequent name.
(j) “Control” or any grammatical variation thereof means the possession of, directly or indirectly, the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
(k) “Equity Securities” of any Person means (a) in the case of a corporation, corporate stock; (b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; (c) in the case of a partnership or limited liability company, partnership, membership interests (whether general or limited) or shares in the capital of a company; and (d) any other interest or participation that confers on a Person the right to receive a share of profits and losses of, or distribution of assets of, the issuing Person.
(l) “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(m) “Exchange Ratio” has the meaning specified in the Merger Agreement.
(n) “Exercise Equivalent Share” is defined in Section 2.3.
(o) “Exercise Period” means the period commencing on the Issue Date and ending on the Expiration Date.
(p) “Exercise Price” means $0.01 per share, divided by the Exchange Ratio (the exercise price per share, as so determined, being rounded to the nearest full cent).
(q) “Exercise Shares” means a number of fully paid and non-assessable shares of Common Stock (rounded to the nearest whole share) equal to 35,038,960, multiplied by the Exchange Ratio, and issuable upon exercise of this Warrant.
(r) “Expiration Date” means the tenth (10th) anniversary of the Issue Date.
(s) “Extraordinary Dividend” is defined in Section 4.3.
(t) “fair value” is defined in Section 2.4.
(u) “FIRPTA Side Letter” means that certain letter agreement relating to FIRPTA Withholding by and between SB WW Holdings (Cayman) Limited and SVF Endurance (Cayman) Limited, on the one hand, and WeWork Inc. and BowX Acquisition Corp., on the other hand, dated March 25, 2021.
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(v) “Fundamental Transaction” is defined in Section 4.5.
(w) “Holder” is defined in the Preamble above, and includes any Holder of Exercise Shares.
(x) “HSR Act” is defined in Section 2.7(b).
(y) “Immediate Family” (i) with respect to any individual, means his or her ancestors, spouse, issue (natural or adopted), spouses of issue, Spousal Equivalent, siblings (natural or adopted), any trustee or trustees, including successor and additional trustees, of trusts principally for the benefit of any one or more of such individuals and/or one or more Charitable Entities that is a permissible current or remainder beneficiary of such trust, and any entity or entities all of the beneficial owners of which are such trusts and/or such individuals, but (ii) with respect to a legal representative, means the Immediate Family of the individual for whom such legal representative was appointed and (iii) with respect to a trustee, means the Immediate Family of the individuals who are the principal beneficiaries of the trust. As used herein, a person is deemed to be a “Spousal Equivalent” provided the following circumstances are true: (i) irrespective of whether or not the relevant person and the Spousal Equivalent are the same sex, they are the sole spousal equivalent of the other for the last twelve (12) months, (ii) they intend to remain so indefinitely, (iii) neither are married to anyone else, (iv) both are at least 18 years of age and mentally competent to consent to contract, (v) they are not related by blood to a degree of closeness that would prohibit legal marriage in the state in which they legally reside, (vi) they are jointly responsible for each other’s common welfare and financial obligations, and (vii) they have resided together in the same residence for the last twelve (12) months and intend to do so indefinitely; and “Charitable Entities” means any organization, foundation, impact investing enterprise, public benefit entity or similar entity whose primary purpose is to preserve the natural environment, combat climate change or support any other environmental, educational or charitable cause.
(z) “Independent Advisor” is defined in Section 4.7.
(aa) “Initial Holder” is defined in the Preamble above.
(bb) “Issue Date” means October 20, 2021 (the date of the closing under the Merger Agreement).
(cc) “Merger Agreement” means the Agreement and Plan of Merger, dated as of March 25, 2021, by and among the Company, BowX Merger Subsidiary Corp. and New WeWork Inc. (Formerly known as WeWork Inc.).
(dd) “Notice of Exercise” is defined in Section 2.2(a).
(ee) “Opt-Out Notice” is defined in Section 2.8(b).
(ff) “Person” means any corporation, association, joint venture, partnership, limited liability company, organization, business, individual, trust, other legal entity or natural person.
(gg) “Rule 144” means Rule 144 promulgated under the Securities Act.
(hh) “SEC” means the Securities and Exchange Commission or any successor thereto.
(ii) “Securities Act” means the Securities Act of 1933, as amended.
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(jj) “Stockholders Agreement” means the Company’s Stockholders Agreement, dated October 20, 2021, as it may be amended or superseded from time to time.
(kk) “Unrestricted Conditions” is defined in Section 9.4.
(ll) “Warrant” is defined in the Preamble above.
(mm) “Warrant Register” is defined in Section 9.3.
2. VESTING; EXERCISE OF WARRANT; ETC.
2.1 Vesting. The right to acquire the Exercise Shares issuable upon exercise of this Warrant is immediately vested as of the Issue Date.
2.2 Exercise of Warrant. The rights represented by this Warrant may be exercised in whole or in part at any time during the Exercise Period by delivery of the following to the Company at its address set forth on the signature page hereto (or at such other address as it may designate by notice in writing to the Holder):
(a) An executed Notice of Exercise (a “Notice of Exercise”) in the form attached hereto as Attachment A; and
(b) Unless the Holder is exercising this Warrant by way of a Cashless Exercise pursuant to Section 2.3, payment of the then-current Exercise Price per share multiplied by the number of Exercise Shares being purchased upon exercise of the Warrant (such amount, the “Aggregate Exercise Price”) in the form of wire transfer of immediately available funds to a bank account designated by the Company.
2.3 Cashless Exercise. At any time, the Holder may, in its sole discretion and in lieu of payment of the Aggregate Exercise Price in the manner specified in Section 2.2(b), elect to exercise all or any part of this Warrant in a “cashless” or “net-issue” exercise (a “Cashless Exercise”) by delivering to the Company a Notice of Exercise selecting a Cashless Exercise, as a result of which the Holder shall be entitled to receive a number of fully paid and non-assessable Exercise Shares calculated using the following formula:
X = Y * (A - B)
A
| where: |
X = | the number of Exercise Shares to be issued to the Holder | ||
| Y = | the number of Exercise Shares with respect to which this Warrant is being exercised | |||
| A = | the fair value per share of a share of the Company’s capital stock that is of the same class as the Exercise Shares (an “Exercise Equivalent Share”) on the date of exercise of this Warrant | |||
| B = | the then-current Exercise Price | |||
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2.4 Fair Value. Solely for the purposes of this Warrant, “fair value” of an Exercise Equivalent Share, as of any applicable date of determination, shall mean the average reported closing price of the Common Stock for the ten (10) trading days ending on the trading day prior to the date of exercise; provided that, with respect to determining fair value in connection with any Cashless Exercise, the date of determination will be deemed to be the date on which the Notice of Exercise for such Cashless Exercise is deemed to have been sent to the Company.
2.5 Delivery of Certificate of Exercise Shares and New Warrant. Upon the exercise of this Warrant, a certificate or certificates for the Exercise Shares so purchased, registered in the name of (i) the Holder or (ii) if the Holder so designates, to Persons to which this Warrant may be transferred to in accordance with Section 9.1, shall be issued and delivered to the Holder within two (2) Business Days of delivery of the applicable Notice of Exercise. In the event that this Warrant is being exercised for less than all of the then-current number of Exercise Shares purchasable hereunder, the Company shall, concurrently with the issuance by the Company of the number of Exercise Shares for which this Warrant is then being exercised and surrender of this Warrant to the Company, issue a new Warrant exercisable for the remaining number of Exercise Shares purchasable hereunder. The Person in whose name any certificate or certificates for Exercise Shares are to be issued upon exercise of this Warrant shall be deemed to have become the holder of record of such shares on the date (following the delivery of the Notice of Exercise for such shares) on which the Exercise Price was made, irrespective of the date of delivery of such certificate or certificates, except that, if the date of such payment is a date when the stock transfer books of the Company are closed, such Person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the stock transfer books are open.
2.6 Automatic Cashless Exercise. To the extent this Warrant has not been exercised in full by the Holder prior to the Expiration Date, any portion of this Warrant that remains unexercised on such date shall be deemed to have been exercised automatically pursuant to Section 2.3 above, in whole (and not in part), on the Business Day immediately preceding such date; provided that, notwithstanding the foregoing, unless the Holder otherwise elects in writing, no such automatic exercise shall occur in the event that the fair value per share of an Exercise Share on the trading day immediately preceding the Expiration Date is less than the Exercise Price.
2.7 Conditional Exercise.
(a) Notwithstanding any other provision hereof, if an exercise of all or any portion of this Warrant is to be made in connection with a Change in Control, such exercise may, at the election of the Holder, be conditioned upon the consummation of such transaction, in which case such exercise shall not be deemed to be effective until immediately prior to the consummation of such transaction.
(b) Notwithstanding any other provision hereof, this Warrant may only be exercised to the extent not prohibited under the Hart–Scott–Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), or any other federal, state and foreign antitrust laws (in each case, to the extent applicable to this Warrant).
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2.8 Notice of Certain Events.
(a) If the Company proposes at any time to:
(i) declare any dividend or distribution upon the outstanding shares of its Common Stock, whether in cash, property or other Equity Securities or securities and whether or not a regular cash dividend;
(ii) offer Equity Securities or other securities for subscription or sale pro rata to the holders of the outstanding shares of the Company’s Common Stock;
(iii) effect any reclassification, exchange, combination, substitution, reorganization or recapitalization of the Company’s outstanding shares of Common Stock;
(iv) effect a Change in Control;
(v) liquidate, dissolve or wind up; or
(vi) effect any bankruptcy, insolvency or similar event (or becomes aware that any such event is reasonably likely to occur);
then, in connection with each such matter or event, the Company shall give the Holder:
(1) in the case of matters or events of the type referred to in clauses (i), (ii) or (iv) above, at least fifteen (15) Business Days prior written notice of the anticipated date on which a record will be taken for such dividend, distribution, offering, sale or subscription rights (and specifying the anticipated date on which the holders of outstanding shares of the Company’s Common Stock will be entitled thereto); and
(2) in the case of the matters or events of the type referred to in clauses (iii), (v) or (vi) above, at least twenty (20) Business Days prior written notice of the anticipated date when the same will take place (and, if applicable, specifying the anticipated date on which the holders of outstanding shares of the Company’s Common Stock will be entitled to exchange their shares for the securities or other property deliverable upon the occurrence of such event).
(b) Notwithstanding the foregoing, the Holder may deliver written notice (an “Opt-Out Notice”) to the Company requesting that the Holder not receive notices from the Company otherwise required by Section 2.8(a); provided that the Holder may later revoke any such Opt-Out Notice in writing. Following receipt of an Opt-Out Notice from the Holder (unless subsequently revoked), the Company shall not deliver any such notices to the Holder, and the Holder shall no longer be entitled to receive any such notice.
3. EXERCISE SHARES.
3.1 All Exercise Shares issued upon the exercise of this Warrant will be validly issued and outstanding, fully paid and non-assessable, and free from all taxes, liens and charges with respect to the issuance thereof (other than any created by the Holder).
3.2 The Company covenants and agrees that the Company will, at all times during the Exercise Period, have authorized and reserved, free from pre-emptive rights, a sufficient number of shares of Common Stock to provide for the exercise of this Warrant. If at any time during the Exercise Period the number of authorized but unissued shares of Common Stock shall not be sufficient to permit exercise of this Warrant, the Company will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes.
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4. ADJUSTMENT.
4.1 Stock Dividends; Split Ups. If, after the date hereof, the number of outstanding shares of Common Stock is increased by a stock dividend payable in shares of Common Stock, or by a split up of shares of Common Stock, or other similar event, then, on the effective date of such stock dividend, split up or similar event, the number of shares of Common Stock issuable on exercise of this Warrant shall be increased in proportion to such increase in outstanding shares of Common Stock. A rights offering to holders of the Common Stock entitling holders to purchase shares of Common Stock at a price less than the “Fair Market Value” (as defined below) shall be deemed a stock dividend of a number of shares of Common Stock equal to the product of (i) the number of shares of Common Stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for the Common Stock) and (ii) one (1), minus the quotient of (x) the price per share of Common Stock paid in such rights offering, divided by (y) the Fair Market Value. For purposes of this Section 4.1, (i) if the rights offering is for securities convertible into or exercisable for Common Stock, in determining the price payable for Common Stock, there shall be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) “Fair Market Value” means the volume weighted average price of the Common Stock as reported during the ten (10) trading day period ending on the trading day prior to the first date on which the shares of Common Stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.
4.2 Aggregation of Shares. If, after the date hereof, the number of outstanding shares of Common Stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of Common Stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification or similar event, the number of shares of Common Stock issuable on exercise of this Warrant shall be decreased in proportion to such decrease in outstanding shares of Common Stock.
4.3 Extraordinary Dividends. If the Company, at any time while this Warrant is outstanding and unexpired, shall pay a dividend or make a distribution in cash, securities or other assets to the holders of the shares of Common Stock on account of such shares of Common Stock (an “Extraordinary Dividend”), then the Exercise Price shall be decreased, effective immediately after the effective date of such Extraordinary Dividend, by the amount of cash and the fair market value (as determined by the board of directors of the Company, in good faith) of any securities or other assets paid on each share of Common Stock in respect of such Extraordinary Dividend; provided, however, that none of the following shall be deemed an Extraordinary Dividend for purposes of this provision: (a) any adjustment described in Section 4.1 or (b) any cash dividends or cash distributions which, when combined on a per share basis with the per-share amount of all other cash dividends and cash distributions paid on the Common Stock during the 365-day period ending on the date of declaration of such dividend or distribution to the extent it does not exceed $0.50 (as adjusted to appropriately reflect any of the events referred to in other subsections of this Section 4 and excluding cash dividends or cash distributions that resulted in an adjustment to the Exercise Price or to the number of shares of Common Stock issuable on exercise of each Warrant). Solely for purposes of illustration, if the Company, at a time while this Warrant is outstanding and unexpired, pays a cash dividend of $0.35 and previously paid an aggregate of $0.40 of cash dividends and cash distributions on the Common Stock during the 365-day period ending on the date of declaration of such $0.35 dividend, then the Exercise Price will be decreased, effectively immediately after the effective date of such $0.35 dividend, by $0.25 (the absolute value of the difference between $0.75 (the aggregate amount of all cash dividends and cash distributions paid or made in such 365-day period, including such $0.35 dividend) and $0.50 (the greater of (x) $0.50 and (y) the aggregate amount of all cash dividends and cash distributions paid or made in such 365-day period prior to such $0.35 dividend)).
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4.4 Adjustments in Exercise Price. Whenever the number of shares of Common Stock purchasable upon the exercise of this Warrant is adjusted, as provided in Sections 4.1 and 4.2, the Exercise Price shall be adjusted (to the nearest cent) by multiplying such Exercise Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares of Common Stock purchasable upon the exercise of this Warrant immediately prior to such adjustment, and (y) the denominator of which shall be the number of shares of Common Stock so purchasable immediately thereafter.
4.5 Replacement of Securities upon Reorganization, etc. In case of any reclassification or reorganization of the outstanding shares of Common Stock (other than a change covered by Section 4.1, 4.2 or 4.3 or that solely affects the par value of the Common Stock), or in the case of any merger or consolidation of the Company with or into another entity, or in the case of any sale or conveyance to another corporation or entity of the assets or other property of the Company as an entirety or substantially as an entirety in connection with which the Company is dissolved (a “Fundamental Transaction”), the Holder shall thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in this Warrant and in lieu of the shares of Common Stock of the Company immediately theretofore purchasable and receivable upon the exercise of this Warrant, the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the Holder would have received if the Holder had exercised this Warrant immediately prior to such event (the “Alternative Consideration”). In any such case, appropriate provision shall be made with respect to the rights and interests of the Holder so that the provisions of this Warrant shall be applicable with respect to any Alternative Consideration thereafter deliverable upon exercise of this Warrant. The Company shall not effect any Fundamental Transaction unless, prior to or simultaneously with the consummation thereof, the survivor or successor or acquiring entity (or the parent entity thereof) resulting from such consolidation or merger or the purchaser of such assets shall assume by written instrument delivered to the Holder the obligation to deliver to the Holder the Alternative Consideration. If any reclassification or reorganization also results in a change in the Common Stock covered by Section 4.1, 4.2 or 4.3, then such adjustment shall be made pursuant to Sections 4.1, 4.2, 4.3, 4.4 and this Section 4.5. The provisions of this Section 4.5 shall similarly apply to successive reclassifications, reorganizations, mergers or consolidations, sales or other transfers. In no event will the Exercise Price be reduced to less than the par value per share issuable upon exercise of this Warrant.
4.6 Notices of Changes in Warrant. Upon every adjustment of the Exercise Price or the number of shares issuable upon exercise of this Warrant, the Company shall give written notice thereof to the Holder, which notice shall state the Exercise Price resulting from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of this Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified in Sections 4.1, 4.2, 4.3, 4.3 or 4.5, then the Company shall give written notice to the Holder of the record date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event.
4.7 Other Events. In case any event shall occur affecting the Company as to which none of the provisions of preceding subsections of this Section 4 are strictly applicable, but which would require an adjustment to the terms of this Warrant in order to (i) avoid an adverse impact on this Warrant and (ii) effectuate the intent and purpose of this Section 4, then, in each such case, the Company shall appoint a nationally recognized accounting firm as may be mutually agreed upon by the Holder and the Board of Directors of the Company (other than the directors designated by SoftBank Group Corp. or SoftBank Vision Fund (AIV M1) L.P. or their respective Affiliates pursuant to the Stockholders Agreement) (an “Independent Advisor”), which shall give its opinion as to whether or not any adjustment to the rights represented by this Warrant is necessary to effectuate the intent and purpose of this Section 4 and, if they determine that an adjustment is necessary, the terms of such adjustment. The Company shall adjust the terms of this Warrant in a manner that is consistent with any adjustment recommended in such opinion.
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5. FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise would result in the issuance of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum in cash equal to the product resulting from multiplying the then-current fair value of an Exercise Share by such fraction.
6. REGISTRATION RIGHTS. Any or all outstanding Exercise Shares which have been issued upon exercise hereof shall be deemed “Registrable Securities” under the Company’s Amended and Restated Registration Rights Agreement, dated October 20, 2021, as it may be amended or superseded from time to time.
7. NO STOCKHOLDER RIGHTS. The Holder, as such, shall not have or exercise any rights by virtue of this Warrant with respect to any Exercise Shares as a holder of any capital stock of the Company that is issuable hereunder (without prejudice to the Holder’s rights as a holder of any shares of capital stock of the Company acquired separately from the exercise of this Warrant), until such Exercise Shares have been issued upon exercise of this Warrant.
8. DISPUTES AND OTHER ACTIONS AFFECTING EXERCISE SHARES OR THIS WARRANT.
8.1 Disputes. In the case of any dispute with respect to the calculation or determination of the number of Exercise Shares issuable upon exercise or any other matter involving this Warrant or the Exercise Shares, in the event the Holder, on the one hand, and the Company, on the other hand, are unable to settle such dispute within fifteen (15) Business Days, then either party may elect to submit the disputed matter(s) for resolution by an Independent Advisor. Such Independent Advisor’s determination of such disputed matter(s) shall be binding upon all parties absent demonstrable error, and the Company and the Holder shall each pay one half of the fees and costs, inclusive of taxes, of such Independent Advisor.
8.2 Equitable Equivalent. In case any event shall occur as to which the provisions of Section 8.1 are not strictly applicable but the failure to make any adjustment would not, in the reasonable, good faith opinion of the Holder, fairly protect the rights and benefits of the Holder represented by this Warrant in accordance with the essential intent and principles of Section 8.1, then, in any such case, at the request of the Holder, the Company shall submit the matter and issues raised by the Holder to an Independent Advisor, which shall give its opinion upon the adjustment, if any, on a basis consistent with the essential intent and principles established in Section 8.1, to the extent necessary to preserve, without dilution, the rights and benefits represented by this Warrant. Upon receipt of such opinion, the Company will promptly mail a copy thereof to the Holder and shall make the adjustments described therein, if any.
8.3 No Avoidance. The Company shall not, by way of amendment of the Charter or the Stockholders Agreement or through any consolidation, merger, reorganization, transfer of assets, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms.
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9. TRANSFER OF WARRANT AND EXERCISE SHARES.
9.1 Generally. This Warrant and the Exercise Shares issued upon exercise of this Warrant may not be transferred or assigned in whole or in part except (i) with respect to transfers and assignments to Affiliates of the Holder in compliance with applicable federal and state securities laws by the transferor and the transferee and (ii) by transfers permitted pursuant to the Charter or the Stockholders Agreement.
9.2 Notice of Assignment. After receipt by the Initial Holder of the executed Warrant, the Initial Holder may transfer all or part of this Warrant in accordance with Section 9.1, by execution of an assignment substantially in the form of Attachment B. Subject to Section 9.1 above and upon providing the Company with written notice that includes the completed form of Attachment B, the Initial Holder, any such Person and any subsequent Holder, may sell, assign or otherwise transfer all or part of this Warrant or the Exercise Shares issuable upon exercise of this Warrant to any other Person, and the Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable).
9.3 Warrant Register. The Company shall keep and properly maintain at its principal executive office a register (the “Warrant Register”) for the registration of this Warrant and any transfers thereof. The Company may deem and treat the Person in whose name this Warrant is registered on such register as the Holder thereof for all purposes, and the Company shall not be affected by any notice to the contrary, except any assignment, division, combination or other transfer of this Warrant effected in accordance with the provisions of this Warrant.
9.4 Removal of Restrictive Legends. Neither this Warrant nor any certificates evidencing Exercise Shares issuable or deliverable under or in connection with this Warrant shall contain any legend restricting the transfer thereof (including the legend set forth initially above) in any of the following (or substantially similar) circumstances: (i) following a sale of the Exercise Shares pursuant to a registration statement covering the sale or resale of Exercise Shares is effective under the Securities Act, (ii) following any sale of this Warrant or any Exercise Shares issued or delivered to the Holder under or in connection herewith pursuant to Rule 144, (iii) following the sale of this Warrant or the Exercise Shares pursuant to clause (b)(1) of Rule 144 or (iv) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the SEC) (collectively, the “Unrestricted Conditions”). If the Unrestricted Conditions are met at the time of issuance of this Warrant or any Exercise Shares, as the case may be, then such instrument shall be issued free of all legends. The Holder agrees that the removal of the restrictive legend from this Warrant or any Exercise Shares pursuant to either an effective registration statement or otherwise pursuant to the requirements of the Securities Act, including any applicable prospectus delivery requirements, or an exemption therefrom, is necessary and appropriate and that if such securities are sold pursuant to a registration statement, they will be sold in compliance with the plan of distribution set forth therein.
10. WITHHOLDING. Notwithstanding any other provision of this Warrant, the issuance of this Warrant and all payments, dividends and distributions on, or in redemption of, or occurring in connection with the issuance of, this Warrant or the Exercise Shares, shall be subject to deduction and withholding and backup withholding of tax to the extent required by law, and amounts deducted and withheld, if any, shall be paid over to the applicable governmental authority to the extent required by law and shall be treated as received by the Holder in respect of which such amounts were deducted and withheld. The Company shall have the right to take measures necessary to obtain cash to satisfy the Company’s withholding obligations with respect to any non-cash, deemed or constructive payment, dividend or distribution to the Holder, including by retaining, selling or liquidating property of the Holder held by the Company in its custody or over which it has control (including without limitation any Exercise Shares, Equity Securities of the Company held in escrow, or cash issuable in lieu of fractional shares); provided, however, that all obligations of the Company to withhold pursuant to Section 1445 of the Code described in this Section 10 shall be satisfied pursuant to, and in all respect subject to the terms of, the FIRPTA Side Letter. The Holder
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shall indemnify the Company and its Affiliates for, and hold harmless the Company and its Affiliates from and against, any and all withholding tax, including penalties and interest, payable by or assessed against the Company or any of its Affiliates in respect of this Warrant, the Exercise Shares and the transactions contemplated hereby. Any indemnification payment made pursuant to this Section 10 shall be made by the Holder in cash in accordance with and subject to the provisions of the FIRPTA Side Letter, including the $25,000,000 threshold amount applicable to the Company’s prior obligation to sell withheld property set forth in the FIRPTA Side Letter.
11. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost, stolen, mutilated or destroyed, the Company may, on such terms as to indemnity or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed. Any such new Warrant shall constitute an original contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any time enforceable by anyone.
12. NOTICES, ETC. All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (i) upon personal delivery to the party to be notified, (ii) when sent by email if sent during normal business hours of the recipient, if not, then on the next Business Day, in each case confirmed by subsequent telephone notice of such email, (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 Business Day delivery, with written verification of receipt. All communications shall be sent to the Company and Holder at the respective address listed on the signature page hereto or at such other address as the Company or Holder may designate by ten (10) days advance written notice to the other party hereto.
13. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.
14. AMENDMENT. This Warrant may not be modified or amended, nor may any provisions hereof be waived, without the prior written consent of both the Company and the Holder. No waiver by the Company or the Holder of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Warrant 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.
15. NO THIRD-PARTY BENEFICIARIES. This Warrant is for the sole benefit of the Company and the Holder and their respective successors and, in the case of the Holder, permitted transferees and 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 Warrant.
16. GOVERNING LAW. All rights and obligations hereunder shall be governed by the laws of the State of New York (without giving effect to principles of conflicts or choices of law that would cause the application of any other laws). All disputes and controversies arising out of or in connection with this Warrant shall be resolved exclusively by the state and federal courts located in the City of New York, Borough of Manhattan, and each party hereto agrees to submit to the jurisdiction of said courts and agrees that venue shall lie exclusively with such courts.
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17. COUNTERPARTS. This Warrant 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 instrument. Delivery by email to the other party of a counterpart executed by a party shall be deemed to meet the requirements of the previous sentence.
18. SEVERABILITY. If any provision of this Warrant is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Warrant shall remain in full force and effect. The parties hereto further agree that if any provision contained herein is, to any extent, held invalid or unenforceable in any respect under the laws governing this Warrant, they shall take any actions necessary to render the remaining provisions of this Warrant valid and enforceable to the fullest extent permitted by law and, to the extent necessary, shall amend or otherwise modify this Warrant to replace any provision contained herein that is held invalid or unenforceable with a valid and enforceable provision giving effect to the intent of the parties hereto.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized officer as of the date first above written.
| WEWORK INC. | ||
| By: | /s/ Jared DeMatteis | |
| Name: |
Jared DeMatteis | |
| Title: |
Chief Legal Officer |
| Address: | ||
| WeWork Inc. 575 Lexington Avenue | ||
| New York, NY 10022 | ||
| Attention: Jared DeMatteis | ||
AGREED AND ACCEPTED:
| SB WW Holdings (Cayman) Limited | ||
| By: | /s/ Karen Ellerbe | |
| Name: | Karen Ellerbe | |
| Title: | Director |
[Signature Page to WeWork Inc. Warrant to Purchase Common Stock]
ATTACHMENT A
NOTICE OF EXERCISE
TO: WEWORK INC. (THE “COMPANY”)
(1) Reference is made to the Warrant to Purchase Common Stock, dated October 20, 2021 issued by the Company to the undersigned (the “Warrant”).
(2) The undersigned hereby elects to purchase shares of Common Stock of the Company (the “Purchased Shares”) pursuant to the terms of the Warrant, and tenders herewith, in payment of the exercise price in full, together with all applicable transfer taxes, if any, the following:
(a) $ (by wire transfer as provided for pursuant to the Warrant); and/or
(b) a Warrant for Purchased Shares (pursuant to a Cashless Exercise in accordance with Section 2.3 of the Warrant) (check here if the undersigned desires to deliver a Warrant for an unspecified number of shares equal to the number sufficient to effect a Cashless Exercise [ ]).
(3) Please issue a certificate or certificates representing said Purchased Shares in the name of the undersigned or in such other name as is specified below:
(Name)
(Address)
(4) The undersigned represents that the undersigned agrees not to make any disposition of all or any part of the aforesaid Purchased Shares unless and until there is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with said registration statement, or such disposition is made pursuant to an exemption from registration under the Securities Act.
(5) If the shares issuable upon this exercise of the Warrant are not all of the Purchased Shares which the Holder is entitled to acquire upon the exercise of the Warrant, the undersigned requests that a new Warrant evidencing the rights not so exercised be issued in the name of and delivered to:
(Please print name)
(Please print address)
(Please print social security or federal employer
identification number (if applicable))
Name of Holder (print):
(Signature):
(By:)
(Title:)
Dated:
[ATTACHMENT A – NOTICE OF EXERCISE]
ATTACHMENT B
FORM OF ASSIGNMENT
Reference is made to the Warrant to Purchase Common Stock, dated October 20, 2021 issued by WeWork Inc. to the undersigned (the “Warrant”).
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers to each assignee set forth below all of the rights and obligations of the undersigned under the Warrant to acquire the number of shares of Common Stock set opposite the name of such assignee below and in and to the foregoing Warrant with respect to said acquisition rights and the shares issuable upon exercise of the Warrant:
| Name of Assignee |
Address |
Number of Shares | ||
If the total of the Exercise Shares (as defined in the Warrant) are not all of the shares of Common Stock evidenced by the foregoing Warrant, the undersigned requests that a new warrant evidencing the right to acquire the Exercise Shares not so assigned be issued in the name of and delivered to the undersigned.
| Name of Holder (print): |
|
| (Signature): |
|
| (By:) |
|
| (Title:) |
|
| Dated: |
|
[ATTACHMENT B – FORM OF ASSIGNMENT]
Exhibit 4.4
Confidential
THIS WARRANT AND ANY SHARES ACQUIRED UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED UNDER SUCH ACT OR QUALIFICATION OR EXEMPTION THEREFROM UNDER SAID ACT PURSUANT TO AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
WEWORK INC.
WARRANT TO PURCHASE COMMON STOCK
| Warrant No. 101 | October 20, 2021 |
THIS CERTIFIES THAT, for good and valuable consideration, and pursuant to the terms and conditions set forth in this Warrant to Purchase Common Stock (as amended or otherwise modified from time to time, this “Warrant”), SVF Endurance (Cayman) Limited or its designee (the “Initial Holder” and, together with any of its successors, transferees or assignees, a “Holder”), is entitled to purchase the Exercise Shares (defined below) at the per share Exercise Price (defined below).
A G R E E M E N T
1. DEFINITIONS. As used herein, the following terms shall have the following respective meanings:
(a) “Affiliate” means, with respect to any specified Person (i) any Person that directly or indirectly Controls, is Controlled by, or is under common Control with such specified Person and shall include, without limitation, any general partner, managing member, officer or director of such Person or any venture capital fund, investment fund or account now or hereafter existing that is Controlled by one or more general partners or managing members of, or shares the same management company or investment adviser with, or is otherwise affiliated with, such Person or (ii) if the specified Person is an individual, any member of the Immediate Family of the specified Person.
(b) “Aggregate Exercise Price” is defined in Section 2.2(b).
(c) “Alternative Consideration” is defined in Section 4.5.
(d) “Business Day” means any day other than (i) a Saturday or a Sunday or (ii) a day on which banking institutions are authorized or required by law to be closed in New York, New York or Tokyo, Japan.
(e) “Cashless Exercise” is defined in Section 2.3.
(f) “Change in Control” means (i) any transaction or series of related transactions which results in a “person” or “group” (within the meaning of Section 13(d) and 14(d) of the Exchange Act) becoming the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of more than fifty percent (50%) of the outstanding voting securities of the Company having the right to vote for the election of members of the Board of Directors of the Company, (ii) any reorganization, merger or consolidation of the Company, other than a transaction or series of related transactions in which the holders of the voting securities of the Company outstanding immediately prior to such transaction or series of related transactions retain, immediately after such transaction or series of related transactions, at
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least a majority of the total voting power represented by the outstanding voting securities of the Company or such other surviving, resulting or purchasing entity or (iii) any sale, lease, license or other disposition of all or substantially all of the assets of the Company. For the avoidance of doubt, the transactions contemplated by the Merger Agreement shall not constitute a Change in Control.
(g) “Charter” means the Certificate of Incorporation of the Company, as it may be amended from time to time.
(h) “Common Stock” means the Company’s Class A common stock, par value $0.0001 per share.
(i) “Company” means WeWork Inc., a Delaware corporation, including such entity under any subsequent name.
(j) “Control” or any grammatical variation thereof means the possession of, directly or indirectly, the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
(k) “Equity Securities” of any Person means (a) in the case of a corporation, corporate stock; (b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; (c) in the case of a partnership or limited liability company, partnership, membership interests (whether general or limited) or shares in the capital of a company; and (d) any other interest or participation that confers on a Person the right to receive a share of profits and losses of, or distribution of assets of, the issuing Person.
(l) “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(m) “Exchange Ratio” has the meaning specified in the Merger Agreement.
(n) “Exercise Equivalent Share” is defined in Section 2.3.
(o) “Exercise Period” means the period commencing on the Issue Date and ending on the Expiration Date.
(p) “Exercise Price” means $0.01 per share, divided by the Exchange Ratio (the exercise price per share, as so determined, being rounded to the nearest full cent).
(q) “Exercise Shares” means a number of fully paid and non-assessable shares of Common Stock (rounded to the nearest whole share) equal to 12,327,444, multiplied by the Exchange Ratio, and issuable upon exercise of this Warrant.
(r) “Expiration Date” means the tenth (10th) anniversary of the Issue Date.
(s) “Extraordinary Dividend” is defined in Section 4.3.
(t) “fair value” is defined in Section 2.4.
(u) “FIRPTA Side Letter” means that certain letter agreement relating to FIRPTA Withholding by and between SB WW Holdings (Cayman) Limited and SVF Endurance (Cayman) Limited, on the one hand, and WeWork Inc. and BowX Acquisition Corp., on the other hand, dated March 25, 2021.
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(v) “Fundamental Transaction” is defined in Section 4.5.
(w) “Holder” is defined in the Preamble above, and includes any Holder of Exercise Shares.
(x) “HSR Act” is defined in Section 2.7(b).
(y) “Immediate Family” (i) with respect to any individual, means his or her ancestors, spouse, issue (natural or adopted), spouses of issue, Spousal Equivalent, siblings (natural or adopted), any trustee or trustees, including successor and additional trustees, of trusts principally for the benefit of any one or more of such individuals and/or one or more Charitable Entities that is a permissible current or remainder beneficiary of such trust, and any entity or entities all of the beneficial owners of which are such trusts and/or such individuals, but (ii) with respect to a legal representative, means the Immediate Family of the individual for whom such legal representative was appointed and (iii) with respect to a trustee, means the Immediate Family of the individuals who are the principal beneficiaries of the trust. As used herein, a person is deemed to be a “Spousal Equivalent” provided the following circumstances are true: (i) irrespective of whether or not the relevant person and the Spousal Equivalent are the same sex, they are the sole spousal equivalent of the other for the last twelve (12) months, (ii) they intend to remain so indefinitely, (iii) neither are married to anyone else, (iv) both are at least 18 years of age and mentally competent to consent to contract, (v) they are not related by blood to a degree of closeness that would prohibit legal marriage in the state in which they legally reside, (vi) they are jointly responsible for each other’s common welfare and financial obligations, and (vii) they have resided together in the same residence for the last twelve (12) months and intend to do so indefinitely; and “Charitable Entities” means any organization, foundation, impact investing enterprise, public benefit entity or similar entity whose primary purpose is to preserve the natural environment, combat climate change or support any other environmental, educational or charitable cause.
(z) “Independent Advisor” is defined in Section 4.7.
(aa) “Initial Holder” is defined in the Preamble above.
(bb) “Issue Date” means October 20, 2021 (the date of the closing under the Merger Agreement).
(cc) “Merger Agreement” means the Agreement and Plan of Merger, dated as of March 25, 2021, by and among the Company, BowX Merger Subsidiary Corp. and New WeWork Inc. (Formerly known as WeWork Inc.).
(dd) “Notice of Exercise” is defined in Section 2.2(a).
(ee) “Opt-Out Notice” is defined in Section 2.8(b).
(ff) “Person” means any corporation, association, joint venture, partnership, limited liability company, organization, business, individual, trust, other legal entity or natural person.
(gg) “Rule 144” means Rule 144 promulgated under the Securities Act.
(hh) “SEC” means the Securities and Exchange Commission or any successor thereto.
(ii) “Securities Act” means the Securities Act of 1933, as amended.
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(jj) “Stockholders Agreement” means the Company’s Stockholders Agreement, dated October 20, 2021, as it may be amended or superseded from time to time.
(kk) “Unrestricted Conditions” is defined in Section 9.4.
(ll) “Warrant” is defined in the Preamble above.
(mm) “Warrant Register” is defined in Section 9.3.
2. VESTING; EXERCISE OF WARRANT; ETC.
2.1 Vesting. The right to acquire the Exercise Shares issuable upon exercise of this Warrant is immediately vested as of the Issue Date.
2.2 Exercise of Warrant. The rights represented by this Warrant may be exercised in whole or in part at any time during the Exercise Period by delivery of the following to the Company at its address set forth on the signature page hereto (or at such other address as it may designate by notice in writing to the Holder):
(a) An executed Notice of Exercise (a “Notice of Exercise”) in the form attached hereto as Attachment A; and
(b) Unless the Holder is exercising this Warrant by way of a Cashless Exercise pursuant to Section 2.3, payment of the then-current Exercise Price per share multiplied by the number of Exercise Shares being purchased upon exercise of the Warrant (such amount, the “Aggregate Exercise Price”) in the form of wire transfer of immediately available funds to a bank account designated by the Company.
2.3 Cashless Exercise. At any time, the Holder may, in its sole discretion and in lieu of payment of the Aggregate Exercise Price in the manner specified in Section 2.2(b), elect to exercise all or any part of this Warrant in a “cashless” or “net-issue” exercise (a “Cashless Exercise”) by delivering to the Company a Notice of Exercise selecting a Cashless Exercise, as a result of which the Holder shall be entitled to receive a number of fully paid and non-assessable Exercise Shares calculated using the following formula:
X = Y * (A - B)
A
| where: |
X = | the number of Exercise Shares to be issued to the Holder | ||
| Y = | the number of Exercise Shares with respect to which this Warrant is being exercised | |||
| A = | the fair value per share of a share of the Company’s capital stock that is of the same class as the Exercise Shares (an “Exercise Equivalent Share”) on the date of exercise of this Warrant | |||
| B = | the then-current Exercise Price | |||
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2.4 Fair Value. Solely for the purposes of this Warrant, “fair value” of an Exercise Equivalent Share, as of any applicable date of determination, shall mean the average reported closing price of the Common Stock for the ten (10) trading days ending on the trading day prior to the date of exercise; provided that, with respect to determining fair value in connection with any Cashless Exercise, the date of determination will be deemed to be the date on which the Notice of Exercise for such Cashless Exercise is deemed to have been sent to the Company.
2.5 Delivery of Certificate of Exercise Shares and New Warrant. Upon the exercise of this Warrant, a certificate or certificates for the Exercise Shares so purchased, registered in the name of (i) the Holder or (ii) if the Holder so designates, to Persons to which this Warrant may be transferred to in accordance with Section 9.1, shall be issued and delivered to the Holder within two (2) Business Days of delivery of the applicable Notice of Exercise. In the event that this Warrant is being exercised for less than all of the then-current number of Exercise Shares purchasable hereunder, the Company shall, concurrently with the issuance by the Company of the number of Exercise Shares for which this Warrant is then being exercised and surrender of this Warrant to the Company, issue a new Warrant exercisable for the remaining number of Exercise Shares purchasable hereunder. The Person in whose name any certificate or certificates for Exercise Shares are to be issued upon exercise of this Warrant shall be deemed to have become the holder of record of such shares on the date (following the delivery of the Notice of Exercise for such shares) on which the Exercise Price was made, irrespective of the date of delivery of such certificate or certificates, except that, if the date of such payment is a date when the stock transfer books of the Company are closed, such Person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the stock transfer books are open.
2.6 Automatic Cashless Exercise. To the extent this Warrant has not been exercised in full by the Holder prior to the Expiration Date, any portion of this Warrant that remains unexercised on such date shall be deemed to have been exercised automatically pursuant to Section 2.3 above, in whole (and not in part), on the Business Day immediately preceding such date; provided that, notwithstanding the foregoing, unless the Holder otherwise elects in writing, no such automatic exercise shall occur in the event that the fair value per share of an Exercise Share on the trading day immediately preceding the Expiration Date is less than the Exercise Price.
2.7 Conditional Exercise.
(a) Notwithstanding any other provision hereof, if an exercise of all or any portion of this Warrant is to be made in connection with a Change in Control, such exercise may, at the election of the Holder, be conditioned upon the consummation of such transaction, in which case such exercise shall not be deemed to be effective until immediately prior to the consummation of such transaction.
(b) Notwithstanding any other provision hereof, this Warrant may only be exercised to the extent not prohibited under the Hart–Scott–Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), or any other federal, state and foreign antitrust laws (in each case, to the extent applicable to this Warrant).
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2.8 Notice of Certain Events.
(a) If the Company proposes at any time to:
(i) declare any dividend or distribution upon the outstanding shares of its Common Stock, whether in cash, property or other Equity Securities or securities and whether or not a regular cash dividend;
(ii) offer Equity Securities or other securities for subscription or sale pro rata to the holders of the outstanding shares of the Company’s Common Stock;
(iii) effect any reclassification, exchange, combination, substitution, reorganization or recapitalization of the Company’s outstanding shares of Common Stock;
(iv) effect a Change in Control;
(v) liquidate, dissolve or wind up; or
(vi) effect any bankruptcy, insolvency or similar event (or becomes aware that any such event is reasonably likely to occur);
then, in connection with each such matter or event, the Company shall give the Holder:
(1) in the case of matters or events of the type referred to in clauses (i), (ii) or (iv) above, at least fifteen (15) Business Days prior written notice of the anticipated date on which a record will be taken for such dividend, distribution, offering, sale or subscription rights (and specifying the anticipated date on which the holders of outstanding shares of the Company’s Common Stock will be entitled thereto); and
(2) in the case of the matters or events of the type referred to in clauses (iii), (v) or (vi) above, at least twenty (20) Business Days prior written notice of the anticipated date when the same will take place (and, if applicable, specifying the anticipated date on which the holders of outstanding shares of the Company’s Common Stock will be entitled to exchange their shares for the securities or other property deliverable upon the occurrence of such event).
(b) Notwithstanding the foregoing, the Holder may deliver written notice (an “Opt-Out Notice”) to the Company requesting that the Holder not receive notices from the Company otherwise required by Section 2.8(a); provided that the Holder may later revoke any such Opt-Out Notice in writing. Following receipt of an Opt-Out Notice from the Holder (unless subsequently revoked), the Company shall not deliver any such notices to the Holder, and the Holder shall no longer be entitled to receive any such notice.
3. EXERCISE SHARES.
3.1 All Exercise Shares issued upon the exercise of this Warrant will be validly issued and outstanding, fully paid and non-assessable, and free from all taxes, liens and charges with respect to the issuance thereof (other than any created by the Holder).
3.2 The Company covenants and agrees that the Company will, at all times during the Exercise Period, have authorized and reserved, free from pre-emptive rights, a sufficient number of shares of Common Stock to provide for the exercise of this Warrant. If at any time during the Exercise Period the number of authorized but unissued shares of Common Stock shall not be sufficient to permit exercise of this Warrant, the Company will take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes.
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4. ADJUSTMENT.
4.1 Stock Dividends; Split Ups. If, after the date hereof, the number of outstanding shares of Common Stock is increased by a stock dividend payable in shares of Common Stock, or by a split up of shares of Common Stock, or other similar event, then, on the effective date of such stock dividend, split up or similar event, the number of shares of Common Stock issuable on exercise of this Warrant shall be increased in proportion to such increase in outstanding shares of Common Stock. A rights offering to holders of the Common Stock entitling holders to purchase shares of Common Stock at a price less than the “Fair Market Value” (as defined below) shall be deemed a stock dividend of a number of shares of Common Stock equal to the product of (i) the number of shares of Common Stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for the Common Stock) and (ii) one (1), minus the quotient of (x) the price per share of Common Stock paid in such rights offering, divided by (y) the Fair Market Value. For purposes of this Section 4.1, (i) if the rights offering is for securities convertible into or exercisable for Common Stock, in determining the price payable for Common Stock, there shall be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) “Fair Market Value” means the volume weighted average price of the Common Stock as reported during the ten (10) trading day period ending on the trading day prior to the first date on which the shares of Common Stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.
4.2 Aggregation of Shares. If, after the date hereof, the number of outstanding shares of Common Stock is decreased by a consolidation, combination, reverse stock split or reclassification of shares of Common Stock or other similar event, then, on the effective date of such consolidation, combination, reverse stock split, reclassification or similar event, the number of shares of Common Stock issuable on exercise of this Warrant shall be decreased in proportion to such decrease in outstanding shares of Common Stock.
4.3 Extraordinary Dividends. If the Company, at any time while this Warrant is outstanding and unexpired, shall pay a dividend or make a distribution in cash, securities or other assets to the holders of the shares of Common Stock on account of such shares of Common Stock (an “Extraordinary Dividend”), then the Exercise Price shall be decreased, effective immediately after the effective date of such Extraordinary Dividend, by the amount of cash and the fair market value (as determined by the board of directors of the Company, in good faith) of any securities or other assets paid on each share of Common Stock in respect of such Extraordinary Dividend; provided, however, that none of the following shall be deemed an Extraordinary Dividend for purposes of this provision: (a) any adjustment described in Section 4.1 or (b) any cash dividends or cash distributions which, when combined on a per share basis with the per-share amount of all other cash dividends and cash distributions paid on the Common Stock during the 365-day period ending on the date of declaration of such dividend or distribution to the extent it does not exceed $0.50 (as adjusted to appropriately reflect any of the events referred to in other subsections of this Section 4 and excluding cash dividends or cash distributions that resulted in an adjustment to the Exercise Price or to the number of shares of Common Stock issuable on exercise of each Warrant). Solely for purposes of illustration, if the Company, at a time while this Warrant is outstanding and unexpired, pays a cash dividend of $0.35 and previously paid an aggregate of $0.40 of cash dividends and cash distributions on the Common Stock during the 365-day period ending on the date of declaration of such $0.35 dividend, then the Exercise Price will be decreased, effectively immediately after the effective date of such $0.35 dividend, by $0.25 (the absolute value of the difference between $0.75 (the aggregate amount of all cash dividends and cash distributions paid or made in such 365-day period, including such $0.35 dividend) and $0.50 (the greater of (x) $0.50 and (y) the aggregate amount of all cash dividends and cash distributions paid or made in such 365-day period prior to such $0.35 dividend)).
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4.4 Adjustments in Exercise Price. Whenever the number of shares of Common Stock purchasable upon the exercise of this Warrant is adjusted, as provided in Sections 4.1 and 4.2, the Exercise Price shall be adjusted (to the nearest cent) by multiplying such Exercise Price immediately prior to such adjustment by a fraction (x) the numerator of which shall be the number of shares of Common Stock purchasable upon the exercise of this Warrant immediately prior to such adjustment, and (y) the denominator of which shall be the number of shares of Common Stock so purchasable immediately thereafter.
4.5 Replacement of Securities upon Reorganization, etc. In case of any reclassification or reorganization of the outstanding shares of Common Stock (other than a change covered by Section 4.1, 4.2 or 4.3 or that solely affects the par value of the Common Stock), or in the case of any merger or consolidation of the Company with or into another entity, or in the case of any sale or conveyance to another corporation or entity of the assets or other property of the Company as an entirety or substantially as an entirety in connection with which the Company is dissolved (a “Fundamental Transaction”), the Holder shall thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in this Warrant and in lieu of the shares of Common Stock of the Company immediately theretofore purchasable and receivable upon the exercise of this Warrant, the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the Holder would have received if the Holder had exercised this Warrant immediately prior to such event (the “Alternative Consideration”). In any such case, appropriate provision shall be made with respect to the rights and interests of the Holder so that the provisions of this Warrant shall be applicable with respect to any Alternative Consideration thereafter deliverable upon exercise of this Warrant. The Company shall not effect any Fundamental Transaction unless, prior to or simultaneously with the consummation thereof, the survivor or successor or acquiring entity (or the parent entity thereof) resulting from such consolidation or merger or the purchaser of such assets shall assume by written instrument delivered to the Holder the obligation to deliver to the Holder the Alternative Consideration. If any reclassification or reorganization also results in a change in the Common Stock covered by Section 4.1, 4.2 or 4.3, then such adjustment shall be made pursuant to Sections 4.1, 4.2, 4.3, 4.4 and this Section 4.5. The provisions of this Section 4.5 shall similarly apply to successive reclassifications, reorganizations, mergers or consolidations, sales or other transfers. In no event will the Exercise Price be reduced to less than the par value per share issuable upon exercise of this Warrant.
4.6 Notices of Changes in Warrant. Upon every adjustment of the Exercise Price or the number of shares issuable upon exercise of this Warrant, the Company shall give written notice thereof to the Holder, which notice shall state the Exercise Price resulting from such adjustment and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of this Warrant, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified in Sections 4.1, 4.2, 4.3, 4.3 or 4.5, then the Company shall give written notice to the Holder of the record date or the effective date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event.
4.7 Other Events. In case any event shall occur affecting the Company as to which none of the provisions of preceding subsections of this Section 4 are strictly applicable, but which would require an adjustment to the terms of this Warrant in order to (i) avoid an adverse impact on this Warrant and (ii) effectuate the intent and purpose of this Section 4, then, in each such case, the Company shall appoint a nationally recognized accounting firm as may be mutually agreed upon by the Holder and the Board of Directors of the Company (other than the directors designated by SoftBank Group Corp. or SoftBank Vision Fund (AIV M1) L.P. or their respective Affiliates pursuant to the Stockholders Agreement) (an “Independent Advisor”), which shall give its opinion as to whether or not any adjustment to the rights represented by this Warrant is necessary to effectuate the intent and purpose of this Section 4 and, if they determine that an adjustment is necessary, the terms of such adjustment. The Company shall adjust the terms of this Warrant in a manner that is consistent with any adjustment recommended in such opinion.
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5. FRACTIONAL SHARES. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional share. If, after aggregation, the exercise would result in the issuance of a fractional share, the Company shall, in lieu of issuance of any fractional share, pay the Holder otherwise entitled to such fraction a sum in cash equal to the product resulting from multiplying the then-current fair value of an Exercise Share by such fraction.
6. REGISTRATION RIGHTS. Any or all outstanding Exercise Shares which have been issued upon exercise hereof shall be deemed “Registrable Securities” under the Company’s Amended and Restated Registration Rights Agreement, dated October 20, 2021, as it may be amended or superseded from time to time.
7. NO STOCKHOLDER RIGHTS. The Holder, as such, shall not have or exercise any rights by virtue of this Warrant with respect to any Exercise Shares as a holder of any capital stock of the Company that is issuable hereunder (without prejudice to the Holder’s rights as a holder of any shares of capital stock of the Company acquired separately from the exercise of this Warrant), until such Exercise Shares have been issued upon exercise of this Warrant.
8. DISPUTES AND OTHER ACTIONS AFFECTING EXERCISE SHARES OR THIS WARRANT.
8.1 Disputes. In the case of any dispute with respect to the calculation or determination of the number of Exercise Shares issuable upon exercise or any other matter involving this Warrant or the Exercise Shares, in the event the Holder, on the one hand, and the Company, on the other hand, are unable to settle such dispute within fifteen (15) Business Days, then either party may elect to submit the disputed matter(s) for resolution by an Independent Advisor. Such Independent Advisor’s determination of such disputed matter(s) shall be binding upon all parties absent demonstrable error, and the Company and the Holder shall each pay one half of the fees and costs, inclusive of taxes, of such Independent Advisor.
8.2 Equitable Equivalent. In case any event shall occur as to which the provisions of Section 8.1 are not strictly applicable but the failure to make any adjustment would not, in the reasonable, good faith opinion of the Holder, fairly protect the rights and benefits of the Holder represented by this Warrant in accordance with the essential intent and principles of Section 8.1, then, in any such case, at the request of the Holder, the Company shall submit the matter and issues raised by the Holder to an Independent Advisor, which shall give its opinion upon the adjustment, if any, on a basis consistent with the essential intent and principles established in Section 8.1, to the extent necessary to preserve, without dilution, the rights and benefits represented by this Warrant. Upon receipt of such opinion, the Company will promptly mail a copy thereof to the Holder and shall make the adjustments described therein, if any.
8.3 No Avoidance. The Company shall not, by way of amendment of the Charter or the Stockholders Agreement or through any consolidation, merger, reorganization, transfer of assets, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms.
9. TRANSFER OF WARRANT AND EXERCISE SHARES.
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9.1 Generally. This Warrant and the Exercise Shares issued upon exercise of this Warrant may not be transferred or assigned in whole or in part except (i) with respect to transfers and assignments to Affiliates of the Holder in compliance with applicable federal and state securities laws by the transferor and the transferee and (ii) by transfers permitted pursuant to the Charter or the Stockholders Agreement.
9.2 Notice of Assignment. After receipt by the Initial Holder of the executed Warrant, the Initial Holder may transfer all or part of this Warrant in accordance with Section 9.1, by execution of an assignment substantially in the form of Attachment B. Subject to Section 9.1 above and upon providing the Company with written notice that includes the completed form of Attachment B, the Initial Holder, any such Person and any subsequent Holder, may sell, assign or otherwise transfer all or part of this Warrant or the Exercise Shares issuable upon exercise of this Warrant to any other Person, and the Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable).
9.3 Warrant Register. The Company shall keep and properly maintain at its principal executive office a register (the “Warrant Register”) for the registration of this Warrant and any transfers thereof. The Company may deem and treat the Person in whose name this Warrant is registered on such register as the Holder thereof for all purposes, and the Company shall not be affected by any notice to the contrary, except any assignment, division, combination or other transfer of this Warrant effected in accordance with the provisions of this Warrant.
9.4 Removal of Restrictive Legends. Neither this Warrant nor any certificates evidencing Exercise Shares issuable or deliverable under or in connection with this Warrant shall contain any legend restricting the transfer thereof (including the legend set forth initially above) in any of the following (or substantially similar) circumstances: (i) following a sale of the Exercise Shares pursuant to a registration statement covering the sale or resale of Exercise Shares is effective under the Securities Act, (ii) following any sale of this Warrant or any Exercise Shares issued or delivered to the Holder under or in connection herewith pursuant to Rule 144, (iii) following the sale of this Warrant or the Exercise Shares pursuant to clause (b)(1) of Rule 144 or (iv) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the SEC) (collectively, the “Unrestricted Conditions”). If the Unrestricted Conditions are met at the time of issuance of this Warrant or any Exercise Shares, as the case may be, then such instrument shall be issued free of all legends. The Holder agrees that the removal of the restrictive legend from this Warrant or any Exercise Shares pursuant to either an effective registration statement or otherwise pursuant to the requirements of the Securities Act, including any applicable prospectus delivery requirements, or an exemption therefrom, is necessary and appropriate and that if such securities are sold pursuant to a registration statement, they will be sold in compliance with the plan of distribution set forth therein.
10. WITHHOLDING. Notwithstanding any other provision of this Warrant, the issuance of this Warrant and all payments, dividends and distributions on, or in redemption of, or occurring in connection with the issuance of, this Warrant or the Exercise Shares, shall be subject to deduction and withholding and backup withholding of tax to the extent required by law, and amounts deducted and withheld, if any, shall be paid over to the applicable governmental authority to the extent required by law and shall be treated as received by the Holder in respect of which such amounts were deducted and withheld. The Company shall have the right to take measures necessary to obtain cash to satisfy the Company’s withholding obligations with respect to any non-cash, deemed or constructive payment, dividend or distribution to the Holder, including by retaining, selling or liquidating property of the Holder held by the Company in its custody or over which it has control (including without limitation any Exercise Shares, Equity Securities of the Company held in escrow, or cash issuable in lieu of fractional shares); provided, however, that all obligations of the Company to withhold pursuant to Section 1445 of the Code described in this Section 10 shall be satisfied pursuant to, and in all respect subject to the terms of, the FIRPTA Side Letter. The Holder
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shall indemnify the Company and its Affiliates for, and hold harmless the Company and its Affiliates from and against, any and all withholding tax, including penalties and interest, payable by or assessed against the Company or any of its Affiliates in respect of this Warrant, the Exercise Shares and the transactions contemplated hereby. Any indemnification payment made pursuant to this Section 10 shall be made by the Holder in cash in accordance with and subject to the provisions of the FIRPTA Side Letter, including the $25,000,000 threshold amount applicable to the Company’s prior obligation to sell withheld property set forth in the FIRPTA Side Letter.
11. LOST, STOLEN, MUTILATED OR DESTROYED WARRANT. If this Warrant is lost, stolen, mutilated or destroyed, the Company may, on such terms as to indemnity or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed. Any such new Warrant shall constitute an original contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any time enforceable by anyone.
12. NOTICES, ETC. All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (i) upon personal delivery to the party to be notified, (ii) when sent by email if sent during normal business hours of the recipient, if not, then on the next Business Day, in each case confirmed by subsequent telephone notice of such email, (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 Business Day delivery, with written verification of receipt. All communications shall be sent to the Company and Holder at the respective address listed on the signature page hereto or at such other address as the Company or Holder may designate by ten (10) days advance written notice to the other party hereto.
13. ACCEPTANCE. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.
14. AMENDMENT. This Warrant may not be modified or amended, nor may any provisions hereof be waived, without the prior written consent of both the Company and the Holder. No waiver by the Company or the Holder of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Warrant 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.
15. NO THIRD-PARTY BENEFICIARIES. This Warrant is for the sole benefit of the Company and the Holder and their respective successors and, in the case of the Holder, permitted transferees and 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 Warrant.
16. GOVERNING LAW. All rights and obligations hereunder shall be governed by the laws of the State of New York (without giving effect to principles of conflicts or choices of law that would cause the application of any other laws). All disputes and controversies arising out of or in connection with this Warrant shall be resolved exclusively by the state and federal courts located in the City of New York, Borough of Manhattan, and each party hereto agrees to submit to the jurisdiction of said courts and agrees that venue shall lie exclusively with such courts.
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17. COUNTERPARTS. This Warrant 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 instrument. Delivery by email to the other party of a counterpart executed by a party shall be deemed to meet the requirements of the previous sentence.
18. SEVERABILITY. If any provision of this Warrant is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Warrant shall remain in full force and effect. The parties hereto further agree that if any provision contained herein is, to any extent, held invalid or unenforceable in any respect under the laws governing this Warrant, they shall take any actions necessary to render the remaining provisions of this Warrant valid and enforceable to the fullest extent permitted by law and, to the extent necessary, shall amend or otherwise modify this Warrant to replace any provision contained herein that is held invalid or unenforceable with a valid and enforceable provision giving effect to the intent of the parties hereto.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized officer as of the date first above written.
| WEWORK INC. | ||
| By: | /s/ Jared DeMatteis | |
| Name: | Jared DeMatteis | |
| Title: | Chief Legal Officer |
| Address: |
| WeWork Inc. |
| 575 Lexington Avenue |
| New York, NY 10022 |
| Attention: Jared DeMatteis |
AGREED AND ACCEPTED:
| SVF Endurance (Cayman) Limited | ||
| By: | /s/ Karen Ellerbe | |
| Name: | Karen Ellerbe | |
| Title: | Director |
[Signature Page to WeWork Inc. Warrant to Purchase Common Stock]
ATTACHMENT A
NOTICE OF EXERCISE
TO: WEWORK INC. (THE “COMPANY”)
(1) Reference is made to the Warrant to Purchase Common Stock, dated October 20, 2021 issued by the Company to the undersigned (the “Warrant”).
(2) The undersigned hereby elects to purchase shares of Common Stock of the Company (the “Purchased Shares”) pursuant to the terms of the Warrant, and tenders herewith, in payment of the exercise price in full, together with all applicable transfer taxes, if any, the following:
(a) $ (by wire transfer as provided for pursuant to the Warrant); and/or
(b) a Warrant for Purchased Shares (pursuant to a Cashless Exercise in accordance with Section 2.3 of the Warrant) (check here if the undersigned desires to deliver a Warrant for an unspecified number of shares equal to the number sufficient to effect a Cashless Exercise [ ]).
(3) Please issue a certificate or certificates representing said Purchased Shares in the name of the undersigned or in such other name as is specified below:
(Name)
(Address)
(4) The undersigned represents that the undersigned agrees not to make any disposition of all or any part of the aforesaid Purchased Shares unless and until there is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with said registration statement, or such disposition is made pursuant to an exemption from registration under the Securities Act.
(5) If the shares issuable upon this exercise of the Warrant are not all of the Purchased Shares which the Holder is entitled to acquire upon the exercise of the Warrant, the undersigned requests that a new Warrant evidencing the rights not so exercised be issued in the name of and delivered to:
(Please print name)
(Please print address)
|
(Please print social security or federal employer identification number (if applicable))
Name of Holder (print): (Signature): (By:) (Title:) Dated: |
[ATTACHMENT A – NOTICE OF EXERCISE]
ATTACHMENT B
FORM OF ASSIGNMENT
Reference is made to the Warrant to Purchase Common Stock, dated October 20, 2021 issued by WeWork Inc. to the undersigned (the “Warrant”).
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers to each assignee set forth below all of the rights and obligations of the undersigned under the Warrant to acquire the number of shares of Common Stock set opposite the name of such assignee below and in and to the foregoing Warrant with respect to said acquisition rights and the shares issuable upon exercise of the Warrant:
| Name of Assignee |
Address |
Number of Shares | ||
If the total of the Exercise Shares (as defined in the Warrant) are not all of the shares of Common Stock evidenced by the foregoing Warrant, the undersigned requests that a new warrant evidencing the right to acquire the Exercise Shares not so assigned be issued in the name of and delivered to the undersigned.
| Name of Holder (print): |
|
| (Signature): |
|
| (By:) |
|
| (Title:) |
|
| Dated: |
|
[ATTACHMENT B – FORM OF ASSIGNMENT]
Exhibit 10.1
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of October 20, 2021, is entered into by and among WeWork Inc., a Delaware corporation, formerly known as BowX Acquisition Corp. (the “Company”), BowX Sponsor, LLC, a Delaware limited liability company (the “Sponsor”) together with the undersigned parties listed under BowX Investors on the signature pages hereto (the “BowX Investors”), SOF-X WW Holdings, L.P., a Delaware limited partnership, and SOF-XI WW Holdings, L.P., a Delaware limited partnership (collectively, the “Starwood Investors”), and Insight Entity (the “Insight Investor” and together with the Starwood Investors, the “Anchor Investors”), the undersigned parties listed under Windmill Investors on the signature pages hereto (the “Windmill Investors” and, collectively with the BowX Investors, the Anchor Investors and any person or entity who hereafter becomes a party to this Agreement pursuant to Section 5.2 of this Agreement, the “Holders” and each a “Holder”).
RECITALS
WHEREAS, each of the Company and the BowX Investors is a party to, and hereby consents to, the amendment and restatement of that certain Registration Rights Agreement, dated August 4, 2020 (the “Existing Registration Rights Agreement”), pursuant to which the Company granted the BowX Investors certain registration rights with respect to certain securities of the Company, as set forth therein;
WHEREAS, the Company and the Vivek Ranadivé entered into that certain letter agreement, dated May 26, 2020 (the “Founder Shares Purchase Agreement”), pursuant to which Mr. Ranadivé purchased an aggregate of 10,062,500 shares of the Company’s Class B common stock, par value $0.0001 per share (the “Class B Common Stock”), and Mr. Ranadive subsequently transferred an aggregate of 3,363,500 Founder Shares to the other BowX Investors;
WHEREAS, on August 4, 2020, the Company entered into those certain subscription agreements (the “Private Placement Warrant Purchase Agreements”) with certain BowX Investors, pursuant to which BowX Investors purchased an aggregate of 7,773,333 private placement warrants (the “Private Placement Warrants”) to purchase, at an exercise price of $11.50 per share of Class A Common Stock;
WHEREAS, on August 4, 2020, the Company effected a stock dividend of 0.2 shares of Class B Common Stock for each share of Class B Common Stock outstanding, resulting in the BowX Investors holding an aggregate of 12,075,000 shares of Class B Common Stock (the “Founder Shares”);
WHEREAS, pursuant to that certain Sponsor Support Agreement, dated March 25, 2021, Sponsor forfeited 3,000,000 Founder Shares on the date hereof.
WHEREAS, upon the date hereof, Mr. Ranadivé transferred an aggregate of 1,811,250 shares of Class B Common Stock to BlackRock Credit Alpha Master Fund, L.P. and HC NCBR Fund.
WHEREAS, upon the closing of the transactions (the “Transactions”) contemplated by that certain Merger Agreement dated March 25, 2021 by and among the Company, BowX Merger Subsidiary Corp., a Delaware corporation (“Merger Sub”), and Windmill, a Delaware corporation (as amended, the “Merger Agreement”), 9,075,000 Founder Shares were converted into shares of the Company’s Class A common stock, par value $0.001 per share (the “Class A Common Stock”);
WHEREAS, on March 25, 2021, the Company entered into those certain Subscription Agreements (the “Anchor Subscription Agreements”) with the Anchor Investors, pursuant to which and in connection with the closing of the Transactions, each of the Anchor Investors purchased shares of Class A Common Stock in a transaction exempt from registration under the Securities Act;
WHEREAS, on the date hereof, pursuant to the Merger Agreement, the Windmill Investors received shares of the Company’s Class A Common Stock;
WHEREAS, pursuant to Section 6.7 of the Existing Registration Rights Agreement, any amendment or modification of the terms, provisions and covenants set forth therein will not be binding upon any party unless executed in writing by such party; and
WHEREAS, the Company and the BowX Investors desire to amend and restate the Existing Registration Rights Agreement in order to provide the BowX Investors, the Anchor Investors and the Windmill Investors with certain registration rights with respect to certain securities of the Company, on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the representations, covenants and agreements contained herein, and certain other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows:
ARTICLE I
DEFINITIONS
1.1. Definitions. The terms defined in Article I shall, for all purposes of this Agreement, have the respective meanings set forth below:
“Adverse Disclosure” shall mean any public disclosure of material non-public information, which disclosure, in the good faith judgment of the Chief Executive Officer or the Chief Financial Officer of the Company, after consultation with counsel to the Company, (i) would be required to be made in any Registration Statement or Prospectus in order for the applicable Registration Statement or Prospectus not to contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein (in the case of any prospectus and any preliminary prospectus in the light of the circumstances under which they were made) not misleading, (ii) would not be required to be made at such time if the Registration Statement were not being filed and (iii) either (A) could reasonably be expected to have a material adverse effect on the Company’s ability to effect a material proposed acquisition, disposition, financing, reorganization, recapitalization or similar transaction or (B) relates to information the accuracy of which has yet to be determined by the Company or which is the subject of an ongoing investigation or inquiry; provided that the Company takes all action as necessary to as expeditiously as possible make such determination and conclude such investigation or inquiry.
“Agreement” shall have the meaning given in the Preamble hereto.
“Anchor Investors” shall have the meaning given in the Recitals hereto.
“Anchor Subscription Agreements” shall have the meaning given in the Recitals hereto.
“business day” means a day, other than a Saturday or Sunday, on which commercial banks in New York, New York are open for the general transaction of business.
“Block Trade” shall mean an underwritten registered offering not involving a “roadshow,” an offer commonly known as a “block trade.”
“Board” shall mean the Board of Directors of the Company.
“BowX Investors” has the meaning given in the Preamble hereto.
“Class A Common Stock” has the meaning given in the Recitals hereto.
“Closing Date” shall have the meaning given in the Merger Agreement.
“Commission” shall mean the Securities and Exchange Commission.
“Commission Guidance” means (i) any publicly-available written or oral guidance of the Commission staff, or any comments, requirements or requests of the Commission staff and (ii) the Securities Act.
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“Company” shall have the meaning given in the Preamble hereto and includes the Company’s successors by recapitalization, merger, consolidation, spin-off, reorganization or similar transaction.
“Company Underwritten Demand Notice” shall have the meaning given in subsection 2.1.3.
“Demanding Anchor Investor” shall have the meaning given in subsection 2.1.5.
“Demanding BowX-Windmill Investor” shall have the meaning given in subsection 2.1.5.
“Demanding Holders” shall have the meaning given in subsection 2.1.3.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as it may be amended from time to time.
“Existing Registration Rights Agreement” shall have the meaning given in the Recitals hereto.
“Form S-1 Registration Statement” shall have the meaning given in subsection 2.1.1.
“Form S-3 Shelf” shall have the meaning given in subsection 2.1.1.
“Founder Shares” shall have the meaning given in the Recitals hereto and shall be deemed to include the shares of Class A Common Stock issued upon conversion thereof.
“Founder Shares Purchase Agreement” has the meaning given in the Recitals hereto.
“Holders” shall have the meaning given in the Preamble hereto, for so long as such person or entity holds any Registrable Securities.
“Insider Letter” shall mean that certain letter agreement, dated as of August 4, 2020, by and between the Company, the Sponsor and each of the other parties thereto.
“Lock-Up Letter Agreements” shall mean those certain letter agreements, dated as of the Closing Date, whereby certain Holders agreed not to transfer their shares for the applicable Lock-Up Period.
“Lock-Up Periods” shall mean the periods of time during which certain Holders have agreed not to transfer their shares as set forth in the Lock-Up Letter Agreements.
“Maximum Number of Securities” shall have the meaning given in subsection 2.2.4.
“Merger Agreement” shall have the meaning given in the Recitals hereto.
“Minimum Takedown Threshold” shall have the meaning given in subsection 2.1.3.
“Misstatement” shall mean an untrue statement of a material fact or an omission to state a material fact required to be stated therein, or necessary to make the statements therein (in the case of any Prospectus and any preliminary Prospectus, in the light of the circumstances under which they were made) not misleading.
“Notices” shall have the meaning given in Section 5.
“Permitted Transferees” shall mean (a) with respect to a BowX Investor, a person or entity to whom a BowX Investor is permitted to Transfer such Registrable Securities prior to the expiration of such investor’s applicable Lock-up Period as set forth in such investor’s applicable Lock-Up Letter Agreement, and to any transferee thereafter, and (b) with respect to a Windmill Investor, a person or entity to whom such Windmill Investor is permitted to Transfer such Registrable Securities prior to the expiration of such investor’s applicable Lock-up Period as set forth in such investor’s applicable Lock-Up Letter Agreement pursuant to Section 5.2 of this Agreement and any other applicable agreement between such Windmill Investors and the Company, and to any transferee thereafter.
“Piggy-back Registration” shall have the meaning given in subsection 2.2.1.
“Private Placement Warrants” shall have the meaning given in the Recitals hereto.
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“Private Placement Warrants Purchase Agreements” shall have the meaning given in the Recitals hereto.
“Pro Rata” shall have the meaning given in subsection 2.2.4.
“Prospectus” shall mean the prospectus included in any Registration Statement, as supplemented by any and all prospectus supplements and as amended by any and all post-effective amendments and including all material incorporated by reference in such prospectus.
“Registrable Security” shall mean (a) any outstanding share of Class A Common Stock or any other equity security (including the Private Placement Warrants and shares of Class A Common Stock issued or issuable upon the exercise of any other equity security) of the Company held by a Holder as of the date of this Agreement or hereafter acquired by a Holder upon the conversion of the Founder Shares or the exercise of any Private Placement Warrants including any shares of Class A Common Stock acquired pursuant to the Merger Agreement by the Windmill Investors or pursuant to the New SBG Warrant (as defined in the Merger Agreement), and (b) any other equity security of the Company issued or issuable with respect to any such share of Class A Common Stock referred to in the foregoing clause (a) by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise; provided, however, that, as to any particular Registrable Security, such securities shall cease to be Registrable Securities when: (i) a Registration Statement with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have been sold, transferred, disposed of or exchanged in accordance with such Registration Statement; (ii) such securities shall have been otherwise transferred, and new certificates or book entry positions for such securities not bearing a legend restricting further transfer shall have been delivered by the Company; (iii) such securities shall have ceased to be outstanding; (iv) such securities may be sold without registration pursuant to Rule 144 promulgated under the Securities Act (together with any successor rule promulgated thereafter by the Commission, “Rule 144”) (but with no volume or other restrictions or limitations thereunder); or (v) such securities have been sold to, or through, a broker, dealer or underwriter in a public distribution or other public securities transaction.
“Registration” shall mean a registration effected by preparing and filing a registration statement or similar document in compliance with the requirements of the Securities Act, and the applicable rules and regulations promulgated thereunder, and such registration statement becoming effective.
“Registration Expenses” shall mean the out-of-pocket expenses of a Registration, including, without limitation, the following:
(a) all registration and filing fees (including fees with respect to filings required to be made with the Financial Industry Regulatory Authority, Inc.) and any securities exchange on which the Class A Common Stock is then listed;
(b) fees and expenses of compliance with securities or blue sky laws (including reasonable fees and disbursements of counsel for the Underwriters in connection with blue sky qualifications of Registrable Securities);
(c) printing, messenger, telephone, delivery and road show or other marketing expenses;
(d) reasonable fees and disbursements of counsel for the Company;
(e) reasonable fees and disbursements of all independent registered public accountants of the Company incurred specifically in connection with such Registration; and
(f) in an Underwritten Offering, reasonable fees and expenses of one (1) legal counsel (not to exceed $100,000 in the aggregate for each Registration without prior approval of the Company) selected by the majority-in-interest of the Demanding Holders.
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“Registration Statement” shall mean any registration statement that covers the Registrable Securities pursuant to the provisions of this Agreement, including the Prospectus included in such registration statement, amendments (including post-effective amendments) and supplements to such registration statement, and all exhibits to and all material incorporated by reference in such registration statement.
“Removed Shares” shall have the meaning given in Section 2.6.
“Requesting Holders” shall have the meaning given in Section 2.1.5.
“Restricted Securities” shall have the meaning given in subsection 3.6.1.
“Rule 144” shall have the meaning given in the definition of “Registrable Security.”
“Rule 415” shall have the meaning given in subsection 2.1.1.
“Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder, all as the same shall be in effect at the time.
“Sponsor” shall have the meaning given in the Preamble hereto.
“Subscription Agreements” shall mean those certain subscription agreements dated March 25, 2021 by and between the Company and certain subscribers to shares of Class A Common Stock.
“Transactions” shall have the meaning given in the Recitals hereto.
“Transfer” shall mean to, directly or indirectly, sell, transfer, assign, pledge, encumber, hypothecate or similarly dispose of, either voluntarily or involuntarily, or to enter into any contract, option or other arrangement or understanding with respect to the sale, transfer, assignment, pledge, encumbrance, hypothecation or similar disposition of, any interest owned by a person or any interest (including a beneficial interest) in, or the ownership, control or possession of, any interest owned by a person.
“Underwriter” shall mean a securities dealer who purchases any Registrable Securities as principal in an underwritten offering and not as part of such dealer’s market-making activities.
“Underwritten Demand” shall have the meaning given in subsection 2.1.3.
“Underwritten Demand Notice” shall have the meaning given in subsection 2.1.3.
“Underwritten Registration” or “Underwritten Offering” shall mean a Registration in which securities of the Company are sold to an Underwriter in a firm commitment underwriting for distribution to the public, including an offering and/or sale of Registrable Securities by any Holder in a Block Trade or on an underwritten basis (whether firm commitment or otherwise) without substantial marketing efforts prior to pricing, including, without limitation, a same day trade, overnight trade or similar transaction.
“Windmill Investors” shall have the meaning given in the Preamble hereto.
“Withdrawal Notice” shall have the meaning given in subsection 2.1.6.
ARTICLE II
REGISTRATIONS
2.1. Shelf Registration.
2.1.1 Initial Registration. The Company shall, as promptly as reasonably practicable, but in no event later than thirty (30) days after the consummation of the transactions contemplated by the Merger Agreement, file a Registration Statement under the Securities Act to permit the public resale of all the Registrable Securities held by the Holders from time to time as permitted by Rule 415 under the Securities Act (or any successor or similar provision adopted by the Commission then in effect) (“Rule 415”) on the terms and conditions specified in this subsection 2.1.1 and shall use its reasonable best efforts
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to cause such Registration Statement to be declared effective as promptly as reasonably practicable after the initial filing thereof, but in no event later than the earlier of (a) sixty (60) days following the filing date thereof if the Commission notifies the Company that it will “review” the Registration Statement and (b) ten (10) business day after the date the Company is notified (orally or in writing, whichever is earlier) by the Commission that the Registration Statement will not be “reviewed” or will not be subject to further review. The Registration Statement filed with the Commission pursuant to this subsection 2.1.1 shall be a shelf registration statement on Form S-1 (a “Form S-1 Registration Statement”) or, if Form S-3 is available to the Company, on Form S-3 (a “Form S-3 Shelf”) or such other form of registration statement as is then available to effect a registration for resale of such Registrable Securities, covering such Registrable Securities, and shall contain a Prospectus in such form as to permit any Holder to sell such Registrable Securities pursuant to Rule 415 at any time beginning on the effective date for such Registration Statement. A Registration Statement filed pursuant to this subsection 2.1.1 shall provide for the resale pursuant to any method or combination of methods legally available to, and requested by, the Holders. The Company shall cause a Registration Statement filed pursuant to this subsection 2.1.1 to remain effective, and to be supplemented and amended to the extent necessary to ensure that such Registration Statement is available or, if not available, that another Registration Statement is available, for the resale of all the Registrable Securities held by the Holders until all such Registrable Securities have ceased to be Registrable Securities. As soon as reasonably practicable following the effective date of a Registration Statement filed pursuant to this subsection 2.1.1, the Company shall notify the Holders of the effectiveness of such Registration Statement. When effective, a Registration Statement filed pursuant to this subsection 2.1.1 (including the documents incorporated therein by reference) will comply as to form in all material respects with all applicable requirements of the Securities Act and the Exchange Act and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading (in the case of any Prospectus contained in such Registration Statement, in the light of the circumstances under which such statement is made).
2.1.2 Form S-3 Shelf. If the Company files a Form S-3 Shelf and thereafter the Company becomes ineligible to use Form S-3 for secondary sales, the Company shall file a Form S-1 Registration Statement as promptly as reasonably practicable to replace the shelf registration statement that is a Form S-3 Shelf and have the Form S-1 Registration Statement declared effective as promptly as reasonably practicable and to cause such Form S-1 Registration Statement to remain effective, and to be supplemented and amended to the extent necessary to ensure that such Registration Statement is available or, if not available, that another Registration Statement is available, for the resale of all the Registrable Securities held by the Holders until all such Registrable Securities have ceased to be Registrable Securities.
2.1.3 Underwritten Offering. At any time and from time to time following the effectiveness of the Registration Statement required by subsection 2.1.1 or 2.1.2, any Anchor Investor, BowX Investor, or Windmill Investor may request to sell all or a portion of their Registrable Securities (a “Demanding Holder”) in an underwritten offering that is registered pursuant to such Registration Statement, including a Block Trade (an “Underwritten Demand”), provided that such Holder(s) (a) reasonably expect aggregate gross proceeds, net of underwriting discounts and commissions, in excess of $50 million (the “Minimum Takedown Threshold”) from such Underwritten Offering or (b) reasonably expects to sell all of the Registrable Securities held by such Holder in such Underwritten Offering, provided that the total offering price is reasonably expected to exceed $25 million in the aggregate. All requests for an Underwritten Offering shall be made by giving written notice to the Company (the “Underwritten Demand Notice”). Each Underwritten Demand Notice shall specify the approximate number of Registrable Securities proposed to be sold in the Underwritten Offering and the expected price range (net of underwriting discounts and commissions) of such Underwritten Offering. Within four (4) days after receipt of any Underwritten Demand Notice, the Company shall give written notice of such requested Underwritten Offering (the “Company Underwritten Demand Notice”) to all other Holders of Registrable Securities and, subject to reductions consistent with the Pro Rata calculations in subsection 2.1.5, shall include in such Underwritten Offering all Registrable Securities with respect to which the Company has received written
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requests for inclusion therein, within five (5) days after sending the Company Underwritten Demand Notice, or, in the case of a Block Trade, as provided in Section 2.6. The Company shall enter into an underwriting agreement in a form as is customary in Underwritten Offerings of securities by the Company with the managing Underwriter or Underwriters selected by the Demanding Holders with the written consent of the Company (such consent not to be unreasonably withheld, delayed or conditioned), and shall take all such other reasonable actions as are requested by the managing Underwriter or Underwriters in order to expedite or facilitate the disposition of such Registrable Securities. In connection with any Underwritten Offering contemplated by this subsection 2.1.3, subject to Section 3.3 and Article IV, the underwriting agreement into which each Holder and the Company shall enter shall contain such representations, covenants, indemnities and other rights and obligations of the Company and such Holders as are customary in underwritten offerings of securities. In any twelve (12) month period, the Company shall not be obligated to effect more than (x) an aggregate of three (3) Registrations pursuant to an Underwritten Demand or Underwritten Offering initiated by the BowX Investors, (y) an aggregate of three (3) Registrations pursuant to an Underwritten Demand or an Underwritten Offering initiated by the Windmill Investors and (z) an aggregate of three (3) Registrations pursuant to an Underwritten Demand or an Underwritten Offering initiated by the Anchor Investors, in each case, with respect to any of all Registrable Securities.
2.1.4 Holder Information Required for Participation in Underwritten Offering. At least ten (10) business days prior to the first anticipated filing date of a Registration Statement pursuant to this Article II, the Company shall use commercially reasonable efforts notify each Holder in writing (which may be by email) of the information reasonably necessary about the Holder to include such Holder’s Registrable Securities in such Registration Statement. Notwithstanding anything else in this Agreement, the Company shall not be obligated to include such Holder’s Registrable Securities to the extent the Company has not received such information, and received any other reasonably requested agreements or certificates, on or prior to the fifth business day prior to the first anticipated filing date of a Registration Statement pursuant to this Article II.
2.1.5 Reduction of Underwritten Offering. If the managing Underwriter or Underwriters in an Underwritten Offering, in good faith, advises the Company, the Demanding Holders and the Holders requesting to include their Registrable Securities in such Underwritten Offering (the “Requesting Holders”) (if any) in writing that, the dollar amount or number of Registrable Securities that the Demanding Holders and the Requesting Holders (if any) desire to sell, taken together with all other Class A Common Stock or other equity securities that the Company desires to sell for its own account and the Class A Common Stock, if any, as to which a Registration has been requested pursuant to separate written contractual piggy-back registration rights held by any other stockholders of the Company who desire to sell, exceeds the maximum dollar amount or maximum number of equity securities that can be sold in such Underwritten Offering without adversely affecting the proposed offering price, the timing, the distribution method, or the probability of success of such offering (such maximum dollar amount or maximum number of such securities, as applicable, the “Maximum Number of Securities”), then the Company shall include in such Underwritten Offering, as follows: (i) first, the Registrable Securities of the Demanding Holders and Requesting Holders who are BowX Investors and Windmill Investors (each a “Demanding BowX-Windmill Investor”) (pro rata based on the respective number of Registrable Securities that each such Demanding BowX-Windmill Investor has requested to be included in such Underwritten Registration and the aggregate number of Registrable Securities that the Demanding BowX-Windmill Investors have requested be included in such Underwritten Registration (such proportion is referred to herein as “Pro Rata”)) that can be sold without exceeding the Maximum Number of Securities, (ii) second, to the extent that the Maximum Number of Securities has not been reached under the foregoing clause, the Registrable Securities of the Demanding Holders who are Anchor Investors (each a “Demanding Anchor Investor”) (Pro Rata based on the respective number of Registrable Securities that each such Demanding Anchor Investor has so requested), (iii) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (i) and (ii), the Registrable Securities of Requesting Holders, to the
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extent not covered by the foregoing clauses (Pro Rata, based on the respective number of Registrable Securities that each Requesting Holder has so requested) exercising their rights to register their Registrable Securities pursuant to subsection 2.2.1 hereof, without exceeding the Maximum Number of Securities; (iv) fourth, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (i), (ii), and (iii), the Class A Common Stock or other equity securities that the Company desires to sell, which can be sold without exceeding the Maximum Number of Securities; and (v) fifth, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (i), (ii), (iii), and (iv), the common stock or other equity securities of other persons or entities that the Company is obligated to register in a Registration pursuant to separate written contractual arrangements with such persons and that can be sold without exceeding the Maximum Number of Securities.
2.1.6 Underwritten Offering Withdrawal. Prior to the filing of the applicable “red herring” prospectus or prospectus supplement used for marking such Underwritten Offering, a majority-in-interest of the Demanding Holders initiating an Underwritten Demand pursuant to a Registration under subsection 2.1.3 shall have the right to withdraw from a Registration pursuant to an Underwritten Offering pursuant to subsection 2.1.3 for any or no reason whatsoever upon written notification (“Withdrawal Notice”) to the Company and the Underwriter or Underwriters (if any) of their intention to withdraw from such Registration; provided that any Requesting Holding may elect to have the Company continue an Underwritten Demand if the Minimum Takedown Threshold would still be satisfied by the Registrable Securities proposed to be sold in the Underwritten Demand by such Requesting Holders. If withdrawn by a Demanding Holder, any Requesting Holder may elect to continue an Underwritten Demand pursuant to the proviso in the immediately preceding sentence and such Underwritten Demand shall instead count as an Underwritten Demand demanded by such Requesting Holder for purposes of subsection 2.1.3. Following the receipt of any Withdrawal Notice, the Company shall promptly forward such Withdrawal Notice to any other Holders that had elected to participate in such Underwritten Offering and shall not include the Registrable Securities of such withdrawing Demanding Holder(s) in the applicable registration and such Registrable Securities shall continue to be Registrable Securities for all purposes of this Agreement (subject to the other terms and conditions of this Agreement). Notwithstanding anything to the contrary in this Agreement, the Company shall be responsible for the Registration Expenses incurred in connection with a Registration pursuant to an Underwritten Offering prior to its withdrawal under this subsection 2.1.6.
2.2. Piggy-back Registration.
2.2.1 Piggy-back Rights. If the Company proposes to conduct a registered offering of, or to file a Registration Statement under the Securities Act with respect to an offering of, equity securities, or securities or other obligations exercisable or exchangeable for, or convertible into equity securities, for its own account or for the account of stockholders of the Company (or by the Company and by the stockholders of the Company including, without limitation, pursuant to Section 2.1), other than a Registration Statement (i) filed in connection with any employee stock option or other benefit plan, (ii) pursuant to a Registration Statement on Form S-4 (or similar form that relates to a transaction subject to Rule 145 under the Securities Act or any successor rule thereto), (iii) for a rights offering or an exchange offer or offering of securities solely to the Company’s existing stockholders, (iv) for an offering of debt that is convertible into equity securities of the Company, (v) for a dividend reinvestment plan, or (vi) for a Block Trade, then the Company shall give written notice of such proposed filing to all of the Holders of Registrable Securities as soon as practicable but not less than ten (10) days before the anticipated filing date of such Registration Statement or, in the case of an Underwritten Offering pursuant to a Form S-3 Shelf, not less than ten (10) days before the anticipated filing date of the prospectus supplement used for marketing such offering, which notice shall (A) describe the amount and type of securities to be included in such offering, the intended method(s) of distribution and the name of the proposed managing Underwriter or Underwriters, if any, in such offering and (B) offer to all of the Holders of Registrable Securities the opportunity to register the sale of such number of Registrable Securities as such Holders may request in writing within five (5) days after receipt of such written notice (such Registration a “Piggy-back
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Registration”). The Company shall, in good faith, cause such Registrable Securities to be included in such Piggy-back Registration and shall use commercially reasonable efforts to cause the managing Underwriter or Underwriters of a proposed Underwritten Offering to permit the Registrable Securities requested by the Holders pursuant to this subsection 2.2.1 to be included in a Piggy-back Registration on the same terms and conditions as any similar securities of the Company included in such Registration and to permit the sale or other disposition of such Registrable Securities in accordance with the intended method(s) of distribution thereof. All such Holders proposing to distribute their Registrable Securities through an Underwritten Offering under this subsection 2.2.1, shall enter into an underwriting agreement in customary form with the Underwriter(s) selected for such Underwritten Offering by the Company.
2.2.2 Reduction of Piggy-back Registration. If the managing Underwriter or Underwriters for a in an Underwritten Offering that is to be a Piggy-back Registration, in good faith, advises the Company and the Holders of Registrable Securities participating in the Piggy-back Registration in writing that the dollar amount or number of the shares of Class A Common Stock or other equity securities that the Company desires to sell, taken together with (i) the shares of Class A Common Stock or other equity securities, if any, as to which Registration has been demanded pursuant to separate written contractual arrangements with persons or entities other than the Holders of Registrable Securities hereunder, (ii) the Registrable Securities as to which registration has been requested pursuant to this Section 2.2, and (iii) the shares of Class A Common Stock or other equity securities, if any, as to which Registration or a registered offering has been requested pursuant to separate written contractual piggy-back registration rights of other stockholders of the Company exceeds the Maximum Number of Securities, then:
(a) If the Registration is undertaken for the Company’s account, the Company shall include in any such Registration: (A) first, the Class A Common Stock or other equity securities that the Company desires to sell for its own account, which can be sold without exceeding the Maximum Number of Securities; (B) second, to the extent that the Maximum Number of Securities has not been reached under the foregoing clause (A), the Registrable Securities of BowX Investors and Windmill Investors exercising their rights to register their Registrable Securities pursuant to Section 2.2.1, Pro Rata, which can be sold without exceeding the Maximum Number of Securities; (C) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A) and (B), the Registrable Securities of Anchor Investors exercising their rights to register their Registrable Securities pursuant to Section 2.2.1, Pro Rata, and (D) fourth, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A), (B) and (C), the Class A Common Stock or other equity securities, if any, as to which Registration has been requested or demanded pursuant to written contractual piggy-back registration rights of other stockholders of the Company, which can be sold without exceeding the Maximum Number of Securities; and
(b) If the Registration is pursuant to a request by persons or entities other than the Holders of Registrable Securities, then the Company shall include in any such Registration (A) first, the Class A Common Stock or other equity securities, if any, of such requesting persons or entities, other than the Holders of Registrable Securities, which can be sold without exceeding the Maximum Number of Securities; (B) second, to the extent that the Maximum Number of Securities has not been reached under the foregoing clause (A), the Registrable Securities of BowX Investors and Windmill Investors exercising their rights to register their Registrable Securities pursuant to Section 2.2.1, Pro Rata, which can be sold without exceeding the Maximum Number of Securities; (C) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A) and (B), the Registrable Securities of Anchor Investors exercising their rights to register their Registrable Securities pursuant to Section 2.2.1, Pro Rata, and (D) fourth, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A), (B) and (C), the Class A Common Stock or other equity securities, if any, as to which Registration has been requested or demanded pursuant to written contractual piggy-back registration rights of other stockholders of the Company, which can be sold without exceeding the Maximum Number of Securities.
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2.2.3 Piggy-back Registration Withdrawal. Any Holder of Registrable Securities shall have the right to withdraw from a Piggy-back Registration for any or no reason whatsoever upon written notification to the Company and the Underwriter or Underwriters (if any) of his, her or its intention to withdraw from such Piggy-back Registration prior to the effectiveness of the Registration Statement filed with the Commission with respect to such Piggy-back Registration (or, in the case of an Underwritten Registration pursuant to Rule 415, prior to the filing of the applicable “red herring” prospectus or prospectus supplement with respect to such Piggy-back Registration used for marketing such transaction). The Company (whether on its own good faith determination or as the result of a request for withdrawal by persons pursuant to separate written contractual obligations) may withdraw a Registration Statement filed with the Commission in connection with a Piggy-back Registration at any time prior to the effectiveness of such Registration Statement. Notwithstanding anything to the contrary in this Agreement, the Company shall be responsible for the Registration Expenses incurred in connection with the Piggy-back Registration prior to its withdrawal under this subsection 2.2.3.
2.2.4 Unlimited Piggy-back Registration Rights. For purposes of clarity, any Registration effected pursuant to Section 2.3 hereof shall not be counted as a Registration pursuant to an Underwritten Offering effected under subsection 2.1.3.
2.3. Market Stand-off. In connection with any Underwritten Offering of equity securities of the Company (other than a Block Trade), if requested by the managing Underwriters, each Holder that is (a) an executive officer, (b) a director or (c) Holder in excess of five percent (5%) of the outstanding Class A Common Stock (and for which it is customary for such a Holder to agree to a lock-up) agrees that it shall not transfer any shares of Common Stock or other equity securities of the Company (other than those included in such offering pursuant to this Agreement), without the prior written consent of the Company, during the ninety (90)-day period (or such shorter time agreed to by the managing Underwriters) beginning on the date of pricing of such offering, except as expressly permitted by such lock-up agreement or in the event the managing Underwriters otherwise agree by written consent. Each such Holder agrees to execute a customary lock-up agreement in favor of the Underwriters to such effect (in each case on substantially the same terms and conditions as all such Holders).
2.4. [Reserved].
2.5. Block Trades.
2.5.1 Notwithstanding any other provision of this Section 2, but subject to Section 3.4, if a Demanding Holder desires to effect a Block Trade (x) with a total offering price reasonably expected to exceed $50 million in the aggregate or (y) with respect to all remaining Registrable Securities held by the Demanding Holder; provided that the total offering price is reasonably expected to exceed $25 million in the aggregate, then such Demanding Holder shall provide written notice to the Company at least five (5) Business Days prior to the date such Block Trade will commence. The Company shall use commercially reasonable efforts to facilitate such Block Trade. The Holders shall use reasonable best efforts to work with the Company and the Underwriters (including by disclosing the maximum number of Registrable Securities proposed to be the subject of such Block Trade) in order to facilitate preparation of the Registration Statement, Prospectus and other offering documentation related to the Block Trade and any related due diligence and comfort procedures. In the event of a Block Trade, and after consultation with the Company, the Demanding Holders and the Requesting Holders (if any) shall determine the Maximum Number of Securities, the underwriter or underwriters and share price of such offering. Notwithstanding anything to the contrary in this Agreement, Section 2.2 shall not apply to a Block Trade initiated by a Demanding Holder pursuant to this Agreement. In any twelve (12) month period, the Company shall not be obligated to effect more than (x) one (1) Block Trade demanded by the BowX Investors, (y) three (3) Block Trade demanded by the Windmill Investors and (z) one (1) Block Trade demanded by each of the Anchor Investors; provided however, that the BowX Investors, Windmill Investors and the Anchor Investors shall be entitled to make no less than six (6) Block Trade demands in the aggregate in any such twelve (12) month period. For the avoidance of doubt, any Block Trade effected pursuant to this Section 2.5.1 shall not be counted as a demand for an Underwritten Demand or an Underwritten Offering pursuant to Section 2.1.3 hereof.
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2.5.2 The Demanding Holder in a Block Trade shall have the right to select the Underwriters for such Block Trade (which shall consist of one or more reputable nationally recognized investment banks).
2.6. Rule 415; Removal. If at any time the Commission takes the position that the offering of some or all of the Registrable Securities in a Registration Statement on Form S-3 filed pursuant to this Section 2 is not eligible to be made on a delayed or continuous basis under the provisions of Rule 415 under the Securities Act (provided, however, the Company shall be obligated to use diligent efforts to advocate with the Commission for the registration of all of the Registrable Securities in accordance with the Commission Guidance, including without limitation, Compliance and Disclosure Interpretation 612.09) or requires a BowX Investor, Anchor Investor or Windmill Investor to be named as an “underwriter,” the Company shall (i) promptly notify each Holder of Registrable Securities thereof (or in the case of the Commission requiring a BowX Investor, Anchor Investor or Windmill Investor to be named as an “underwriter,” the BowX Investor, Anchor Investor or Windmill Investor) and (ii) use reasonable best efforts to persuade the Commission that the offering contemplated by such Registration Statement is a valid secondary offering and not an offering “by or on behalf of the issuer” as defined in Rule 415 and that none of the BowX Investors, Anchor Investors or Windmill Investors is an “underwriter.” The Holders shall have the right to select one legal counsel designated by the Holders of a majority of the Registrable Securities subject to such Registration Statement to review and oversee any registration or matters pursuant to this Section 2.6, including participation in any meetings or discussions with the Commission regarding the Commission’s position and to comment on any written submission made to the Commission with respect thereto. No such written submission with respect to this matter shall be made to the Commission to which the applicable Holders’ counsel reasonably objects. In the event that, despite the Company’s reasonable best efforts and compliance with the terms of this Section 2.6, the Commission refuses to alter its position, the Company shall (i) remove from such Registration Statement such portion of the Registrable Securities (the “Removed Shares”) and/or (ii) agree to such restrictions and limitations on the registration and resale of the Registrable Securities as the Commission may require to assure the Company’s compliance with the requirements of Rule 415; provided, however, that the Company shall not agree to name any BowX Investor, Anchor Investor or Windmill Investor as an “underwriter” in such Registration Statement without the prior written consent of such BowX Investor, Anchor Investor or Windmill Investor, as applicable. In the event of a share removal pursuant to this Section 2.6, the Company shall give the applicable Holders at least five (5) days prior written notice along with the calculations as to such Holder’s allotment. Any removal of shares of the Holders pursuant to this Section 2.6 shall (A) first be applied to Holders other than the BowX Investors, Anchor Investors or Windmill Investors with securities registered for resale under the applicable Registration Statement, (B) second be applied to the Anchor Investors with securities registered for resale under the applicable Registration Statement and (C) thereafter allocated between the BowX Investors and Windmill Investors on a Pro Rata basis based on the aggregate amount of Registrable Securities held by the BowX Investors, Anchor Investors or Windmill Investors. In the event of a share removal of the Holders pursuant to this Section 2.6, the Company shall promptly register the resale of any Removed Shares pursuant to subsection 2.1.2 hereof and in no event shall the filing of such Registration Statement on Form S-1 or subsequent Registration Statement on Form S-3 filed pursuant to the terms of subsection 2.1.2 be counted as a Underwritten Demand hereunder. Until such time as the Company has registered all of the Removed Shares for resale pursuant to Rule 415 on an effective Registration Statement, the Company shall not be able to defer the filing of a Registration Statement pursuant to Section 2.3.
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In the case of a Form S-1 Registration Statement filed to register the resale of Removed Shares, upon such date as the Company becomes eligible to register all of the Removed Shares for resale on a Form S-3 Shelf pursuant to the Commission Guidance and, if applicable, without a requirement that any of the BowX Investors, Anchor Investors or Windmill Investors be named as an “underwriter” therein, the Company shall use commercially reasonable efforts to file a Form S-3 Shelf as promptly as practicable to replace the applicable Form S-1 Registration Statement and have the Form S-3 Shelf declared effective as promptly as practicable and to cause such Form S-3 Shelf to remain effective, and to be supplemented and amended to the extent necessary to ensure that such Registration Statement is available or, if not available, that another Registration Statement is available, for the resale of all the Registrable Securities thereunder held by the applicable Holders until all such Registrable Securities have ceased to be Registrable Securities.
ARTICLE III
COMPANY PROCEDURES
3.1. General Procedures. If the Company is required to effect the Registration of Registrable Securities, the Company shall use commercially reasonable efforts to effect such Registration to permit the sale of such Registrable Securities in accordance with the intended plan of distribution thereof, and pursuant thereto the Company shall:
3.1.1 prepare and file with the Commission within thirty (30) days a Registration Statement with respect to such Registrable Securities and use commercially reasonable efforts to cause such Registration Statement to become effective and remain effective until all Registrable Securities covered by such Registration Statement are sold in accordance with the intended plan of distribution set forth in such Registration Statement or have ceased to be Registrable Securities;
3.1.2 prepare and file with the Commission such amendments and post-effective amendments to the Registration Statement, and such supplements to the Prospectus, as may be reasonably requested by any Holder of Registrable Securities or as may be required by the rules, regulations or instructions applicable to the registration form used by the Company or by the Securities Act or rules and regulations thereunder to keep the Registration Statement effective until all Registrable Securities covered by such Registration Statement are sold in accordance with the intended plan of distribution set forth in such Registration Statement or supplement to the Prospectus or have ceased to be Registrable Securities;
3.1.3 prior to filing a Registration Statement or the Prospectus, or any amendment or supplement thereto, furnish without charge to the Underwriters, if any, and each Holder of Registrable Securities included in such Registration, and such Holder’s legal counsel, copies of such Registration Statement as proposed to be filed, each amendment and supplement to such Registration Statement (in each case including all exhibits thereto and documents incorporated by reference therein), the Prospectus included in such Registration Statement (including each preliminary Prospectus), and such other documents as the Underwriters and each Holder of Registrable Securities included in such Registration or the legal counsel for any such Holders may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Holders; provided that the Company shall have no obligation to furnish any documents publicly filed or furnished with the Commission pursuant to the Electronic Data Gathering, Analysis and Retrieval System (“EDGAR”);
3.1.4 prior to any Underwritten Offering of Registrable Securities, use commercially reasonable efforts to (i) register or qualify the Registrable Securities covered by the Registration Statement under such securities or “blue sky” laws of such jurisdictions in the United States as any Holder of Registrable Securities included in such Registration Statement (in light of their intended plan of distribution) may request to the extent such registration or qualification is required by applicable law and (ii) take such action necessary to cause such Registrable Securities covered by the Registration Statement to be registered with or approved by such other governmental authorities as may be necessary by virtue of the business and operations of the Company and do any and all other acts and things that may be necessary or advisable, in each case, to enable the Holders of Registrable Securities included in such Registration Statement to consummate the disposition of such Registrable Securities in such jurisdictions; provided, however, that the Company shall not be required to qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify or take any action to which it would be subject to general service of process or taxation in any such jurisdiction where it is not then otherwise so subject;
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3.1.5 cause all such Registrable Securities to be listed on each securities exchange or automated quotation system on which similar securities issued by the Company are then listed;
3.1.6 provide a transfer agent or warrant agent, as applicable, and registrar for all such Registrable Securities no later than the effective date of such Registration Statement;
3.1.7 promptly furnish to each seller of Registrable Securities covered by such Registration Statement such number of conformed copies of such Registration Statement and of each such amendment and supplement thereto (in each case including all exhibits), such number of copies of the Prospectus contained in such Registration Statement (including each preliminary Prospectus and any summary Prospectus) and any other Prospectus filed under Rule 424 under the Securities Act, in conformity with the requirements of the Securities Act, and such other documents as such seller may reasonably request;
3.1.8 advise each seller of such Registrable Securities, promptly after it shall receive notice or obtain knowledge thereof, of any request by the Commission that the Company amend or supplement such Registration Statement or Prospectus or the issuance of any stop order by the Commission suspending the effectiveness of such Registration Statement or Prospectus the initiation or threatening of any proceeding for such purpose and promptly use commercially reasonable efforts to amend or supplement such Registration Statement or Prospectus or prevent the issuance of any stop order or to obtain its withdrawal if such stop order should be issued, as applicable;
3.1.9 advise each Holder of Registrable Securities covered by such Registration Statement, promptly after the Company receives notice thereof, of the time when such registration statement has been declared effective or a supplement to any Prospectus forming a part of such registration statement has been filed;
3.1.10 at least five (5) days prior to the filing of any Registration Statement or Prospectus or any amendment or supplement to such Registration Statement or Prospectus (or such shorter period of time as may be (a) necessary in order to comply with the Securities Act, the Exchange Act, and the rules and regulations promulgated under the Securities Act or Exchange Act, as applicable or (b) advisable in order to reduce the number of days that sales are suspended pursuant to Section 3.4), furnish a copy thereof to each seller of such Registrable Securities or its counsel (excluding any exhibits thereto and any filing made under the Exchange Act that is to be incorporated by reference therein);
3.1.11 as promptly as practicable, notify the Holders at any time when a Prospectus relating to such Registration Statement is required to be delivered under the Securities Act, of the happening of any event or the existence of any condition as a result of which the Prospectus included in such Registration Statement, as then in effect, includes a Misstatement, and then to correct such Misstatement as set forth in Section 3.4, at the request of any such Holder promptly prepare and furnish to such Holder a reasonable number of copies of a supplement to or an amendment of such Prospectus as may be necessary so that, as thereafter delivered to the purchasers of such securities, such Prospectus shall not include a Misstatement or such Prospectus, as supplemented or amended, shall comply with law;
3.1.12 in the event of an Underwritten Offering, permit a representative of the Holders, if any, and any attorney or accountant retained by such Holders or Underwriter(s) to participate, at each such person’s or entity’s own expense, in the preparation of the Registration Statement, and cause the Company’s officers, directors and employees to supply all information reasonably requested by any such representative, Underwriter, financial institution, attorney, consultant or accountant in connection with the Registration; provided, however, that such representatives, Underwriters or financial institutions agree to confidentiality arrangements in form and substance reasonably satisfactory to the Company, prior to the release or disclosure of any such information;
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3.1.13 obtain a “cold comfort” letter from the Company’s independent registered public accountants in the event of an Underwritten Offering in customary form and covering such matters of the type customarily covered by “cold comfort” letters as the managing Underwriter may reasonably request, and reasonably satisfactory to a majority-in-interest of the participating Holders;
3.1.14 in the event of an Underwritten Offering, on the date the Registrable Securities are delivered for sale pursuant to such Registration, obtain an opinion, dated such date, of counsel representing the Company for the purposes of such Registration, addressed to the participating Holders, the placement agents or sales agent, if any, and the Underwriters, if any, covering such legal matters with respect to the Registration in respect of which such opinion is being given as the participating Holders, placement agent, sales agent or Underwriter may reasonably request and as are customarily included in such opinions and negative assurance letters;
3.1.15 in the event of any Underwritten Offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing Underwriter of such offering;
3.1.16 make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve (12) months beginning with the first day of the Company’s first full calendar quarter after the effective date of the Registration Statement which satisfies the provisions of Section 11(a) of the Securities Act, including Rule 158 thereunder (or any successor rule promulgated thereafter by the Commission);
3.1.17 use commercially reasonable efforts to make available senior executives of the Company to participate in customary “road show” presentations that may be reasonably requested by the Underwriter(s) in any Underwritten Offering; and
3.1.18 otherwise, in good faith, cooperate reasonably with, and take such customary actions as may reasonably be requested by the participating Holders, consistent with the terms of this Agreement, in connection with such Registration.
Notwithstanding the foregoing, the Company shall not be required to provide any documents or information to an Underwriter, broker, sales agent or placement agent if such Underwriter, broker, sales agent or placement agent has not then been named with respect to the applicable Underwritten Offering or other offering involving a registration as an Underwriter, broker, sales agent or placement agent, as applicable.
3.2. Registration Expenses. The Registration Expenses of all Registrations shall be borne by the Company. It is acknowledged by the Holders that the Holders shall bear all incremental selling expenses relating to the sale of Registrable Securities, such as Underwriters’ commissions and discounts, brokerage fees, Underwriter marketing costs, and, other than as set forth in the definition of “Registration Expenses,” all reasonable fees and expenses of any legal counsel representing any Holder.
3.3. Participation in Underwritten Offering.
3.3.1 No person or entity may participate in any Underwritten Offering for equity securities of the Company pursuant to a Registration initiated by the Company hereunder unless such person or entity (i) agrees to sell such person’s or entity’s securities on the basis provided in any underwriting arrangements approved by the Company and (ii) completes and executes all customary questionnaires, powers of attorney, indemnities, lock-up agreements, underwriting agreements and other customary documents as may be reasonably required under the terms of such underwriting arrangements.
3.4. Suspension of Sales; Adverse Disclosure; Restriction on Registration Rights.
3.4.1 Upon receipt of written notice from the Company that a Registration Statement or Prospectus contains a Misstatement, each of the Holders shall forthwith discontinue disposition of Registrable Securities until it has received copies of a supplemented or amended Prospectus correcting the Misstatement (it being understood that the Company hereby covenants to prepare and file such supplement or amendment as soon as practicable after the time of such notice such that the Registration Statement or Prospectus, as so amended or supplemented, as applicable, will not include a Misstatement), or until it is advised in writing by the Company that the use of the Prospectus may be resumed.
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3.4.2 Subject to Section 3.4.4, if the filing, initial effectiveness or continued use of a Registration Statement in respect of any Registration at any time would require the Company to make an Adverse Disclosure or would require the inclusion in such Registration Statement of financial statements that are unavailable to the Company for reasons beyond the Company’s control, the Company may, upon giving prompt written notice of such action to the Holders, delay the filing or initial effectiveness of, or suspend use of, such Registration Statement for the shortest period of time, but in no event more than thirty (30) days, determined in good faith by the Company to be necessary for such purpose. In the event the Company exercises its rights under the preceding sentence, the Holders agree to suspend, immediately upon their receipt of the notice referred to above, their use of the Prospectus relating to any Registration in connection with any sale or offer to sell Registrable Securities. The Company shall immediately notify the Holders of the expiration of any period during which it exercised its rights under this Section 3.4.2.
3.4.3 (a) During the period starting with the date thirty (30) days prior to the Company’s good faith estimate of the date of the filing of, and ending on a date ninety (90) after the effective date of, a Company-initiated Registration and provided that the Company continues to actively employ, in good faith, all reasonable efforts to maintain the effectiveness of the applicable shelf Registration Statement, the Company may, upon giving prompt written notice of such action to the Holders, delay any other registered offering pursuant to Section 2.4 and, (b) during the period starting with the date fifteen (15) days prior to the Company’s good faith estimate of the date of the filing of, and ending on a date forty five (45) days after the effective date of, a Company-initiated Registration, and provided that the Company continues to actively employ, in good faith, all reasonable efforts to maintain the effectiveness of the applicable shelf Registration Statement, the Company may, upon giving prompt written notice of such action to the Holders, delay any other registered offering pursuant to Section 2.4.
3.4.4 The right to delay or suspend any filing, initial effectiveness or continued use of a Registration Statement pursuant to Section 3.4.2 or registered offering pursuant to Section 3.4.3 shall be exercised by the Company, in the aggregate, on not more than two occasions or for more than sixty (60) consecutive calendar days, or more than one hundred and twenty (120) total calendar days, in each case during any twelve-month period.
3.5. Covenants of the Company. As long as any Holder shall own Registrable Securities, the Company hereby covenants and agrees:
3.5.1 at all times while it shall be a reporting company under the Exchange Act, covenants to 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. The Company further covenants that it shall take such further action as any Holder may reasonably request, all to the extent required from time to time to enable such Holder to sell shares of Class A Common Stock held by such Holder 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 any Holder, the Company shall deliver to such Holder a written certification of a duly authorized officer as to whether it has complied with such requirements; and
3.5.2 reasonably promptly following the effectiveness of the shelf registration statement required by subsection 2.1.1, the Company shall cause the transfer agent to remove any restrictive legends (including any electronic transfer restrictions) from any Class A Common Stock or Private Placement Warrants held by such Holder and provide or cause any customary opinions of counsel to be delivered to the transfer agent in connection with such removal. The Company shall be responsible for the fees of the transfer agent associated with such issuance.
3.6. [Reserved].
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ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
4.1. Indemnification.
4.1.1 The Company agrees to indemnify, to the extent permitted by law, each Holder of Registrable Securities, its officers and directors and each person who controls such Holder (within the meaning of the Securities Act) against all losses, claims, damages, liabilities and expenses (including attorneys’ fees) caused by (i) any untrue or alleged untrue statement of material fact contained in any Registration Statement, Prospectus or preliminary Prospectus or any amendment thereof 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, except insofar as the same are caused by or contained in any information furnished in writing to the Company by such Holder expressly for use therein and (ii) any violation or alleged violation by the Company of the Securities Act, Exchange Act or any state securities law or any rule or regulation thereunder, in connection with the performance of its obligations under this Article IV; provided, that the indemnification contained in this Article IV shall not apply to amounts paid in settlement of any losses, claims, damages, liabilities and expenses (including attorneys’ fees) if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld, conditioned or delayed). The Company shall indemnify the Underwriters, their officers and directors and each person who controls such Underwriters (within the meaning of the Securities Act) to the same extent as provided in the foregoing with respect to the indemnification of the Holder.
4.1.2 In connection with any Registration Statement in which a Holder of Registrable Securities is participating, such Holder shall furnish (or cause to be furnished) to the Company in writing such information and affidavits as the Company reasonably requests for use in connection with any such Registration Statement or Prospectus and, to the extent permitted by law, shall indemnify the Company, its directors and officers and agents and each person who controls the Company (within the meaning of the Securities Act) against any losses, claims, damages, liabilities and expenses (including without limitation reasonable and documented attorneys’ fees) resulting from any untrue statement of material fact contained in the Registration Statement, Prospectus or preliminary Prospectus or any amendment thereof or supplement thereto or any 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 or affidavit so furnished in writing by such Holder expressly for use therein. The Holders of Registrable Securities shall indemnify the Underwriters, their officers, directors and each person who controls such Underwriters (within the meaning of the Securities Act) to the same extent as provided in the foregoing with respect to indemnification of the Company. For the avoidance of doubt, the obligation to indemnify under this Section 4.1.2 shall be several, not joint and several, among the Holders of Registrable Securities, and the total liability of a Holder under this Section 4.1.2 shall be in proportion to and limited to the net proceeds received by such Holder from the sale of Registrable Securities pursuant to such Registration Statement.
4.1.3 Any person entitled to indemnification herein shall (a) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification (provided that the failure to give prompt notice shall not impair any person’s right to indemnification hereunder to the extent such failure has not materially prejudiced the indemnifying party) and (b) unless in such indemnified party’s reasonable judgment a conflict of interest between such indemnified and indemnifying parties may exist with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party to the indemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to the indemnified party under this Article IV for any legal or other expenses subsequently
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incurred by the indemnified party in connection with the defense thereof other than reasonable costs of investigation, unless (a) such indemnified party reasonably objects to such assumption on the grounds that there may be defenses available to it which are different from or in addition to the defenses available to such indemnifying party, (b) the indemnifying party shall have failed within a reasonable period of time to assume such defense or, having assumed such defense, has not conducted the defense of such claim actively and diligently or (c) the named parties in any such proceeding (including any impleaded parties) include both the indemnified party and the indemnifying party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interest between them, in which case the indemnified party shall be promptly reimbursed by the indemnifying party for the expenses incurred in connection with retaining one separate legal counsel, in addition to any local counsel (for the avoidance of doubt, for all indemnified parties in connection therewith). If such defense is assumed, (i) the indemnifying party shall keep the indemnified party informed as to the status of such claim at all stages thereof (including all settlement negotiations and offers), promptly submit to such indemnified party copies of all pleadings, responsive pleadings, motions and other similar legal documents and paper received or filed in connection therewith, permit such indemnified party and their respective counsels to confer with the indemnifying party and its counsel with respect to the conduct of the defense thereof, and permit indemnified party and its counsel a reasonable opportunity to review all legal papers to be submitted prior to their submission and (ii) the indemnifying party shall not be subject to any liability for any settlement made by the indemnified party without its consent (but such consent shall not be unreasonably withheld). In any action hereunder as to which the indemnifying party has assumed the defense thereof with counsel satisfactory to the indemnified party, the indemnified party shall continue to be entitled to participate in the defense thereof, with counsel of its own choice, but the indemnifying party shall not be obligated hereunder to reimburse the indemnified party for the costs thereof. No indemnifying party shall, without the prior written consent of the indemnified party, consent to the entry of any judgment or enter into any settlement which cannot be settled in all respects by the payment of money (and such money is so paid by the indemnifying party pursuant to the terms of such settlement) or which settlement includes a statement or admission of fault, culpability or failure to act on the part of such indemnified party or which settlement does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation that shall be in form and substance satisfactory to such indemnified party.
4.1.4 The indemnification provided for under this Agreement shall remain in full force and effect regardless of any investigation made by or on behalf of the indemnified party or any officer, director or controlling person of such indemnified party and shall survive the transfer of securities.
4.1.5 If the indemnification provided under this Section 4.1 hereof from the indemnifying party is unavailable or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities and expenses referred to herein, then the indemnifying party, in lieu of indemnifying the indemnified party, shall contribute to the amount paid or payable by the indemnified party as a result of such losses, claims, damages, liabilities and expenses in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party, as well as any other relevant equitable considerations. The relative fault of the indemnifying party and indemnified party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact, was made by, or relates to information supplied by, such indemnifying party or indemnified party, and the indemnifying party’s and indemnified party’s relative intent, knowledge, access to information and opportunity to correct or prevent such action; provided, however, that the liability of any Holder under this subsection 4.1.5 shall be limited to the amount of the net proceeds received by such Holder in such offering giving rise to such liability. The amount paid or payable by a party as a result of the losses or other liabilities referred to above shall be deemed to include, subject to the limitations set forth in subsections 4.1.1, 4.1.2 and 4.1.3 above, any legal or other fees, charges or expenses reasonably incurred by such party in connection with any investigation or proceeding. The parties hereto agree that it would not be just and
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equitable if contribution pursuant to this subsection 4.1.5 were determined by Pro Rata allocation or by any other method of allocation, which does not take account of the equitable considerations referred to in this subsection 4.1.5. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution pursuant to this subsection 4.1.5 from any person who was not guilty of such fraudulent misrepresentation.
ARTICLE V
MISCELLANEOUS
5.1. Notices. Any notice or communication under this Agreement must be in writing and given by (a) deposit in the United States mail, addressed to the party to be notified, postage prepaid and registered or certified with return receipt requested, (b) delivery in person or by courier service providing evidence of delivery, or (c) transmission by hand delivery, electronic mail or facsimile. Each notice or communication that is mailed, delivered, or transmitted in the manner described above shall be deemed sufficiently given, served, sent, and received, in the case of mailed notices, on the third business day following the date on which it is mailed and, in the case of notices delivered by courier service, hand delivery, electronic mail, telecopy, telegram or facsimile, at such time as it is delivered to the addressee (with the delivery receipt or the affidavit of messenger) or at such time as delivery is refused by the addressee upon presentation. Any notice or communication under this Agreement must be addressed, if to the Company, to: WeWork Inc., 45 W. 18th Street, Floor 6, New York, NY 10011, Attention: Chief Legal Officer, Email: legal@wework.com and, if to any Holder, at such Holder’s address or facsimile number as set forth in the Company’s books and records. Any party may change its address for notice at any time and from time to time by written notice to the other parties hereto, and such change of address shall become effective thirty (30) days after delivery of such notice as provided in this Section 6.1.
5.2. Assignment; No Third Party Beneficiaries.
5.2.1 This Agreement and the rights, duties and obligations of the Company and the Holder of Registrable Securities, as the case may be, hereunder may not be assigned or delegated by the Company or the Holders of Registrable Securities, as the case may be, in whole or in part, except in connection with a transfer of Registrable Securities by such Holder to a Permitted Transferee but only if such Permitted Transferee agrees to become bound by this Agreement and any Lock-Up Period applicable to such Registrable Securities.
5.2.2 Prior to the expiration of any Lock-Up Period, no Holder subject to any such Lock-Up Period may assign or delegate such Holder’s rights, duties or obligations under this Agreement, in whole or in part, in violation of the applicable Lock-Up Period, except in connection with a transfer of Registrable Securities by such Holder to a Permitted Transferee but only if such Permitted Transferee agrees to become bound by this Agreement and any Lock-Up Period applicable to such Registrable Securities.
5.2.3 This Agreement and the provisions hereof shall be binding upon and shall inure to the benefit of each of the parties and its successors and the permitted assigns of the Holders, which shall include Permitted Transferees.
5.2.4 This Agreement shall not confer any rights or benefits on any persons that are not parties hereto, other than as expressly set forth in this Agreement and this Section 5.2.
5.2.5 No assignment by any party hereto of such party’s rights, duties and obligations hereunder shall be binding upon or obligate the Company unless and until the Company shall have received (i) written notice of such assignment as provided in Section 5.1 hereof and (ii) the written agreement of the assignee, in a form reasonably satisfactory to the Company, to be bound by the terms and provisions of this Agreement (which may be accomplished by an addendum or certificate of joinder to this Agreement). Any transfer or assignment made other than as provided in this Section 5.2 shall be null and void.
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5.3. Counterparts. This Agreement may be executed in multiple counterparts (including facsimile or PDF counterparts), each of which shall be deemed an original, and all of which together shall constitute the same instrument, but only one of which need be produced.
5.4. Governing Law; Venue. THE PARTIES EXPRESSLY AGREE THAT (I) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE STATE OF NEW YORK AND (II) THE VENUE FOR ANY ACTION TAKEN WITH RESPECT TO THIS AGREEMENT SHALL BE ANY STATE OR FEDERAL COURT IN NEW YORK COUNTY IN THE STATE OF NEW YORK.
5.5. Amendments and Modifications. Upon the written consent of the Company and the Holders of at least a majority in interest of the Registrable Securities at the time in question, compliance with any of the provisions, covenants and conditions set forth in this Agreement may be waived, or any of such provisions, covenants or conditions may be amended or modified; provided, however, that notwithstanding the foregoing, any amendment hereto or waiver hereof that adversely affects one Holder or group of affiliated Holders, solely in its capacity as a holder of the shares of capital stock of the Company, in a manner that is materially different from the other Holders (in such capacity) shall require the consent of the Holder or group of affiliated Holders so affected and (b) any amendment hereto or waiver hereof that adversely affects the rights of any Anchor Investor shall require the consent of such entity. No course of dealing between any Holder or the Company and any other party hereto or any failure or delay on the part of a Holder or the Company in exercising any rights or remedies under this Agreement shall operate as a waiver of any rights or remedies of any Holder or the Company. No single or partial exercise of any rights or remedies under this Agreement by a party shall operate as a waiver or preclude the exercise of any other rights or remedies hereunder or thereunder by such party.
5.6. Other Registration Rights. Other than pursuant to the terms of the Subscription Agreements, the Company represents and warrants that no person, other than the Holders of the Registrable Securities, has any right to require the Company to register any shares of the Company’s capital stock for sale or to include shares of the Company’s capital stock in any registration filed by the Company for the sale of shares of capital stock for its own account or for the account of any other person. Further, with respect to the parties hereto, the Company represents and warrants that this Agreement supersedes any other registration rights agreement or agreement with similar terms and conditions and in the event of a conflict between any such agreement or agreements and this Agreement, the terms of this Agreement shall prevail. For so long as at least five percent (5%) of the shares of Class A Common Stock outstanding as of the date of this Agreement remain outstanding and constitute Registrable Securities, the Company hereby agrees and covenants that it will not grant rights to register any shares of Class A Common Stock or any other class or series of equity securities of the Company pursuant to the Securities Act that are more favorable, pari passu or senior to those granted to the Holders hereunder without the prior written consent of the Holders of a majority of the total Registrable Securities.
5.7. Term. This Agreement shall terminate, with respect to any Holder, on the date that such Holder no longer holds any Registrable Securities. The provisions of Sections 3.2 and 3.5 and Articles IV and V shall survive any termination.
5.8. Specific Performance. Each of the parties acknowledges and agrees that the other parties would be damaged irreparably in the event any of the provisions of this Agreement are not performed in accordance with their specific terms or otherwise are breached or violated. Accordingly, to the fullest extent permitted by law, each of the parties agrees that, without posting bond or other undertaking, the other parties will be entitled to an injunction or injunctions to prevent breaches or violations of the provisions of this Agreement and to enforce specifically this Agreement and the terms and provisions hereof in any action, claim or suit in addition to any other remedy to which it may be entitled, at law or in equity. Each party further agrees that, in the event of any action for specific performance in respect of such breach or violation, it will not assert that the defense that a remedy at law would be adequate.
19
5.9. Entire Agreement. This Agreement constitutes the entire understanding and agreement between the parties as to the matters covered herein and supersedes and replaces any prior understanding, agreement or statement of intent, in each case, written or oral, of any and every nature with respect thereto.
5.10. Severability. This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible that is valid and enforceable.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
20
IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement to be executed and delivered by their duly authorized representatives as of the date first written above.
| COMPANY: | ||
| WEWORK INC. | ||
| By: | /s/ Jared DeMatteis | |
| Name:Jared DeMatteis | ||
| Title:Chief Legal Officer and Secretary | ||
IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement to be executed and delivered by their duly authorized representatives as of the date first written above.
| COMPANY: | ||
| WEWORK INC. | ||
| By: | /s/ Jared Dematteis | |
| Name: | Jared Dematteis | |
| Title: | Chief Legal Officer and Secretary | |
[Signature Page to A&R Registration Rights Agreement]
| BOWX INVESTORS: | ||||||
| BOWX SPONSOR, LLC | ||||||
| By: | /s/ Vivek Ranadive |
|||||
| Name: | Vivek Ranadive | |||||
| Title: | Managing Member | |||||
| /s/ Vivek Ranadive |
/s/ Vijay Advani | |||||
| Vivek Ranadive | Vijay Advani | |||||
| /s/ Murray Rode |
/s/ Lori Wright | |||||
| Murray Rode | Lori Wright | |||||
| /s/ Eric C. W. Dunn |
/s/ Nanci Caldwell | |||||
| Eric C. W. Dunn | Nanci Caldwell | |||||
| /s/ Daven Patel |
/s/ Rafi Sayed | |||||
| Daven Patel | Rafi Sayed | |||||
| /s/ Suraj Patel |
/s/ Shaquille O’ Neal | |||||
| Suraj Patel | Shaquille O’ Neal | |||||
| /s/ Vishal Sikka |
/s/ Christina Dong | |||||
| Vishal Sikka | Christina Dong | |||||
| /s/ Ken Goldman |
||||||
| Ken Goldman | ||||||
[Signature Page to A&R Registration Rights Agreement]
| BLACKROCK CREDIT ALPHA MASTER FUND L.P. | ||
| By: | BlackRock Financial Management, Inc., in its capacity as investment advisor | |
| By: | /s/ Christopher Biasotti | |
| Name: | Christopher Biasotti | |
| Title: | Authorized Signatory | |
| HC NCBR FUND | ||
| By: | BlackRock Financial Management, Inc., in its capacity as investment advisor | |
| By: | /s/ Christopher Biasotti | |
| Name: | Christopher Biasotti | |
| Title: | Authorized Signatory | |
[Signature Page to A&R Registration Rights Agreement]
| ANCHOR INVESTORS | ||
| SOF-X WW HOLDINGS, L.P. | ||
| By: | SOF-X WW Holdings GP, L.L.C. | |
| By: | /s/ Timothy Abram | |
| Name: | Timothy Abram | |
| Title: | Senior Vice President | |
| SOF-XI WW HOLDINGS, L.P. | ||
| By: | SOF-XI WW Holdings GP, L.L.C. | |
| By: | /s/ Timothy Abram | |
| Name: | Timothy Abram | |
| Title: | Senior Vice President | |
[Signature Page to A&R Registration Rights Agreement]
| INSIGHT ENTITIES | ||
| INSIGHT PARTNERS XII, L.P. | ||
| By: | /s/ Andrew Prodromos | |
| Name: | Andrew Prodromos | |
| Title: | Authorized Officer | |
| INSIGHT PARTNERS XII (CO-INVESTORS), L.P. | ||
| By: | /s/ Andrew Prodromos | |
| Name: | Andrew Prodromos | |
| Title: | Authorized Officer | |
| INSIGHT PARTNERS XII (CO-INVESTORS) (B), L.P. | ||
| By: | /s/ Andrew Prodromos | |
| Name: | Andrew Prodromos | |
| Title: | Authorized Officer | |
| INSIGHT PARTNERS (CAYMAN) XII, L.P. | ||
| By: | /s/ Andrew Prodromos | |
| Name: | Andrew Prodromos | |
| Title: | Authorized Officer | |
[Signature Page to A&R Registration Rights Agreement]
| INSIGHT ENTITIES | ||
| INSIGHT PARTNERS (DELAWARE) XII, L.P. | ||
| By: | /s/ Andrew Prodromos | |
| Name: | Andrew Prodromos | |
| Title: | Authorized Officer | |
| INSIGHT PARTNERS (EU) XII, S.C. S.P. | ||
| By: | /s/ Andrew Prodromos | |
| Name: | Andrew Prodromos | |
| Title: | Authorized Officer | |
[Signature Page to A&R Registration Rights Agreement]
| WINDMILL INVESTORS | ||
| BENCHMARK CAPITAL PARTNERS VII (AIV), L.P. as nominee for | ||
| Benchmark Capital Partners VII (AIV), L.P., | ||
| Benchmark Founders’ Fund VII, L.P. and | ||
| Benchmark Founders’ Fund VII-B, L.P. | ||
| By: | Benchmark Capital Management Co. VII, L.L.C., its general partner | |
| By: | /s/ An-Yen Hu | |
| An-Yen Hu, Officer | ||
| Address: | 2965 Woodside Road | |
| Woodside, CA 94062 | ||
[Signature Page to A&R Registration Rights Agreement]
| SB WW HOLDINGS (CAYMAN) LIMITED | ||
| By: | /s/ Karen Ellerbe | |
| Name: | Karen Ellerbe | |
| Title: | Director | |
| SVF ENDURANCE (CAYMAN) LIMITED | ||
| By: | /s/ Karen Ellerbe | |
| Name: | Karen Ellerbe | |
| Title: | Director | |
| SVF II WW (DE) LLC | ||
| By: | /s/ Matthew Johnson | |
| Name: | Matthew Johnson | |
| Title: | Director | |
[Signature Page to A&R Registration Rights Agreement]
| DAG Ventures V, L.P. | ||
| By: | /s/ John Cadeddu | |
| Name: | John Cadeddu | |
| Title: | Managing Director | |
| DAG Ventures V-QP, L.P. | ||
| By: | /s/ John Cadeddu | |
| Name: | John Cadeddu | |
| Title: | Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Fidelity Securities Fund: Fidelity OTC Portfolio | ||||
| By: | /s/ James Wegmann |
|||
| Name: | James Wegmann | |||
| Title: | Authorized Signatory | |||
| Fidelity Contrafund: Fidelity Advisor New Insights Fund | ||||
| By: | /s/ James Wegmann |
|||
| Name: | James Wegmann | |||
| Title: | Authorized Signatory | |||
| Fidelity Contrafund: Fidelity Contrafund | ||||
| By: | /s/ James Wegmann |
|||
| Name: | James Wegmann |
|||
| Title: | Authorized Signatory | |||
| Fidelity Contrafund: Fidelity Series Opportunistic Insights Fund | ||||
| By: | /s/ James Wegmann |
|||
| Name: | James Wegmann | |||
| Title: | Authorized Signatory | |||
| Fidelity Contrafund: Commingled Pool | By: | Fidelity Management Trust Company as Trustee | ||
| By: | /s/ James Wegmann |
|||
| Name: | James Wegmann | |||
| Title: | Authorized Signatory |
[Signature Page to A&R Registration Rights Agreement]
| 522 Fifth Avenue Fund, L.P. | ||
| By: | /s/ Tyler Jayroe | |
| Name: | Tyler Jayroe | |
| Title: | Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| National Automatic Sprinkler Industry Pension Fund | ||
| By: | /s/ Tyler Jayroe | |
| Name: | Tyler Jayroe | |
| Title: | Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| PEG Digital Growth Fund II L.P. | ||
| By: | /s/ Tyler Jayroe | |
| Name: | Tyler Jayroe | |
| Title: | Managing Director | |
| PEG Digital Global Private Equity Institutional Investors V LLC | ||
| By: | /s/ Tyler Jayroe | |
| Name: | Tyler Jayroe | |
| Title: | Managing Director | |
| PEG Secondary Private Equity Investors II L.P. | ||
| By: | /s/ Tyler Jayroe | |
| Name: | Tyler Jayroe | |
| Title: | Managing Director | |
| PEG WeWork LLC | ||
| By: | /s/ Tyler Jayroe | |
| Name: | Tyler Jayroe | |
| Title: | Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Red River Venture Capital Fund, L.P. | ||
| By: | /s/ Tyler Jayroe | |
| Name: | Tyler Jayroe | |
| Title: | Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| UNITE HERE Retirement Fund | ||
| By: | /s/ Tyler Jayroe | |
| Name: | Tyler Jayroe | |
| Title: | Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Co-Op Retirement Plan Trust | ||
| JPMorgan Chase Bank, N.A., solely in its capacity as Trustee | ||
| By: | /s/ Kristopher Nickol | |
| Name: | Kristopher Nickol | |
| Title: | Vice President | |
[Signature Page to A&R Registration Rights Agreement]
| Benvolio Ventures LLC – Series WeWork | ||
| By: Benvolio Group LLC, its Manager | ||
| By: | /s/ Ernest Odinec | |
| Name: | Ernest Odinec | |
| Title: | Manager | |
[Signature Page to A&R Registration Rights Agreement]
| Frankfort Family Trust DTD 11/11/2003 | ||
| By: |
/s/ Roberta Frankfort | |
| Name: |
Roberta Frankfort | |
| Title: |
Trustee | |
[Signature Page to A&R Registration Rights Agreement]
| Genuine Parts Company Pension Plan | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Global Multi-Strategy Fund | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Growth Portfolio | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Hadley Harbor Master Investors (Cayman) L.P. | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| The Hartford Capital Appreciation Fund | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
| The Hartford Growth Opportunities Fund | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
| Hartford Disciplined Equity HLS Fund | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
| Hartford International Equity Fund | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Mid Cap Stock Fund | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| John Hancock Variable Insurance Trust – Mid Cap Stock Trust | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Treasurer of the State of North Carolina | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Vanguard U.S. Growth Fund | ||
| By: | Wellington Management Company LLP, as investment adviser | |
| By: | /s/ Valerie N. Tipping | |
| Name: | Valerie N. Tipping | |
| Title: | Counsel and Managing Director | |
[Signature Page to A&R Registration Rights Agreement]
| Empire Star Global Limited | ||
| By: | /s/ Authorized Person | |
| Name: | ||
| Title: | Authorized Person | |
[Signature Page to A&R Registration Rights Agreement]
Exhibit 10.2
EXECUTION VERSION
STOCKHOLDERS AGREEMENT
This STOCKHOLDERS AGREEMENT (this “Agreement”) is made and entered into as of October 20, 2021, by and among (i) WeWork Inc., a Delaware corporation (formerly known as BowX Acquisition Corp) (the “Company”), (ii) BowX Sponsor, LLC, a Delaware limited liability company (“BowX Investor”), (iii) SB WW Holdings (Cayman) Limited (“SB Investor”), (iv) SVF Endurance (Cayman) Limited (“VF Investor”), (v) Benchmark Capital Partners VII (AIV), L.P. (“Benchmark Investor” and, together with BowX Investor, SB Investor and VF Investor, each a “Stockholder” and collectively, the “Stockholders”). Each capitalized term used and not otherwise defined herein shall have the meaning assigned to such term in the Merger Agreement (as defined below).
WHEREAS, BowX Investor is the holder of certain shares of the Company’s Class A common stock, par value $0.0001 per share (the “Class A Common Stock” or the “Common Stock”), and certain warrants to acquire shares of Class A Common Stock;
WHEREAS, as a result of the transactions contemplated by that certain Agreement and Plan of Merger, dated March 25, 2021, by and among the Company and certain other persons named therein and party thereto (as it may be amended in accordance with its terms, the “Merger Agreement”), each of the Stockholders other than BowX Investor are receiving shares of Class A Common Stock; and
WHEREAS, in connection with the transactions contemplated by the Merger Agreement, the Company and the Stockholders desire to set forth certain understandings among them, including with respect to certain governance matters.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:
ARTICLE I
REPRESENTATIONS AND WARRANTIES OF THE PARTIES
Each party hereby represents and warrants to the other parties and acknowledges that: (a) the execution, delivery and performance of this Agreement have been duly authorized by such party and do not require such party to obtain any consent or approval that has not been obtained and do not contravene or result in a default under any provision of any law or regulation applicable to such party or other Governing Documents or any agreement or instrument to which such party is a party or by which such party is bound; (b) such party has the power and authority to enter into this Agreement and to carry out its obligations hereunder; and (c) this Agreement is valid, binding and enforceable against such party in accordance with its terms.
ARTICLE II
BOARD OF DIRECTORS; OBSERVERS; VOTING AGREEMENT
Section 2.1 Initial Board Composition. As of the date of this Agreement, the authorized number of directors on the board of directors of the Company (the “Board”) is nine (9). The initial composition of the Board shall be as follows:
(a) three directors designated by the SB Investor, who initially shall be: Véronique Laury, Michel Combes, and Marcelo Claure, who shall initially serve as Executive Chairman;
(b) one director designated by the VF Investor, who initially shall be Kirthiga Reddy;
(c) one director designated by the Benchmark Investor, who initially shall be Bruce Dunlevie;
(d) one director designated by Insight Partners (the “Insight Investor”), who initially shall be Deven Parekh;
(e) one director designated by the BowX Investor, who initially shall be Vivek Ranadivé;
(f) the Chief Executive Officer of the Company, who initially shall be Sandeep Mathrani; and
(g) Jeff Sine.
Section 2.2 SB Investor Director Designations. Until such time as the SB Investor Transfers (other than to a Permitted Transferee) a number of shares of Class A Common Stock representing at least 50% of the outstanding shares of Class A Common Stock held by the SB Investor as of the Closing, the SB Investor shall have the right to designate for nomination by the Board (or a nominating committee thereof) three candidates for election to the Board. After such time as the SB Investor has Transferred (other than to a Permitted Transferee) a number of shares of Class A Common Stock representing at least 50% of the outstanding shares of Class A Common Stock held by the SB Investor as of the Closing, for so long as the SB Investor and the Permitted Transferees of the SB Investor, in the aggregate, hold a number of shares representing at least the percentage of the combined outstanding shares of Class A Common Stock and Class C Common Stock shown below, the SB Investor shall have the right to designate for nomination by the Board (or a nominating committee thereof) a number of candidates for election to the Board that, if elected, would result in SB Investor having nominated the number of directors serving on the Board that is shown below (any person nominated by the SB Investor pursuant to this Section 2.2, an “SB Investor Nominee”).
2
| Percentage of Outstanding Class A and Class C Common Stock |
Number of SB Investor Directors |
|||
| 25% or greater |
3 | |||
| Less than 25% but greater than or equal to 15% |
2 | |||
| Less than 15% but greater than or equal to 1% |
1 | |||
| Less than 1% |
0 | |||
Section 2.3 Other Investor Director Designations. Until such time as a Stockholder (other than the SB Investor) or the Insight Investor Transfers (other than to a Permitted Transferee) a number of shares of Class A Common Stock representing at least 50% of the outstanding shares of Class A Common Stock held, as applicable, by such Stockholder or the Insight Investor as of the Closing, such Stockholder or the Insight Investor, as applicable, shall have the right to designate for nomination by the Board (or a nominating committee thereof) one candidate for election to the Board (each, a “Stockholder Nominee”). Notwithstanding anything in the immediately preceding sentence to the contrary, if the VF Investor loses such designation right, effective immediately upon such loss, so long as the SB Investor and the Permitted Transferees of the SB Investor, in the aggregate, hold a number of shares representing at least 1% of the outstanding shares of Class A Common Stock and Class C Common Stock, the SB Investor shall have the right to designate for nomination by the Board (or a nominating committee thereof) an additional candidate in addition to the candidates set forth in Section 2.2.
Section 2.4 Company Actions.
(a) To the extent such action is consistent with the fiduciary duties of the Board (or a nominating committee thereof), the Company agrees to include in the slate of nominees recommended by the Board those SB Investor Nominees and Stockholder Nominees designated by the Stockholders in accordance with the terms hereof and to include such persons in the Company’s proxy materials and form of proxy disseminated to stockholders of the Company in connection with the election of directors (including at any special meeting of stockholders held for the election of directors). Each of the Stockholders shall include in its written communication of designation to the Board (or a nominating committee thereof), which shall be delivered no later than 15 days prior to the Board or nominating committee meeting to consider a slate of director nominees, (x) director biographies in customary form and (y) reasonably detailed information regarding the independence of each such nominee intended to qualify as independent. To the extent such action is consistent with the fiduciary duties of the Board (or a nominating committee thereof), the Company shall use its reasonable best efforts to cause the election of each such designee to the Board, including nominating such designees to be elected as directors and by soliciting proxies in favor of the election of such persons.
(b) In the event that at any time the number of directors entitled to be designated by a Stockholder pursuant to Sections 2.2 or 2.3 decreases, such Stockholder and the Company shall take reasonable actions to cause a sufficient number of designated directors to resign from the Board at or prior to the end of such designated director’s term (as may be determined by the Company’s nominating and corporate governance committee) such that the number of directors designated by such Stockholder after such resignation(s) equals the number of directors such Stockholder is then-entitled to designate pursuant to Sections 2.2 and 2.3 (as applicable). Subject to Section 2.8(b), any vacancies created by such resignation may remain
3
vacant until the next annual meeting of stockholders or may be filled by a majority vote of the Board or a committee thereof in accordance with Section 2.8(b). Notwithstanding the foregoing, such designated director(s) need not resign from the Board at or prior to the end of such
director’s term if the Company’s nominating and corporate governance committee recommends the nomination of such director(s) for election at the next annual meeting coinciding with the end of such director’s term, or otherwise (and upon such election, such director shall no longer be considered a designee of the applicable Stockholder).
Section 2.5 Director Independence. During the term of this Agreement, the majority of the directors comprising the Board shall qualify as “independent” under all Applicable Regulations (collectively, “Independent”). If the Board (or a nominating committee thereof) in the exercise of its reasonable business judgment reasonably determines that any individual designated by a Stockholder as Independent is not Independent, the Board shall promptly notify such Stockholder of such determination and such Stockholder will be entitled to designate a replacement Independent individual for nomination. The Stockholders acknowledge and agree that the SB Investor shall never be required to designate for nomination more than one candidate for election to the Board that qualifies as Independent. Any director designated for nomination by the Insight Investor shall be required at all times to be Independent.
Section 2.6 Employee Directors. For so long as the Company has a duly appointed and acting Chief Executive Officer as a named executive officer, the Company shall take all Necessary Action to include such Chief Executive Officer in the slate of nominees recommended by the Board for election as directors at each applicable annual or special meeting of
stockholders at which directors are to be elected.
Section 2.7 Committee Representation. Subject to Applicable Regulations (including with respect to Independent director representation on Board committees), SB Investor shall have the right to have a pro rata number of SB Investor Nominees (rounded to the nearest whole number, but in any event not less than one (1)) appointed to serve on each committee of the Board for so long as SB Investor has the right to designate at least one (1) director for election to the Board. (For example, if SB Investor then has the right to nominate three (3) persons to a board of directors of nine (9) persons (i.e., 33%), and a committee of three (3) persons is established, one (1) committee member shall be a SB Investor Director). Notwithstanding the foregoing, if there shall ever be a committee of less than two (2) directors established, no SB Investor designated director shall serve on such committee.
Section 2.8 Vacancies and Removal.
(a) Except as provided for in Section 2.1 and Section 2.2, and to the extent not inconsistent with Section 141(k) of the General Corporation Law of the State of Delaware and the Company’s Governing Documents: (a) each Stockholder shall have the exclusive right to instruct that its respective nominated director(s) be removed from the Board, and the Board and each Stockholder shall take all Necessary Action to cause the removal of any of the directors nominated by a Stockholder at the instruction of such Stockholder; and (b) each Stockholder shall have the exclusive right to nominate for appointment or nomination by the Board candidates to fill vacancies created by reason of death, removal or resignation of the applicable SB Investor Nominee or Stockholder Nominee, as applicable, and the Board and the Stockholders shall take all Necessary Action to cause any such vacancies to be filled by replacement candidates nominated by the applicable stockholder (consistent with the other provisions of this Agreement) as promptly as reasonably practicable.
4
(b) Notwithstanding Section 2.7, at any time that the voting restrictions set forth in Article V, Part A, Section 7 of the Charter remain in effect, if a vacancy on the Board arises by reason of the death, removal or resignation of a director (x) who was not nominated by any of the Stockholders pursuant to Section 2.2 or Section 2.3 or (y) pursuant to the first sentence of Section 2.4(b), then a committee of the Board shall be created consisting of all of the directors other than any directors designated by the SB Investor or the VF Investor, and any such vacancy shall be filled as promptly as practicable by a majority vote of such committee.
(c) To the extent not inconsistent with Section 141(k) of the General Corporation Law of the State of Delaware and the Company’s Governing Documents, in the event the director initially identified in Section 2.1(g) is no longer then-serving as a director by reason of death, removal, resignation or otherwise, the Board and the Stockholders shall take all Necessary Action to cause any such vacancy to be filled by a replacement candidate approved and nominated by the Stockholders based on a majority vote of shares of Common Stock held by the Stockholders; provided, however, that if at such time the voting restrictions set forth in Article V, Part A, Section 7 of the Charter remain in effect, then the shares held by the SB Investor shall remain subject to such provision of the Charter (i.e., SB Investor and VF Investor, together, cannot exercise more than 49.9% voting power in such approval and nomination).
(d) If upon any event or for any reason, the directors designated by the SB Investor and the VF Investor would comprise more than half of the directors then in office, then, effective immediately prior to such event (a “Resignation Event”), a sufficient number of the SB Investor designated directors shall be deemed to have resigned from the Board so that the directors designated by the SB Investor and the VF Investor would not comprise more than half of the directors then in office. For the avoidance of doubt, this Section 2.8(d) shall not be interpreted as restricting any of the SB Investor’s or the VF Investor’s rights under this Agreement, including, without limitation, Section 2.2, Section 2.3 and Section 2.8(a).
Section 2.9 Board Observer Rights. Until such time as SOF-X WW Holdings, L.P. and SOF-XI WW Holdings, L.P. (together, “Starwood Investors”) Transfer (other than to a Permitted Transferee) a number of shares of Class A Common Stock representing at least 50% of the aggregate outstanding shares of Class A Common Stock held by Starwood Investors as of the Closing, the Company will permit an individual designated in writing by Starwood Investors from time to time (each, an “Observer”) to attend meetings of the Board and of any committee thereof as a non-voting observer, and will give such individual notice of such meetings at the same time and in the same manner as notice to the directors or advisory board members. Observer shall be entitled to concurrent receipt of any materials provided to the Board or any committee thereof, provided, however, that such Observer shall agree to hold in confidence and trust all information so provided; provided further, however, that the Company reserves the right to withhold any materials and to exclude such Observer from any meeting or portion thereof if access to such materials or attendance at such meeting could adversely affect the attorney-client privilege between the Company and its counsel or result in disclosure of trade secrets or a conflict of interest, or if Starwood Investors or their representative is a competitor of the Company.
5
Section 2.10 Board Meeting Expenses. The Company shall pay all reasonable and documented out-of-pocket costs and expenses (including, but not limited to, travel and lodging) incurred by each member of the Board, and by each Observer (if any), incurred in the course of his or her service hereunder, including in connection with attending regular and special meetings of the Board, any board of directors or board of managers of each of the Company’s subsidiaries and/or any of their respective committees.
Section 2.11 Voting Agreement. Subject to Section 2.12, each Stockholder hereby agrees to vote, or cause to be voted, all shares of Common Stock owned beneficially or of record by such Stockholder, or over which such Stockholder maintains voting control, directly or indirectly, in such manner as may be necessary or advisable in support of, or to implement, maintain, or protect the various matters set forth in, and the intent of, this Article II (including without limitation the maintenance of a number of authorized directors and the election or removal of designated nominees), whether at an annual or special meeting of stockholders of the Company or pursuant to any written consent of the stockholders of the Company. Notwithstanding anything in this Agreement to the contrary, at any time the voting restrictions set forth in Article V, Part A, Section 7 of the Charter remain in effect, any shares of Common Stock subject to the Subject Shares Proxy shall be voted in accordance with the Charter.
Section 2.12 Proxy. Except as otherwise set forth in Section 2.8(c), solely with respect to the election of directors to the Board and as set forth in clause (y) below, each of the SB Investor and the VF Investor hereby irrevocably appoints the WW Executive (as defined in the Charter) as its attorney and proxy, to the full extent of its voting rights with respect to its shares (“Remaining Shares”) of Common Stock, other than Subject Shares (as defined in the Charter), (x) except as set forth in the following clause (y), to vote all Remaining Shares in accordance with Section 2.11 and (y) in connection with a stockholder vote to remove any director from the Board who has not been designated by a Stockholder pursuant to Section 2.2 or Section 2.3, to vote all Remaining Shares in proportion to the votes cast by the stockholders of the Company (other than the SB Investor and the VF Investor) in such stockholder vote. For the avoidance of doubt, the SB Investor and the VF Investor retain all economic and all other non-voting rights, powers and preferences in their respective Remaining Shares, including voting rights on matters unrelated to those described in the foregoing sentence. The proxy granted under this Section 2.12 shall automatically terminate when the voting restrictions set forth in Article V, Part A, Section 7 of the Charter are no longer in effect.
ARTICLE III
TERM AND TERMINATION
Section 3.1 Term. This Agreement shall terminate, and be of no further force and effect:
(a) upon the mutual consent of all parties hereto; or
6
(b) with respect to any Stockholder, upon the time that such Stockholder is no longer entitled to nominate at least one (1) director (or in the case of Starwood Investors, an observer) pursuant to Article II hereof.
Section 3.2 Effect of Termination. If this Agreement is terminated pursuant to Section 3.1(a) hereof, this Agreement shall become void and of no further force and effect, except for: (i) the provisions set forth in this Section 3.2 and in Article V; and (ii) the rights with respect to the breach of any provision hereof by the Company.
ARTICLE IV
DEFINITIONS
“Affiliate” has the meaning set forth in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended.
“Applicable Regulations” means applicable laws and national securities exchange regulations that apply to the Company.
“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in New York City, New York are authorized or required by law to close.
“Governing Documents” with respect to the Company and any of its subsidiaries, means, collectively, certificate of incorporation, certificate of formation, bylaws, operating agreement or similar governing documents.
“Necessary Action” means, with respect to a specified result, all actions, to the fullest extent permitted by applicable law and, in the case of any action by the Company that requires a vote or other action on the part of the Board, to the extent such action is consistent with the fiduciary duties of the Board, necessary to cause such result, including, without limitation: (a) voting or providing a written consent or proxy with respect to the Common Stock; (b) causing the adoption of amendments to the Governing Documents; (c) executing agreements and instruments; and (d) making, or causing to be made, with governmental, administrative or regulatory authorities, all filings, registrations or similar actions that are required to achieve such result.
“Person” means any individual, firm, corporation, partnership, limited liability company, incorporated or unincorporated association, joint venture, joint stock company, governmental authority or instrumentality or other entity of any kind.
“Charter” means the Company’s Second Amended and Restated Certificate of Incorporation, as amended.
“Transfer” means, with respect to any securities, to sell, assign, transfer or otherwise dispose of such securities.
7
ARTICLE V
MISCELLANEOUS
Section 5.1 Amendment and Waiver. This Agreement may be amended by the parties at any time by execution of an instrument in writing signed by the Company and the Stockholders holding at least two-thirds (2/3) of the shares of Common Stock subject to this Agreement; provided, however, that (x) no amendment shall adversely affect the rights of a Stockholder in a manner disproportionate to any other Stockholder (unless consented to by such Stockholder), and (y) if at such time the voting restrictions set forth in Article V, Part A, Section 7 of the Charter remain in effect, then the shares held by the SB Investor shall remain subject to such provision of the Charter (i.e., SB Investor and VF Investor, together, cannot exercise more than 49.9% voting power in connection with any proposed amendment). Notwithstanding the foregoing, Section 2.1 and Section 2.9 may only be amended as follows: (i) Section 2.1(a) may only be amended with the express written consent of SB Investor, (ii) Section 2.1(b) may only be amended with the express written consent of VF Investor, (iii) Section 2.1(c) may only be amended with the express written consent of Benchmark Investor, and (iv) Section 2.1(e) may only be amended with the express written consent of BowX Investor; provided that a provision for which a specific Stockholder is no longer entitled to rights thereunder shall not require any consent of such Stockholder with respect to amending or modifying such provision. In the event any Applicable Regulations come into force or effect (including by amendment), including any applicable rules of a national securities exchange upon which the Class A Common Stock is registered, or of the Securities and Exchange Commission, which conflicts with the terms and conditions of this Agreement, the parties shall negotiate in good faith to revise this Agreement to achieve the parties’ intention set forth herein.
Section 5.2 Severability. In the event that any term, provision, covenant or restriction of this Agreement, or the application thereof, is held to be illegal, invalid or unenforceable under any present or future applicable law: (a) such provision will be fully severable; (b) this Agreement will be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof; (c) the remaining provisions of this Agreement will remain in full force and effect and will not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom; and (d) in lieu of such illegal, invalid or unenforceable provision, there will be added automatically as a part of this Agreement a legal, valid and enforceable provision as similar in terms of such illegal, invalid or unenforceable provision as may be possible.
Section 5.3 Entire Agreement. Except as otherwise expressly set forth herein, this document and the documents referenced herein and therein embody the complete agreement and understanding among the parties hereto with respect to the subject matter hereof and supersede and preempt any prior understandings, agreements or representations by or among the parties hereto, written or oral, which may have related to the subject matter hereof in any way. The parties hereto acknowledge and agree that: (i) the Insight Investor shall be a third-party beneficiary of Section 2.3; (ii) the Starwood Investors shall be a third-party beneficiary of Section 2.3; (iii) Section 2.1(d) may only be amended with the express written consent of the Insight Investor; and (iv) Section 2.9 may only be amended with the express written consent of the Starwood Investors; provided that the third-party beneficiary and consent rights granted under this Section 5.3 shall terminate (x) in respect of the Insight Investor, when it no longer has the right to designate a member of the Board pursuant to Section 2.1(d), and (y) in respect of the Starwood Investors, when they no longer have the right to designate an Observer pursuant to Section 2.9.
8
Section 5.4 Transfers; Successors and Assigns.
(a) If a Stockholder effects any Transfer of shares of Common Stock to any Affiliate of such Stockholder (or to any executive officer or director of such Stockholder or of such Stockholder’s Affiliates) (each, a “Permitted Transferee”) or any other Person approved by the Company in its sole and absolute discretion, such Permitted Transferee shall, if not a Stockholder, within five (5) days of such Transfer execute an agreement stating that the transferee is receiving and holding the securities subject to the provisions of this Agreement and that such Permitted Transferee agrees to be a “Stockholder” for all purposes of this Agreement, and which provides that such Permitted Transferee shall be bound by and shall fully comply with the terms of this Agreement. If a Stockholder effects any Transfer of shares of Common Stock to any Person that is not a Permitted Transferee, such Person shall not become a “Stockholder” hereunder, and shall have no rights or obligations hereunder.
(b) Except as otherwise provided herein, this Agreement shall bind and inure to the benefit of and be enforceable by the Company and its successors and assigns, and each Stockholder and its respective successors and assigns, so long as such Persons hold Common Stock. No Stockholder may assign any of its rights hereunder to any Person other than a Permitted Transferee. Each Permitted Transferee of any Stockholder shall be subject to all of the terms of this Agreement, and by taking and holding such shares such Person shall be entitled to receive the benefits of and be conclusively deemed to have agreed to be bound by and to comply with all of the terms and provisions of this Agreement; provided, however, no transfer of rights permitted hereunder shall be binding upon or obligate the Company unless and until if required under Section 5.4(a), the Company shall have received written notice of such transfer and the written agreement of the transferee provided for in Section 5.4(a). Notwithstanding the foregoing, no successor or assignee of the Company shall have any rights granted under this Agreement until such Person shall acknowledge its rights and obligations hereunder by a signed written statement of such Person’s acceptance of such rights and obligations.
Section 5.5 Counterparts. This Agreement may be executed in separate counterparts each of which shall be an original and all of which taken together shall constitute one and the same agreement.
Section 5.6 Remedies. The parties hereto agree and acknowledge that money damages are not an adequate remedy for any breach of the provisions of this Agreement and that the Company and each Stockholder shall have the right to injunctive relief or specific performance, in addition to all of its rights and remedies at law or in equity, to enforce the provisions of this Agreement. Nothing contained in this Agreement shall be construed to confer upon any person who is not a signatory hereto any rights or benefits, as a third party beneficiary or otherwise. Each of the parties hereto shall pay their own fees and expenses, including their own counsel fees, incurred in connection with this Agreement; provided, that a Stockholder that incurs fees and expenses in successfully enforcing its rights under this Agreement against the Company shall be entitled to award or reimbursement of such fees and expenses to the extent documented and reasonably incurred.
9
Section 5.7 Notices. All notices and other communications hereunder shall be in writing and shall be deemed given: (a) on the date established by the sender as having been delivered personally; (b) one Business Day after being sent by a nationally recognized overnight courier guaranteeing overnight delivery; (c) on the date delivered, if delivered by email, with confirmation of transmission; or (d) on the fifth Business Day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications, to be valid, must be addressed as follows:
If to the Company:
WeWork Inc.
575 Lexington Avenue
New York, NY 10022
Attention: Chief Legal Officer
Email: legal@wework.com
If to a Stockholder:
To such Stockholder as set forth on Schedule I.
or to such other address or to the attention of such Person or Persons as the recipient party has specified by prior written notice to the sending party (or in the case of counsel, to such other readily ascertainable business address as such counsel may hereafter maintain). If more than one method for sending notice as set forth above is used, the earliest notice date established as set forth above shall control.
Section 5.8 Governing Law. This Agreement and any action, suit, dispute, controversy or claim arising out of this Agreement or the validity, interpretation, breach or termination of this Agreement shall be governed by and construed in accordance with the internal law of the State of Delaware regardless of the law that might otherwise govern under applicable principles of conflicts of law thereof.
Section 5.9 CONSENT TO JURISDICTION AND SERVICE OF PROCESS; WAIVER OF JURY TRIAL. THE PARTIES TO THIS AGREEMENT SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE COURT OF CHANCERY OF THE STATE OF DELAWARE, OR IF SUCH COURT SHALL NOT HAVE JURISDICTION, ANY STATE OR FEDERAL COURT LOCATED IN THE STATE OF DELAWARE (AND ANY APPROPRIATE APPELLATE COURT THEREFROM) (THE “DELAWARE COURTS”) IN RESPECT OF THE INTERPRETATION AND ENFORCEMENT OF THE PROVISIONS OF THIS AGREEMENT AND ANY RELATED AGREEMENT, CERTIFICATE OR OTHER DOCUMENT DELIVERED IN CONNECTION HEREWITH AND BY THIS AGREEMENT WAIVE, AND AGREE NOT TO ASSERT, ANY DEFENSE IN ANY ACTION FOR THE INTERPRETATION OR ENFORCEMENT OF THIS AGREEMENT AND ANY RELATED AGREEMENT, CERTIFICATE OR OTHER DOCUMENT DELIVERED IN CONNECTION HEREWITH, THAT THEY ARE NOT SUBJECT THERETO OR THAT SUCH ACTION
10
MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN THE APPLICABLE DELAWARE COURT OR THAT THIS AGREEMENT MAY NOT BE ENFORCED IN OR BY THE APPLICABLE DELAWARE COURT OR THAT THEIR PROPERTY IS EXEMPT OR IMMUNE FROM EXECUTION, THAT THE ACTION IS BROUGHT IN AN INCONVENIENT FORUM, OR THAT THE VENUE OF THE ACTION IS IMPROPER. SERVICE OF PROCESS WITH RESPECT THERETO MAY BE MADE UPON ANY PARTY TO THIS AGREEMENT BY MAILING A COPY THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH PARTY AT ITS ADDRESS AS PROVIDED IN SECTION 5.7.
Section 5.10 WAIVER OF TRIAL BY JURY. EACH PARTY HERETO HEREBY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) 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, (II) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5.10.
Section 5.11 Descriptive Headings. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.
[remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of the date first written above.
THE COMPANY:
WeWork Inc.
| By: | /s/ Jared Dematteis | |
| Name: | Jared Dematteis | |
| Title: | Chief Legal Officer and Secretary |
[Signature Page to Stockholders Agreement]
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of the date first written above.
BOWX INVESTOR:
BowX Sponsor, LLC.
| By: | /s/ Vivek Ranadive | |
| Name: | Vivek Ranadive | |
| Title: | Managing Member |
[Signature Page to Stockholders Agreement]
SB INVESTOR
SB WW HOLDINGS (CAYMAN) LIMITED
| By: | /s/ Karen Ellerbe | |
| Name: | Karen Ellerbe | |
| Title: | Director |
[Signature Page to Stockholders Agreement]
VISION FUND INVESTOR
SVF ENDURANCE (CAYMAN) LIMITED
| By: | /s/ Karen Ellerbe | |
| Name: | Karen Ellerbe | |
| Title: | Director |
[Signature Page to Stockholders Agreement]
BENCHMARK INVESTOR
| BENCHMARK CAPITAL PARTNERS VII (AIV), L.P. | ||
| as nominee for | ||
| Benchmark Capital Partners VII (AIV), L.P., | ||
| Benchmark Founders’ Fund VII, L.P. and | ||
| Benchmark Founders’ Fund VII-B, L.P. | ||
| By: | Benchmark Capital Management Co. VII, L.L.C., | |
| its general partner | ||
| By: | /s/ An-Yen Hu | |
| An-Yen Hu, Officer |
| Address: | 2965 Woodside Road | |
| Woodside, CA 94062 |
[Signature Page to Stockholders Agreement]
Schedule I
BowX Investor
BowX Sponsor LLC
c/o BowX Acquisition Corp.
2400 Sand Hill Road Suite 200
Menlo Park, CA 94025
SB Investor
SB WW Holdings (Cayman) Limited
Walkers Corporate Limited
190 Elgin Avenue, George Town, Grand Cayman
KY1-9008 Cayman Islands
Attention: SoftBank Legal
Email: Legal@softbank.com
VF Investor
SVF Endurance (Cayman) Limited
Walkers Corporate Limited
190 Elgin Avenue, George Town, Grand Cayman
KY1-9008 Cayman Islands
Attention: SoftBank Legal
Email: Legal@softbank.com
Benchmark Investor
Benchmark Capital Partners VII (AIV), L.P.
2965 Woodside Road
Woodside, CA 94062
Attention: An-Yen Hu
[Signature Page to Stockholders Agreement]
Exhibit 10.3
EXECUTION VERSION
CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS NOT MATERIAL AND IS THE TYPE OF INFORMATION THAT THE REGISTRANT CUSTOMARILY AND ACTUALLY TREATS AS PRIVATE AND CONFIDENTIAL. REDACTED INFORMATION IS INDICATED BY [***]
THIRD AMENDED AND RESTATED
AGREEMENT OF EXEMPTED LIMITED PARTNERSHIP
OF
THE WE COMPANY MANAGEMENT HOLDINGS L.P.
a Cayman Islands exempted limited partnership
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR ANY OTHER APPLICABLE SECURITIES LAWS AND ARE BEING SOLD IN RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. SUCH SECURITIES MUST BE ACQUIRED FOR INVESTMENT ONLY AND MAY NOT BE OFFERED FOR SALE, PLEDGED, MORTGAGED, CHARGED, HYPOTHECATED, SOLD, ASSIGNED OR TRANSFERRED AT ANY TIME EXCEPT IN COMPLIANCE WITH (I) THE SECURITIES ACT, ANY APPLICABLE STATE SECURITIES LAWS AND ANY OTHER APPLICABLE SECURITIES LAWS; AND (II) THE TERMS AND CONDITIONS OF THIS THIRD AMENDED AND RESTATED AGREEMENT OF EXEMPTED LIMITED PARTNERSHIP IN THE ABSENCE OF SUCH REGISTRATION, UNLESS THE TRANSFEROR DELIVERS TO THE PARTNERSHIP AN OPINION OF COUNSEL SATISFACTORY TO THE PARTNERSHIP, TO THE EFFECT THAT THE PROPOSED SALE, TRANSFER OR OTHER DISPOSITION MAY BE EFFECTED WITHOUT REGISTRATION UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES OR “BLUE SKY” LAWS.
Dated on October 20, 2021
TABLE OF CONTENTS
| Page | ||||||
| ARTICLE I | ||||||
| DEFINED TERMS | ||||||
| Section 1.1 |
Definitions | 1 | ||||
| Section 1.2 |
Interpretation | 17 | ||||
| ARTICLE II | ||||||
| GENERAL PROVISIONS | ||||||
| Section 2.1 |
Formation | 21 | ||||
| Section 2.2 |
Name | 21 | ||||
| Section 2.3 |
Principal Place of Business; Other Places of Business | 21 | ||||
| Section 2.4 |
Registered Office | 21 | ||||
| Section 2.5 |
Term | 21 | ||||
| Section 2.6 |
No Concerted Action | 21 | ||||
| Section 2.7 |
Business Purpose | 21 | ||||
| Section 2.8 |
Powers | 21 | ||||
| Section 2.9 |
Certificates; Filings | 22 | ||||
| Section 2.10 |
Representations and Warranties by the Partners and Super HoldCo | 22 | ||||
| ARTICLE III | ||||||
| CAPITAL CONTRIBUTIONS | ||||||
| Section 3.1 |
Capital Contributions of the Partners | 24 | ||||
| Section 3.2 |
Issuances of Additional Partnership Interests | 24 | ||||
| Section 3.3 |
Additional Funds and Capital Contributions | 26 | ||||
| Section 3.4 |
Equity Plans | 28 | ||||
| Section 3.5 |
Capital Accounts | 28 | ||||
| Section 3.6 |
No Interest; No Return | 29 | ||||
| Section 3.7 |
Conversion, Exchange or Redemption of Preferred Shares and Common Shares | 29 | ||||
| Section 3.8 |
Tax Treatment of Profits Partnership Interests | 30 | ||||
| ARTICLE IV | ||||||
| DISTRIBUTIONS | ||||||
| Section 4.1 |
Distributions in General | 30 | ||||
| Section 4.2 |
Tax Distributions | 32 | ||||
| Section 4.3 |
Distributions in Kind | 33 | ||||
| Section 4.4 |
Withholding | 34 | ||||
| Section 4.5 |
Distributions upon Liquidation | 35 | ||||
| Section 4.6 |
Revisions to Reflect Additional Partnership Units | 35 | ||||
| Section 4.7 |
Restricted Distributions | 35 | ||||
| Section 4.8 |
Calculation of Distributions | 35 | ||||
| Section 4.9 |
Special Distributions to Facilitate Acquisitions | 35 | ||||
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| ARTICLE V | ||||||
| ALLOCATIONS | ||||||
| Section 5.1 |
Allocations of Net Income and Net Loss | 36 | ||||
| Section 5.2 |
Special Allocations | 37 | ||||
| Section 5.3 |
Curative Allocations | 38 | ||||
| Section 5.4 |
Tax Allocations | 38 | ||||
| Section 5.5 |
Compliance with Section 704(b) of the Code | 38 | ||||
| Section 5.6 |
Consent of Partners | 38 | ||||
| Section 5.7 |
Change in Partnership Interest | 38 | ||||
| Section 5.8 |
Modification of Allocations | 39 | ||||
| Section 5.9 |
Certain Actions | 39 | ||||
| ARTICLE VI OPERATIONS | ||||||
| Section 6.1 |
Management | 39 | ||||
| Section 6.2 |
Compensation and Reimbursement | 43 | ||||
| Section 6.3 |
Outside Activities | 43 | ||||
| Section 6.4 |
Transactions with Affiliates | 44 | ||||
| Section 6.5 |
Liability of the General Partner and Management Representative | 44 | ||||
| Section 6.6 |
Indemnification | 46 | ||||
| ARTICLE VII | ||||||
| RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS | ||||||
| Section 7.1 |
Return of Capital | 47 | ||||
| Section 7.2 |
Rights of Limited Partners Relating to the Partnership | 48 | ||||
| Section 7.3 |
Partnership Right to Call Partnership Interests | 48 | ||||
| Section 7.4 |
Change of Control Transactions; Termination Transactions | 48 | ||||
| Section 7.5 |
Limitation of Liability | 51 | ||||
| Section 7.6 |
Certificates Evidencing Partnership Units | 52 | ||||
| Section 7.7 |
Class C Shares | 52 | ||||
| ARTICLE VIII | ||||||
| BOOKS AND RECORDS | ||||||
| Section 8.1 |
Books and Records | 53 | ||||
| Section 8.2 |
Inspection | 53 | ||||
| ARTICLE IX | ||||||
| TAX MATTERS | ||||||
| Section 9.1 |
Treatment for Tax Purposes | 53 | ||||
| Section 9.2 |
Tax Returns | 53 | ||||
| Section 9.3 |
Tax Elections | 54 | ||||
| Section 9.4 |
Partnership Representative | 54 | ||||
| ARTICLE X | ||||||
| PARTNER TRANSFERS AND WITHDRAWALS | ||||||
| Section 10.1 |
Transfer | 55 | ||||
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| Section 10.2 |
Transfer of the Parent Entities’ Partnership Interests | 56 | ||||
| Section 10.3 |
Limited Partners’ Rights to Transfer | 56 | ||||
| Section 10.4 |
Substituted Limited Partners | 58 | ||||
| Section 10.5 |
Assignees | 58 | ||||
| Section 10.6 |
General Provisions | 59 | ||||
| Section 10.7 |
PIU Aggregator | 60 | ||||
| ARTICLE XI | ||||||
| ADMISSION OF PARTNERS | ||||||
| Section 11.1 |
Admission of Successor General Partner | 60 | ||||
| Section 11.2 |
Partners; Admission of Additional Limited Partners | 61 | ||||
| Section 11.3 |
Limit on Number of Partners | 61 | ||||
| Section 11.4 |
Admission | 62 | ||||
| ARTICLE XII | ||||||
| TERMINATION, LIQUIDATION AND DISSOLUTION | ||||||
| Section 12.1 |
No Termination or Dissolution | 62 | ||||
| Section 12.2 |
Events Causing Termination | 62 | ||||
| Section 12.3 |
Distribution upon Liquidation | 62 | ||||
| Section 12.4 |
Rights of Holders | 63 | ||||
| Section 12.5 |
Dissolution | 64 | ||||
| Section 12.6 |
Reasonable Time for Winding Up | 64 | ||||
| ARTICLE XIII | ||||||
| PROCEDURES FOR ACTIONS AND CONSENTS | ||||||
| OF PARTNERS; AMENDMENTS; MEETINGS | ||||||
| Section 13.1 |
Actions and Consents of Partners | 64 | ||||
| Section 13.2 |
Amendments | 64 | ||||
| Section 13.3 |
Procedures for Meetings and Actions of the Partners | 64 | ||||
| ARTICLE XIV REDEMPTION RIGHTS |
||||||
| Section 14.1 |
Redemption Rights of Qualifying Parties | 66 | ||||
| Section 14.2 |
Certain Adjustments | 70 | ||||
| Section 14.3 |
Coordination and Cooperation; Cash Election | 70 | ||||
| ARTICLE XV | ||||||
| PARTNERSHIP CLASS PI COMMON UNIT CONVERSION | ||||||
| Section 15.1 |
Conversion Mechanics and Notice | 71 | ||||
| ARTICLE XVI | ||||||
| MISCELLANEOUS | ||||||
| Section 16.1 |
Partnership Counsel | 72 | ||||
| Section 16.2 |
Damages not an Adequate Remedy | 72 | ||||
| Section 16.3 |
Governing Law and Consent to Jurisdiction | 72 | ||||
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| Section 16.4 |
Arbitration | 72 | ||||
| Section 16.5 |
Accounting and Fiscal Year | 73 | ||||
| Section 16.6 |
Waiver of Jury Trial | 73 | ||||
| Section 16.7 |
Entire Agreement | 73 | ||||
| Section 16.8 |
Further Assurances | 73 | ||||
| Section 16.9 |
Notices | 73 | ||||
| Section 16.10 |
Construction | 74 | ||||
| Section 16.11 |
Binding Effect | 74 | ||||
| Section 16.12 |
Severability | 74 | ||||
| Section 16.13 |
Consent to Use of Name | 74 | ||||
| Section 16.14 |
Consent by Spouse | 74 | ||||
| Section 16.15 |
Counterparts | 75 | ||||
| Section 16.16 |
Other Agreements | 75 | ||||
| Section 16.17 |
Survival and Third Party Rights | 75 | ||||
| Section 16.18 |
Anti-Money Laundering Representations and Undertakings | 75 |
| EXHIBIT A | NOTICE OF REDEMPTION | |
| EXHIBIT B | ADDRESS OF DOMICILE OR PRINCIPAL PLACE OF BUSINESS | |
| EXHIBIT C | CAPITAL ACCOUNTS | |
| EXHIBIT D | NOTICE OF CONVERSION | |
| EXHIBIT E | CONSENT BY SPOUSE | |
| EXHIBIT F | ANTI-MONEY LAUNDERING REPRESENTATIONS AND UNDERTAKINGS | |
| ANNEX A | PARTNERSHIP UNIT DESIGNATIONS | |
iv
THIRD AMENDED AND RESTATED AGREEMENT OF EXEMPTED
LIMITED PARTNERSHIP OF THE WE COMPANY MANAGEMENT HOLDINGS L.P.
THIS THIRD AMENDED AND RESTATED AGREEMENT OF EXEMPTED LIMITED PARTNERSHIP OF THE WE COMPANY MANAGEMENT HOLDINGS L.P., dated on October 20, 2021 (the “Effective Date”), is entered into by and among The We Company MC LLC, a Delaware limited liability company (“TWC MC”), The We Company Management LLC, a Delaware limited liability company (“WCM”), Euclid WW Holdings Inc., a Delaware corporation, each of the other Limited Partners (as defined herein) and, in its capacity as the parent company of TWC MC and not as a Partner in the Partnership, WeWork Inc., a Delaware corporation (“Super HoldCo”).
WHEREAS, The We Company Management Holdings L.P., a Cayman Islands exempted limited partnership (the “Partnership”), was formed and registered under the Exempted Limited Partnership Law (2018 Revision) (as it may be amended from time to time, and any successor to such statute, the “Act”), pursuant to (i) a Certificate filed pursuant to Section 9 of the Act on April 5, 2019 (the “Formation Date”), and (ii) the Initial Exempted Limited Partnership Agreement of The We Company Management Holdings L.P., dated on April 5, 2019 (the “Original Agreement”), by and between Super HoldCo and WCM;
WHEREAS, in accordance with the deed of substitution of general partner dated May 8, 2019, Super HoldCo transferred its general partner interest in the Partnership to TWC MC and withdrew as general partner of the Partnership pursuant to clause 13 of the Original Agreement;
WHEREAS, in accordance with the Original Agreement, the Original Agreement was amended and restated on July 15, 2019 (the “July 15, 2019 Agreement”);
WHEREAS, in accordance with the July 15, 2019 Agreement, the July 15, 2019 Agreement was amended and restated on October 30, 2019 (the “October 30, 2019 Agreement”); and
WHEREAS, in accordance with the October 30, 2019 Agreement, the parties now desire to continue the Partnership and amend and restate the October 30, 2019 Agreement in its entirety as hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement, intending to be legally bound, agree as follows:
ARTICLE I
DEFINED TERMS
Section 1.1 Definitions. The following definitions shall be for all purposes, unless otherwise clearly indicated to the contrary, applied to the terms used in this Agreement:
“A Cash Amount” means an amount of cash equal to the product of (i) the Trading Price and (ii) the A-to- A Shares Amount.
“A-to-A Shares Amount” means a number of Class A Shares equal to the excess, if any, of:
(a) the product of (i) the number of A Tendered Units multiplied by (ii) the Adjustment Factor as of the Specified Redemption Date, over
(b) the quotient of (1) any Unoffset Tax Distributions associated with the A Tendered Units (if any) in excess of the corresponding Unoffset Tax Distributions attributable to the same number of Partnership Class A Common Units held directly or indirectly by Super HoldCo at such time, divided by (2) the Trading Price; provided, that the applicable Tendering Party may reduce the value of the foregoing clause (1) on a dollar-for-dollar basis by paying any such amount to the Partnership in cash.
“Additional Limited Partner” means a Person who is admitted to the Partnership as a Limited Partner pursuant to the Act and Article X or Section 11.2, who is shown as such on the books and records of the Partnership, and who has not ceased to be a Limited Partner pursuant to the Act and this Agreement.
“Adjusted Capital Account Deficit” means, with respect to any Partner, the deficit balance, if any, in such Partner’s Capital Account as of the end of the relevant Fiscal Year after giving effect to the following adjustments: (a) credit to such Capital Account any amounts that such Partner is obligated to restore pursuant to Treasury Regulations section 1.704-1(b)(2)(ii)(c) and the penultimate sentences of Treasury Regulations sections 1.704-2(g)(1) and 1.704-2(i)(5) and (b) debit to such Capital Account such Partner’s share of the items described in Treasury Regulations sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6). This definition of “Adjusted Capital Account Deficit” is intended to comply with the provisions of Treasury Regulations section 1.704-1(b)(2)(ii)(d) and shall be interpreted and applied consistently therewith.
“Adjusted Trading Price” means the product of the Trading Price multiplied by the Adjustment Factor.
“Adjustment Factor” means, initially and after the transactions contemplated by the Merger Agreement, 1.0; provided, however, that the Adjustment Factor shall be appropriately, equitably and reasonably adjusted to the extent necessary to prevent inappropriate dilution or accretion and to otherwise maintain existing economic entitlements in the case of the following events: (i) any subdivision (by any stock split, stock dividend or distribution, reclassification, reorganization, recapitalization or otherwise) or combination (by reverse stock split, reclassification, reorganization, recapitalization or otherwise) of any equity securities of Super HoldCo that is not accompanied by a substantively identical subdivision or combination of the Partnership Units; or (ii) any subdivision (by any unit split, unit dividend or distribution, reclassification, reorganization, recapitalization or otherwise) or combination (by reverse unit split, reclassification, reorganization, recapitalization or otherwise) of any Partnership Units that is not accompanied by a substantively identical subdivision or combination of the equity securities of Super HoldCo (the events described in subclauses (i) and (ii), “Adjustment Events”).
“Advanced Tax Distribution” means, with respect to any Partnership Unit at any time, the Tax Distributions previously made with respect to the Partnership Unit pursuant to Section 4.2(a) that have not yet reduced other distributions with respect to such Partnership Unit in accordance with Section 4.2(b).
“Affiliate” shall mean, with respect to any specified Person, (i) any Person that directly or indirectly controls, is controlled by, or is under common control with such specified Person (and, in the case of any Person that is an entity, shall include any general partner, managing member, manager, officer or director of such Person or any venture capital fund, investment fund or account now or hereafter existing that is controlled by one or more general partners, managers or managing members of, or shares the same management company or investment adviser with, or is otherwise affiliated with, such Person); or (ii) if the specified Person is an individual, any member of the Immediate Family of the specified Person. For purposes of this definition, “control” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
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“Aggregate Distribution Threshold” means, in respect of any Partnership Class PI Common Unit, an amount that is equal to or greater than the value (determined by the General Partner (with the consent of the Compensation Committee of the Board of Directors) in a manner consistent with the principles of IRS Revenue Procedure 93-27) of the liquidating distributions that would be made under Section 12.3(a)(iii) if, immediately after such Partnership Class PI Common Unit were issued, the Partnership were to (i) sell all of its assets for cash at their fair market values (as determined in accordance with this sentence), (ii) receive from each Partner any amounts then unconditionally due and payable by such Partner to the Partnership and any contributions required to be made by such Partner to the Partnership (with or without lapse of time), (iii) settle all of its debts and liabilities in accordance with Section 12.3(a)(i) and Section 12.3(a)(ii), in each case, to the extent of the available assets of the Partnership (but limited, in the case of nonrecourse liabilities as to which the creditors’ rights to repayment are limited solely to one or more assets of the Partnership, to the value of such assets, determined in accordance with clause (i)), and (iv) make liquidating distributions of its remaining assets in accordance with such provision. The Aggregate Distribution Threshold in respect of each Partnership Class PI Common Unit shall (i) notwithstanding any other provision herein to the contrary, at all times be no less than necessary to comply with the requirements of IRS Revenue Procedure 93-27 (and, accordingly, shall be appropriately adjusted to take into account Capital Contributions after the date of grant of the applicable Partnership Class PI Common Unit as reasonably determined by the General Partner, after reasonable consultation with the Management Representative), and (ii) be set forth in the applicable Profits Interest Award Agreement (or set forth in a supplement thereto as promptly as practicable after the date of such Profits Interest Award Agreement).
“Agreement” means this Third Amended and Restated Agreement of Exempted Limited Partnership of The We Company Management Holdings L.P., together with the Schedules, Annexes and Exhibits hereto, as now or hereafter amended, restated, modified, supplemented or replaced.
“Applicable Record Date” means the record date reasonably established by the General Partner for the purpose of determining the Partners entitled to notice of or to vote at any meeting of Partners or to consent to any matter, or to receive any distribution or the allotment of any other rights, or in order to make a determination of Partners for any other proper purpose, which, in the case of a record date fixed for the determination of Partners entitled to receive any distribution, shall (unless otherwise reasonably determined by the General Partner) generally be the same as the record date established by Super HoldCo for a dividend or distribution to its stockholders. Such record date shall not precede the date upon which the resolution fixing the record date is adopted by the General Partner and such record date shall not be more than 60 nor less than 10 days before the date of the applicable meeting or consent.
“Assets” means any assets and property of the Partnership, and “Asset” means any one such asset or property.
“Assignee” means a Person to whom a Partnership Interest has been Transferred, but who has not become a Substituted Limited Partner, and who has the rights set forth in Section 10.5.
“Bankruptcy” means, with respect to any Person:
(i) (A) if such Person (1) makes a general assignment for the benefit of creditors, (2) files a voluntary bankruptcy petition, (3) becomes the subject of an order for relief or is declared insolvent in any bankruptcy or insolvency proceeding, (4) files a petition or answer seeking for such Person a reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any law, (5) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against such Person in a proceeding of the type described in clauses (1)-(4) above, or (6) seeks, consents to, or acquiesces in the appointment of a trustee, receiver, or liquidator of such Person or of all or any substantial part of such Person’s properties, or
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(ii) (A) a proceeding is commenced seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any law and 90 days have expired without the proceeding being dismissed, or (B) without that Person’s consent or acquiescence, a trustee, receiver, or liquidator is appointed of that Partner or of all or any substantial part of its properties and 90 days have expired without the appointment being vacated or stayed, or if stayed, 90 days have expired after the date of expiration of a stay, unless the appointment has been vacated.
“Board of Directors” means the Board of Directors of Super HoldCo.
“Business Day” means any weekday, excluding any legal holiday observed pursuant to United States federal or New York State law or regulation.
“C-Corp Subsidiary” means Euclid WW Holdings Inc.
“Capital Contribution” means, with respect to any Partner, the amount of money and the initial Carrying Value of any Contributed Asset that such Partner contributes to the Partnership or is deemed to contribute pursuant to Article III which shall be set forth on Exhibit C.
“Capital Stock” means any class or series of stock of Super HoldCo now or hereafter authorized.
“Carrying Value” means, with respect to any Asset, the asset’s adjusted basis for U.S. federal income tax purposes, except as follows:
(i) the Carrying Value of any asset contributed or deemed contributed by a Partner to the Partnership shall be the fair market value of such asset at the time of contribution;
(ii) the Carrying Value of any asset distributed or deemed distributed by the Partnership to any Partner shall be adjusted immediately prior to such distribution to equal its fair market value at such time;
(iii) the Carrying Values of all Assets may be adjusted to equal their respective fair market values as of the following times:
| 1. | immediately prior to the date of the acquisition of any new or additional Partnership Interest (including any Profits Interests) by any new or existing Partner, other than in exchange for a de minimis Capital Contribution (except that, for the avoidance of doubt, no Capital Contribution is required with respect to the issuance of Profits Interests); |
| 2. | immediately prior to the date of the distribution of more than a de minimis amount of Partnership property to a Partner; |
| 3. | immediately prior to the liquidation of the Partnership within the meaning of Treasury Regulations section 1.704-1(b)(2)(ii)(g); |
| 4. | in connection with the grant of a Partnership Interest (other than a de minimis Partnership Interest) as consideration for the provision of services to or for the benefit of the Partnership or a Subsidiary of the Partnership by an existing Partner acting in a partner capacity, or by a new Partner acting in a partner capacity in anticipation of becoming a Partner; provided |
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| that an adjustment described in subclauses 1, 2 and 4 of this clause (iii) may only not be made if the General Partner (together with the Consent of the Management Representative, such consent not to be unreasonably withheld, conditioned or delayed) reasonably determines that not making such adjustment is necessary to reflect the collective economic interests of the Partners in the Partnership; and |
| 5. | at any other time, as permitted by the Treasury Regulations, within the discretion of the General Partner, with the Consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed) (including, to the extent permitted by the Treasury Regulations, immediately prior to a conversion pursuant to Section 15.1). |
In the case of any asset that has a Carrying Value determined pursuant to subclauses 1, 2, 4 or 5 above, depreciation shall be computed based on the asset’s Carrying Value as so determined, and not on the asset’s adjusted tax basis, as more fully described under the definition of Net Income and Net Loss below.
“Catch-up Base Amount” means an amount (not less than $0 and not more than the fair market value of, (i) in the case of any Profits Interests granted before the date hereof, a Class B Share at the time of grant, and (ii) in the case of any Profits Interests granted on or after the date hereof, a Class A Share at the time of grant) as reasonably determined by the General Partner (and, in the case of Partnership Class PI Common Units, with the consent of the Compensation Committee of the Board of Directors), which amount with respect to any Profits Interests, as of the date of grant of such Profits Interests, shall be set forth in the applicable Profits Interest Award Agreement; provided that in the event of any change in the Partnership’s capital structure that affects any Profits Interests issued with a Strike Price Catch-up Amount (such as a subdivision of Partnership Class PI Common Units into a greater number of Partnership Class PI Common Units or any other event referred to in the definition of Adjustment Factor), the Catch-up Base Amount with respect to any such affected Profits Interests shall be equitably adjusted to the extent necessary (in the reasonable and good faith determination of the General Partner, after reasonable consultation with the Management Representative) to prevent such capital structure change from (i) changing the economic rights represented by the applicable Profits Interests in a manner that is disproportionately favorable or unfavorable in relation to the economic rights of other classes of outstanding Partnership Units or (ii) reducing or increasing the aggregate Strike Price Catch-up Amounts to which such Profits Interests are entitled.
“Certificate” means the Section 9 Statement (and any and all amendments thereto and restatements thereof) filed with the Registrar on behalf of the Partnership pursuant to the Act.
“Change of Control Transaction” means: (a) a merger, tender or exchange offer, consolidation, amalgamation or other similar combination involving Super HoldCo and any other Person, pursuant to which the stockholders of Super HoldCo immediately prior to such merger, consolidation or other combination (as a group) would own, as of immediately after such transaction or series of related transactions, less than fifty percent (50%) of the total economic and voting power of all outstanding equity securities of Super HoldCo (or of any resulting or surviving entity) or (b) a sale, lease, exchange or other transfer of all or substantially all of the assets of Super HoldCo and its Subsidiaries (taken as a whole) to any other Person (other than a wholly owned Subsidiary of Super HoldCo) not in the ordinary course of its business, whether in a single transaction or a series of related transactions.
“Charitable Entity” means any organization, foundation, impact investing enterprise, public benefit entity or similar entity whose primary purpose is to preserve the natural environment, combat climate change or support any other environmental, educational or charitable cause.
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“Charter” means the certificate of incorporation of Super HoldCo, within the meaning of Section 104 of the General Corporation Law of the State of Delaware, as amended from time to time.
“Class A Share” means a share of Class A common stock of Super HoldCo, $0.001 par value per share.
“Class B Share” means a share of Class B common stock of WeWork Inc., $0.001 par value per share, issued prior to the date of this Agreement.
“Class C Share” means a share of Class C common stock of Super HoldCo, $0.001 par value per share.
“Code” means the United States Internal Revenue Code of 1986, as amended.
“Common Share” means a Class A Share or Class C Share (and shall not include any additional series or class of Super HoldCo’s common stock created after the date of this Agreement).
“Consent” means the consent to, approval of, or vote in favor of a proposed action by a Partner given in accordance with Article XIII.
“Consent of the Management Representative” means the consent or approval of the Management Representative, which consent or approval, for all purposes of this Agreement, shall be required only in the event that the related action disproportionately and adversely impacts (other than in a de minimis fashion) (i) the rights, privileges, preferences or obligations of the Partnership Class PI Common Units or the Partnership Class A Common Units relative to any other class of Partnership Units or (ii) any Limited Partner in its capacity as a holder of Partnership Common Units relative to any other Limited Partner in its capacity as a holder of Partnership Common Units or relative to any stockholder of Super HoldCo in its capacity as a holder of stock in Super HoldCo. For the avoidance of doubt, in furtherance and not in limitation of the foregoing, any reference to the Consent of the Management Representative contained in this Agreement shall not be required if the foregoing standard is not met.
“Consent of the Non-Super HoldCo Partners” means the Consent of a Majority in Interest of the Non-Super HoldCo Partners (and subject to the Consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed)), which Consent shall be obtained before the taking of any action for which it is required by this Agreement and, except as otherwise provided in this Agreement, may be given or withheld by Partners in their discretion.
“Consent of the Partners” means the Consent of a Majority in Interest of the Partners (and subject to the Consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed)), which Consent shall be obtained before the taking of any action for which it is required by this Agreement and, except as otherwise provided in this Agreement, may be given or withheld by Partners in their discretion.
“Contributed Asset” means each Asset or other asset, in such form as may be permitted by the Act, but excluding cash, contributed or deemed contributed to the Partnership.
“Controlled Entity” means, as to any Person, (a) any corporation more than fifty percent (50%) of the outstanding voting stock of which is owned by such Person or such Person’s Immediate Family or Affiliates, (b) any trust, whether or not revocable, of which such Person or such Person’s Immediate Family or Affiliates are the sole beneficiaries, (c) any partnership of which such Person or an Affiliate of such Person is the managing partner and in which such Person or such Person’s Immediate Family or Affiliates hold partnership interests representing at least twenty-five percent (25%) of such partnership’s capital and profits and (d) any limited liability company of which such Person or an Affiliate of such Person is the manager or managing member and in which such Person or such Person’s Immediate Family or Affiliates hold limited liability company interests representing at least twenty-five percent (25%) of such limited liability company’s capital and profits.
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“Cut-Off Time” means, with respect to any Notice of Redemption, the close of business on the fifth (5th) Business Day after the General Partner’s receipt of such Notice of Redemption.
“Debt” means, as to any Person, as of any date of determination: (i) all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services; (ii) all amounts owed by such Person to banks or other Persons in respect of reimbursement obligations under letters of credit, surety bonds and other similar instruments guaranteeing payment or other performance of obligations by such Person; (iii) all indebtedness for borrowed money or for the deferred purchase price of property or services secured by any lien on any property owned by such Person, to the extent attributable to such Person’s interest in such property, even though such Person has not assumed or become liable for the payment thereof; and (iv) obligations of such Person as lessee under capital leases.
“Distribution Threshold Per Profits Interest” means, with respect to each Profits Interest, an amount equal to the aggregate distribution that would be made in respect of (i) in the case of any Profits Interests granted before the date hereof, one Class B Share, and (ii) in the case of any Profits Interests granted on or after the date hereof, one Class A Share at the time of grant, in each case if, immediately prior to the grant of such Profits Interest, (a) the Partnership were to make liquidating distributions under Section 12.3(a)(iii) in an amount equal to the Aggregate Distribution Threshold determined with respect to such Profits Interest, and (b) Super HoldCo distributed in liquidation an amount equal to Super HoldCo’s direct or indirect economic entitlement to such amounts in accordance with the rights and preferences of its equity securities (including all instruments outstanding on the date of grant that are convertible, exercisable or exchangeable for equity, but excluding any amounts relating to unvested instruments). The initial Distribution Threshold Per Profits Interest with respect to any Profits Interest shall be set forth in the applicable Profits Interest Award Agreement (or set forth in a supplement thereto as promptly as practicable after the date of such Profits Interest Award Agreement). In the event of any change in the Partnership’s capital structure which affects any Profits Interests (such as a subdivision of Partnership Class PI Common Units into a greater number of Partnership Class PI Common Units or any other event referred to in the definition of Adjustment Factor), the Distribution Threshold Per Profits Interest with respect to any such affected Partnership Class PI Common Units shall be equitably adjusted to the extent necessary (in the reasonable and good faith determination of the General Partner, after reasonable consultation with the Management Representative) to prevent such capital structure change from changing the economic rights represented by the applicable Profits Interests in a manner that is disproportionately favorable or unfavorable in relation to the economic rights of other classes of outstanding Partnership Units.
“Equity Plan” means any plan, agreement or other arrangement that provides for the grant or issuance of equity or equity-based awards and that is now in effect or is hereafter adopted by the Partnership or Super HoldCo (or its predecessor, WeWork Inc.) for the benefit of any of their respective employees or other service providers (including directors, advisers and consultants), or the employees or other service providers (including directors, advisers and consultants) of any of their respective Affiliates or Subsidiaries.
“ERISA” means the United States Employee Retirement Income Security Act of 1974, as amended.
“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and any successor statute thereto, and the rules and regulations of the SEC promulgated thereunder.
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“Exchange Factor” means, in respect of any Partnership Class PI Common Unit, the quotient, rounded to four decimal places, of:
(i) the sum of (A) the amount obtained by subtracting the Distribution Threshold Per Profits Interest in respect of such Partnership Unit from the Adjusted Trading Price (it being understood that such amount may be negative) plus (B) the Unpaid Catch-up Amount (if any) in respect of such Partnership Unit that would be paid in respect of such Partnership Class PI Common Unit if, on the applicable date, the Partnership were to (I) sell all of its assets for cash at their fair market values (taking into account the Adjusted Trading Price or the valuation implied by any applicable Change of Control Transaction or Termination Transaction), (II) receive from each Partner any amounts then unconditionally due and payable by such Partner to the Partnership and any contributions required to be made by such Partner to the Partnership (with or without lapse of time), (III) settle all of its debts and liabilities in accordance with Section 12.3(a)(i) and Section 12.3(a)(ii), in each case, to the extent of the available assets of the Partnership (but limited, in the case of nonrecourse liabilities as to which the creditors’ rights to repayment are limited solely to one or more assets of the Partnership, to the value of such assets, determined in accordance with clause (I)), and (IV) make liquidating distributions of its remaining assets in accordance with Section 12.3(a)(iii), disregarding for this purpose all Unvested Profits Interests, plus (C) any and all amounts that would have been (but were not) distributed in respect of such Partnership Unit had such Partnership Unit participated in all distributions (I) that were declared after the date of such Partnership Unit’s issuance and have an Applicable Record Date prior to the date of the applicable Conversion (subject to Section 14.1(d)(i)), (II) that resulted in a corresponding distribution by Super HoldCo in respect of at least one Class A Share, and (III) in which the Partnership Class A Common Units participated (it being understood that there were no such distributions prior to the date hereof); divided by
(ii) the Adjusted Trading Price.
The principles of Section 3.8(a) shall apply mutatis mutandis to the foregoing calculations. For the avoidance of doubt, the amount described in clause (i)(B) shall be reasonably determined by the General Partner based on the value of the Partnership implied by the Adjusted Trading Price as of the applicable time.
“First Restatement Date” means July 15, 2019.
“Funding Debt” means any Debt incurred by or on behalf of any of the Parent Entities for the purpose of providing funds to the Partnership.
“General Partner” means TWC MC and/or any additional or successor General Partner(s) designated as such pursuant to the Act and this Agreement, and, in each case, that has not ceased to be a general partner pursuant to the Act and this Agreement, in such Person’s capacity as a general partner of the Partnership.
“Holder” means either (a) a Partner or (b) an Assignee that owns a Partnership Unit; provided, that in the case of any Holder that holds more than one class of Partnership Units, where applicable, “Holder” shall refer to such Person in its capacity as a Holder of each such class and not all classes, as appropriate.
“Immediate Family” means, (i) with respect to any individual, (A) his or her ancestors, spouse, issue (natural or adopted), spouses of issue, Spousal Equivalent, siblings (natural or adopted), (B) any trustee or trustees, including successor and additional trustees, of trusts principally for the benefit of such individual, any one or more of the individuals described in the foregoing clause (i)(A) and/or one or more Charitable Entities that is a permissible current or remainder beneficiary of such trust, and (C) any entity or entities all
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of the beneficial owners of which are such trusts and/or such individuals, (ii) with respect to a legal representative, the Immediate Family (as otherwise defined in the foregoing clause (i)) of the individual for whom such legal representative was appointed and (iii) with respect to a trustee, the Immediate Family (as otherwise defined in the foregoing clause (i)) of the individuals who are the principal beneficiaries of the trust. As used herein (including in the definition of “Transfer”), a person is deemed to be a “Spousal Equivalent” provided the following circumstances are true: (a) irrespective of whether or not the relevant person and the Spousal Equivalent are the same sex, they are the sole spousal equivalent of the other for the last twelve (12) months, (b) they intend to remain so indefinitely, (c) neither are married to anyone else, (d) both are at least 18 years of age and mentally competent to consent to contract, (e) they are not related by blood to a degree of closeness that would prohibit legal marriage in the state in which they legally reside, (f) they are jointly responsible for each other’s common welfare and financial obligations, and (g) they have resided together in the same residence for the last twelve (12) months and intend to do so indefinitely.
“Incapacity” or “Incapacitated” means: (i) as to any Partner who is an individual, death or for whom a guardian, conservator or receiver (or similar) has been appointed to manage such individual’s affairs; (ii) as to any Partner that is a corporation, the filing of a certificate of dissolution, or its equivalent, for the corporation or the revocation of its charter; (iii) as to any Partner that is a partnership or limited liability company, the dissolution and commencement of winding up of the partnership or limited liability company; (iv) as to any Partner that is an estate, the distribution by the fiduciary of the estate’s entire interest in the Partnership; (v) as to any trustee of a trust that is a Partner, the termination of the trust (but not the substitution of a new trustee); or (vi) as to any Partner, the Bankruptcy of such Partner.
“Indemnitee” means (i) any Person made, or threatened to be made, a party to a proceeding by reason of its status as (a) the General Partner, (b) a manager, member, director, officer, employee, agent or representative of the General Partner or the Partnership or (c) the Management Representative, (ii) any Person made, or threatened to be made, a party to a proceeding by reason of its status as (a) the parent entity of the General Partner (including Super HoldCo) or (b) a manager, member, director, officer, employee, agent or representative of the parent entity of the General Partner (including Super HoldCo) or the Management Representative and (iii) such other Persons (including Affiliates, employees or agents of the General Partner, any Parent Entity or the Partnership) as the General Partner may designate from time to time (whether before or after the event giving rise to potential liability).
“Ineligible Cash Election Class A Unit” means, with respect to any A Tendered Unit, any such A Tendered Unit issued pursuant to the Conversion of a Vested Profits Interest that vested (pursuant to the terms of the applicable Profits Interest Award Agreement) within six months of the date of the applicable Specified Redemption Date.
“IRS” means the United States Internal Revenue Service.
“Limited Partner” means each Person that is, from time to time, admitted to the Partnership as a limited partner pursuant to the Act and this Agreement, and any Substituted Limited Partner or Additional Limited Partner, each shown as such in the books and records of the Partnership, in each case, that has not ceased to be a limited partner of the Partnership pursuant to the Act and this Agreement, in such Person’s capacity as a limited partner of the Partnership; provided, that in the case of any Limited Partner that holds more than one class of Partnership Units, where applicable, “Limited Partner” shall refer to such Person in its capacity as a Limited Partner, and with respect to the Partnership Units held by such Limited Partner, of each such class and not all classes, as appropriate.
“Majority in Interest of the Non-Super HoldCo Partners” means Partners (excluding the Parent Entities) holding more than fifty percent (50%) of all outstanding Partnership Units held by all Partners (excluding the Parent Entities).
“Majority in Interest of the Partners” means Partners (including the Parent Entities and any Controlled Entity of any Parent Entity) entitled to vote on or consent to any matter holding more than fifty percent (50%) of all outstanding Partnership Units held by all Partners (including the Parent Entities and any Controlled Entity of any Parent Entity) entitled to vote on or consent to such matter.
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“Management Representative” means a Person that is appointed by the Majority in Interest of the Non-Super HoldCo Partners, which Person shall execute a joinder to this Agreement, solely in such Person’s capacity as the Management Representative; provided, that no Person shall be qualified to serve as the Management Representative if such Person (i) is deceased or (ii) is permanently and totally disabled such that he or she is unable to engage, with or without reasonable accommodation by the Partnership, in any substantial gainful activity by reason of any medically determinable physical or mental impairment that would reasonably be expected to result in imminent death or which has lasted or would reasonably be expected to last for a continuous period of not less than twelve (12) months as determined by a licensed medical practitioner.
“Merger Agreement” means that certain Agreement and Plan of Merger, dated as of March 25, 2021, by and among BowX Acquisition Corp., BowX Merger Subsidiary Corp. and WeWork Inc.
“Net Income” and “Net Loss” shall mean, for each Fiscal Year, an amount equal to the net taxable income or loss of the Partnership for such Fiscal Year determined in accordance with Section 703(a) of the Code (it being understood that for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code shall be included in such taxable income or loss) and determined in accordance with the accounting method used by the Partnership for U.S. federal income tax purposes with the following adjustments (without duplication):
(i) all items of income, gain, loss or deduction allocated pursuant to Section 5.2 or Section 5.3 shall not be taken into account in computing such taxable income or loss;
(ii) any income that is exempt from U.S. federal income taxation and not otherwise taken into account in computing Net Income and Net Loss shall be added to such taxable income or loss;
(iii) if the Carrying Value of any asset differs from its adjusted tax basis for U.S. federal income tax purposes, any gain or loss resulting from a disposition of such asset shall be calculated with reference to such Carrying Value;
(iv) upon an adjustment to the Carrying Value of any asset pursuant to clauses (ii) or (iii) of the definition of Carrying Value (other than an adjustment in respect of depreciation), the amount of the adjustment shall be included as gain or loss in computing such taxable income or loss;
(v) if the Carrying Value of any asset differs from its adjusted tax basis for U.S. federal income tax purposes, the amount of depreciation, amortization or cost recovery deductions with respect to such asset for purposes of determining Net Income and Net Loss shall be an amount which bears the same ratio to such Carrying Value as the U.S. federal income tax depreciation, amortization or other cost recovery deductions bears to such adjusted tax basis (provided that if the U.S. federal income tax depreciation, amortization or other cost recovery deduction is zero, the General Partner may use any reasonable method for purposes of determining depreciation, amortization or other cost recovery deductions in calculating Net Income and Net Loss); and
10
(vi) except for items set forth in clauses (i) through (v) above, any Partnership expenditures not deductible in computing taxable income or loss, not properly capitalizable and not otherwise taken into account in computing Net Income and Net Loss pursuant to this definition shall be treated as deductible items.
“New Securities” means (i) any rights, options, warrants or convertible or exchangeable securities that entitle the holder thereof to subscribe for or purchase, convert such securities into or exchange such securities for, Common Shares or Preferred Shares, excluding Preferred Shares and grants under the Equity Plans, (ii) other securities the value of which is derived from the value of Common Shares or Preferred Shares (excluding Preferred Shares and grants under any Equity Plan) or (iii) any Debt issued by Super HoldCo that provides any of the rights described in the preceding clauses (i) or (ii).
“Nonrecourse Debt” has the meaning ascribed to “nonrecourse liability” in Treasury Regulations section 1.704-2(b)(3).
“Nonrecourse Deductions” shall be as defined in Treasury Regulations section 1.704-2(b). The amount of Nonrecourse Deductions for a Fiscal Year equals the net increase, if any, in the amount of Partnership Minimum Gain during that Fiscal Year, determined according to the provisions of Treasury Regulations section 1.704-2(c).
“Notice of Redemption” means a Notice of Redemption substantially in the form of Exhibit A attached hereto.
“Parent Entities” means each of: (i) Super HoldCo; (ii) BowX Merger Subsidiary II, LLC; (iii) TWC MC; (iv) WCM; (v) the C-Corp Subsidiary; (vi) the highest entity in an unbroken chain of entities ending with immediately above the Partnership or any Surviving Partnership; provided that each entity in such unbroken chain owns, at the time of the determination, securities possessing fifty percent (50%) or more of the total combined voting power of all classes of securities in one of the other entities in such chain or in the Partnership or any Surviving Partnership; or (vii) any Subsidiary of Super HoldCo or the entity referenced in clause (v), excluding, in each case of clauses (vi) and (vii), (a) WE Holdings and any other entity in which Adam Neumann possesses fifty percent (50%) or more of the total combined economic interests and (b) the Partnership or any Surviving Partnership and each of their respective Subsidiaries.
“Partner” means the General Partner or a Limited Partner, and “Partners” means the General Partner and the Limited Partners.
“Partner Nonrecourse Debt” shall be as defined in Treasury Regulations section 1.704-2(b)(4).
“Partner Nonrecourse Debt Minimum Gain” shall be as defined in Treasury Regulations sections 1.704-2(i)(2) and 1.704-2(i)(3).
“Partner Nonrecourse Deductions” shall be as defined in Treasury Regulations section 1.704-2(i)(2). The amount of Partner Nonrecourse Deductions shall be determined as set forth in Treasury Regulations section 1.704-2(i).
“Partnership Class A Common Unit” means a Partnership Unit designated as a “Partnership Class A Common Unit” with the rights and obligations specified with respect to a Partnership Class A Common Unit set forth in this Agreement.
11
“Partnership Class PI Common Unit” means a Partnership Unit designated as a “Partnership Class PI Common Unit” with the rights and obligations specified with respect to a Partnership Class PI Common Unit set forth in this Agreement and any applicable Profits Interest Award Agreement.
“Partnership Common Unit” means a Partnership Class A Common Unit or Partnership Class PI Common Unit.
“Partnership Employee” means an employee of the Partnership or an employee of a Subsidiary of the Partnership, if any.
“Partnership Equivalent Units” means, with respect to any class or series of Preferred Shares, Partnership Units with powers, preferences, conversion and other rights (other than voting rights), restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption that are substantially the same as (or correspond to) the powers, preferences, conversion and other rights, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption of such Preferred Shares as appropriate to reflect the relative rights, powers and preferences of such Preferred Shares as to the Common Shares and the other classes and series of Preferred Shares as such Partnership Equivalent Units would have as to Partnership Common Units and the other classes and series of Partnership Units corresponding to the other classes of Preferred Shares, but not as to matters such as voting for members of the Board of Directors that are not applicable to the Partnership. For the avoidance of doubt, the voting rights, redemption rights and rights to Transfer Partnership Equivalent Units need not be similar to the rights of the corresponding class or series of Preferred Shares, provided, however, with respect to redemption rights, the terms of Partnership Equivalent Units must be such so that the Partnership complies with Section 3.7.
“Partnership Interest” means an ownership interest in the Partnership represented by Partnership Units held by either a Limited Partner or the General Partner and includes any and all benefits to which the holder of such a Partnership Interest may be entitled as provided in this Agreement, together with all obligations of such Person to comply with the terms and provisions of this Agreement. There may be one or more classes or series of Partnership Interests. A Partnership Interest shall be expressed as a number of Partnership Common Units or other Partnership Units.
“Partnership Minimum Gain” shall be as defined in Treasury Regulations sections 1.704-2(b)(2) and 1.704-2(d).
“Partnership Preferred Unit” means a Partnership Unit of a particular class or series that the General Partner has authorized pursuant to Section 3.1, Section 3.2 or Section 3.3 that has distribution rights, or rights upon liquidation, winding up and dissolution, that are superior or prior to the Partnership Common Units.
“Partnership Unit” means a Partnership Common Unit, a Partnership Preferred Unit or any other portion of the Partnership Interests that the General Partner has authorized pursuant to Section 3.1, Section 3.2 or Section 3.3.
“Percentage Interest” means, with respect to each Partner, as to any class or series of Partnership Units, the fraction, expressed as a percentage, the numerator of which is the aggregate number of Partnership Units of such class or series held by such Partner and the denominator of which is the total number of Partnership Units of such class or series held by all Partners.
“Permitted Charity” means any organization exempt from taxation pursuant to section 501(c)(3) or section 501(c)(4) of the Code.
12
“Permitted Transfer” means (a) any Transfer by a Limited Partner to an Affiliate of such Limited Partner, (b) a Transfer by a Limited Partner to the Partnership pursuant to any forfeiture or repurchase requirements under any Equity Plan, (c) any Transfer of a Partnership Interest or other security (i) by a Limited Partner (other than a Parent Entity) to the Immediate Family of such Limited Partner for estate planning purposes and (ii) by a Limited Partner (other than a Parent Entity) or Immediate Family of a Limited Partner (other than a Parent Entity) to which securities have been Transferred pursuant to clause (i), to a Permitted Charity, (d) a Transfer by a Limited Partner by will or by the laws of descent and distribution or by instrument to an inter vivos or testamentary trust in which the Partnership Interest or other security is to be passed to beneficiaries upon the death of the trustor (settlor), or by gift to “family member” as that term is defined in Rule 701 et seq. promulgated under the Exchange Act, and which may not be made subject to execution, attachment or similar process (provided that the terms of this Agreement shall be binding upon the executor, administrator, successors and assigns of the Holder who is a party to this Agreement), (e) any Transfer permitted in a Profits Interest Award Agreement, (f) any Transfer of Partnership Class A Common Units by the PIU Aggregator to any of its limited partners, (g) any Transfer of any or all Partnership Class A Common Units or Class C Shares held by We Holdings to its partners, members or stockholders and (h) any Transfer approved by a majority of the independent members of the Board of Directors then in office who are disinterested with respect to such Transfer; provided in the case of a Permitted Transfer pursuant to clauses (a), (c) and (f) above, the transferee shall receive and hold such Partnership Interests subject to the provisions of this Agreement.
“Permitted Transferee” means any permitted recipient of a Permitted Transfer.
“Person” means an individual or a corporation, partnership, trust, unincorporated organization, association, limited liability company or other entity.
“PIU Aggregator” means any direct or indirect Subsidiary of Super HoldCo or any aggregator entity controlled by Super HoldCo or any direct or indirect Subsidiary of Super HoldCo that has in place a governing agreement (including a Limited Partnership Agreement or Limited Liability Company Agreement) that provides the right or option to hold, own or acquire Partnership Class A Common Units or securities convertible into or exchangeable for Partnership Class A Common Units, including The We Company PI L.P., a Cayman Islands exempted limited partnership, provided that the governing agreement for any such Subsidiary or aggregator entity has in place provisions that are at least as favorable to the Partnership as the provisions in Sections 3.2 (limited to the last sentence thereof), 4.1(c), 4.2, 6.4 and 7.6 of that certain Third Amended and Restated Agreement of Exempted Limited Partnership of The We Company PI L.P. entered into on or about the date hereof.
“Preferred Share” means a share of stock of Super HoldCo now or hereafter authorized or reclassified that has dividend rights, or rights upon liquidation, winding up and dissolution, that are superior or prior to the Common Shares.
“Profits Interest” means a Partnership Class PI Common Unit that is issued with an Aggregate Distribution Threshold determined in accordance with the definition thereof. A Profits Interest is intended to meet the definition of a “profits interest” in IRS Revenue Procedures 93-27 and 2001-43, and the provisions of this Agreement shall be interpreted and applied consistently with such intention.
“Profits Interest Award Agreement” means an agreement between the Partnership or any Affiliate of the Partnership, on the one hand, and one or more Persons, on the other hand, in form or forms reasonably approved by the General Partner and, to the extent that any such agreement provides for any deviation from the terms of this Agreement, by the Compensation Committee of the Board of Directors, as it may be amended or supplemented from time to time with the written approval of the General Partner acting reasonably and in good faith, the Compensation Committee of the Board of Directors (if required hereby) and the applicable Person(s) or as otherwise permitted therein, pursuant to which Profits Interests or another class of similar Partnership Units are awarded to such Person(s).
13
“Qualified Transferee” means an “accredited investor,” as defined in Rule 501 promulgated under the Securities Act.
“Qualifying Party” means (a) a Limited Partner, (b) an Assignee who is the transferee of a Limited Partner’s Partnership Interest in a Permitted Transfer, or (c) a Person who is the transferee of a Limited Partner’s Partnership Interest in a Permitted Transfer; provided, however, that a Qualifying Party shall not include any Parent Entity.
“Redemption Committee” means a committee of members of the Board of Directors that includes at least two members (or one, if the Board of Directors does not include at least two members) who qualify as independent directors under Section 303A.00 of the NYSE Listed Company Manual or NASDAQ Marketplace Rule 4200(a)(15), as applicable, which committee makes its determination by majority approval (including a majority of such independent directors); provided, that, the Redemption Committee may not, and is not authorized to, elect or otherwise direct or approve the payment of cash for Ineligible Cash Election Class A Units (other than in respect of fractional shares). For the avoidance of doubt, the Redemption Committee may be a standing committee of the Board of Directors that satisfies the conditions described in this definition.
“Registrar” means the Registrar of Exempted Limited Partnerships of the Cayman Islands.
“Revised Audit Rules” shall mean the revised partnership audit rules under the United States Bipartisan Budget Act of 2015 and any sections of the Code or Treasury Regulations promulgated thereunder and with respect thereto, each as amended from time to time, and any similar state and local rules and regulations.
“SEC” means the United States Securities and Exchange Commission.
“Securities Act” means the United States Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.
“Section 4.9 Transaction” means (a) an acquisition by a Parent Entity contemplated by, and in accordance with, Section 4.9, provided, that the entity or assets acquired pursuant thereto are transferred to the Partnership in accordance with this Agreement or (b) a transaction conducted in accordance with, and solely to facilitate an acquisition by a Parent Entity contemplated by, Section 4.9 that, in the case of each of (a) and (b), (i) would not, and would not reasonably be expected to, be adverse (other than to a de minimis extent) to any of the Limited Partners (other than the Parent Entities) (for the avoidance of doubt, assuming for these purposes that the terms of the acquisition by a Parent Entity contemplated by Section 4.9, in and of themselves and without giving effect to any transactions by or with the Partnership pursuant to Section 4.9, would not, and would not reasonably be expected to, be so adverse), (ii) is on terms and conditions reasonably determined by the General Partner to be no less favorable to the Partnership than would be available to the Partnership from any third party (including, in the case of a sale to the Partnership, the seller of the assets to the Parent Entities) and (iii) does not result in any Limited Partner being personally liable to the applicable Parent Entities in respect of such transaction.
“Strike Price Catch-up Amount” means, in respect of any Profits Interest issued with a Strike Price Catch-up Amount (as set forth in the applicable Profits Interest Award Agreement), the excess of (a) the Distribution Threshold Per Profits Interest over (b) the Catch-up Base Amount.
14
“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, joint venture, trust or other legal entity of which such Person (either directly or through or together with another direct or indirect Subsidiary of such Person) (i) owns a majority of the equity interests having ordinary voting power for the election of directors or trustees or other governing body, or (ii) otherwise controls the management, including through a Person’s status as general partner, manager or managing member of the entity.
“Substituted Limited Partner” means a Person who is admitted as a Limited Partner to the Partnership pursuant to Section 10.4 and who has not ceased to be a Limited Partner pursuant to the Act and this Agreement.
“Termination Transaction” means: (a) a merger, tender or exchange offer, consolidation, amalgamation or other similar combination involving Super HoldCo and any other Person that is not a Change of Control Transaction; (b) a reclassification, recapitalization or change of the outstanding shares of Capital Stock (other than a change in par value, or from par value to no par value, or as a result of a stock split, stock dividend or similar subdivision); (c) the adoption of any plan of liquidation or dissolution of Super HoldCo or any other Liquidating Event, in each case, that is not a Change of Control Transaction; or (d) a Transfer of all or any portion of Super HoldCo’s Partnership Interest or TWC MC’s status as the General Partner, other than (i) a Transfer to the Partnership or a direct or indirect wholly owned subsidiary of any Parent Entity that is wholly owned (directly or indirectly) by Super HoldCo or (ii) a Transfer effected in accordance with Section 10.2(b).
“Trading Price” means, subject to Section 7.4(a), the last sentence of Section 14.1(a)(i) and the last sentence of Section 15.1, the closing price of a Class A Share on the stock exchange on which the Class A Shares are traded, calculated to four decimal places as reported by Bloomberg, L.P. (or any successor service), and determined without regard to after-hours trading or any other trading outside of the regular trading session trading hours, for the same trading day as the day the applicable Notice of Conversion or Notice of Redemption is properly delivered to the Partnership hereunder. Notwithstanding the foregoing, a Holder may deliver a Notice of Conversion or Notice of Redemption only on a trading day of an established securities exchange and at a time when such Holder would be permitted to publicly purchase or sell securities of Super HoldCo if such Holder is then subject to the corporate policy of Super HoldCo governing securities trading for directors and officers of Super HoldCo that Super HoldCo has in effect at the time such Notice of Conversion or Notice of Redemption is delivered by the Holder.
“Transfer” and any grammatical variation thereof shall refer to any, direct, indirect or synthetic, sale, exchange, issuance, redemption, assignment, distribution, encumbrance, hypothecation, gift, pledge, mortgage, charge, retirement, resignation, transfer or other withdrawal, disposition or alienation in any way (whether voluntarily, involuntarily or by operation of law). Transfer shall specifically, without limitation of the above, include assignments and distributions resulting from death, incompetency, bankruptcy, liquidation and dissolution. Notwithstanding the foregoing, when the term is used in Article X (other than Section 10.3(c)), “Transfer” does not include (a) any Redemption of Partnership Common Units by the Partnership, or acquisition of A Tendered Units by Super HoldCo (directly or through any of its Subsidiaries), pursuant to Section 7.3 or Section 14.1, (b) any Conversion of Partnership Class PI Common Units pursuant to Section 15.1, (c) any redemption of Partnership Units pursuant to any Partnership Unit Designation, (d) the granting of a revocable proxy to the Board of Directors at the request of the Board of Directors in connection with actions to be taken at an annual or special meeting of stockholders of Super HoldCo, (e) entering into any voting agreement, support agreement, tender agreement or similar agreement (in each case with or without granting a proxy) to which Super HoldCo is a party and that the Board of Directors has approved, or effectuating any actions or transactions contemplated thereunder, (f) any pledge or security interest (1) pursuant to or contemplated by (x) the Amended and Restated Secured Non-Recourse Promissory Note, dated as of February 26, 2021, executed and delivered by Adam Neumann and/or (y) the
15
Amended and Restated Pledge Agreement, dated as of February 26, 2021, among Adam Neumann, WE Holdings, LLC and StarBright WW LP, in the case of clause (x) and (y), as amended, supplemented, modified, replaced or refinanced (the agreements described in this clause (1), the “AN Pledge Agreements”) or (2) that creates a security interest in such Partnership Units pursuant to a bona fide loan or indebtedness transaction for so long as such Limited Partner continues to exercise the power (whether exclusive or shared) to vote or direct the voting of any Class C Shares that correspond to such pledged Partnership Units by proxy, voting agreement or otherwise; it being agreed that the sale by the lender parties or agents thereto pursuant to a foreclosure (a “Foreclosure Sale”) on any such Partnership Units (including Partnership Units and shares of Super HoldCo actually issued upon the Conversion, Redemption, Tendered Unit Acquisition, conversion or exchange of such Partnership Units in the event of any Foreclosure Sale) or other securities pledged pursuant to the AN Pledge Agreements to a third party pursuant to the provisions of the applicable loan agreement and any pledge agreement will not constitute a Transfer ; provided, further, that the transfer of the power (whether exclusive or shared) to vote or direct the voting of any Class C Shares that correspond to such Partnership Units to any such lender parties or agents pursuant to the exercise of remedies shall not be deemed to result in a Transfer, notwithstanding that such transfer of voting power may not be a Permitted Transfer, or (g) the fact that the spouse or Spousal Equivalent of any Limited Partner possesses or obtains an interest in such Limited Partner’s Partnership Units or Class C Shares arising solely by reason of the application of the community property laws of any jurisdiction, so long as no other event or circumstance shall exist or have occurred that constitutes a Transfer.
“Treasury Regulations” means one or more United States Department of Treasury regulations promulgated under the Code, whether such regulations are in proposed, temporary or final form, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations).
“Unoffset Tax Distributions” means, with respect to any Partnership Unit, any Tax Distributions paid in respect of such Partnership Unit in excess of the aggregate amount of distributions that would have been paid in respect of such Partnership Unit if Section 4.2 were not contained in this Agreement.
“Unpaid Catch-up Amount” means, in respect of any Profits Interest issued with a Strike Price Catch-up Amount (as set forth in the applicable Profits Interest Award Agreement), at any time, an amount equal to the excess of (i) the Strike Price Catch-up Amount in respect of such Profits Interest over (ii) the aggregate amount distributed prior to such time pursuant to the first proviso in Section 4.1(b) in respect of such Profits Interest.
“Unvested Profits Interest” means any Profits Interest that has not vested as of the date of determination pursuant to the terms of the Profits Interest Award Agreement pursuant to which such Profits Interest was granted.
“Vested Profits Interest” means any Profits Interest that has vested as of the date of determination pursuant to the terms of the Profits Interest Award Agreement pursuant to which such Profits Interest was granted.
“We Holdings” means We Holdings LLC, a Delaware limited liability company (together with any successors in interest thereto).
“WW Entities” means and includes each of the Partnership, the Parent Entities (including Super HoldCo) and their respective Controlled Entities.
16
Section 1.2 Interpretation. In this Agreement and in the exhibits hereto, except to the extent that the context otherwise requires:
(a) the headings are for convenience of reference only and shall not affect the interpretation of this Agreement;
(b) defined terms include the plural as well as the singular and vice versa, and context-appropriate grammatical variations of defined terms shall be applied in such manner as to give effect to the underlying meaning of such defined terms;
(c) words importing gender include all genders;
(d) a reference to any statute or statutory provision shall be construed as a reference to the same as it may have been or may from time to time be amended, extended, re-enacted or consolidated and to all statutory instruments or orders made under it;
(e) any reference to a “day” or a “Business Day” shall mean the whole of such day, being the period of 24 hours running from midnight to midnight;
(f) references to Articles, Sections, subsections, clauses and Exhibits are references to Articles, Sections, subsections, clauses and Exhibits to this Agreement;
(g) the words “including” and “include” and other words of similar import shall be deemed to be followed by the phrase “without limitation”;
(h) unless otherwise specified, references to any party to this Agreement or any other document or agreement shall include its successors and permitted assigns;
(i) when consent of any Person is to be given in one capacity, any such consent shall be deemed given by such Person only in such capacity and not in any other capacity; and
(j) unless otherwise specified, references to “gross negligence,” “fraud” or “willful misconduct” shall have the respective meanings as determined under Delaware law with regard to agreements entered into and executed solely in Delaware.
INDEX OF DEFINED TERMS
| A Tendered Units |
Section 14.1(a) | |||
| AAA |
Section 16.4 | |||
| Acquired Percentage |
Section 14.1(b) | |||
| Act |
Recitals | |||
| Actions |
Section 6.6(a) | |||
| Additional Funds |
Section 3.3(a) | |||
| Additional Limited Partner |
Section 1.1 | |||
| Adjusted Capital Account Deficit |
Section 1.1 | |||
| Adjusted Trading Price |
Section 1.1 | |||
| Adjustment Events |
Section 1.1 | |||
| Adjustment Factor |
Section 1.1 | |||
| Advance Super HoldCo Election |
Section 14.3 | |||
| Advanced Tax Distribution |
Section 1.1 | |||
| Affiliate |
Section 1.1 | |||
| Aggregate Distribution Threshold |
Section 1.1 | |||
| Agreement |
Section 1.1 |
17
| Applicable Record Date |
Section 1.1 | |||
| Asset |
Section 1.1 | |||
| Assets |
Section 1.1 | |||
| Assignee |
Section 1.1 | |||
| Bankruptcy |
Section 1.1 | |||
| Board of Directors |
Section 1.1 | |||
| Business Day |
Section 1.1 | |||
| Capital Account |
Section 3.5(a) | |||
| Capital Contribution |
Section 1.1 | |||
| Capital Stock |
Section 1.1 | |||
| Carrying Value |
Section 1.1 | |||
| Catch-up Base Amount |
Section 1.1 | |||
| C-Corp Subsidiaries |
Section 1.1 | |||
| Certificate |
Section 1.1 | |||
| Change of Control Transaction |
Section 1.1 | |||
| Change of Control Transaction Notice |
Section 7.4(b)(i) | |||
| Charter |
Section 1.1 | |||
| Class A Share |
Section 1.1 | |||
| Class C Share |
Section 1.1 | |||
| Code |
Section 1.1 | |||
| Common Share |
Section 1.1 | |||
| Consent |
Section 1.1 | |||
| Consent by Spouse |
Section 16.14 | |||
| Consent of the Management Representative |
Section 1.1 | |||
| Consent of the Non-Super HoldCo Partners |
Section 1.1 | |||
| Consent of the Partners |
Section 1.1 | |||
| Contingent Notice |
Section 14.1(b) | |||
| Contributed Asset |
Section 1.1 | |||
| Controlled Entity |
Section 1.1 | |||
| Conversion |
Section 15.1 | |||
| Converted A Cash Amount |
Section 1.1 | |||
| Converted A-to-Converted A Shares Amount |
Section 1.1 | |||
| Cut-Off Time |
Section 1.1 | |||
| Debt |
Section 1.1 | |||
| Declination |
Section 14.1(a) | |||
| Distribution Threshold Per Profits Interest |
Section 1.1 | |||
| Effective Date |
Introduction | |||
| Equity Plan |
Section 1.1 | |||
| ERISA |
Section 1.1 | |||
| Exchange Act |
Section 1.1 | |||
| Exchange Factor |
Section 1.1 | |||
| First Restatement Date |
Section 1.1 | |||
| Fiscal Year |
Section 16.5 | |||
| Formation Date |
Recitals | |||
| Funding Debt |
Section 1.1 | |||
| General Partner |
Section 1.1 | |||
| Holder |
Section 1.1 | |||
| Immediate Family |
Section 1.1 | |||
| Imputed Underpayment |
Section 9.4(b) | |||
| Incapacitated |
Section 1.1 | |||
| Incapacity |
Section 1.1 |
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| Indemnitee |
Section 1.1 | |||
| Ineligible Cash Election Class B Unit |
Section 1.1 | |||
| IRS |
Section 1.1 | |||
| Issuance Consideration |
Section 3.3(e) | |||
| July 15, 2019 Agreement |
Recitals | |||
| Liabilities |
Section 6.6(a) | |||
| Limited Partner |
Section 1.1 | |||
| Liquidating Event |
Section 12.2 | |||
| Liquidator |
Section 12.3(a) | |||
| M&A Distribution |
Section 4.9 | |||
| Majority in Interest of the Non-Super HoldCo Partners |
Section 1.1 | |||
| Majority in Interest of the Partners |
Section 1.1 | |||
| Management Representative |
Section 1.1 | |||
| Merger Agreement |
Section 1.1 | |||
| Net Income |
Section 1.1 | |||
| Net Loss |
Section 1.1 | |||
| New Securities |
Section 1.1 | |||
| Nonrecourse Debt |
Section 1.1 | |||
| Nonrecourse Deductions |
Section 1.1 | |||
| Notice of Conversion |
Section 15.1 | |||
| Notice of Redemption |
Section 1.1 | |||
| October 30, 2019 Agreement |
Recitals | |||
| Original Agreement |
Recitals | |||
| Parent Entities |
Section 1.1 | |||
| Partner |
Section 1.1 | |||
| Partner Nonrecourse Debt |
Section 1.1 | |||
| Partner Nonrecourse Debt Minimum Gain |
Section 1.1 | |||
| Partner Nonrecourse Deductions |
Section 1.1 | |||
| Partners |
Section 1.1 | |||
| Partnership |
Recitals | |||
| Partnership Class A Common Unit |
Section 1.1 | |||
| Partnership Class PI Common Unit |
Section 1.1 | |||
| Partnership Common Unit |
Section 1.1 | |||
| Partnership Counsel |
Section 16.1 | |||
| Partnership Employee |
Section 1.1 | |||
| Partnership Equivalent Units |
Section 1.1 | |||
| Partnership Interest |
Section 1.1 | |||
| Partnership Minimum Gain |
Section 1.1 | |||
| Partnership Preferred Unit |
Section 1.1 | |||
| Partnership Representative |
Section 9.4(a) | |||
| Partnership Unit |
Section 1.1 | |||
| Partnership Unit Designation |
Section 3.2(a) | |||
| Percentage Interest |
Section 1.1 | |||
| Permitted Charity |
Section 1.1 | |||
| Permitted Transfer |
Section 1.1 | |||
| Permitted Transferee |
Section 1.1 | |||
| Person |
Section 1.1 | |||
| PIU Aggregator |
Section 1.1 | |||
| Preferred Share |
Section 1.1 | |||
| Profits Interest |
Section 1.1 | |||
| Profits Interest Award Agreement |
Section 1.1 |
19
| Qualified Transferee |
Section 1.1 | |||
| Qualifying Party |
Section 1.1 | |||
| Redemption |
Section 14.1(a) | |||
| Redemption Committee |
Section 1.1 | |||
| Register |
Section 3.1 | |||
| Registrar |
Section 1.1 | |||
| Regulatory Allocations |
Section 5.3 | |||
| Revised Audit Rules |
Section 1.1 | |||
| SEC |
Section 1.1 | |||
| Section 4.9 Transaction |
Section 1.1 | |||
| Securities Act |
Section 1.1 | |||
| Specified Redemption Date |
Section 14.1(a) | |||
| Spousal Equivalent |
Section 1.1 | |||
| Strike Price Catch-up Amount |
Section 1.1 | |||
| Subsidiary |
Section 1.1 | |||
| Substituted Limited Partner |
Section 1.1 | |||
| Super HoldCo |
Introduction | |||
| Surviving Partnership |
Section 7.4(c)(ii) | |||
| Tax Distribution |
Section 4.2(a) | |||
| Tendered Unit Acquisition |
Section 14.1(b) | |||
| Tendering Party |
Section 14.1(a) | |||
| Termination Transaction |
Section 1.1 | |||
| Trading Price |
Section 1.1 | |||
| Transfer |
Section 1.1 | |||
| Treasury Regulations |
Section 1.1 | |||
| TWC MC |
Introduction | |||
| Unoffset Tax Distributions |
Section 1.1 | |||
| Unpaid Catch-up Amount |
Section 1.1 | |||
| Unvested Profits Interest |
Section 1.1 | |||
| Vested Profits Interest |
Section 1.1 | |||
| WCM |
Introduction | |||
| We Holdings |
Section 1.1 | |||
| WW Entities |
Section 1.1 |
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ARTICLE II
GENERAL PROVISIONS
Section 2.1 Formation. The Partnership is an exempted limited partnership previously formed and registered pursuant to the provisions of the Act and upon the terms and subject to the conditions set forth in the Original Agreement. Except as expressly provided in this Agreement to the contrary, the rights and obligations of the Partners and the administration and termination of the Partnership shall be governed by the Act. The Certificate, and all actions taken or to be taken by any employee of Skadden, Arps, Slate, Meagher & Flom LLP or Maples Group and any other Person who executed and filed or who executes and files, after the date hereof, the Certificate are hereby adopted and ratified, or authorized, as the case may be.
Section 2.2 Name. The name of the Partnership is “The We Company Management Holdings L.P.” The Partnership may also conduct business at the same time under one or more fictitious names if the General Partner determines that such is in the best interests of the Partnership. The General Partner may change the name of the Partnership, from time to time, in accordance with applicable law.
Section 2.3 Principal Place of Business; Other Places of Business. The principal business office of the Partnership is located at 115 West 18th Street, 2nd Floor, New York, New York 10011, or such other place within or outside the Cayman Islands as the General Partner may from time to time designate. The Partnership may maintain offices and places of business at such other place or places within or outside the Cayman Islands as the General Partner deems advisable.
Section 2.4 Registered Office. So long as required by the Act, the Partnership shall continuously maintain a registered office in the Cayman Islands. As of the date of this Agreement, the address of the registered office of the Partnership in the Cayman Islands is at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands.
Section 2.5 Term. The term of the Partnership commenced on the Formation Date and such term shall continue until the Partnership is dissolved in accordance with the Act or this Agreement. Notwithstanding the termination of the business of the Partnership, the existence of the Partnership shall continue until termination pursuant to this Agreement or as otherwise provided in the Act.
Section 2.6 No Concerted Action. Each Partner hereby acknowledges and agrees that, except as expressly provided herein, in performing its obligations or exercising its rights hereunder, it is acting independently and is not acting in concert with, on behalf of, as agent for, or as joint venturer of, any other Partner. Other than in respect of the Partnership, nothing contained in this Agreement shall be construed as creating a corporation, association, joint stock company, business trust, organized group of persons, whether incorporated or not, among or involving any Partner or its Affiliates, and nothing in this Agreement shall be construed as creating or requiring any continuing relationship or commitment as between such parties other than as specifically set forth herein.
Section 2.7 Business Purpose. The Partnership may carry on any lawful business, purpose or activity in which an exempted limited partnership may be engaged under applicable law (including the Act).
Section 2.8 Powers. Subject to the limitations set forth in this Agreement, the Partnership will possess and may exercise all of the powers and privileges granted to it by the Act, by any other applicable law or this Agreement, together with all powers incidental thereto, so far as such powers are necessary or convenient to the conduct, promotion or attainment of the purpose of the Partnership set forth in Section 2.7.
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Section 2.9 Certificates; Filings. The Certificate was previously filed on behalf of the Partnership with the Registrar, as required by the Act. The General Partner, acting reasonably and in good faith, may execute and file any duly authorized amendments to the Certificate from time to time in a form prescribed by the Act. The General Partner shall also cause to be made, on behalf of the Partnership, such additional filings and recordings as the General Partner shall deem necessary or advisable. If requested in good faith by the General Partner, the Limited Partners shall promptly execute all certificates and other documents consistent with the terms of this Agreement reasonably necessary for the General Partner to accomplish all filing, recording, publishing and other acts as may be appropriate to comply with all requirements for (a) the formation and operation of an exempted limited partnership under the laws of the Cayman Islands, (b) if the General Partner reasonably and in good faith deems it advisable, the operation of the Partnership as an exempted limited partnership, or partnership in which the Limited Partners have limited liability, in all jurisdictions where the Partnership proposes to operate and (c) all other filings required to be made by the Partnership, in each case, which actions do not result in personal liability to any Limited Partner (without such Limited Partner’s prior written consent).
Section 2.10 Representations and Warranties by the Partners and Super HoldCo.
(a) Each Partner that is an individual (including each Additional Limited Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or a Substituted Limited Partner) represents and warrants to, and covenants with, each other Partner that, as of the date upon which such Partner becomes a Partner (i) the consummation of the transactions contemplated by this Agreement to be performed by such Partner will not result in a breach or violation of, or a default under, any material agreement by which such Partner or any of such Partner’s property is bound, or any statute, regulation, order or other law to which such Partner is subject and (ii) this Agreement is binding upon, and enforceable against, such Partner in accordance with its terms.
(b) Each Partner that is not an individual (including each Additional Limited Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or a Substituted Limited Partner) represents and warrants to, and covenants with, each other Partner that, as of the date upon which such Partner becomes a Partner (i) all transactions contemplated by this Agreement to be performed by it have been duly authorized by all necessary action, including that of its general partner(s), managing member(s), manager(s), member(s), committee(s), trustee(s), beneficiaries, directors, officers and/or stockholder(s) (as the case may be) as required, (ii) the consummation of such transactions shall not result in a breach or violation of, or a default under, its partnership or operating agreement, trust agreement, charter or bylaws (as the case may be), any material agreement by which such Partner or any of such Partner’s properties or any of its partners, members, beneficiaries, trustees or stockholders (as the case may be) is or are bound, or any statute, regulation, order or other law to which such Partner or any of its partners, members, trustees, beneficiaries or stockholders (as the case may be) is or are subject, and (iii) this Agreement is binding upon, and enforceable against, such Partner in accordance with its terms.
(c) Super HoldCo represents and warrants to, and covenants with, each Partner that (i) all transactions contemplated by this Agreement to be performed by it have been duly authorized by all necessary action, including that of its directors and/or stockholders as required, (ii) the consummation of such transactions shall not result in a breach or violation of, or a default under, its charter or bylaws, any material agreement by which Super HoldCo is bound, or any statute, regulation, order or other law to which Super HoldCo is subject, and (iii) this Agreement is binding upon, and enforceable against, Super HoldCo in accordance with its terms.
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(d) Each Partner (including each Additional Limited Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or Substituted Limited Partner) represents and warrants that as of the date upon which such Partner becomes a Partner, it is an “accredited investor” as defined in Rule 501 promulgated under the Securities Act and represents, warrants and agrees that, as of the date upon which such Partner becomes a Partner, it has acquired and continues to hold its interest in the Partnership for its own account for investment purposes only and not for the purpose of, or with a view toward, the resale or distribution of all or any part thereof, and not with a view toward selling or otherwise distributing such interest or any part thereof at any particular time or under any predetermined circumstances. Each Partner further represents and warrants that, as of the date upon which such Partner becomes a Partner, it is a sophisticated investor, able and accustomed to handling sophisticated financial matters for itself, and that it has a sufficiently high net worth that it does not anticipate a need for the funds that it has invested in the Partnership in what it understands to be a speculative and illiquid investment.
(e) The representations and warranties contained in Sections 2.10(a), 2.10(b), 2.10(c) and 2.10(d) shall survive the execution and delivery of this Agreement by each Partner (and, in the case of an Additional Limited Partner or a Substituted Limited Partner, the admission of such Additional Limited Partner or Substituted Limited Partner as a Limited Partner in the Partnership) and the termination, liquidation and dissolution of the Partnership.
(f) Each Partner (including each Additional Limited Partner or Substituted Limited Partner as a condition to becoming an Additional Limited Partner or Substituted Limited Partner) hereby acknowledges that, as of the date upon which such Partner becomes a Partner, no representations as to potential profit, cash flows, funds from operations or yield, if any, in respect of the Partnership or any Parent Entity have been made by any Partner or any employee or representative or Affiliate of any Partner, and that projections and any other information, including financial and descriptive information and documentation, that may have been in any manner submitted to such Partner shall not constitute any representation or warranty of any kind or nature, express or implied.
(g) Notwithstanding the foregoing, the General Partner may permit the modification of any of the representations and warranties contained in Sections 2.10(a), 2.10(b), 2.10(c) and 2.10(d) as applicable to any Partner (including any Additional Limited Partner or Substituted Limited Partner or any transferee of either, but excluding any Parent Entity) provided that such representations and warranties, as modified, shall be set forth in either (i) a Partnership Unit Designation applicable to the Partnership Units held by such Partner or (ii) a separate writing addressed to the Partnership and the General Partner.
(h) Each Partner hereby represents and warrants and covenants to the Partnership and each other Partner as follows as of the date upon which such Partner becomes a Partner:
(i) Such Partner maintains its domicile or principal place of business at the address shown on Exhibit B with respect to such Partner, and such Partner is not merely transient or temporarily resident at such address.
(ii) Such Partner is aware that (A) its Partnership Interests involve a substantial degree of risk of loss of such Partner’s entire investment and that there is no assurance of any income from such Partner’s investment; (B) any tax benefits which may be available to it may be lost through the adoption of new laws or regulations, changes to existing laws and regulations, changes in the interpretation of existing laws and regulations or as a result of subsequent transactions or events and (C) any disposition of the Partnership Interests may result in unfavorable tax consequences to it. Such Partner is relying solely on its own conclusions or the advice of its own counsel or investment representative with respect to tax aspects of any investment in the Partnership.
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(iii) Such Partner has not obtained, nor will such Partner transfer or assign, any of its Partnership Units (or any interest therein) or cause any of its Partnership Units (or any interest therein) to be marketed on or through an “established securities market” within the meaning of Section 7704(b)(1) of the Code, or a “secondary market,” or the substantial equivalent thereof, within the meaning of Section 7704(b)(2) of the Code, including an over-the-counter market or an interdealer quotation system that regularly disseminates firm buy or sell quotations.
(i) As of the date upon which a Partner becomes a Partner, such Partner shall represent and warrant to the Partnership and each other Partner as to the total number of “partners” in the Partnership for purposes of Treasury Regulations Section 1.7704-1(h)(l)(ii) that such Partner represents. For purposes of this calculation, (x) the PIU Aggregator and (y) any other entity that is a direct or indirect Partner in the Partnership that is a flow-through entity (within the meaning of Treasury Regulations Section 1.7704-1(h)(3)) fifty percent (50%) or more of the asset value of which consists of Partnership Units, in each case, shall be treated as representing a number of “partners” in the Partnership for purposes of Treasury Regulations Section 1.7704-1(h)(l)(ii) equal to the number of beneficial owners (within the meaning of Treasury Regulations Section 1.7704-1(h)(3)) of the PIU Aggregator or such other entity, as applicable.
ARTICLE III
CAPITAL CONTRIBUTIONS
Section 3.1 Capital Contributions of the Partners. Other than Partners who hold solely Partnership Class PI Common Units, the Partners as of the Effective Date (or their predecessors in interest) have heretofore made (or are deemed to have made) Capital Contributions to the Partnership. Except as provided by law, or as expressly set forth in this Agreement (including Section 3.2, 3.3 or 4.4) with respect to the Parent Entities, the Partners shall have no obligation or, except with the prior written consent of the General Partner in connection with a bona fide business purpose (as reasonably determined by the General Partner), right to make any additional Capital Contributions or any loans to the Partnership. The General Partner shall cause to be maintained in the principal business office of the Partnership, or such other place as may be determined by the General Partner, the books and records of the Partnership, which shall include, among other things, a register containing the name, address, and number and class of Partnership Units of each Partner, and such other information as the General Partner may deem necessary or desirable (the “Register”). The Register shall not be deemed part of this Agreement. The General Partner shall from time to time update the Register as necessary to accurately reflect the information therein, including as a result of any sales, exchanges or other Transfers, or any redemptions, issuances or similar events involving Partnership Units. Any reference in this Agreement to the Register shall be deemed a reference to the Register as in effect from time to time. Subject to the terms of this Agreement, the General Partner may take any action authorized hereunder in respect of the Register without any need to obtain the consent of any other Partner. No action of any Limited Partner shall be required to amend or update the Register. Except as required by law, no Limited Partner shall be entitled to receive a copy of the information set forth in the Register relating to any Partner other than itself.
Section 3.2 Issuances of Additional Partnership Interests. Subject to the rights of any Holder set forth in a Partnership Unit Designation and the other terms and conditions of this Agreement:
(a) General. Partnership Interests shall be represented by Partnership Units. As of the Effective Date, the outstanding classes of Partnership Units shall be designated as “Partnership Class A Common Units,” or “Partnership Class PI Common Units.” The Partners, and the number and class of Partnership Units held by each Partner (including PIU Aggregator, if applicable), as of the effectiveness of this Agreement, are set forth in the Register. The General Partner, subject to the terms and conditions of the Charter, is hereby authorized to cause the Partnership to issue additional Partnership Interests, in the form of Partnership Units, for any Partnership purpose in accordance with the terms and conditions of this Agreement, at any time or from time to time, to the Partners (including the Parent Entities and including PIU Aggregator) or to other Persons, and to admit such Persons as Additional Limited Partners, for such
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consideration and on such terms and conditions as shall be established by the General Partner, all without the approval of any Limited Partner. Without limiting the foregoing, the General Partner is expressly authorized to cause the Partnership to issue Partnership Units in accordance with the other terms and conditions of this Agreement (i) upon the conversion, redemption or exchange of any Debt, Partnership Units, or other securities issued by the Partnership, (ii) for less than fair market value, (iii) for no consideration, (iv) in connection with any merger of any other Person into the Partnership, (v) upon (or, in the case of a Section 4.9 Transaction, substantially contemporaneously with) the contribution of property or assets to the Partnership or (vi) in exchange for services or pursuant to an Equity Plan. Subject to the terms and conditions of this Agreement, any additional Partnership Interests may be issued in one or more classes, or one or more series of any of such classes, with such designations, preferences, conversion or other rights, voting powers, restrictions, rights to distributions, qualifications and terms and conditions of redemption (including rights that may be senior or otherwise entitled to preference over existing Partnership Interests) as shall be determined by the General Partner for a bona fide business purpose (as reasonably determined by the General Partner), without the approval of any Limited Partner, and set forth in a written document thereafter attached to and made an exhibit to this Agreement, which exhibit shall be an amendment to this Agreement and shall be incorporated herein by this reference (each, a “Partnership Unit Designation”). Without limiting the generality of the foregoing, the General Partner shall have authority to specify the allocations of items of Partnership income, gain, loss, deduction and credit to each such class or series of Partnership Interests in accordance with the terms and conditions of this Agreement. Except to the extent specifically set forth in any Partnership Unit Designation, a Partnership Interest of any class or series other than a Partnership Common Unit shall not entitle the holder thereof to vote on, or consent to, any matter. Upon the issuance of any additional Partnership Interest, the General Partner shall amend the Register and the books and records of the Partnership as appropriate to reflect such issuance. Notwithstanding anything to the contrary in this Agreement or in any Profits Interests Award Agreement, in the event of any change in the Partnership’s capital structure which affects any Profits Interests or any other Partnership Interests, the General Partner shall, in addition to making appropriate and equitable adjustments to the Catch-up Base Amount and the Distribution Threshold Per Profits Interest in accordance with this Agreement, make appropriate and equitable adjustments to the number of outstanding Profits Interests (by distribution or splitting or merging such interests) to the extent necessary (in the reasonable and good faith determination of the General Partner) to prevent such capital structure change from (x) modifying the economic rights represented by the applicable Profits Interests in a manner that is disproportionately favorable or unfavorable in relation to the economic rights of other classes of outstanding Partnership Units or (y) increasing or reducing the aggregate Strike Price Catch-up Amounts to which such Profits Interests are entitled.
(b) Issuances to the Parent Entities. No additional Partnership Units shall be issued to any Parent Entity unless such Parent Entity is wholly owned (directly or indirectly) by Super HoldCo and: (i) the additional Partnership Units are issued to all Partners holding Partnership Common Units in proportion to their respective Percentage Interests in the Partnership Common Units; (ii) (a) the additional Partnership Units are (x) Partnership Class A Common Units issued in connection with an issuance of an equivalent number of Class A Shares taking into account the Adjustment Factor at the time or (y) Partnership Equivalent Units (other than Partnership Common Units) issued in connection with an issuance of an equivalent number of Preferred Shares, New Securities or other interests in Super HoldCo (other than Common Shares), taking into account the Adjustment Factor at the time, and (b) the applicable Parent Entity contributes to the Partnership the gross (after netting out all fees, costs and expenses incurred by Super HoldCo associated with such issuance, with such fees, costs and expenses to be borne by and for the account of the Partnership in accordance with Section 3.3(e)) cash proceeds or other consideration received by any WW Entities in connection with the issuance of such Common Shares, Preferred Shares, New Securities or other interests in Super HoldCo in accordance with Section 3.3(e); (iii) the additional Partnership Units are issued in connection with a transaction described in Section 4.3(b) that involves the redemption, surrender or cancellation of an equivalent number of Partnership Units of the same class held by one or more Parent Entities or (iv) the additional Partnership Units are issued in connection with any other transaction that is fair to the Holders as a whole other than the Parent Entities, subject to the Consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed).
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(c) No Preemptive Rights. Except as expressly provided in this Agreement or in any Partnership Unit Designation, no Person, including any Holder, shall have any preemptive, preferential, participation or similar right or rights to subscribe for or acquire any Partnership Interest, in each case, except to the extent such rights are made available to stockholders of Super HoldCo, in which case, Super HoldCo and the Partnership shall make appropriate provision to make such rights available to the Holders (other than the Parent Entities).
Section 3.3 Additional Funds and Capital Contributions.
(a) General. The General Partner may, at any time and from time to time, determine that the Partnership requires additional funds (“Additional Funds”) for the acquisition or development of additional Assets, for the redemption of Partnership Units or for such other purposes as the General Partner may determine. Additional Funds may be obtained by the Partnership, at the election of the General Partner, in any manner provided in, and in accordance with, the terms of this Section 3.3 without the approval of any Limited Partner.
(b) Additional Capital Contributions. The General Partner, on behalf of the Partnership, may obtain any Additional Funds by accepting Capital Contributions from any Partners or other Persons. In connection with any such Capital Contribution (of cash or property), the General Partner is hereby authorized to cause the Partnership from time to time to issue additional Partnership Units (as set forth in Section 3.2 above and, for the avoidance of doubt, subject to the restrictions and procedures set forth therein) in consideration therefor and the Percentage Interests of the General Partner and the Limited Partners (and, if necessary, the priorities in Section 4.1(b)) shall be appropriately adjusted to reflect the issuance of such additional Partnership Units; provided, however, that to the extent the fair market value of such additional Partnership Units exceeds the fair market value of the Capital Contribution in exchange for which such additional Partnership Units are issued, such issuance shall be subject to the Consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed). For the avoidance of doubt, except as provided by law, or as expressly set forth in this Agreement (including Section 3.2, 3.3 or 4.4) with respect to the Parent Entities, the Partners shall have no obligation to make any additional Capital Contributions or any loans to the Partnership.
(c) Loans by Third Parties. The General Partner, on behalf of the Partnership, may obtain any Additional Funds by causing the Partnership to incur Debt to any Person (other than, except as contemplated in Section 3.3(d), the Parent Entities) upon such terms as the General Partner determines appropriate, including making such Debt convertible, redeemable or exchangeable for Partnership Units; provided, however, that the Partnership shall not incur any such Debt if (i) any Limited Partner would be personally liable for the repayment of such Debt (unless such Limited Partner otherwise agrees in writing) or (ii) the incurrence of such Debt or the terms thereof would disproportionately adversely affect (other than to a de minimis extent) any rights, privileges, preferences or obligations of any of the Limited Partners (other than the Parent Entities); provided, further, that neither the Partnership nor any Parent Entity shall incur any debt that is convertible, redeemable or exchangeable for Partnership Units without complying with all of the provisions of this Agreement that govern the issuance of equity by the Partnership.
(d) Parent Entity Loans. The General Partner, on behalf of the Partnership, may obtain any Additional Funds by causing the Partnership to incur Debt with Super HoldCo or any Parent Entity that is wholly owned (directly or indirectly) by Super HoldCo if (i) such Debt is, to the extent permitted by law, on substantially the same terms and conditions (including interest rate, repayment schedule, and conversion,
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redemption, repurchase and exchange rights) as Funding Debt incurred by the applicable Parent Entity, the net proceeds of which are loaned to the Partnership to provide such Additional Funds, or (ii) such Debt is on terms and conditions reasonably determined by the General Partner to be no less favorable to the Partnership than would be available to the Partnership from any third party (subject to the Consent of the Management Representative); provided, however, that the Partnership shall not incur any such Debt if any Limited Partner would be personally liable for the repayment of such Debt (unless such Limited Partner otherwise agrees in writing).
(e) Issuance of Securities by Super HoldCo. Super HoldCo shall not issue any additional Common Shares, Preferred Shares or New Securities unless a Parent Entity that is wholly owned (directly or indirectly) by Super HoldCo contributes the cash proceeds or other consideration (the “Issuance Consideration”) received from the issuance of such additional Common Shares, Preferred Shares or New Securities (as the case may be) and from the exercise of the rights contained in any such additional New Securities to the Partnership in exchange for (y) in the case of an issuance of Class A Shares, an equal number of Partnership Class A Common Units (taking into account the Adjustment Factor) or (z) in the case of an issuance of Preferred Shares or New Securities, an equal number of Partnership Equivalent Units (taking into account the Adjustment Factor); provided, however, that notwithstanding the foregoing, Super HoldCo may issue Common Shares, Preferred Shares or New Securities (a) pursuant to Section 3.4, Section 7.7 (in connection with the issuance of Class C Shares) or Section 14.1(b) (in connection with a Redemption or Tendered Unit Acquisition), (b) pursuant to a dividend or distribution (including any stock split) of Common Shares, Preferred Shares or New Securities to all of the holders of Common Shares, Preferred Shares or New Securities (as the case may be), (d) upon a conversion, redemption or exchange of Preferred Shares (as described in Section 3.7) or (e) upon a conversion, redemption, exchange or exercise of New Securities. In the event of any issuance of additional Common Shares, Preferred Shares or New Securities by Super HoldCo, and the contribution to the Partnership, by a Parent Entity, of the Issuance Consideration received from such issuance, (i) the Partnership shall pay Super HoldCo’s and any Parent Entity’s fees, costs and expenses associated with such issuance, including any underwriting commissions, (ii) the Issuance Consideration shall be contributed to the Partnership as soon as practicable after Super HoldCo’s direct or indirect receipt thereof, and (iii) during any time period between the time of Super HoldCo’s direct or indirect receipt of the Issuance Consideration and the contribution of such Issuance Consideration to the Partnership, the Parent Entities shall hold such Issuance Consideration, and operate any acquired assets that are part of such Issuance Consideration, for the benefit of the Partnership. For the avoidance of doubt, the provisions of this Section 3.3(e) shall be subject to the restrictions and procedures set forth in Section 3.2.
(f) Issuance of Securities by Parent Entities other than Super HoldCo. No Parent Entity other than Super HoldCo shall issue to any Person other than Super HoldCo or another Parent Entity that is wholly owned (directly or indirectly) by Super HoldCo, any (i) equity interests, (ii) rights, options, warrants or convertible or exchangeable securities that entitle the holder thereof to subscribe for or purchase, convert such securities into or exchange such securities for any equity interests in the issuer thereof, (iii) other securities the value of which is derived from the value of the equity of such entity or (iv) any Debt issued by any Parent Entity that provides any of the rights described in the preceding clauses (i), (ii) or (iii).
(g) Prevention of Cash Accumulation at Parent Entities. Within ninety (90) days of any Parent Entity receiving a distribution from the Partnership (other than a distribution pursuant to Section 4.2 or an M&A Distribution), such distribution shall be further distributed by such Parent Entity (unless the Parent Entity is Super HoldCo), through other Parent Entities if necessary, to Super HoldCo, and used to pay a corresponding dividend by Super HoldCo, provided, that in the event such Parent Entity or Super HoldCo (as relevant) is prohibited by applicable law (including the order of any agency having appropriate jurisdiction) from distributing the amounts received as required hereby, such entity shall (i) notify the General Partner and the Management Representative of such issue, and (ii)(A) make the distributions required hereby as soon as legally possible to the persons who are entitled to receive a distribution on such date and (B) notify the General Partner and the Management Representative of the subsequent distribution.
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Section 3.4 Equity Plans.
(a) If at any time Super HoldCo issues one or more Class A Shares in connection with any Equity Plan, whether such Class A Shares are issued upon exercise (including cashless exercise) of an option, settlement of a restricted stock unit, as restricted stock or otherwise, the General Partner shall cause the Partnership to issue a corresponding number (determined based upon the Adjustment Factor then in effect) of Partnership Class A Common Units to TWC MC (or, at the sole discretion of Super HoldCo, to any or all of the other Parent Entities); provided that Super HoldCo shall be required to contribute and cause TWC MC (and all of the other Parent Entities) to contribute all of the net proceeds (if any) received by Super HoldCo from or otherwise in connection with such issuance of Class A Shares, including the exercise price of any option exercised, to the Partnership. If any such Class A Shares so issued by Super HoldCo in connection with an Equity Plan are subject to vesting or forfeiture provisions, then the Partnership Class A Common Units that are issued by the Partnership to Parent Entities in connection therewith in accordance with the preceding provisions of this Section 3.4(a) shall be subject to vesting or forfeiture on the same basis; if any of such Class A Shares vest or are forfeited, then a corresponding number (determined based upon the Adjustment Factor then in effect) of Partnership Class A Common Units issued by the Partnership in accordance with the preceding provisions of this Section 3.4(a) shall automatically vest or be forfeited. Any cash or property held by Super HoldCo, other Parent Entities or the Partnership or on any of such Person’s behalf in respect of dividends paid on restricted Class A Shares that fail to vest shall be returned to the Partnership upon the forfeiture of such restricted Class A Shares.
(b) The Partnership intends, and the Partners acknowledge and agree, that, to the maximum extent permitted by applicable law, the Partnership or an applicable Subsidiary of the Partnership shall withhold any and all taxes required to be withheld in connection with the transactions described in Section 3.4(a), and shall remit to the appropriate taxing authority all such withheld taxes and all other employment-related taxes in connection with such transactions.
Section 3.5 Capital Accounts.
(a) A separate capital account (a “Capital Account”) shall be established and maintained for each Partner. The balance of each Partner’s Capital Account on the Effective Date shall be set forth in the format of Exhibit C, shall be provided to all Partners as promptly as practicable following the date hereof, and shall be updated thereafter from time to time in accordance with this Agreement.
(b) The balance in each Partner’s Capital Account shall be adjusted by (i) increasing such balance by (x) all Net Income allocable to such Partner in respect of its Partnership Units pursuant to Section 5.1 and any items of income or gain which are allocated to such Partner pursuant to Section 5.2 or Section 5.3, in each case for such Fiscal Year, plus (y) the sum of the amount of any cash Capital Contributions and the fair market value of any other Capital Contributions made by such Partner during such Fiscal Year (net of liabilities assumed from such Partner and the liabilities to which such contributed property is subject), and (ii) decreasing such balance by (A) the sum of the amount of any cash and the fair market value of any other property distributed to such Partner during such Fiscal Year (net of liabilities assumed by such Partner and the liabilities to which such property is subject) and (B) all Net Losses allocable to such Partner in respect of its Partnership Units pursuant to Section 5.1 and any items of loss or deduction of the Partnership allocated to such Partner pursuant to Section 5.2 or Section 5.3, in each case for such Fiscal Year.
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(c) If a Partner Transfers any Partnership Units in accordance with this Agreement, then in connection with such Transfer, the original Capital Account established for such transferee shall be in (or, in the case of a Transfer to a Person that is an existing Partner, such Person’s Capital Account shall be increased by) an amount equal to the portion of such Transferring Partner’s Capital Account that relates to the Partnership Units Transferred to such transferee, and the Capital Account of any Partner who makes any such Transfer shall be correspondingly decreased to reflect such Transfer. Any reference in this Agreement to a Capital Contribution of or distribution to a then-Partner shall include a Capital Contribution or distribution previously made by or to any prior Partner in respect of the Partnership Units of such then-Partner.
(d) Except as otherwise required by law, no Partner shall be required to pay to the Partnership or to any other Partner the amount of any negative balance which may exist from time to time in such Partner’s Capital Account, including upon the liquidation or dissolution of the Partnership.
(e) The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Treasury Regulations sections 1.704-1 and 1.704-2, and shall be interpreted and applied in a manner consistent with such Treasury Regulations and any amendment or successor provision thereto.
Section 3.6 No Interest; No Return. No Partner shall be entitled to interest on its Capital Contribution or on such Partner’s Capital Account. Except as provided herein or by law, no Partner shall have any right to demand or receive the return of its Capital Contribution from the Partnership.
Section 3.7 Conversion, Exchange or Redemption of Preferred Shares and Common Shares.
(a) Conversion or Exchange of Preferred Shares. If, at any time, any Preferred Shares are converted into, or exchanged for, Common Shares, in whole or in part, then an equal number of Partnership Equivalent Units held by Super HoldCo (directly or through any of the other Parent Entities, at the sole discretion of Super HoldCo) that correspond to the class or series of Preferred Shares so converted shall automatically be converted or exchanged into a number of Partnership Common Units equal to the quotient of (i) the number of Common Shares issued upon such conversion, divided by (ii) the Adjustment Factor then in effect.
(b) Redemption or Repurchase of Preferred Shares. If, at any time, any Preferred Shares are redeemed, repurchased or otherwise acquired (whether by exercise of a put or call right, automatically or by means of another arrangement) by any Parent Entity, then, immediately prior to such redemption, repurchase or acquisition of Preferred Shares, the Partnership shall purchase an equal number of Partnership Equivalent Units held by Super HoldCo (directly or through any of the other Parent Entities, at the sole discretion of Super HoldCo) that correspond to the class or series of Preferred Shares so redeemed, repurchased or acquired upon the same terms and for the same consideration per Partnership Equivalent Unit, as such Preferred Shares are redeemed, repurchased or acquired (after giving effect to the application of the Adjustment Factor).
(c) Redemption, Repurchase or Forfeiture of Common Shares. If, at any time, any Common Shares are redeemed, repurchased or otherwise acquired (whether by exercise of a put or call right, upon forfeiture of any award granted under any Equity Plan, automatically or by means of another arrangement) by any Parent Entity, then, immediately prior to such redemption, repurchase or acquisition of Common Shares, the Partnership shall redeem a number of Partnership Common Units held by Super HoldCo (directly or through any of the other Parent Entities, at the sole discretion of Super HoldCo) equal to the quotient of (i) the number of Common Shares so redeemed, repurchased or acquired, divided by (ii) the Adjustment Factor then in effect, with such redemption, repurchase or acquisition to be upon the same terms and for the same price per Partnership Common Unit (after giving effect to application of the Adjustment Factor) as such Common Shares are redeemed, repurchased or acquired.
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(d) Conversion of Partnership Class B Common Units. If, as of the date hereof, any Partnership Class B Common Units (as defined in the October 30, 2019 Agreement) are outstanding, such Partnership Class B Common Units shall automatically be converted into a number of Partnership Class A Common Units equal to the number of Class C Shares corresponding to such Partnership Class B Common Units as of immediately prior to the conversion pursuant to this Section 3.7(d).
Section 3.8 Tax Treatment of Profits Partnership Interests.
(a) With respect to any Profits Interests, (i) recipients who are subject to taxation in the United States shall be required to make timely elections under Section 83(b) of the Code and (ii) the applicable Profits Interest Award Agreement shall provide that no distributions shall be made with respect to such Partnership Units, and no value shall be ascribed to them for purposes of any redemption or exchange rights pursuant to Article XIV or Article XV which would reasonably be expected to cause the Partnership Units to fail to meet the definition of a “profits interest” in IRS Revenue Procedures 93-27 and 2001-43. If distributions with respect to any Profits Interests are reduced pursuant to the preceding sentence, the General Partner shall make appropriate adjustments to future distributions with respect to the holder of such Profits Interests and all other Holders of Partnership Units, so that the holder of such Profits Interests receives (consistent with the principles of this Section 3.8(a)) an amount equal to such foregone distributions out of amounts that, but for this sentence, would have been distributed to other Partners.
(b) Notwithstanding anything in this Agreement to the contrary, upon receipt of and solely to the extent required by written advice from independent tax counsel of nationally recognized standing, the General Partner is authorized to amend this Agreement, and any schedules or attachments thereto, as reasonably necessary to ensure that the Profits Interests are treated as described in Section 3.8(a), subject to the Consent of the Management Representative (such consent not to be unreasonably withheld, conditioned or delayed).
ARTICLE IV
DISTRIBUTIONS
Section 4.1 Distributions in General.
(a) Except as provided in Section 4.2, Section 4.9 or Section 12.3, distributions of the Partnership’s cash or other assets to the Partners shall be made at such times and in such amounts as determined by the General Partner in compliance with applicable law and this Agreement, including when necessary for the operation of the Parent Entities or for distributions to Super HoldCo’s stockholders; provided that the Partnership shall retain sufficient working capital reserves as measured immediately after any proposed distribution. No distribution shall be made by the Partnership at a time when a Parent Entity would be prohibited by applicable law from complying with the requirements of Section 3.3(g) hereof with respect to such distribution (disregarding the proviso thereto). No Partner shall be entitled to any distribution or payment with respect to such Partner’s Partnership Interest except as set forth in this Agreement.
(b) Other than distributions pursuant to Section 4.2, Section 4.3(b) or Section 12.3, except as provided in, and subject to the rights of any Parent Entity set forth in, a Partnership Unit Designation (subject to, and in compliance with, Section 3.2(a)), Section 3.8(a), Section 4.1(c) and Section 4.1(d)), if the General Partner declares and determines to make any distribution of cash or other assets to the Partners, all such distributions shall be made to all holders of Partnership Units, pro rata in
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accordance with the number of such Partnership Units held by each such holder; provided, that immediately upon the aggregate amount of all distributions to all Partners pursuant to this Section 4.1(b) (together with the aggregate value of all Partnership Units redeemed by the Partnership, including pursuant to Section 3.7, but excluding, for the avoidance of doubt, exchanges for additional equity interests of equivalent value in the Partnership or Super HoldCo) exceeding the Aggregate Distribution Threshold in respect of such Partnership Class PI Common Unit that has a Strike Price Catch-up Amount, the holder of such Partnership Class PI Common Unit shall be entitled to receive an amount equal to the aggregate Unpaid Catch-up Amount (if any) in respect of such Partnership Class PI Common Unit, in preference to all other distributions that would otherwise be made under this Section 4.1(b) (it being understood that, for purposes of determining whether and to what extent distributions exceed the Aggregate Distribution Threshold in respect of any Partnership Class PI Common Unit, only distributions that were declared after the date of such Partnership Class PI Common Unit’s issuance and have an Applicable Record Date prior to the date of the applicable determination shall be taken into account), and no other Partnership Interests shall be entitled to participate in distributions pursuant to this proviso until the Unpaid Catch-up Amounts are reduced to zero; provided, further, that distributions under the immediately preceding proviso shall be made among the holders of Partnership Class PI Common Units then entitled to receive an Unpaid Catch-up Amount in proportion to each such holder’s Unpaid Catch-up Amounts.
(c) Notwithstanding the provisions of Section 4.1(b), a holder of a Partnership Class PI Common Unit shall be entitled to a distribution pursuant to Section 4.1(b) in respect of such Partnership Class PI Common Unit only to the extent that the aggregate amount of all distributions to all Partners pursuant to Section 4.1(b) (together with the aggregate value of all Partnership Units redeemed by the Partnership, including pursuant to Section 3.7, but excluding, for the avoidance of doubt, exchanges for additional equity interests of equivalent value in the Partnership or Super HoldCo) following the issuance of such Partnership Class PI Common Unit exceeds the Aggregate Distribution Threshold in respect of such Partnership Class PI Common Unit. For purposes of this Section 4.1(c) and the first proviso of Section 4.1(b), Advanced Tax Distributions shall be treated as distributions pursuant to Section 4.1(b) to the extent such Advanced Tax Distributions were not made in respect of Partnership Class PI Common Units.
(d) Except for distributions pursuant to Section 4.2, no distributions will be made with respect to any Unvested Profits Interests; provided, that any distributions that would have otherwise been made on any Unvested Profits Interests will be distributed to the holder thereof on a priority basis ahead of distributions to holders of all other Partnership Interests once such Profits Interests have vested. For the avoidance of doubt, once such Profits Interests have vested, distributions shall not be made to any other Partner until such holder has received the full amount of the distributions that would have otherwise been made on such Unvested Profits Interests. The distributions under this Section 4.1(d) shall be made pro rata among the holders of Partnership Class PI Common Unit then-entitled to receive amounts pursuant to this Section 4.1(d) in accordance with such amounts then-owing to such holders.
(e) Except as otherwise provided by law and this Agreement, no Partner shall be required to restore or repay to the Partnership any funds properly distributed to it pursuant to this Section 4.1. In the event a Partner is required to restore or repay to the Partnership any funds so distributed and the circumstances described in Section 34(1) of the Act are applicable, the amount payable pursuant to Section 34(1) of the Act shall not bear any interest.
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Section 4.2 Tax Distributions.
(a) Within ninety (90) days after the close of each Fiscal Year, the Partnership shall make a distribution (a “Tax Distribution”) to each Partner so that the aggregate distributions to such Partner pursuant to this Article IV for such Fiscal Year (including all distributions pursuant to this Section 4.2 for such Fiscal Year), equal the aggregate United States federal, state and local income tax liability of such Partner for such Fiscal Year attributable to such Partner’s ownership of its interest in the Partnership, determined (i) solely by reference to such Partner’s share of the Partnership’s income (including income includible by such Partner (or its regarded owner for U.S. federal tax purposes) by reason of Section 951, 951A, or 956 of the Code or otherwise pursuant to subpart F of Part III of the Code, but determined without regard to (A) any income recognized by a holder of an option of the Partnership as a result of the exercise of such option, (B) any income recognized by a Partner in connection with the transfer of Partnership Interests or (C) in the case of any recipient of a guaranteed payment for the performance of services, to the extent that such payment is actually made within three (3) months after the end of the relevant taxable year, in cash or property to the Partner providing services to the Partnership, any income to the Partner in respect of guaranteed payments paid in cash or property for the performance of such services); (ii) except as set forth below in the case of the Parent Entities (which shall use their actual effective tax rates (or if a Partner is a disregarded entity or a partnership for U.S. federal income tax purposes, the actual effective tax rate of such Partner’s regarded owner that is not itself a partnership or disregarded entity)) as if such Partner were subject to the maximum combined United States federal and relevant state and local tax rates (including any applicable Code Section 1411 net investment income tax) applicable to an individual or corporation, as applicable, residing in New York City on ordinary income and net short-term capital gain or on net long-term capital gain, as applicable, and, in the case of a corporation, taking into account the deductibility of state and local income taxes for U.S. federal income tax purposes and the deductibility of local income taxes for state income tax purposes and, in the case of any individual (or, to the extent owned by an individual, any other Partner transparent for U.S. federal income tax purposes), any deduction available under Section 199A of the Code; and (iii) taking into account any prior year Net Losses with respect to the Partnership allocable to such Partner to the extent such Net Losses would be deductible against such Partner’s share of the Partnership’s taxable income (assuming such Net Losses are carried forward to the extent of any applicable law and not applied against any non-Partnership income). Solely in respect of distributions pursuant to this Section 4.2 to the Parent Entities, (i) each calculation of the amounts of such distributions shall take into account (A) the net operating loss carryforwards and any other tax attributes of such Parent Entities from taxable years (or portions thereof) ending before the First Restatement Date hereof that may be utilized to offset taxable income allocable by the Partnership to such Parent Entities and (B) the actual effective combined United States federal and relevant state and local tax rate applicable to the taxable income allocable by the Partnership to the Parent Entities (as reported to the Partnership by Super HoldCo), and (ii) to the extent any such distributions are not ultimately used by the Parent Entities to pay a tax liability (or to the extent used by the Parent Entities to pay a tax liability but ultimately refunded to the Parent Entities by the applicable taxing authority) such amounts shall be contributed by the Parent Entities to the capital of the Partnership (without any issuance of Partnership Units in exchange therefor, but reducing amounts treated as advances under Section 4.2(b) appropriately). If any portion of a Partner’s Partnership Interests is redeemed by the Partnership or forfeited pursuant to the applicable Profits Interest Award Agreement to which such Partner is a party, then such Partner’s distribution pursuant to this Section 4.2 in respect of income of the Partnership after the date of such redemption or forfeiture shall be determined without regard to any items allocated to, or amounts distributed to, such Partner in respect of such redeemed or forfeited Partnership Interests. Subject to the availability of sufficient funds, and as advances of the annual distribution required by this Section 4.2, the Partnership shall make periodic distributions to the Partners in amounts and at times that the General Partner reasonably determines to be sufficient for the Partners to pay estimated taxes, calculated in accordance with the principles set forth in this Section 4.2. Notwithstanding the foregoing and any other provision of this Agreement, the amount otherwise payable to any Partner under this Section 4.2 in respect of a given Fiscal Year shall be reduced (but not below zero) by the total amount of all unreturned distributions made during such Fiscal Year to such Partner (other than other distributions made under this Section 4.2 with respect to a prior Fiscal Year).
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(b) Notwithstanding anything to the contrary in this Agreement, but except as set forth in the next sentence, distributions made pursuant to this Section 4.2 if any, shall be treated as a dollar-for-dollar advance of the amounts otherwise distributable to the Partners pursuant to this Article IV and Section 12.3 and will be taken into account in determining subsequent distributions to the Partners pursuant to this Article IV and Section 12.3 so that each Partner receives as promptly as possible the same aggregate amount of distributions such Partner would have received if this Section 4.2 were not contained in this Agreement. If any of a Partner’s Partnership Units are redeemed by the Partnership or forfeited pursuant to the applicable Profits Interest Award Agreement to which such Partner is a party, and such redeemed or forfeited Partnership Units are subject to Advanced Tax Distributions pursuant to this Section 4.2, the Advanced Tax Distributions associated with such redeemed or forfeited Partnership Units shall be reduced to zero so that the Tax Distribution with respect to redeemed or forfeited interests are not applied to determine or reduce subsequent distributions to any Partner with respect to remaining Partnership Units not otherwise forfeited or redeemed.
(c) Any transferee in any Transfer (other than a Transfer pursuant to Article XIV) shall succeed to Advanced Tax Distributions associated with the applicable Transferred Partnership Units. In addition, any Advanced Tax Distributions in respect of a Profits Interest shall carry over into any Partnership Class A Common Unit received on a conversion of such Profits Interest in accordance with Section 15.1.
(d) If a Partner or its direct or indirect owner realizes, in cash (including through a reduction in cash taxes otherwise payable), a tax benefit related to any redeemed or forfeited Partnership Units in the year that such Partnership Units are redeemed or forfeited or in any of the four succeeding years thereafter, such Partner shall pay an amount equal to such benefit to the Partnership. The amount of any such benefit shall be reasonably determined by the Partner using a with-and-without calculation. Upon request of the Partnership or the General Partner, such Partner shall provide the Partnership with any reasonable supporting documentation or detail with respect to the foregoing calculations; provided that such Partner shall not be required to provide the Partnership with any tax returns (or tax returns of its direct or indirect owners). At the option of the applicable Partner, amounts owed to the Partnership under this Section 4.2(d) may be satisfied through a forfeiture of Partnership Units rather than payments in cash, with the value of any forfeited Partnership Units reasonably determined by the General Partner in accordance with clause (i) of the definition of “Exchange Factor” in the case of a Profits Interest and the last value determined for a Class A Share in the case of a Partnership Class A Common Unit (provided that such Class A Share value may be reasonably adjusted by the General Partner to take into account any material events occurring since the date of the applicable valuation). The Partnership, upon request of the Partner, shall repay the Partner the amount (or a portion of the amount) of the benefit paid over pursuant to the foregoing (plus, on an after-tax basis, any interest imposed by the relevant taxing authority) to the extent that the Partner is required to repay the amount (or a portion of the amount) of such benefit to such taxing authority. Notwithstanding any other provision of this Agreement or any Profits Interest Award Agreement to the contrary, a Partner’s obligations under this Section 4.2(d) shall survive the termination of such Partner’s interest in the Partnership.
Section 4.3 Distributions in Kind.
(a) No Holder may demand to receive property other than cash as provided in this Agreement. The General Partner may cause the Partnership to make a distribution in kind of Assets, Surviving Partnership assets or Partnership Interests to the Holders and such assets or Partnership Interests shall be distributed in such a fashion as to ensure that (i) the fair market value (as reasonably determined by the General Partner in good faith) is distributed and allocated in accordance with Articles IV, V and XII, in each case, as determined by the General Partner reasonably and in good faith following consultation with the Management Representative and (ii) such distribution preserves the economic objectives underlying this Agreement with respect to the entirety of the business of the Partnership as of immediately prior to such distribution (including the opportunity to participate in the future value of each business, whether or
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not any applicable participation requirement or threshold is satisfied as of the date of such distribution). Subject to Section 4.3(c) and notwithstanding Section 6.3(a), if the Partnership distributes property in kind that was contributed to the Partnership by a Parent Entity (or deemed contributed by a Parent Entity, for tax purposes, or received in a tax-deferred exchange for property contributed or so deemed contributed to the Partnership by a Parent Entity), the General Partner shall use commercially reasonable efforts to cause such property to be distributed to the Parent Entity who contributed such property (or was deemed to contribute such property), to the extent that such Partner is otherwise entitled to receive such a distribution at such time, in accordance with the immediately foregoing sentence and the other provisions of this Agreement.
(b) Notwithstanding Section 4.3(a) or Section 4.3(c), the General Partner may cause the Partnership to make a distribution in kind to the C-Corp Subsidiary of property that was contributed to the Partnership by the C-Corp Subsidiary prior to the date hereof (or deemed contributed by the C-Corp Subsidiary, for tax purposes, or received in a tax-deferred exchange for property contributed or so deemed contributed to the Partnership by the C-Corp Subsidiary, in each case, prior to the date hereof) in order to facilitate a sale (other than to any WW Entity) of such distributed property or the C-Corp Subsidiary to which it was distributed; provided that (i) such distribution shall be in redemption of Partnership Units held by the C-Corp Subsidiary and (ii) all proceeds of any such sale must be contributed to the Partnership in exchange for such number and class of Partnership Units in the manner described in clause (iii) of Section 3.2(b).
(c) Notwithstanding the other provisions of this Article IV (but subject to Section 4.3(b)), in the event (i) Super HoldCo desires, for a bona fide business purpose that is not intended, in whole or in part, to be adverse to the Limited Partners (other than the Parent Entities), to engage in a spin-off, split-off or similar transaction, or otherwise cause the distribution of securities of a Subsidiary or (ii) the Partnership desires, for a bona fide business purpose that is not intended, in whole or in part, to be adverse to the Limited Partners (other than the Parent Entities), to engage in a de-merger, the General Partner shall make a reasonable and good faith determination, following consultation with the Management Representative, regarding the treatment of Profits Interests in connection therewith, including the form, type and amount of securities of the de-merged, spun-out, split out or similar entity to be distributed (or otherwise made available) to holders of Profits Interests in connection with such transaction (together with appropriate equitable adjustments to the Distribution Threshold Per Profits Interest and the Catch-up Base Amount), which the General Partner has reasonably and in good faith determined following consultation with the Management Representative shall achieve the economic objective underlying this Agreement with respect to the entirety of the business of the Partnership as of immediately prior to such transaction and shall take into account each Partner’s and their Affiliates’ economic and tax consequences related to the transaction or distribution (including the opportunity to participate in the future value of each business, whether or not any applicable participation requirement or threshold is satisfied as of the date of such transaction).
Section 4.4 Withholding. The Partnership is authorized to withhold from distributions, or with respect to allocations, to the Partners and to pay over to any U.S. federal, state, local or non-United States government any amounts required to be so withheld pursuant to the Code or any provisions of any other U.S. federal, state, local or non-United States law and shall apportion such amounts to the Partners with respect to which such amount was withheld. At least five (5) Business Days prior to any such withholding in respect of any Partner, the Partnership shall notify the Management Representative (or, in the case of any notification that relates to a Parent Entity, the General Partner) of the proposed withholding and shall reasonably cooperate with the Management Representative and the applicable Partner in order to minimize or eliminate such withholding. The Partnership is also authorized to require a Partner to promptly pay to the Partnership any amount otherwise required to be so withheld respect to such Partner that is paid over by the Partnership to the appropriate taxing authority (and such payment shall not be considered a Capital Contribution for purposes of this Agreement). Any amounts so withheld (and not paid to the Partnership
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by the applicable Partners) and paid over by the Partnership to the appropriate taxing authority shall be offset against the current or next amounts otherwise distributable to such Partners (and, to the extent so withheld and paid over, shall be treated as amounts distributed to such Partner for all purposes of this Agreement). For the avoidance of doubt, except in the event of gross negligence, fraud or willful misconduct by the Partnership, the General Partner, a Partnership Representative, or any managing member, manager, agent, officer, or employee of the foregoing, as the case may be, no Partner shall have any recourse against the Partnership, the General Partner, each Partnership Representative, or any managing member, manager, agent, officer, or employee of the foregoing in respect of any withholdings or payments made or required under this Section 4.4, and in the case of any overwithholding, a Partner’s sole recourse shall be to seek a refund of such excess amounts.
Section 4.5 Distributions upon Liquidation. Notwithstanding the other provisions of this Article IV, upon the occurrence of a Liquidating Event, the assets of the Partnership shall be distributed to the Holders in accordance with Section 12.3.
Section 4.6 Revisions to Reflect Additional Partnership Units. In the event that the Partnership issues additional Partnership Units pursuant to the provisions of Article III, subject to the rights of any Holder set forth in a Partnership Unit Designation, the General Partner (following consultation with the Management Representative) is hereby authorized to make such revisions to this Article IV and to Article V as it reasonably and in good faith determines are equitable and necessary to reflect the issuance of such additional Partnership Units while preserving the economic objectives underlying this Agreement with respect to the entirety of the business of the Partnership as of immediately prior to such revisions (including the opportunity to participate in the future value of each business, whether or not any applicable participation requirement or threshold is satisfied as of the date of such transaction), including making preferential distributions to certain classes of Partnership Units.
Section 4.7 Restricted Distributions. Notwithstanding any provision to the contrary contained in this Agreement, neither the Partnership nor the General Partner, on behalf of the Partnership, shall make a distribution to any Holder (including pursuant to Section 4.2) if such distribution would violate the Act or other applicable law, or to the extent such distribution is prohibited by any contract, agreement or other obligation (including an indenture, credit agreement or other loan document) to which the Partnership or any of its Subsidiaries is a party as of the date hereof, as such agreement or obligation exists as of the date hereof (including the extent to which the Partnership is unable to obtain such funds as a distribution from a Subsidiary due to any such prohibition).
Section 4.8 Calculation of Distributions. In calculating all distributions payable to any holders of Partnership Units, the General Partner shall round the aggregate amount payable to each applicable Partner to the nearest whole cent ($0.01), with one-half cent rounded upward.
Section 4.9 Special Distributions to Facilitate Acquisitions. The General Partner shall be permitted to cause a distribution, loan or other transfer of cash by the Partnership or one or more of its Subsidiaries to be made solely to one or several Partners that are Parent Entities (such distribution, loan or other transfer satisfying the following proviso, an “M&A Distribution”), provided, however that (i) each such distribution, loan or other transfer is (A) made at or following such time as the General Partner reasonably determines that a specific acquisition is reasonably likely to be consummated and (B) used solely to facilitate the consummation of an acquisition by a Parent Entity within the time reasonably specified therefor by the General Partner at the time of such M&A Distribution (with any interest accrued thereon for the benefit of the Partnership), and (ii) such Parent Entities (x) contribute (in the case of an M&A Distribution that was a distribution), (y) transfer in repayment of the applicable M&A Distribution that was a loan, or (z) sell solely in exchange for the applicable previously made M&A Distribution that was not a distribution or a loan, or cause to be contributed (in the case of an M&A Distribution that was a
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distribution), transferred in repayment of the applicable M&A Distribution that was a loan, or sold solely in exchange for the applicable previously made M&A Distribution that was not a distribution or a loan, as soon as practicable thereafter, to the Partnership or the applicable Subsidiaries of the Partnership the assets directly or indirectly acquired with such distribution, loan or other transfer, as directed by the General Partner. If the M&A Distribution is not used solely to facilitate the consummation of an acquisition in accordance with the foregoing clause (i) within the time specified therefor by the General Partner, the Parent Entities will contribute (in the case of an M&A Distribution that was a distribution), transfer in repayment of the applicable M&A Distribution that was a loan, or retransfer (in the case of an M&A Distribution that was not a distribution or a loan) the full amount of such M&A Distribution and any interest accrued thereon to the Partnership or the applicable Subsidiaries of the Partnership at or prior to 5:00 pm New York time on the applicable date. During any time period between the time of the M&A Distribution and the contribution, repayment or sale contemplated by the foregoing clause (ii) of the immediately foregoing sentence, the Parent Entities shall hold such cash, and operate any acquired assets, for the benefit of the Partnership. The number and classes of Partnership Units held by the Parent Entities and their wholly owned Subsidiaries in the aggregate shall not change as a result of any M&A Distribution or the re-contribution, repayment or retransfer of such M&A Distribution (together with any interest accrued thereon) or contribution, repayment or sale of any assets directly or indirectly acquired with such M&A Distribution, in each case as described in this Section 4.9. For the avoidance of doubt, neither an M&A Distribution nor the re-contribution, repayment or retransfer of such M&A Distribution (together with any interest accrued thereon) or contribution, repayment or sale of any assets directly or indirectly acquired with such M&A Distribution shall (A) result in any adjustment to the Aggregate Distribution Threshold or the Distribution Threshold Per Profits Interest or (B) have any effect on the Exchange Factor. For purposes of all computations required under this Agreement, the amount of (x) any M&A Distribution that has not been repaid to the Partnership or the applicable Subsidiaries of the Partnership (including, to the extent an acquisition has been consummated with the proceeds of such M&A Distribution but the assets so acquired have not yet been contributed, repaid or sold to the Partnership or the applicable Subsidiaries of the Partnership as required hereby, the value of the assets so acquired) and (y) any Issuance Consideration that has not been contributed to the Partnership in accordance with Section 3.3(e), shall be treated as an asset owned by the Partnership or the applicable Subsidiaries of the Partnership and not by any Parent Entity. To the extent that any fees, costs and expenses are incurred in connection with the pursuit of an acquisition described in this Section 4.9, such fees, costs and expenses will be subject to the reimbursement provisions in Section 6.2(b).
ARTICLE V
ALLOCATIONS
Section 5.1 Allocations of Net Income and Net Loss. At the end of each Fiscal Year, after giving effect to the special allocations set forth in Section 5.2 and Section 5.3, and subject to Section 5.8, Net Income or Net Loss, as applicable, including, if necessary, items thereof, realized in any Fiscal Year shall be determined and such amounts shall be allocated among the Partners, including in respect of Unvested Profits Interests, in a manner such that the Capital Account of each such Partner, immediately after giving effect to such allocation, is, as nearly as possible, equal (proportionately) to the amount of the distributions that would be made to such Partner at the end of such Fiscal Year if (i) the Partnership were dissolved and terminated, (ii) its affairs were wound up and each Asset was sold for cash equal to its Carrying Value, (iii) all Partnership liabilities were satisfied (limited with respect to each nonrecourse liability to the Carrying Value of the assets securing such liability), and (iv) the net assets of the Partnership were distributed in accordance with Section 4.1 to all Partners, including in respect of Unvested Profits Interests as if such Unvested Profits Interests were Vested Profits Interests.
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Section 5.2 Special Allocations. Notwithstanding any other provision in this Agreement, the following special allocations shall be made in the following order:
(a) Minimum Gain Chargeback. If there is a net decrease in Partnership Minimum Gain or Partner Nonrecourse Debt Minimum Gain (determined in accordance with the principles of Treasury Regulations sections 1.704-2(d) and 1.704-2(i)) during any Partnership taxable year, the Partners shall be specially allocated items of Partnership income and gain for such year (and, if necessary, subsequent years) in an amount equal to their respective shares of such net decrease during such year, determined pursuant to Treasury Regulations sections 1.704-2(g) and 1.704-2(i)(5). The items to be so allocated shall be determined in accordance with Treasury Regulations section 1.704-2(f)(6) and 1.704-2(j)(2). This Section 5.2(a) is intended to comply with the minimum gain chargeback requirements in such Treasury Regulations sections and shall be interpreted and applied consistently therewith; including that no chargeback shall be required to the extent of the exceptions provided in Treasury Regulations sections 1.704-2(f) and 1.704-2(i)(4).
(b) Qualified Income Offset. In the event any Partner unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of Partnership income and gain shall be specially allocated to such Partner in an amount and manner sufficient to eliminate, to the extent required by the Treasury Regulations, the Partner’s Adjusted Capital Account Deficit as promptly as possible; provided that an allocation pursuant to this Section 5.2(b) shall only be made if and to the extent that such Partner would have such an Adjusted Capital Account Deficit after all other allocations provided in this Article V have been tentatively made as if this Section 5.2(b) were not in this Agreement. This Section 5.2(b) is intended to comply with the “qualified income offset” provision of Treasury Regulations section 1.704-1(b)(ii)(d) and shall be interpreted and applied consistently therewith.
(c) Gross Income Allocation. In the event any Partner has a deficit Capital Account at the end of any Fiscal Year which is in excess of the amount such Partner is deemed to be obligated to restore pursuant to the penultimate sentences of Treasury Regulations section 1.704-2(g)(1) and 1.704-2(i)(5), each such Partner shall be specially allocated items of Partnership income and gain in the amount of such excess as promptly as possible; provided that an allocation pursuant to this Section 5.2(c) shall be made only if and to the extent that a Partner would have a deficit Capital Account in excess of such amount after all other allocations provided for in this Article V have been tentatively made as if Section 5.2(b) and this Section 5.2(c) were not in this Agreement.
(d) Nonrecourse Deductions. Nonrecourse Deductions for any Fiscal Year shall be allocated among the Partners pro rata in accordance with each Partner’s relative share of Net Income or Net Loss, as applicable, for such Fiscal Year and each Partner’s share of excess Nonrecourse Debt shall be allocated in the same manner.
(e) Partner Nonrecourse Deductions. Partner Nonrecourse Deductions for any Fiscal Year shall be allocated to the Partner who bears the economic risk of loss with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable in accordance with Treasury Regulations section 1.752-3. If more than one Partner bears the economic risk of loss for a Partner Nonrecourse Debt, any Partner Nonrecourse Deductions attributable to that Partner Nonrecourse Debt shall be allocated among the Partners according to the ratio in which they bear the economic risk of loss.
(f) Section 754 Elections. To the extent an adjustment to the adjusted tax basis of any Asset pursuant to Section 734(b) or 743(b) of the Code is required, pursuant to Treasury Regulations section 1.704-1(b)(2)(iv)(m)(2) or (4), to be taken into account in determining Capital Accounts, the amount of such adjustment to the applicable Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis), and such gain or loss shall be specially allocated to the Partners in a manner consistent with the manner in which their respective Capital Accounts are required to be adjusted pursuant to such sections of the Treasury Regulations.
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(g) Tax Credits. Allocations of tax credits shall be made in accordance with Treasury Regulations section 1.704-1(b)(4)(ii) and allocations of creditable foreign tax expenditures shall be made in accordance with Treasury Regulations section 1.704-1(b)(4)(viii).
Section 5.3 Curative Allocations. The allocations set forth in Section 5.2 (the “Regulatory Allocations”) are intended to comply with certain requirements of the Treasury Regulations. The Partners intend that, to the extent possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or with special allocations of other items of income, gain, loss or deduction pursuant to this Section 5.3. Therefore, notwithstanding any other provision of this Agreement, the Partnership shall allocate items of income, gain, loss and deduction allocable among the Partners so that, to the extent possible, the net amount of such allocations of items and the Regulatory Allocations, and allocations of Net Income and Net Loss to each such Partner shall be equal to the net amount that would have been allocated to each such Partner pursuant to Section 5.1 if the Regulatory Allocations (and the allocations under this Section 5.3) had not occurred. When making allocations pursuant to this Section 5.3, the Partnership shall take into account future Regulatory Allocations under Section 5.2(a) that, although not yet made, are likely to offset other Regulatory Allocations previously made under Section 5.2(d) or Section 5.2(e).
Section 5.4 Tax Allocations. For income tax purposes only, each item of income, gain, loss and deduction shall be allocated in the same manner as the corresponding items are allocated for Capital Account purposes; provided that in the case of any Asset the fair market value of which differs from its adjusted tax basis for U.S. federal income tax purposes, income, gain, loss and deduction with respect to such asset shall be allocated among the Partners solely for income tax purposes in accordance with the principles of Section 704(c) of the Code and the Treasury Regulations promulgated thereunder so as to take account of the difference between the Carrying Value and adjusted tax basis of such asset. Unless otherwise determined by the General Partner (subject to the Consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed)), for purposes of applying the principles of Section 704(c) of the Code, the Partnership shall use the “traditional method” of Treasury Regulations section 1.704-3(b). Allocations pursuant to this Section 5.4 are solely for U.S. federal, state and local income tax purposes and shall not affect, or in any way be taken into account in computing, any Partner’s Capital Account or share of items of income, gain, loss and deduction.
Section 5.5 Compliance with Section 704(b) of the Code. The allocation provisions contained in this Article V are intended to comply with Section 704(b) of the Code and the Treasury Regulations promulgated thereunder, and shall be interpreted and applied in a manner consistent therewith.
Section 5.6 Consent of Partners. The allocation methods of items of income, gain, loss and deduction are hereby expressly consented to by each Partner as a condition of becoming a Partner.
Section 5.7 Change in Partnership Interest. If there is a change in any Partner’s Partnership Interest during any Fiscal Year, the principles of Section 706(d) of the Code shall apply in allocating Net Income and Net Loss and items thereof for such Fiscal Year to account for the variation. For purposes of applying Section 706(d) of the Code, the General Partner may adopt any method or convention permitted under applicable Treasury Regulations; provided, however, that in the event of a Transfer of Partnership Units solely between a transferor Partner and a transferee Partner such transferor Partner and transferee Partner shall be entitled to determine the allocation method and convention under Section 706(d) of the Code applicable as between such Partners with respect to any and all allocations under Section 706(d) of the Code that affect solely such transferor Partner and transferee Partner.
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Section 5.8 Modification of Allocations. The allocations set forth in this Article V are intended to comply with certain requirements of the Treasury Regulations. Notwithstanding the other provisions of this Agreement (including Section 5.4), the General Partner shall be authorized to make, in its reasonable discretion, with the consent of the Management Representative (such consent not to be unreasonably withheld, conditioned or delayed) appropriate amendments to the allocations of Net Income and Net Loss (and to individual items of income, gain, loss, deduction and credit) pursuant to this Agreement as are required (i) in order to comply with Section 704 of the Code or applicable Treasury Regulations, (ii) to allocate properly Net Income and Net Loss (and individual items of income, gain, loss, deduction and credit) to those Partners who bear the economic burden or benefit associated therewith and/or (iii) to otherwise cause the Partners to achieve the economic objectives underlying this Agreement, in each case, as reasonably determined by the General Partner with the consent of the Management Representative (such consent not to be unreasonably withheld, conditioned or delayed). If there are any changes after the date of this Agreement in applicable tax law, regulations or interpretation, or any errors, ambiguities, inconsistencies or omissions in this Agreement with respect to allocations to be made to Capital Accounts which would, individually or in the aggregate, cause the Partners not to achieve in any material respect the economic objectives underlying this Agreement, the General Partner may in its reasonable discretion with the consent of the Management Representative (such consent not to be unreasonably withheld, conditioned or delayed) make appropriate adjustments to such allocations in order to achieve or approximate such economic objectives.
Section 5.9 Certain Actions. In no event shall the Partnership or the General Partner take or cause the Partnership (or any of the Partnership’s Subsidiaries) to take any action (or fail to take any action) or make, or cause the Partnership (or any of its Subsidiaries) to make, any determination (or fail to make any determination) with respect to tax matters or otherwise affecting the tax items of the Partnership (or any of its Subsidiaries) or of any Partner (including with respect to the method of allocation of income and losses to Capital Accounts or for tax purposes, any tax election, any method of tax accounting or any position on any tax return, in connection with any tax proceeding or otherwise) if such action or omission (a) could reasonably be expected to have a disproportionate and more than de minimis adverse effect on the holders of any class of Partnership Units as compared to any other class of Partnership Units, and (b) is not expressly required by the provisions of this Agreement. Notwithstanding the foregoing, nothing in this Section 5.9 shall be interpreted or applied so as to require the General Partner or the Partnership to take or cause the Partnership (or any of the Partnership’s Subsidiaries) to take any action (or fail to take any action) or make, or cause the Partnership (or any of its Subsidiaries) to make, any determination (or fail to make any determination) that the Partnership or General Partner reasonably determines would result in a violation of applicable law; provided, that, if an action or omission is required as a result of this sentence, the General Partner and the Partnership shall cooperate in good faith with the other Partners to mitigate any effect of such action or omission to the extent that such effect would otherwise be subject to the requirements of the first sentence of this Section 5.9.
ARTICLE VI
OPERATIONS
Section 6.1 Management.
(a) Subject to the terms and conditions of this Agreement, the General Partner shall have full, exclusive and complete discretion to manage and control the business and affairs of the Partnership, to make all decisions affecting the business and affairs of the Partnership and to do or cause to be done any and all acts, at the expense of the Partnership, as it deems necessary or appropriate to accomplish the purposes and direct the affairs of the Partnership. Subject to the terms and conditions of this Agreement, the General Partner shall have the exclusive power and authority to bind the Partnership, except and to the extent that such power is expressly delegated in writing to any other Person by the General
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Partner, and such delegation shall not cause the General Partner to cease to be a Partner or the General Partner of the Partnership. Notwithstanding the foregoing, the Board of Directors (and any duly authorized committee thereof to which the Board of Directors may delegate such authority) shall have general oversight of the actions of the General Partner and actions or decisions of the Partnership or the General Partner which if taken by Super HoldCo would require the consent of or approval from the Board of Directors or a duly authorized committee thereof shall similarly require the consent of or approval from the Board of Directors or such duly authorized committee thereof if proposed to be taken by the Partnership. The General Partner shall be an agent of the Partnership’s business, and the actions of the General Partner taken in such capacity and in accordance with this Agreement shall bind the Partnership. The General Partner shall at all times be a Partner of the Partnership. The General Partner shall constitute a “general partner” under the Act. Except to the extent expressly delegated in writing by the General Partner, no Limited Partner (in such capacity) or Assignee (in such capacity) shall take part in the operations, management or control (within the meaning of the Act) of the Partnership’s business, transact any business in the Partnership’s name or have the power to sign documents for or otherwise bind the Partnership. The transaction of any such business by the General Partner, any of its Affiliates or any member, officer or employee of the General Partner, the Partnership or any of their Affiliates, in their capacity as such, shall not affect, impair or eliminate the limitations on the liability of the Limited Partners or Assignees under this Agreement. The General Partner may not be removed by the Partners, with or without cause, except with the consent of Super HoldCo.
(b) It is anticipated that the General Partner’s primary business activities shall be limited to the operation of the WW Entities. Subject to the foregoing, the other terms and conditions of this Agreement and any additional limitations contained in any constituent agreement(s) of any other WW Entity, the determination as to any of the following matters, made by or at the direction of the General Partner consistent with the Act and this Agreement, shall be final and conclusive and shall be binding upon the Partnership and every Limited Partner: (i) the amount of assets at any time available for distribution or the redemption of Partnership Common Units or Partnership Preferred Units; (ii) the amount and timing of any distribution; (iii) any determination to redeem A Tendered Units; (iv) the amount, purpose, time of creation, increase or decrease, alteration or cancellation of any reserves or charges and the propriety thereof (whether or not any obligation or liability for which such reserves or charges shall have been created shall have been paid or discharged); (v) the fair value, or any sale, bid or asked price to be applied in determining the fair value, of any asset owned or held by the Partnership; (vi) any matter relating to the acquisition, holding and disposition of any assets by the Partnership; or (vii) any other matter relating to the business and affairs of the Partnership or required or permitted by applicable law, this Agreement or otherwise to be determined by the General Partner.
(c) The General Partner may also, from time to time, appoint such officers and establish such management and/or advisory boards or committees of the Partnership as the General Partner deems necessary or advisable, each of which shall have such powers, authority and responsibilities as are delegated in writing by the General Partner from time to time (which shall be subject to all limitations thereon contained herein or in applicable law and in no event be greater than the powers, authority and responsibilities of the General Partner hereunder and under applicable law). Each such officer and/or board or committee member shall serve at the pleasure of the General Partner.
(d) Except as otherwise expressly provided in this Agreement or required by any non-waivable provision of the Act or other applicable law, no Partner (in such capacity) other than the General Partner shall (a) have any right to vote on or consent to any other matter, act, decision or document involving the Partnership or its business or (b) take part in the day-to-day management, or the operation or control, of the business and affairs of the Partnership. Without limiting the generality of the foregoing, except as otherwise expressly provided in this Agreement (including based on any consent, approval or consultation required by this Agreement, if applicable, as provided herein) or required by any non-waivable
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provision of the Act or other applicable law, the General Partner may cause the Partnership, without the consent or approval of any other Partner to enter into any of the following in one or a series of related transactions: (i) any merger or equivalent process, (ii) any acquisition, (iii) any consolidation, (iv) any sale, lease or other transfer or conveyance of assets, (v) any recapitalization, reclassification or reorganization of outstanding securities, (vi) any merger, sale, lease, spin-off, exchange, transfer or other disposition of a subsidiary, division or other business, (vii) any issuance of debt or equity securities (subject to any limitations expressly provided for herein) or (viii) any incurrence of indebtedness.
(e) No Partner (in such capacity) other than the General Partner shall take any action or commence any proceedings or petition a court for the liquidation of the Partnership, nor enter into any arrangement, reorganisation or insolvency proceedings in relation to the Partnership whether under the laws of the Cayman Islands or other applicable bankruptcy laws. Any such proceeding or petition filed by any other Partner (in such capacity), to the fullest extent permitted by applicable law, shall be deemed an unauthorized and bad faith filing and all parties to this Agreement shall use their best efforts to cause such petition to be dismissed.
(f) Subject to the rights of any Holder set forth in a Partnership Unit Designation and to the other terms and conditions of this Agreement (including Section 6.1(g)), the General Partner shall have the power, acting reasonably and in good faith, without the Consent of any of the Partners, to amend this Agreement, in a manner that would not, and would not reasonably be expected to, be disproportionately adverse (other than to a de minimis extent) to any of the Limited Partners, to the extent required to implement any of the following purposes:
(i) to add to the obligations of the General Partner or surrender any right or power granted to the General Partner or any Affiliate of the General Partner for the benefit of the Limited Partners;
(ii) to reflect the admission, substitution or withdrawal of Partners, the Transfer of any Partnership Interest or the termination of the Partnership, in each case, in accordance with this Agreement, and to amend the Register to reflect such admission, substitution, withdrawal or Transfer;
(iii) to cure any ambiguity or mistake or to correct or supplement any provision in this Agreement not inconsistent with law or with other provisions;
(iv) to satisfy any requirements, conditions or mandatory guidelines contained in any order, directive, opinion, ruling or regulation of a U.S. federal, state or foreign agency or contained in U.S. federal, state or foreign law;
(v) to reflect the issuance of additional Partnership Interests in accordance with Article III;
(vi) to set forth the designations, preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions, qualifications or terms or conditions of redemption of any additional Partnership Units issued in accordance with and pursuant to Article III;
(vii) if the Partnership is the Surviving Partnership in any Change of Control Transaction or Termination Transaction, to modify Section 14.1 or any related definitions to provide the holders of interests in such Surviving Partnership rights that are consistent with Section 7.4(c)(ii)(6);
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(viii) as a result of any Parent Entity or the Partnership adopting, modifying or terminating any share or unit incentive plan for the benefit of employees, directors or other business associates of any Parent Entity, the Partnership or any of their Affiliates to reflect a modification of this Agreement for the purpose of maintaining the economic equivalency of the Partnership Common Units or the Partnership Preferred Units and the applicable Common Shares or Preferred Shares; and
(ix) to reflect a modification of this Agreement that is necessary or appropriate to reflect and account for the formation by the Partnership of, or investment by the Partnership in, any corporation, partnership, joint venture, limited liability company or other entity, in connection with the conduct by the Partnership of activities permitted by the terms of Section 2.7, provided that such change does not adversely impact the economic equivalence of the Partnership Common Units or the Partnership Preferred Units and the applicable Common Shares or Preferred Shares.
(g) Notwithstanding Article XIII, this Agreement shall not be amended (by merger, consolidation, repeal, or otherwise) (other than an amendment pursuant to Section 4.6), and no action may be taken by the General Partner, without the consent of each Partner, if any, adversely affected thereby, including if such amendment or action would (i) convert a Limited Partner into a general partner of the Partnership (except as a result of the Limited Partner becoming the General Partner pursuant to Section 11.1), (ii) modify the limited liability of a Limited Partner or increase the obligation of a Limited Partner to make a Capital Contribution to the Partnership, (iii) adversely alter the rights of any Partner to receive the distributions to which such Partner is entitled pursuant to, or otherwise make any distribution that is inconsistent with, Article IV or Section 12.3(a)(iii), or alter the allocations specified in Article V (except, in any case, as permitted pursuant to Section 6.1(f)), (iv) alter or modify in a manner that adversely affects any Partner under Section 14.1 or Section 15.1, or amend or modify any related definitions (except for amendments to this Agreement or other actions that provide rights consistent with Section 7.4(c)(ii)(6)), (v) convert the Partnership into a corporation (other than in connection with a Change of Control Transaction or Termination Transaction, in each case, effected in accordance with this Agreement), (vi) limit any express consent, approval or consultation rights of the Management Representative hereunder, (vii) alter the restrictions on the General Partner’s authority set forth elsewhere in this Section 6.1 or (viii) amend this Section 6.1(g); provided, however, that, the Consent of any individual Partner adversely affected shall not be required under this Section 6.1(g) for any amendment or action that affects all Partners holding the same class or series of Partnership Units on a uniform or pro rata basis, if approved by a Majority in Interest of the Non-Super HoldCo Partners of such class or series. Any such amendment or action consented to by any Partner shall be effective as to that Partner, notwithstanding the absence of such Consent by any other Partner.
(h) Notwithstanding Section 6.1(g), the General Partner shall have the power, without the Consent of any of the Partners, to effect a split, subdivision or reverse split of any class of Partnership Units that is accompanied by a substantively identical split, subdivision or reverse split of the applicable equity securities of Super HoldCo.
(i) The General Partner, acting on behalf of the Partnership, may (in its sole discretion) accept the surrender by any Limited Partner of any Partnership Units whereupon such Partnership Units shall immediately be cancelled, upon such terms and conditions that the General Partner and such Limited Partner may determine.
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Section 6.2 Compensation and Reimbursement.
(a) The General Partner shall not receive any fees from the Partnership for its services in administering the Partnership, except as otherwise provided herein.
(b) Subject to Section 6.2(c), the Partnership shall be liable for, and shall reimburse the General Partner, any Parent Entity, the Management Representative (in its capacity as such) and PIU Aggregator, as applicable, on a monthly basis, or such other basis as the General Partner may reasonably determine, for all sums expended in connection with the Partnership’s business, including (i) expenses relating to the ownership of interests in and management and operation of, or for the benefit of, the Partnership (including any fees, costs and expenses incurred by any Parent Entity in connection with the pursuit of an acquisition described in Section 4.9), (ii) compensation of officers and employees of the General Partner, any Parent Entity or the Partnership, including payments under future compensation plans of the General Partner, any Parent Entity or the Partnership that may provide for stock units, or phantom stock, pursuant to which employees of the General Partner, any Parent Entity or the Partnership will receive payments based upon dividends on or the value of shares of Capital Stock, (iii) director fees and expenses, (iv) all costs and expenses of Super HoldCo being a public company (as opposed to a private company), including costs of filings with the SEC, reports and other distributions to its stockholders, and (v) all organizational and operational expenses reasonably incurred by PIU Aggregator or its general partners (in such capacity) or any Parent Entity, including all payments, advances and other expenses in connection with any indemnity or similar obligation of PIU Aggregator or any Parent Entity; provided, however, that the amount of any reimbursement shall be reduced by any interest earned by the Parent Entities with respect to bank accounts or other instruments or accounts held by it on behalf of the Partnership that are permitted pursuant to Section 6.3. Such reimbursements shall be in addition to any reimbursement of the General Partner, the Parent Entities, the Management Representative (incurred in his capacity as the Management Representative) and PIU Aggregator as a result of indemnification pursuant to Section 6.6.
(c) To the extent practicable, Partnership expenses shall be billed directly to and paid by the Partnership.
Section 6.3 Outside Activities.
(a) No Parent Entity shall directly or indirectly enter into or conduct any business, other than (i) with respect to its capacity as the General Partner or a Limited Partner and the ownership of Partnership Interests, (ii) with respect to its capacity as the General Partner, the management of the business of the Partnership, (iii) with respect to Super HoldCo, its reporting obligations as a reporting company with a class (or classes) of securities registered under the Exchange Act, (iv) with respect to Super HoldCo, the offering, sale, syndication, private placement or public offering of stock, bonds, securities or other interests for the ultimate benefit of the Partnership or its assets or activities and in accordance with Section 3.3(e), (v) with respect to Super HoldCo, the maintenance of each of the other Parent Entities as legal entities, (vi) with respect to TWC MC, the maintenance of each of the Parent Entities (other than Super HoldCo) as legal entities, (vii) financing or refinancing of any type for the ultimate benefit of the Partnership or its assets or activities, (viii) a Section 4.9 Transaction or activities incident to a transaction described in Section 4.3(b), (ix) such activities as are incidental to any of the foregoing clauses (i)–(viii), (x) such other business as may be conducted with the consent of the Management Representative and (xi) business substantially equivalent to any of the foregoing clauses (i), (ii), (vii), (viii), (ix) or (x) with respect to any Surviving Partnership. Nothing contained herein shall be deemed to prohibit the General Partner from executing guarantees of Partnership Debt for which it would otherwise be liable in its capacity as General Partner. The General Partner and any Affiliates of the General Partner may acquire Partnership Interests and shall be entitled to exercise all rights of a Limited Partner relating to such Partnership Interests.
(b) Except as set forth in Section 6.3(a) (and subject to any agreements entered into pursuant to Section 6.4 and any other agreements entered into by a Limited Partner or any of its Affiliates with the General Partner), the Partnership or a Subsidiary (including any employment agreement), notwithstanding any duty otherwise existing at law or in equity, any Limited Partner (other than any Parent Entity) and any Assignee, officer, director, manager, managing member, partner, employee, agent, trustee,
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Affiliate, member or stockholder of any Limited Partner shall be entitled to and may have business interests and engage in business activities in addition to those relating to the Partnership, including business interests and activities that are in direct or indirect competition with the Partnership or that are enhanced by the activities of the Partnership. Neither the Partnership nor any Partner shall have any rights by virtue of this Agreement in any business ventures of any Limited Partner or Assignee that is not a Parent Entity. Subject to such agreements, none of the Limited Partners nor any other Person shall have any rights by virtue of this Agreement or the partnership relationship established hereby in any business ventures of any other Person (other than the Parent Entities, to the extent expressly provided herein), and such Person shall have no obligation pursuant to this Agreement, subject to Section 6.4 and any other agreements entered into by a Limited Partner or its Affiliates with the General Partner, the Partnership or a Subsidiary, to offer any interest in any such business ventures to the Partnership, any Limited Partner, or any such other Person, even if such opportunity is of a character that, if presented to the Partnership, any Limited Partner or such other Person, could be taken by such Person.
Section 6.4 Transactions with Affiliates.
(a) The Partnership may lend or contribute funds or other assets to Super HoldCo and its Subsidiaries or other Persons in which Super HoldCo has a direct or indirect equity investment, and such Persons may borrow funds from the Partnership, on terms and conditions no less favorable to the Partnership in the aggregate than would be available from unaffiliated third parties as determined by the General Partner (to the extent such lending, contribution or borrowing is not a Section 4.9 Transaction, subject to the Consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed)). The foregoing authority shall not create any right or benefit in favor of any Partner or any other Person. It is expressly acknowledged and agreed by each Partner that Super HoldCo (directly or through any of the other Parent Entities) may (i) borrow funds from the Partnership in order to redeem or repurchase, at any time or from time to time, Common Shares, Preferred Shares or New Securities previously or hereafter issued by Super HoldCo, (ii) put to the Partnership, for cash, any Common Shares, Preferred Shares or New Securities that Super HoldCo may desire or be required to repurchase or redeem or (iii) borrow funds from the Partnership to acquire assets that will be contributed to the Partnership for Partnership Units.
(b) Except as provided in Section 6.3, the Partnership may transfer assets to joint ventures, limited liability companies, partnerships, corporations, business trusts or other business entities in which it is or thereby becomes a participant upon such terms and subject to such conditions consistent with this Agreement and applicable law.
(c) Super HoldCo may propose and adopt on behalf of the Partnership Employees benefit plans funded by the Partnership for the benefit of employees of the Partnership, any of the Parent Entities, Subsidiaries of the Partnership or any Affiliate of any of them in respect of services performed, directly or indirectly, for the benefit of any of the Parent Entities, the Partnership or any of the Partnership’s Subsidiaries.
Section 6.5 Liability of the General Partner and Management Representative.
(a) Subject to its obligations and duties as the General Partner set forth in this Agreement and applicable law, the General Partner may exercise any of the powers granted to it by this Agreement and perform any of the duties imposed upon it hereunder either directly or by or through its employees or agents. In addition to its duty to act in good faith as a matter of Cayman Island law, the General Partner shall, in its capacity as General Partner, and not in any other capacity, have the same fiduciary duties to the Partnership and the Limited Partners as a member of the board of directors of a Delaware corporation has to such corporation and its stockholders (which fiduciary duties shall be
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interpreted and applied in accordance with the laws of the State of Delaware). It is hereby acknowledged by the parties hereto that the General Partner will act, directly or indirectly, at the direction of Super HoldCo, and that the General Partner will owe fiduciary duties to Super HoldCo. The General Partner will use commercially reasonable and appropriate efforts and means, as determined in good faith by the General Partner, to minimize any conflict of interest between the Limited Partners, on the one hand, and the stockholders of Super HoldCo, on the other hand.
(b) In performing its duties under this Agreement and the Act, each of the General Partner and the Management Representative shall be entitled to rely on the provisions of this Agreement and on any information, opinion, report or statement, including any financial statement or other financial data or the records or books of account of the Partnership or any subsidiary of the Partnership, prepared or presented by an officer, employee or agent of Super HoldCo, the General Partner or the Partnership or any such subsidiary, or by a lawyer, certified public accountant, appraiser or other person engaged by Super HoldCo, the General Partner or the Partnership as to any matter within such person’s professional or expert competence, and any act taken or omitted to be taken in reliance upon any such information, opinion, report or statement as to matters that the General Partner or the Management Representative, as applicable, reasonably believes to be within such Person’s professional or expert competence shall be conclusively presumed to have been done or omitted in good faith and in accordance with such opinion. Each of the General Partner and the Management Representative shall be entitled to engage (at the expense of the Partnership) and rely on the advice of legal counsel, independent public accountants and other experts, including financial advisors, and any act of or failure to act by the General Partner or the Management Representative, as applicable, in reliance on such advice shall not subject the General Partner or the Management Representative, as applicable, to liability to the Partnership or any Partner. Each of the General Partner and the Management Representative may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture or other paper or document reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties.
(c) Notwithstanding anything herein to the contrary, the Management Representative shall not have any personal liability whatsoever, to the Partnership or to the other Partners, for any action or omission taken in its capacity as the Management Representative or, to the fullest extent permitted by the Act, for the debts or liabilities of the Partnership or the Partnership’s obligations hereunder, except in the case of any action or omission determined by a final, non-appealable order of a court of competent jurisdiction or an arbitrator selected and acting in accordance with this Agreement to constitute willful misconduct, fraud or gross negligence. Without limitation of the foregoing, and except pursuant to any such express indemnity, no property or assets of the Management Representative shall be subject to levy, execution or other enforcement procedures for the satisfaction of any judgment (or other judicial process) in favor of any other Partner(s) and arising out of, or in connection with, this Agreement.
(d) No manager, member, director, officer, employee, agent or representative of the General Partner, no officer of the Partnership and no Management Representative shall be liable to the Partnership or any Partner for money damages by reason of their service as such; provided, however, that any such manager, member, director, officer, employee, agent or representative or the Management Representative shall not be exculpated from liability under this sentence for any action or omission determined by a final, non-appealable order of a court of competent jurisdiction or an arbitrator selected and acting in accordance with this Agreement to constitute willful misconduct, fraud or gross negligence.
(e) Any amendment, modification or repeal of this Section 6.5 or any provision hereof (by merger, consolidation, repeal or otherwise) shall be prospective only and shall not in any way affect the limitations on the liability of the General Partner, or the managers, members, directors, officers or agents of the General Partner, or officers of the Partnership, or the Management Representative to the Partnership and the Partners under this Section 6.5, as in effect immediately prior to such amendment, modification or repeal, with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.
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(f) The Management Representative shall have the right, with the reasonable approval of the General Partner, from time to time to delegate any of its powers, authority and responsibilities hereunder to such Persons as it may designate in writing. The Management Representative may, in all questions arising hereunder, rely on the advice of legal counsel, and, for anything done, omitted or suffered in good faith by the Management Representative based on such advice, the Management Representative shall not be liable to any Partner or the Partnership while acting in its capacity as Management Representative. All decisions and actions (including documents executed and delivered) by the Management Representative shall be binding upon the parties, and no person shall have the right to object, dissent, protest or otherwise contest the same, absent a knowing and intentional breach of this Agreement. The Management Representative may act solely in its capacity as such, without taking into account any other duties it has in any other capacity.
Section 6.6 Indemnification.
(a) The Partnership shall indemnify and hold harmless each Indemnitee (and such Person’s heirs, successors, assigns, executors and administrators) to the fullest extent permitted by applicable law (as it presently exists or may hereafter be amended) from and against any and all losses, claims, damages, liabilities, expenses (including reasonable attorney’s fees and other legal fees and expenses), judgments, fines, taxes, settlements and other amounts of any nature whatsoever, known or unknown, liquid or illiquid, that are reasonably incurred (collectively, “Liabilities”) arising from any and all threatened, pending or completed claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative, and whether formal or informal, including appeals (“Actions”), in which such Indemnitee may be involved, or is threatened to be involved, as a party or otherwise, by reason of the fact that such Indemnitee is or was the General Partner, the Management Representative or an officer, manager or director of Super HoldCo, the Partnership or the General Partner. Notwithstanding the preceding sentence, the Partnership shall be required to indemnify an Indemnitee in connection with an Action (or part thereof) commenced by such Indemnitee only if the commencement of such Action (or part thereof) by the Indemnitee was authorized in advance by the General Partner or if such Action seeks enforcement of this Agreement. Further, notwithstanding the foregoing, the Management Representative (and, to the extent such status is attributable to an arrangement or relationship with the Management Representative, any other Indemnitee), solely in such capacity, shall not be entitled to any indemnification in respect of any Action or Liability to the extent principally arising from or in relation to any action or omission determined by a final, non-appealable order of a court of competent jurisdiction or an arbitrator selected and acting in accordance with this Agreement to constitute willful misconduct, fraud or gross negligence.
(b) Expenses incurred by an Indemnitee in defending any Action, subject to this Section 6.6, shall be advanced, upon request, by the Partnership prior to the final disposition of such Action upon receipt by the Partnership of a written commitment by or on behalf of the Indemnitee to repay such amount if it shall be determined that such Indemnitee is not entitled to be indemnified as authorized in this Section 6.6; provided that such undertaking shall be unsecured and interest free and shall be accepted without regard to an Indemnitee’s ability to repay amounts advanced and without regard to an Indemnitee’s entitlement to indemnification. For the avoidance of doubt, and consistent with the foregoing, to the extent any Indemnitee receives an advance or any other indemnity proceeds from the Partnership and is later determined not to have been entitled to indemnification with respect to the applicable Liability or Action, such Indemnitee shall be personally and unconditionally liable to the Partnership for the repayment of such amounts.
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(c) Any indemnification obligations of the Partnership arising under this Section 6.6 shall be satisfied out of any Assets (including any amounts otherwise currently or subsequently distributable to any Partner(s)) only and the Limited Partners shall not have any personal liability on account thereof. The Partnership may purchase and maintain insurance on behalf of the Indemnitees against any liability asserted against them and incurred by them in such capacity, or arising out of their status as Indemnitees, whether or not the Partnership would have the power to indemnify them against such liability under this Section 6.6.
(d) The right to indemnification provided hereby shall not be exclusive of, and shall not affect, any other rights to which an Indemnitee or any other Person may be entitled under any agreement, pursuant to any vote of the Partners, as a matter of law or otherwise, and shall continue as to an Indemnitee who has ceased to serve in such capacity and shall inure to the benefit of the heirs, successors, assigns, executors and administrators of the Indemnitee unless otherwise provided in a written agreement with such Indemnitee or in the writing pursuant to which such Indemnitee is indemnified.
(e) To the fullest extent permitted by applicable law, the Partnership shall purchase and maintain insurance, on behalf of any of the Indemnitees and such other Persons as the General Partner shall determine, against any Liability that may be asserted against or expenses that may be incurred by such Person in connection with the Partnership’s activities, regardless of whether the Partnership would have the power to indemnify such Person against such Liability under the provisions of this Agreement.
(f) To the fullest extent permitted by applicable law, any liabilities which an Indemnitee incurs as a result of acting on behalf of the Partnership, the Management Representative or the General Partner (whether as a fiduciary or otherwise) in connection with the operation, administration or maintenance of an employee benefit plan or any related trust or funding mechanism (whether such liabilities are in the form of excise taxes assessed by the IRS, penalties assessed by the U.S. Department of Labor, restitutions to such a plan or trust or other funding mechanism or to a participant or beneficiary of such plan, trust or other funding mechanism, or otherwise) shall be treated as liabilities or judgments or fines under this Section 6.6.
(g) An Indemnitee shall not be denied indemnification in whole or in part under this Section 6.6 solely because the Indemnitee had an interest in the transaction with respect to which the indemnification applies if the transaction was otherwise permitted by the terms of this Agreement.
(h) The provisions of this Section 6.6 are for the benefit of the Indemnitees, their heirs, successors, assigns, executors and administrators and shall not be deemed to create any rights for the benefit of any other Persons. Any amendment, modification or repeal of this Section 6.6 or any provision hereof shall be prospective only and shall not in any way affect the limitations on the Partnership’s liability to any Indemnitee under this Section 6.6 as in effect immediately prior to such amendment, modification or repeal with respect to claims arising from or relating to matters occurring, in whole or in part, prior to such amendment, modification or repeal, regardless of when such claims may arise or be asserted.
ARTICLE VII
RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS
Section 7.1 Return of Capital. Except pursuant to Section 14.1 or rights of redemption set forth in any Partnership Unit Designation, no Limited Partner shall be entitled to the withdrawal or return of its Capital Contribution, except to the extent of distributions made pursuant to this Agreement or upon dissolution of the Partnership as provided herein. Except to the extent provided in Article IV, Article V or Section 12.3 or otherwise expressly provided in this Agreement or in any Partnership Unit Designation, no Limited Partner or Assignee shall have priority over any other Limited Partner or Assignee either as to the return of Capital Contributions or as to profits, losses or distributions.
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Section 7.2 Rights of Limited Partners Relating to the Partnership.
(a) In addition to other rights provided by this Agreement or by the Act, the General Partner shall deliver to each Limited Partner a copy of any information mailed or otherwise delivered to all of the common stockholders of Super HoldCo contemporaneously with such mailing or other delivery (without duplication if such Limited Partner is also a common stockholder of Super HoldCo).
(b) The Partnership shall notify any Limited Partner that is a Qualifying Party, on request, of the then current Adjustment Factor or any change made to the Adjustment Factor.
Section 7.3 Partnership Right to Call Partnership Interests. Notwithstanding any other provision of this Agreement (and unless otherwise provided in a Profits Interest Award Agreement), (x) on and after the date on which the aggregate number of Partnership Common Units held by the Limited Partners (other than the Parent Entities) is less than 50,000 (equitably adjusted to reflect any reclassification, reorganization, recapitalization or other similar transaction) or (y) subject to the prior written consent of the Management Representative, the Partnership shall have the right, but not the obligation, from time to time and at any time to redeem all (but not less than all) outstanding Partnership Common Units (other than Partnership Common Units held by any of the Parent Entities) by treating all such Holders as having simultaneously delivered, as applicable, a Notice of Conversion pursuant to Section 15.1 (if a holder of Partnership Class PI Common Units) and a Notice of Redemption pursuant to Section 14.1 for all of the Partnership Common Units held by such Holder and by delivering written notice (at least ten (10) Business Days prior to the applicable Conversion and Redemption) that the Partnership has elected to exercise its rights under this Section 7.3; provided, that in order for the Partnership to cause the Conversion and Redemption of any Unvested Profits Interests pursuant to the foregoing, the vesting of such Unvested Profits Interests must be accelerated in full such that such Profits Interests constitute Vested Profits Interests immediately prior to the applicable Conversion. Such notice given by the General Partner to a Holder pursuant to this Section 7.3 shall be treated as if it were, as applicable, a Notice of Conversion and a Notice of Redemption delivered to the General Partner by such Holder. For purposes of this Section 7.3, (a) any Limited Partner (whether or not otherwise a Qualifying Party) may be treated as a Qualifying Party that is a Tendering Party and (b) Section 14.1 and Section 15.1 shall apply, in each case, mutatis mutandis. For purposes of calculating the aggregate number of Partnership Common Units held by the Limited Partners, (i) the Conversion of Vested Profits Interests shall be disregarded and (ii) the denominator shall be equitably adjusted to reflect any reclassification, reorganization, recapitalization or other similar transaction.
Section 7.4 Change of Control Transactions; Termination Transactions.
(a) Except as may be otherwise provided in a Profits Interest Award Agreement, subject to Section 7.4(c) and otherwise notwithstanding anything in this Agreement to the contrary, if at any time Super HoldCo engages in a Change of Control Transaction, the Partnership shall have the right, at the direction of Super HoldCo, to cause any and all outstanding Partnership Common Units (other than Partnership Common Units held by any of the Parent Entities) to participate in such Change of Control Transaction by delivering to each Limited Partner and Assignee (and not rescinding) a Change of Control Transaction Notice, pursuant to which the applicable Holders shall be treated as having delivered a Notice of Conversion (contingent upon the consummation of such Change of Control Transaction) pursuant to Section 15.1 for the amount of Partnership Common Units determined under this Section 7.4; provided, that in order for the Partnership to cause the participation of any Unvested Profits Interests pursuant to the foregoing, any service or similar time-based vesting of such Unvested Profits Interests shall be accelerated in full; provided, further, that no such acceleration shall apply to any performance-based vesting restrictions
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that are not otherwise satisfied as a result of the applicable transaction and in no case shall any acceleration be permitted under the preceding clause to the extent that it would be inconsistent with any forfeiture required under a “for cause termination,” “bad leaver” or similar provision of the applicable Equity Plan or Profits Interest Award Agreement. Such notice given by the General Partner to a Holder pursuant to this Section 7.4(a) shall be treated as if it were a Notice of Conversion delivered to the General Partner by such Holder. For purposes of this Section 7.4, notwithstanding anything to the contrary in this Agreement, “Trading Price” shall mean the price per Class A Share implied by the applicable Change of Control Transaction.
(b) Before the earlier to occur of (x) five (5) Business Days following the execution of, and (y) five (5) Business Days before the consummation of, any definitive agreement with respect to a Change of Control Transaction, Super HoldCo shall:
(i) provide the Limited Partners and Assignees written notice (a “Change of Control Transaction Notice”) of such Change of Control Transaction, which notice shall contain (A) the name and address of the third party purchaser, (B) the proposed purchase price, terms of payment and other material terms and conditions of such purchaser’s offer, together with a copy of any binding agreement with respect to such Change of Control Transaction and (C) notification of whether or not the Partnership will redeem such Limited Partner or Assignee’s Partnership Interests in connection with such Change of Control Transaction; and
(ii) promptly notify the Limited Partners and Assignees of all proposed changes to such material terms and keep the Limited Partners and Assignees reasonably informed as to all material terms relating to such sale or contribution, and promptly deliver to the Limited Partners and Assignees copies of all final material agreements relating thereto not already provided in according with this Section 7.4(b) or otherwise.
Super HoldCo shall provide the Limited Partners and Assignees written notice of the termination of a Change of Control Transaction within five (5) Business Days following such termination, which notice shall state that the Change of Control Transaction Notice served with respect to such Change of Control Transaction is rescinded.
(c) Notwithstanding anything in this Agreement to the contrary, neither the General Partner nor any Parent Entity (or the Board of Directors) shall engage in, or cause, permit, support or recommend in favor of, a Change of Control Transaction or a Termination Transaction, other than if the Management Representative consents in writing or either of the following clauses (i) or (ii) is satisfied:
(i) in connection with any such Change of Control Transaction or Termination Transaction:
(1) (I) each holder of Partnership Class A Common Units (if any, assuming the Conversion of all Profits Interests pursuant to Section 15.1 and giving effect to the Adjustment Factor, as applicable) will receive, and, if applicable, will have the same right to elect to receive, for each Partnership Class A Common Unit the greatest amount of cash, securities or other property paid to a holder of one Class A Share in consideration of one Class A Share in connection with such Change of Control Transaction or Termination Transaction or (II) if, in connection with any Change of Control Transaction, a purchase, tender or exchange offer shall have been made to and accepted by the holders of a majority of the outstanding Common Shares entitled to vote on such transaction under the terms of the Charter, each holder of Partnership Class A Common Units (if any, assuming the Conversion of all Profits Interests pursuant to Section 15.1 and giving effect to the Adjustment Factor, as applicable) will receive, and, if applicable, will have
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the same right to elect to receive, for each Partnership Class A Common Unit, the greatest amount of cash, securities or other property which such holder of Partnership Class A Common Units would have received had it exercised its right to Redemption pursuant to Article XIV and received Class A Shares in exchange for its Partnership Class A Common Units immediately prior to the expiration of such purchase, tender or exchange offer and had thereupon accepted such purchase, tender or exchange offer and then such Change of Control Transaction or Termination Transaction shall have been consummated;
(2) without the prior written consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed), the effect of any such Change of Control Transaction or Termination Transaction shall not be adverse in any material respect to the holders of Partnership Common Units (other than the Parent Entities) (if any, assuming the Conversion of all Profits Interest pursuant to Section 15.1 and giving effect to the Adjustment Factor) relative to the effect such Change of Control Transaction or Termination Transaction would have had on such holders had all of their Partnership Common Units been acquired in a Tendered Unit Acquisition for Common Shares pursuant to Section 14.1 immediately prior to the consummation of the applicable transaction; and
(3) each holder of Partnership Class A Common Units (if any, assuming the Conversion of all Profits Interests pursuant to Section 15.1 and giving effect to the Adjustment Factor, as applicable) shall be permitted to participate in such Change of Control Transaction by delivery of a Contingent Notice and Super HoldCo will use its reasonable best efforts expeditiously and in good faith to ensure that such holders may participate in such Change of Control Transaction without the Redemption of such Partnership Class A Common Units (or, if so required, to ensure that any such Redemption shall be effective only upon, and shall be conditional upon, the closing of such Change of Control Transaction); or
(ii) If, following such Change of Control Transaction or Termination Transaction (and only if the Holders (other than the Parent Entities) that held Partnership Common Units immediately prior to the consummation of such Change of Control Transaction or Termination Transaction shall continue to own Partnership Common Units or substantially equivalent equity in the Surviving Partnership (as defined below)), all of the following conditions are met:
(1) substantially all of the assets directly or indirectly owned by the Partnership, the Surviving Partnership or any direct or indirect parent of the Surviving Partnership prior to the announcement of the Change of Control Transaction or Termination Transaction are, immediately after the Change of Control Transaction or Termination Transaction, owned directly or indirectly by the Partnership or another limited partnership or limited liability company which is the survivor of a merger, consolidation or combination of assets with the Partnership (in each case, the “Surviving Partnership”);
(2) the Holders (other than the Parent Entities) that held Partnership Common Units immediately prior to the consummation of such Change of Control Transaction or Termination Transaction own an economic interest in the Surviving Partnership that, based on the relative fair market value (as determined by the General Partner reasonably and in good faith, after reasonable consultation with the Management Representative) of the net assets of the Partnership and the other net assets of the Surviving Partnership immediately prior to the consummation of such transaction, is equivalent to the economic interest such Holders held in the Partnership immediately prior to the consummation of such transaction;
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(3) the rights, preferences and privileges of such Holders with respect to the Surviving Partnership are at least as favorable in all material respects (and such rights, preferences and privileges with respect to the economic provisions are at least as favorable in all respects) as those of Holders holding Partnership Common Units immediately prior to the consummation of such transaction (it being understood and agreed that such rights shall include the right to redeem Partnership Common Units for common stock of the ultimate parent entity of the Surviving Partnership) and as those applicable to any other limited partners or non-managing members of the Surviving Partnership and no less favorable than those of stockholders of Super HoldCo;
(4) the liabilities and obligations of such Holders with respect to the Surviving Partnership are at least as favorable in all material respects (and such liabilities and obligations with respect to the economic provisions are at least as favorable in all respects) as and are in no event greater than those of Holders holding Partnership Common Units immediately prior to the consummation of such transaction and no less favorable in any material respect than those of stockholders of Super HoldCo;
(5) the Surviving Partnership is classified as a Partnership for U.S. federal tax purposes; and
(6) without the prior written consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed), the effect of any such Change of Control Transaction or Termination Transaction shall not be adverse in any material respect to the holders of Partnership Common Units (other than the Parent Entities) (if any, assuming the Conversion of all Vested Profits Interests pursuant to Section 15.1 and giving effect to the Adjustment Factor) relative to the effect such Change of Control Transaction or Termination Transaction would have had on such holders had all of their Partnership Common Units been acquired in a Tendered Unit Acquisition for Common Shares pursuant to Section 14.1 immediately prior to the consummation of the applicable transaction.
Section 7.5 Limitation of Liability. Without limiting Section 6.5(a), none of Super HoldCo, the Management Representative nor any Limited Partner, in its capacity as such, shall have any duties or liability under this Agreement except as expressly provided in this Agreement (including, without limitation, Section 4.4 and Section 14.1 hereof) or under the Act. To the maximum extent permitted by law, none of Super HoldCo, the Management Representative nor any Limited Partner shall have any personal liability whatsoever to the Partnership, the other Partners or any other Persons for any action or omission taken in its capacity as a limited partner or the Management Representative or for the debts or liabilities of the Partnership or the Partnership’s obligations hereunder, except pursuant to any express indemnities given to the Partnership by Super HoldCo, the Management Representative or such Limited Partner pursuant to any other written instrument, and except for liabilities of Super HoldCo pursuant to Section 14.1 hereof. Without limitation of the foregoing, and except pursuant to any such express indemnity (and, in the case of Super HoldCo, pursuant to Section 14.1 hereof), no property or assets of Super HoldCo, the Management Representative or a Limited Partner, other than its interest in the Partnership, shall be subject to levy, execution or other enforcement procedures for the satisfaction of any judgment (or other judicial process) in favor of any other Partner(s) and arising out of, or in connection with, this Agreement. For the avoidance of doubt, this Section 7.5 shall not apply to the General Partner in its capacity as such.
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Section 7.6 Certificates Evidencing Partnership Units. The General Partner may, at any time, determine that ownership of any class of Partnership Units shall be evidenced by a certificate in such form as the General Partner adopts from time to time, which certificate may be imprinted with a legend setting forth such restrictions placed on the Partnership Units as specified in this Agreement and such restrictions will be binding upon all holders of the certificate along with the terms and conditions set forth in this Agreement. If the General Partner elects to issue certificates to evidence any class of Partnership Units, the following provisions shall apply: (a) the certificate shall state that the Partnership is an exempted limited partnership formed under the laws of the Cayman Islands, the name of the Partner to whom such certificate is issued and that the certificate represents a “partnership interest,” within the meaning of Section 2 of the Act; (b) each certificate shall be signed by the General Partner of the Partnership by either manual, PDF, facsimile or electronic signature; (c) the certificates shall be numbered and registered in the Register as they are issued; (d) when certificates are presented to the Partnership with a request to register a transfer, if the transfer is permitted by this Agreement, the Partnership shall register the transfer or make the exchange on the Register or transfer books of the Partnership; provided, that any certificates presented or surrendered for registration of transfer or exchange must be duly endorsed or accompanied by a written instrument of transfer in form satisfactory to the Partnership, duly executed by the holder thereof or his attorney duly authorized in writing; (e) before due presentment for registration of transfer of a certificate in compliance with and in accordance with this Agreement, the Partnership shall be entitled to treat the individual or entity in whose name any certificates issued by the Partnership stand on the books of the Partnership as the absolute owner of the Partnership Units evidenced thereby, and shall not be bound to recognize any equitable or other claim to, or interest in, such Partnership Units on the part of any other individual or entity; and (f) if any mutilated certificate is surrendered to the Partnership, or the Partnership receives evidence to its satisfaction of the destruction, loss or theft of any certificate, the Partnership shall issue a replacement certificate if the requirements of Section 8-405 of the Uniform Commercial Code are met. If required by the General Partner, an indemnity and/or the deposit of a bond in such form and in such sum, and with such surety or sureties as the General Partner may direct, must be supplied by the holder of such lost, destroyed or stolen certificate that is sufficient in the judgment of the General Partner to protect the Partnership from any loss that it may suffer if a certificate is replaced. The Partnership may charge for its expenses incurred in connection with replacing a certificate (if applicable).
Section 7.7 Class C Shares.
(a) Class C Issuances.
(i) With respect to each Profits Interest granted to a Person (other than any Parent Entity), subject to the terms and conditions of the Charter, Super HoldCo shall also grant the holder thereof one fully paid, non-assessable Class C Share. The number of Profits Interests shall correspond to the number of Class C Shares as adjusted pursuant to the Exchange Ratio (as defined in the Merger Agreement). Without limiting any Partner’s ability to effect a Redemption or Conversion and subject to the last sentence of this Section 7.7(a), no holder of Class C Shares shall be permitted to consummate a Transfer of Class C Shares other than as part of a concurrent Transfer of an equal number of Partnership Class A Common Units or Profits Interests made to the same transferee in compliance with this Agreement (for the avoidance of doubt, whether or not pursuant to a Permitted Transfer) or with the Consent of the General Partner. Any purported Transfer of Class C Shares not in accordance with the terms of this Section 7.7(a) shall, to the fullest extent permitted by law, be void ab initio.
(b) Concurrently with any Redemption or Tendered Unit Acquisition, a number of Class C Shares held by the applicable Partner equal to the number of Partnership Class A Common Units (or, if the applicable Partner holds a number of Class C Shares that is less than the number of Partnership Class A Common Units being Redeemed, all of the applicable Partner’s Class C Shares) Redeemed shall be automatically, without further action by such Partner, Parent Entity, the Board of Directors or the Partnership, redeemed and retired and resume the status of authorized and unissued Class C Shares, and all rights of the applicable Partner with respect to such shares, including the rights, if any, to receive notices and to vote, shall thereupon cease and terminate.
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(c) The PIU Aggregator may, in its sole discretion, transfer to its limited partners all Class C Shares that are issued to the PIU Aggregator, which shares shall be subject to cancellation in accordance with Section 7.7(b) in the event the corresponding Partnership Class A Common Units associated therewith are Redeemed.
ARTICLE VIII
BOOKS AND RECORDS
Section 8.1 Books and Records. At all times during the continuance of the Partnership, the Partnership shall prepare and maintain separate books of account for the Partnership for financial reporting purposes, on an accrual basis, in accordance with United States generally accepted accounting principles, consistently applied. The Partnership shall keep at its principal office the following:
(a) a current list of the full name and the last known street address of each Partner;
(b) a copy of the Certificate and this Agreement and all amendments thereto; and
(c) copies of the Partnership’s United States federal, state and local income tax returns for the three most recent years.
Section 8.2 Inspection. The Partnership shall keep full and accurate books of account and other records of the Partnership, and copies of the books of account and other records of Super HoldCo, the PIU Aggregator and the Parent Entities, at its principal place of business. Subject to any confidentiality obligations to which such Limited Partners are subject, Limited Partners (personally or through an authorized representative) may, for purposes reasonably related to their respective Partnership Interests, examine and copy (at their own cost and expense) the books and records of the Partnership, Super HoldCo, the PIU Aggregator and the Parent Entities at all reasonable business hours upon reasonable prior notice.
ARTICLE IX
TAX MATTERS
Section 9.1 Treatment for Tax Purposes. The Partnership intends to be classified as a partnership for U.S. federal income tax purposes (and for state and local income tax purposes). Other than in connection with a Change of Control Transaction or Termination Transaction, the General Partner shall, for and on behalf of the Partnership, take all steps as may be reasonably required or advisable to maintain the Partnership’s classification as a partnership for U.S. federal income tax purposes.
Section 9.2 Tax Returns. The General Partner shall prepare or cause to be prepared the Partnership’s income tax returns using such methods of accounting as the General Partner deems necessary or appropriate as permitted by the Code and Treasury Regulations. Within ninety (90) days after the end of each taxable year (or as soon as reasonably practicable thereafter) the Partnership shall send to each Person that was a Partner at any time during such year copies of Schedule K-1 to Form 1065, “Partner’s Share of Income, Credits, Deductions, Etc.”, or any successor schedule or form, with respect to such Person. The Limited Partners shall promptly provide the General Partner with such information as may be reasonably requested by the General Partner from time to time in connection with the preparation of the Partnership’s tax returns. The General Partner shall deliver the Partnership’s income tax returns to the Management Representative reasonably in advance of filing such tax returns and will consider in good faith any reasonable comments from the Management Representative.
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Section 9.3 Tax Elections. Except as otherwise provided herein, the General Partner shall determine whether and when to make or change any available election pursuant to the Code or any other tax law; provided, however, that the General Partner shall cause the Partnership to make the election under Section 754 of the Code. The General Partner shall have the right to seek to revoke any such election (including, with the consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed), any election under Section 754 of the Code).
Section 9.4 Partnership Representative.
(a) For each taxable year of the Partnership, the General Partner shall be entitled to designate the “partnership representative” of the Partnership within the meaning of Section 6223 of the Code (the “Partnership Representative”). The General Partner is hereby authorized to take any actions necessary under the Revised Audit Rules or other guidance to effect such designation with respect to each taxable year of the Partnership (and the Partnership Representative is authorized to take any actions specified under the Revised Audit Rules or any applicable state statute or local law), and the Partnership shall comply with any requirements necessary to effect such designation. Each Partner hereby consents to such designations and agrees that upon the request of the Partnership Representative, such Partner will execute, certify, acknowledge, deliver, swear to, file and record at the appropriate public offices such documents as may be necessary or appropriate to evidence such consent. The Partnership Representative shall keep the Management Representative reasonably informed of any material audit or proceeding asserting any tax liability related to the Partnership and the Partnership Representative shall only settle or compromise any such audit or proceeding subject to the Consent of the Management Representative (not to be unreasonably withheld, conditioned or delayed).
(b) The Partnership Representative shall use its commercially reasonable efforts to apply the rules and elections under the Revised Audit Rules in a manner that minimizes the likelihood that any Partner would bear any material tax, interest or penalties as a result of any audit or proceeding that is attributable to another Partner (other than a predecessor in interest). The Partnership Representative is hereby authorized to take any action reasonably required to cause the financial burden of any “imputed underpayment” (as determined under Section 6225 of the Code) and associated interest, adjustments to tax and penalties arising from a partnership-level adjustment that are imposed on the Partnership (an “Imputed Underpayment”) to be borne by the Partners to whom such Imputed Underpayment relates as reasonably determined by the Partnership Representative after consulting with the Partnership’s accountants or other advisers, taking into account any differences in the amount of taxes attributable to each Partner because of such Partner’s status, nationality or other characteristics, including such Partner’s actions or omissions, and each Partner hereby agrees to reasonably cooperate with the Partnership Representative in connection with such Imputed Underpayment, including by filing an amended tax return pursuant to Treasury Regulations section 301.6225-2(d)(2); provided, however, that any Holder of Partnership Class PI Common Units shall only be required to file any such amended tax return with the consent of the Management Representative (such consent not to be unreasonably withheld, conditioned or delayed); provided, further, that no Partner shall be required to file any such amended tax return in connection with any Imputed Underpayment that is de minimis as compared to the costs of preparing and filing such an amended tax return. For the avoidance of doubt, each Partner shall bear its own costs and expenses incurred in connection with making any amended tax filings or complying with the alternative procedure in Treasury Regulations section 301.6225-2(d)(2)(x). By executing this Agreement or a counterpart hereof, each Partner (i) expressly authorizes the Partnership Representative and the Partnership to take any and all actions that are reasonably necessary under applicable U.S. federal income tax law (as such law may be revised from time to time) to cause the Partnership to make the election set forth in Section 6226(a) of the Code if the Partnership Representative decides to make such election, and (ii) expressly agrees to take any action, and furnish the Partnership Representative with any information necessary, to give effect to such election. Each Partner hereby severally indemnifies and holds the Partnership, the General Partner and the Partnership Representative
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harmless for such Partner’s respective portion of the financial burden of an Imputed Underpayment as provided in the foregoing sentences and in furtherance thereof, each Partner agrees (A) to pay such amount to the Partnership within fifteen (15) days following the Partnership’s request for payment (and any failure to pay such amount shall result in interest on such amount calculated at the prime rate plus two percent (2%)) and (B) that any amounts otherwise distributable to such Partner may be applied in satisfaction of such obligations. Except with the express written consent of the General Partner, each Partner shall be jointly and severally liable with their predecessors in interest, if any, for amounts owed hereunder in respect of any predecessor in interest to such Partner. No Partner shall file a notice with the IRS under Section 6222(c)(1)(B) of the Code in connection with such Partner’s intention to treat an item on such Partner’s U.S. federal income tax return in a manner that is inconsistent with the treatment of such item on the Partnership’s U.S. federal income tax return unless such Partner has, not less than thirty (30) days prior to the filing of such notice, provided the Partnership with a copy of the notice and thereafter in a timely manner provides such other information related thereto as the General Partner shall reasonably request.
(c) The Partnership Representative shall employ experienced tax counsel to represent the Partnership in connection with any audit or investigation of the Partnership by the IRS and in connection with all subsequent administrative and judicial proceedings arising out of such audit. The fees and expenses of such tax counsel, and all reasonable expenses incurred by the Partnership Representative in serving as the Partnership Representative, shall be Partnership expenses and shall be paid by the Partnership. Notwithstanding the foregoing, it shall be the responsibility of the General Partner and of each Limited Partner, at their expense, to employ tax counsel to represent their respective separate interests.
(d) If the Partnership Representative is required by law or regulation to incur fees and expenses in connection with tax matters not affecting all of the Partners, then the Partnership Representative shall, in its reasonable discretion, seek reimbursement from or charge such fees and expenses to the Capital Accounts of those Partners on whose behalf such fees and expenses were incurred.
(e) The provisions contained in this Section 9.4 shall survive the termination of the Partnership and, with respect to any Partner, the withdrawal of such Partner for as long a period of time as is necessary to resolve with the IRS any and all matters regarding the U.S. federal income taxation of the Partnership or the Partners. Super HoldCo shall cause the governing agreement (including a Limited Partnership Agreement or Limited Liability Company Agreement) of PIU Aggregator to contain provisions substantially similar to this Section 9.4, and shall cause the PIU Aggregator to take (or cause to be taken) or omit to take (or cause to be omitted to take) such actions thereunder as are necessary or advisable to give effect to this Section 9.4 or any decisions or actions taken by the Partnership Representative hereunder. This Section 9.4 shall apply mutatis mutandis to any Imputed Underpayment imposed with respect to a subsidiary of the Partnership, to the extent that the General Partner reasonably determines that the Partnership has or will economically bear any portion of such Imputed Underpayment.
ARTICLE X
PARTNER TRANSFERS AND WITHDRAWALS
Section 10.1 Transfer.
(a) To the fullest extent permitted by law, no part of the interest of a Partner in the Partnership shall be subject to the claims of any creditor, to any spouse for alimony or support, or to legal process, and may not be voluntarily or involuntarily alienated or encumbered except as may be specifically provided for in this Agreement.
(b) No Partnership Interest shall be Transferred, in whole or in part, except in accordance with the terms and conditions set forth in this Article X. Any Transfer or purported Transfer of a Partnership Interest not made in accordance with this Article X shall, to the fullest extent permitted by law, be null and void ab initio.
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Section 10.2 Transfer of the Parent Entities’ Partnership Interests.
(a) Except as provided in Section 10.2(b), and subject to the rights of any Holder set forth in a Partnership Unit Designation, the Parent Entities may not Transfer all or any portion of their Partnership Interest without the consent of the Management Representative.
(b) Subject to compliance with the other provisions of this Article X, any Parent Entity other than the General Partner may Transfer all of its Partnership Interest at any time to any other Parent Entity or any Person that is, at the time of such Transfer, a direct or indirect wholly owned Subsidiary of Super HoldCo without the Consent of any Partner.
(c) It is a condition to any Transfer of the entire Partnership Interest of a sole General Partner otherwise permitted hereunder that (i) coincident or prior to such Transfer, the transferee is admitted as a General Partner pursuant to the Act and this Agreement; (ii) the transferee assumes by operation of law or express agreement all of the obligations of the transferor General Partner under this Agreement with respect to such Transferred Partnership Interest; and (iii) the transferee has executed such instruments as may be necessary to effectuate such admission (including any notification required under applicable Cayman Islands law) and to confirm the agreement of such transferee to be bound by all the terms and provisions of this Agreement applicable to the General Partner and the admission of such transferee as a General Partner.
Section 10.3 Limited Partners’ Rights to Transfer.
(a) General. Except for a Transfer that satisfies the below conditions or as set forth in a Profits Interest Award Agreement, no Holder may Transfer any Partnership Unit without the consent of the General Partner. Notwithstanding the foregoing, except as otherwise provided pursuant to Section 10.3(a)(i) or Section 10.3(c), any Holder (other than any Parent Entity) may, at any time, without the consent of the General Partner, Transfer all or any portion of its Partnership Units pursuant to a Permitted Transfer. Any Transfer by a Holder is subject to Section 10.4 and to satisfaction of the following conditions:
(i) Transfer of Unvested Profits Interests. Except as permitted by the Board of Directors or a committee thereof and except as may be provided in a Profits Interest Award Agreement, Unvested Profits Interests (together with the Class C Shares associated therewith), and any interest therein, may only be transferred or assigned by the Holder thereof by will or by the laws of descent and distribution or by instrument to an inter vivos or testamentary trust in which the Unvested Profits Interests are to be passed to beneficiaries upon the death of the trustor (settlor) or to a revocable trust, or by gift to “family member” as that term is defined in Rule 701 et seq. promulgated under the Exchange Act, and may not be made subject to execution, attachment or similar process. For the avoidance of doubt, the foregoing limitations on assignment and transfer apply to Unvested Profits Interests and, prior to the vesting thereof, the Class C Shares associated therewith, and pursuant to the foregoing sentence shall be understood to include, without limitation, a prohibition against any pledge, hypothecation, or other transfer, including any short position, any “put equivalent position” or any “call equivalent position” (in each case, as defined in Rule 16a-1 promulgated under the Exchange Act) except as may otherwise be approved by the Compensation Committee of the Board of Directors. The terms of an Unvested Profits Interest shall be binding upon the executor, administrator, successors and assigns of the Holder who is a party to this Agreement.
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(ii) Transfer of Vested Profits Interests and Partnership Class A Common Units. All or any portion of the Partnership Class A Common Units and, except as may be provided in a Profits Interest Award Agreement, Vested Profits Interests (in each case, together with the Class C Shares associated therewith) may be Transferred by the holder thereof without the Consent of any Partner if such Transfer is not then restricted by the Profits Interest Award Agreement or the applicable restriction is waived in compliance with the Profits Interest Award Agreement.
(iii) Qualified Transferee. Except as may be provided in a Profits Interest Award Agreement, any Transfer of a Partnership Unit shall be made only to a Qualified Transferee.
(iv) Opinion of Counsel. Except as may be provided in a Profits Interest Award Agreement, the transferor shall deliver or cause to be delivered to the General Partner an opinion of legal counsel reasonably satisfactory to the General Partner to the effect that the proposed Transfer may be effected without registration under the Securities Act and will not otherwise violate the registration provisions of the Securities Act and the regulations promulgated thereunder or violate any state securities laws or regulations applicable to the Partnership or the Partnership Units Transferred; provided, however, that the General Partner may waive this condition upon the request of the transferor. The Partnership shall provide to the transferor such information as is reasonably requested by legal counsel to the transferor in connection with evaluating whether it can provide such opinion.
(v) Exception for Permitted Transfers. The conditions of Section 10.3(a)(ii) through Section 10.3(a)(iv) shall not apply in the case of a Permitted Transfer or a Transfer in accordance with Section 7.4 (in each case, together with the Class C Shares associated therewith).
It is a condition to any Transfer otherwise permitted hereunder that the transferee assumes by operation of law or express agreement all of the obligations of the transferor Limited Partner under this Agreement with respect to such Transferred Partnership Units, and no such Transfer (other than pursuant to a statutory merger or consolidation wherein all obligations and liabilities of the transferor are assumed by a successor corporation by operation of law) shall relieve the transferor of its obligations under this Agreement without the approval of the General Partner. Any transferee, whether or not admitted as a Substituted Limited Partner, shall take subject to the obligations of the transferor hereunder. Unless admitted as a Substituted Limited Partner, no transferee, whether by a voluntary Transfer, by operation of law or otherwise, shall have any rights hereunder, other than the rights of an Assignee as provided in Section 10.5.
(b) Incapacity. If a Limited Partner is subject to Incapacity, the executor, administrator, trustee, committee, guardian, conservator or receiver of such Limited Partner’s estate shall have all the rights of such Limited Partner, but not more rights than those enjoyed by such Limited Partner, for the purpose of settling or managing the estate, and such power as the Incapacitated Limited Partner possessed to Transfer all or any part of its interest in the Partnership. The Incapacity of a Limited Partner, in and of itself, shall not dissolve or terminate the Partnership.
(c) Publicly Traded Partnership; Adverse Tax Consequences. No Transfer by a Partner of its Partnership Units (including any acquisition of Partnership Units by any Parent Entity or any acquisition of Partnership Units by the Partnership, and including any Permitted Transfer) may be made to or by any Person if the General Partner reasonably determines that such Transfer either would cause the Partnership to be characterized as a “publicly traded partnership” or would materially increase the risk that the Partnership will be so characterized. For purposes of this Section 10.3(c), the phrase “publicly traded partnership” shall have the meanings set forth in Sections 7704(b) and 469(k) of the Code. The Partnership intends to satisfy the private placement safe harbor in Treasury Regulations Section 1.7704-1(h) and shall limit issuances of Partnership Units and limit Transfers of Partnership Units to satisfy the requirement in
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Treasury Regulations Section 1.7704-1(h)(1)(ii). In furtherance of the foregoing, the total number of Partners other than Adam Neumann and his Permitted Transferees who are “partners” in the Partnership for purposes of Treasury Regulations Section 1.7704-1(h)(l)(ii) shall not exceed seventy-five (75) and Adam Neumann shall not be permitted to make any Transfer of all or a portion of his Partnership Units to any Transferee if immediately after a proposed Transfer, taking into consideration the anti-avoidance rule set forth in Treasury Regulations Section 1.7704-1(h)(3), Adam Neumann and all of his Transferees (for the avoidance of doubt, other than Super HoldCo and any other Parent Entity), in the aggregate, would represent more than fifteen (15) “partners” in the Partnership for purposes of Treasury Regulations Section 1.7704-1(h)(l)(ii). For purposes of the above calculations, (x) the PIU Aggregator and (y) any other entity that is a direct or indirect Partner in the Partnership that is a flow-through entity (within the meaning of Treasury Regulations Section 1.7704-1(h)(3)) fifty percent (50%) or more of the asset value of which consists of Partnership Units, in each case, shall be treated as representing a number of “partners” in the Partnership for purposes of Treasury Regulations Section 1.7704-1(h)(l)(ii) equal to the number of beneficial owners (within the meaning of Treasury Regulations Section 1.7704-1(h)(3)) of the PIU Aggregator or such other entity, as applicable.
Section 10.4 Substituted Limited Partners.
(a) No Limited Partner shall have the right to substitute a transferee other than a Permitted Transferee as a Limited Partner in its place. A transferee of the interest of a Limited Partner may be admitted as a Substituted Limited Partner only with the consent of the General Partner; provided, however, that (x) a Permitted Transferee shall be admitted as a Substituted Limited Partner pursuant to a Permitted Transfer without the consent of the General Partner, subject to compliance with the last sentence of this Section 10.4(a) and (y) the General Partner shall not withhold such consent if the Assignee complies with the last sentence of this Section 10.4(a). The failure or refusal by the General Partner to permit a transferee of any such interests to become a Substituted Limited Partner shall not give rise to any cause of action against the Partnership or the General Partner. Subject to the foregoing, an Assignee shall be admitted as a Substituted Limited Partner if and when it furnishes to the General Partner (i) evidence of acceptance, in form and substance reasonably satisfactory to the General Partner, of all the terms, conditions and applicable obligations of this Agreement, (ii) a counterpart signature page to this Agreement executed by such Assignee, (iii) Consent by Spouse, if applicable, and (iv) such other documents and instruments as the General Partner determines in good faith are reasonably required to effect such Assignee’s admission as a Substituted Limited Partner.
(b) Concurrently with, and as evidence of, the admission of a Substituted Limited Partner, the General Partner shall amend the Register and the books and records of the Partnership to reflect the name, address and number and type of Partnership Units of such Substituted Limited Partner and to eliminate or adjust, if necessary, the name, address and number and type of Partnership Units of the predecessor of such Substituted Limited Partner.
(c) A transferee who has been admitted as a Substituted Limited Partner in accordance with this Article X shall have all the rights and powers and be subject to all the restrictions and liabilities of a Limited Partner under this Agreement.
Section 10.5 Assignees. If the General Partner’s consent is required for the admission of any transferee under Section 10.3 as a Substituted Limited Partner, as described in Section 10.4, and the General Partner withholds such consent, such transferee shall be considered an Assignee for purposes of this Agreement. An Assignee shall be entitled to all the rights of an assignee of an exempted limited partnership interest under the Act, including the right to receive distributions from the Partnership and the share of Net Income, Net Losses and other items of income, gain, loss, deduction and credit of the Partnership attributable to the Partnership Units assigned to such transferee and the rights to Transfer the Partnership
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Units provided in this Article X and shall be deemed to have all Conversion rights under Section 15.1 and to be a Qualifying Party for purposes of Section 14.1, but shall not be deemed to be a holder of Partnership Units for any other purpose under this Agreement, and shall not be entitled to effect a Consent or vote with respect to such Partnership Units on any matter presented to the Limited Partners for approval (such right to Consent or vote, to the extent provided in this Agreement or under the Act, fully remaining with the transferor Limited Partner). In the event that any such transferee desires to make a further assignment of any such Partnership Units, such transferee shall be subject to all the provisions of this Article X to the same extent and in the same manner as any Limited Partner desiring to make an assignment of Partnership Units.
Section 10.6 General Provisions.
(a) No Limited Partner may withdraw from the Partnership other than: (i) as a result of (A) a Transfer of all of such Limited Partner’s Partnership Interest in accordance with this Article X with respect to which the transferee(s) becomes a Substituted Limited Partner(s) or (B) a surrender all of such Limited Partner’s Partnership Units in accordance with Section 6.1(i); (ii) pursuant to a redemption (or acquisition by Super HoldCo (directly or through any other Parent Entity)) of all of its Partnership Interest pursuant to a Redemption or Tendered Unit Acquisition under Section 7.3 or Section 14.1 and/or pursuant to any Partnership Unit Designation; or (iii) as a result of the acquisition by the Partnership or Super HoldCo (directly or through any other Parent Entity) of all of such Limited Partner’s Partnership Interest, whether or not pursuant to Section 14.1(b).
(b) Any Limited Partner who shall (i) Transfer all of its Partnership Units in one or more Transfers (A) permitted pursuant to this Article X where such transferee was admitted as a Substituted Limited Partner, (B) pursuant to the exercise of its rights to effect a redemption of all of its Partnership Units pursuant to a Redemption or Tendered Unit Acquisition under Section 14.1 and/or pursuant to any Partnership Unit Designation or (C) to any Parent Entity whether or not pursuant to Section 14.1(b), or (ii) surrender all of its Partnership Units by way of one or more surrenders in accordance with Section 6.1(i), in case of each of (i) and (ii), shall cease to be a Limited Partner.
(c) All distributions attributable to such Partnership Unit with respect to which the Applicable Record Date is before the date of such Transfer, assignment, Redemption or Tendered Unit Acquisition shall be made to the transferor Partner or the Tendering Party (as the case may be) and, in the case of a Transfer other than a Redemption or Tendered Unit Acquisition, all distributions thereafter attributable to such Partnership Unit shall be made to the transferee.
(d) In addition to any other restrictions on Transfer herein contained and except as may be provided in a Profits Interest Award Agreement, in no event may any Transfer or assignment of a Partnership Interest by any Partner (including any acquisition of Partnership Units by a Parent Entity or any other acquisition of Partnership Units by the Partnership) be made (i) to any Person who lacks the legal right, power or capacity to own a Partnership Interest; (ii) in violation of applicable law; (iii) of any component portion of a Partnership Interest, such as the Capital Account, or rights to distributions, separate and apart from all other components of a Partnership Interest (other than in the case of the General Partner not approving such transferee as a Substituted Limited Partner); (iv) if the General Partner reasonably determines that such Transfer would create a material risk that the Partnership would become, with respect to any employee benefit plan subject to Title I of ERISA, a “party-in-interest” (as defined in ERISA Section 3(14)) or a “disqualified person” (as defined in Section 4975(c) of the Code); (v) if the General Partner reasonably determines, based on the advice of counsel, that such Transfer would create a material risk that any portion of the assets of the Partnership would constitute assets of any employee benefit plan pursuant to U.S. Department of Labor Regulations section 2510.3-101; (vi) if such Transfer is not exempt from registration pursuant to applicable U.S. federal and state securities laws; (vii) if the General Partner reasonably determines that such Transfer creates a material risk that the Partnership would become a reporting company under the Exchange Act; or (viii) if such Transfer subjects the Partnership to regulation under the U.S. Investment Company Act of 1940, the U.S. Investment Advisors Act of 1940 or ERISA, each as amended.
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Section 10.7 PIU Aggregator.
(a) The governing agreement (including a Limited Partnership Agreement or Limited Liability Company Agreement) of PIU Aggregator shall contain transfer restrictions with respect to the equity interests of PIU Aggregator that are at least as restrictive as the transfer restrictions set forth in this Article X and such restrictions shall not be amended (by merger, consolidation, repeal or otherwise) without the Consent of the Non-Super HoldCo Partners. The provisions of this Agreement shall be applied with respect to the PIU Aggregator and the limited partners or members thereof in a manner that results in the equitable treatment thereof with regard to the rights and obligations of PIU Aggregator and the limited partners or members thereof. Solely for purposes of applying the Transfer provisions of this Agreement, including for the avoidance of doubt Section 10.3(c), the General Partners shall treat each owner of the PIU Aggregator as if it were a direct owner of the Partnership. Accordingly, (i) upon any grant of a series of equity interests to a limited partner or member of PIU Aggregator or a withdrawal by a limited partner or member from PIU Aggregator (or any other event that causes the cancellation, repurchase or failure to vest of any series of equity interests of PIU Aggregator) or (ii) upon the Transfer of Partnership Common Units by PIU Aggregator, PIU Aggregator shall, and the General Partner shall take all necessary actions or make other adjustments to cause the Partnership and PIU Aggregator as a Limited Partner to, replicate such actions at the level of the Partnership, including if a series of equity interests of PIU Aggregator are forfeited or cancelled, cancelling or forfeiting the corresponding Partnership Common Units held by PIU Aggregator.
(b) The General Partner shall be entitled to elect to cause all or any portion of the equity interests of PIU Aggregator to be redeemed in exchange for the Partnership Class PI Common Units that correspond to such equity interests, on such terms as may be reasonably determined by the General Partner in good faith. In connection with any such exchange, PIU Aggregator shall take or cause to be taken all actions requested by the General Partner in order to expeditiously consummate any exchange and any related transactions, including executing, acknowledging and delivering assignments and other documents and instruments as may be reasonably requested and otherwise cooperating with the General Partner, and making customary representations and warranties, including as to due approval and ownership free and clear of any liens and transfer of such equity interests. Additionally, in the event that the Partnership provides notice to PIU Aggregator that the Partnership desires PIU Aggregator to exercise its right to repurchase any equity interests of PIU Aggregator, then PIU Aggregator shall distribute a corresponding number of Partnership Class PI Common Units to the applicable partner or member in PIU Aggregator in exchange for the applicable equity interests of PIU Aggregator, whereupon the Partnership shall repurchase from such partner or member in PIU Aggregator such Partnership Class PI Common Units at an equivalent price per unit.
ARTICLE XI
ADMISSION OF PARTNERS
Section 11.1 Admission of Successor General Partner. A successor to all of the General Partner’s Partnership Interest pursuant to Section 10.2(a) and in compliance with Section 10.2(c) whom the General Partner has designated to become a successor General Partner shall be admitted to the Partnership as the General Partner, effective immediately upon the Transfer of such Partnership Interest to it (together with all of the General Partner’s other Partnership Interests). Upon any such Transfer and the admission of any such transferee as a successor General Partner in accordance with this Section 11.1, the transferor General Partner shall be relieved of its obligations under this Agreement and shall cease to be a general
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partner of the Partnership without any separate Consent of the Partners or the consent or approval of any other Person. Any such successor shall carry on the business of the Partnership without dissolution. In each case, the admission shall be subject to the successor General Partner executing and delivering to the Partnership an acceptance of all of the terms and conditions of this Agreement, together with an assumption of all of the obligations under this Agreement of the transferor General Partner in its capacity as such, and such other documents or instruments as may be required to effect the admission. In the event that the General Partner withdraws from the Partnership, or transfers its entire Partnership Interest, in violation of this Agreement, or otherwise dissolves or terminates or ceases to be the general partner of the Partnership, a Majority in Interest of the Partners shall elect to continue the Partnership by selecting a successor General Partner and shall promptly so elect a successor General Partner.
Section 11.2 Partners; Admission of Additional Limited Partners.
(a) Subject to Section 10.3(c), a Person (other than a then-existing Partner) who either (i) makes a Capital Contribution to the Partnership in exchange for Partnership Units or (ii) receives a Partnership Class PI Common Unit (other than pursuant to Article X), in either case in accordance with this Agreement shall be admitted to the Partnership as an Additional Limited Partner only upon furnishing to the General Partner (A) evidence of acceptance, in form and substance satisfactory to the General Partner, of all of the terms and conditions of this Agreement, including the power of attorney granted in Section 16.1, (B) a counterpart signature page to this Agreement executed by such Person, (C) Consent by Spouse, if applicable and (D) such other documents or instruments as may be required by the General Partner in order to effect such Person’s admission as an Additional Limited Partner. Concurrently with, and as evidence of, the admission of an Additional Limited Partner, the General Partner shall amend the Register and the books and records of the Partnership to reflect the name, address, number and type of Partnership Units of such Additional Limited Partner.
(b) Notwithstanding anything to the contrary in this Section 11.2, no Person shall be admitted as an Additional Limited Partner pursuant to this Article XI without the consent of the General Partner. The admission of any Person as an Additional Limited Partner shall become effective on the date upon which the name of such Person is recorded on the books and records of the Partnership, following the consent of the General Partner to such admission and the satisfaction of all the conditions set forth in Section 11.2(a).
(c) All distributions with respect to which the Applicable Record Date is before the date of such admission shall be made solely to Partners and Assignees other than the Additional Limited Partner, and all distributions thereafter shall be made to all the Partners and Assignees including such Additional Limited Partner.
(d) For the admission to the Partnership of any Partner, the General Partner shall take all steps necessary and appropriate under the Act to amend the Register and the books and records of the Partnership and, if necessary, to prepare as soon as practical an amendment of this Agreement and, if required by law, shall prepare and file an amendment to the Certificate of Limited Partnership.
Section 11.3 Limit on Number of Partners. Unless otherwise permitted by the General Partner, no Person shall be admitted to the Partnership as an Additional Limited Partner if the effect of such admission would be to cause the Partnership to have a number of Partners (including as Partners for this purpose those Persons indirectly owning an interest in the Partnership through another partnership, a limited liability company, a subchapter S corporation or a grantor trust) that would cause the Partnership to become a reporting company under the Exchange Act.
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Section 11.4 Admission. A Person shall be admitted to the Partnership as a limited partner of the Partnership or a general partner of the Partnership only upon strict compliance, and not upon substantial compliance, with the requirements set forth in this Agreement for admission to the Partnership as a Limited Partner or a General Partner.
ARTICLE XII
TERMINATION, LIQUIDATION AND DISSOLUTION
Section 12.1 No Termination or Dissolution. The Partnership shall not be terminated by the admission of additional Partners in accordance with the terms of this Agreement. The Partnership may be terminated, liquidated and dissolved only pursuant to the provisions of this Article XII, and the Partners hereby irrevocably waive any and all other rights they may have to cause a termination of the Partnership or a sale or partition of any or all of the Partnership assets.
Section 12.2 Events Causing Termination. The Partnership shall commence winding up upon the occurrence of any of the following events (each, a “Liquidating Event”):
(a) the sale of all or substantially all of the Partnership’s assets;
(b) at any time there are no Limited Partners of the Partnership;
(c) an election to dissolve the Partnership made by the General Partner (subject to the Consent of the Non-Super HoldCo Partners except to the extent the Partnership shall be permitted to call Partnership Interests pursuant to Section 7.3); or
(d) where a winding up order has been made by a Person other than a WW Entity, upon the presentation of a petition for winding up.
Upon the occurrence of a Liquidating Event, the General Partner will file notice of the winding up of the Partnership with the Registrar, it being understood that the formal winding up of the Partnership shall not commence until this filing is made.
Section 12.3 Distribution upon Liquidation.
(a) Upon the termination of the Partnership pursuant to Section 12.2, unless the Partnership is continued pursuant to the Act, the General Partner (or, in the event that there is no remaining General Partner or the General Partner has dissolved, become Bankrupt or ceased to operate, any Person elected by a Majority in Interest of the Partners (the General Partner or such other Person being referred to herein as the “Liquidator”)) shall be responsible for overseeing the winding up and liquidation of the Partnership and shall take full account of the Partnership’s liabilities and property, and the Partnership property shall be liquidated as promptly as is consistent with obtaining the fair value thereof, and the proceeds therefrom (which may, to the extent determined by the General Partner, include shares of stock in Super HoldCo) shall be applied and distributed in the following order:
(i) First, to the satisfaction of all of the Partnership’s debts and liabilities to creditors including Partners who are creditors (other than with respect to liabilities owed to Partners in satisfaction of liabilities for distributions), whether by payment or the making of reasonable provision for payment thereof;
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(ii) Second, to the satisfaction of all of the Partnership’s liabilities to the Partners in satisfaction of liabilities for distributions, whether by payment or the making of reasonable provision for payment thereof, as set forth in Section 4.1(b); and
(iii) Third, the balance, if any, to the Partners in accordance with Section 4.1(b) (taking into account the limitations in, and exceptions to, Section 4.1(b)).
The General Partner shall not receive any additional compensation for any services performed pursuant to this Article XII.
(b) Notwithstanding the provisions of Section 12.3(a) that require liquidation of the assets of the Partnership, but subject to the order of priorities set forth therein, if prior to or upon dissolution of the Partnership, the Liquidator determines that an immediate sale of part or all of the Partnership’s assets would be impractical or would cause undue loss to the Holders, the Liquidator may, in its sole and absolute discretion, defer for a reasonable time the liquidation of any assets except those necessary to satisfy liabilities of the Partnership (including to those Holders as creditors) and/or distribute to the Holders, in lieu of cash, as tenants in common and in accordance with the provisions of Section 12.3(a), undivided interests in such Assets as the Liquidator deems not suitable for liquidation. Any such distributions in kind shall be made only if, in the good faith judgment of the Liquidator, such distributions in kind are in the best interest of the Holders, and shall be subject to such conditions relating to the disposition and management of such properties as the Liquidator deems reasonable and equitable and to any agreements governing the operation of such properties at such time. The Liquidator shall determine the fair market value of any property distributed in kind using such reasonable method of valuation as it may adopt. If the Partnership distributes property in kind that was contributed to the Partnership by a Partner (or deemed contributed by a Partner, for tax purposes, or received in a tax-deferred exchange for property contributed or so deemed contributed to the Partnership by a Partner), the Liquidator shall use commercially reasonable efforts to cause such property to be distributed to the Partner who contributed such property (or was deemed to contribute such property), to the extent that such Partner is otherwise entitled to receive such a distribution at such time in accordance with Section 4.1(b) and Section 4.1(c).
(c) In the sole and absolute discretion of the General Partner or the Liquidator, a pro rata portion of the distributions that would otherwise be made to the Holders pursuant to this Article XII may be:
(i) distributed to a trust established for the benefit of the General Partner and the Holders for the purpose of liquidating Assets, collecting amounts owed to the Partnership, and paying any contingent or unforeseen liabilities or obligations of the Partnership or of the General Partner arising out of or in connection with the Partnership and/or Partnership activities. The assets of any such trust shall be distributed to the Holders, from time to time, in the reasonable discretion of the General Partner, in the same proportions and amounts as would otherwise have been distributed to the Holders pursuant to this Agreement; or
(ii) withheld or escrowed to provide a reasonable reserve for Partnership liabilities (contingent or otherwise) and to reflect the unrealized portion of any installment obligations owed to the Partnership, provided that such withheld or escrowed amounts shall be distributed to the Holders in the manner and order of priority set forth in Section 12.3(a) as soon as practicable.
Section 12.4 Rights of Holders. Except as otherwise provided in this Agreement and subject to the rights of any Holder set forth in a Partnership Unit Designation, (a) each Holder shall look solely to the assets of the Partnership for the return of its Capital Contribution, (b) no Holder shall have the right or power to demand or receive property other than cash from the Partnership and (c) no Holder shall have priority over any other Holder as to the return of its Capital Contributions, distributions or allocations.
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Section 12.5 Dissolution. The Partnership shall dissolve when all of the assets of the Partnership, after payment of or due provision for all debts, liabilities and obligations of the Partnership, shall have been distributed to the holders of Partnership Units in the manner provided for in this Article XII, and the necessary notification in respect of the same has been filed with the Registrar as required by the Act.
Section 12.6 Reasonable Time for Winding Up. A reasonable time shall be allowed for the orderly winding up of the business and affairs of the Partnership and the liquidation of its assets pursuant to Section 12.3, in order to minimize any losses otherwise attendant upon such winding up, and the provisions of this Agreement shall remain in effect between and among the Partners during the period of liquidation.
ARTICLE XIII
PROCEDURES FOR ACTIONS AND CONSENTS
OF PARTNERS; AMENDMENTS; MEETINGS
Section 13.1 Actions and Consents of Partners. The actions requiring Consent of any Partner pursuant to this Agreement, or otherwise pursuant to applicable law, are subject to the procedures set forth in this Article XIII.
Section 13.2 Amendments. Except as otherwise required or permitted by this Agreement (including Section 6.1), amendments to this Agreement (by merger, consolidation, repeal, or otherwise) must be approved by the Consent of the General Partner, the Consent of the Partners and the Consent of the Non-Super HoldCo Partners, and may be proposed only by (a) the General Partner, (b) the Majority in Interest of the Non-Super HoldCo Partners or (c) the Management Representative. Following such proposal, the General Partner shall submit to the Partners any proposed amendment that, pursuant to the terms of this Agreement, requires the Consent of the Partners. The General Partner shall seek the Consent of the Partners entitled to vote thereon on any such proposed amendment in accordance with Section 13.3. Upon obtaining any such Consent, and/or any other Consent required by this Agreement, and without further action or execution by any other Person, including any Limited Partner, (i) any amendment to this Agreement may be implemented and reflected in a writing executed solely by the General Partner, and (ii) the Holders shall be deemed a party to and bound by such amendment of this Agreement. Within thirty (30) days after the effectiveness of any amendment to this Agreement that does not receive the Consent of all Partners, the General Partner shall deliver a copy of such amendment to all Partners that did not Consent to such amendment. For the avoidance of doubt, notwithstanding anything to the contrary in this Agreement, this Agreement may not be amended (by merger, consolidation, repeal, or otherwise) without the Consent of the General Partner.
Section 13.3 Procedures for Meetings and Actions of the Partners.
(a) Meetings of the Partners may be called only by the General Partner. The call shall state the nature of the business to be transacted. Notice of any such meeting shall be given to all Partners entitled to act at the meeting not less than ten (10) days nor more than ninety (90) days prior to the date of such meeting. Partners may vote in person or by proxy at such meeting. Unless approval by a different number or proportion of the Partners is required by this Agreement, or any Partnership Unit Designation, the affirmative vote of a Majority in Interest of the Partners shall be sufficient to approve such proposal at a meeting of the Partners. Whenever the Consent of any Partners is permitted or required under this Agreement, such Consent may be given at a meeting of Partners or in accordance with the procedure prescribed in Section 13.3(b).
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(b) Any action requiring the Consent of any Partner or a group of Partners pursuant to this Agreement, or that is required or permitted to be taken at a meeting of the Partners may be taken without a meeting if a Consent in writing or by electronic transmission setting forth the action so taken or consented to is given by Partners whose affirmative vote would be sufficient to approve such action or provide such Consent at a meeting of the Partners. Such Consent may be in one instrument or in several instruments, and shall have the same force and effect as the affirmative vote of such Partners at a meeting of the Partners. Such Consent shall be filed with the General Partner. An action so taken shall be deemed to have been taken at a meeting held on the effective date so certified. For purposes of obtaining a Consent in writing or by electronic transmission, the General Partner may require a response within a reasonable specified time, but not less than fifteen (15) days of receipt of notice, and failure to respond in such time period shall constitute a Consent that is consistent with the General Partner’s recommendation with respect to the proposal; provided, however, that an action shall become effective at such time as requisite Consents are received even if prior to such specified time.
(c) Each Partner entitled to act at a meeting of Partners may authorize any Person or Persons to act for it by proxy on all matters in which a Partner is entitled to participate, including waiving notice of any meeting, or voting or participating at a meeting. Each proxy must be signed by the Partner or its attorney-in-fact. No proxy shall be valid after the expiration of eleven (11) months from the date thereof unless otherwise provided in the proxy (or there is receipt of a proxy authorizing a later date). Every proxy shall be revocable at the pleasure of the Partner executing it, such revocation to be effective upon the Partnership’s receipt of written notice of such revocation from the Partner executing such proxy, unless such proxy states that it is irrevocable and is coupled with an interest.
(d) The General Partner may set, in advance, a record date for the purpose of determining the Partners (i) entitled to Consent to any action, (ii) entitled to receive notice of or vote at any meeting of the Partners or (iii) in order to make a determination of Partners for any other proper purpose. Such date, in any case, shall not be prior to the close of business on the day the record date is fixed and shall be not more than ninety (90) days and, in the case of a meeting of the Partners, not less than ten (10) days, before the date on which the meeting is to be held. If no record date is fixed, the record date for the determination of Partners entitled to notice of or to vote at a meeting of the Partners shall be at the close of business on the day on which the notice of the meeting is sent, and the record date for any other determination of Partners shall be the effective date of such Partner action, distribution or other event. When a determination of the Partners entitled to vote at any meeting of the Partners has been made as provided in this Section 13.3(d), such determination shall apply to any adjournment thereof.
(e) Each meeting of Partners shall be conducted by the General Partner or such other Person as the General Partner may appoint pursuant to such rules for the conduct of the meeting as the General Partner or such other Person deems appropriate in its reasonable discretion. Without limitation, meetings of Partners may be conducted in the same manner as meetings of Super HoldCo’s stockholders and may be held at the same time as, and as part of, the meetings of Super HoldCo’s stockholders.
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ARTICLE XIV
REDEMPTION RIGHTS
Section 14.1 Redemption Rights of Qualifying Parties.
(a) (i) A Qualifying Party shall have the right (subject to the terms and conditions set forth herein) to require the Partnership to redeem all or a portion of the Partnership Class A Common Units held by such Qualifying Party (including, for purposes of a contingent notice delivered pursuant to the last sentence of this Section 14.1(a)(i) (such contingent notice delivered pursuant to the last sentence of this Section 14.1(a)(i) or a contingent notice delivered pursuant to the last sentence of Section 15.1, as applicable, a “Contingent Notice”), any Partnership Class A Common Units issuable upon the Conversion of any Profits Interests that either (x) would become Vested Profits Interests upon the consummation of the contingent transaction specified in the applicable Contingent Notice or (y) are Vested Profits Interests) (Partnership Class A Common Units that have in fact been tendered for redemption pursuant to this Section 14.1 being hereafter referred to as “A Tendered Units”) in exchange for the A Cash Amount or A-to- A Shares Amount (subject to Section 14.1(c), at the election of the Partnership) payable on the Specified Redemption Date (in each case, a “Redemption”). Any Redemption shall be exercised pursuant to a Notice of Redemption delivered to the General Partner on any trading day of an established securities exchange by the Qualifying Party when exercising the Redemption right (the “Tendering Party”). Any Notice of Redemption may be made contingent on (with the Specified Redemption Date occurring subject to, and immediately prior to) the consummation of (x) a Change of Control Transaction, (y) a tender or exchange offer conducted by Super HoldCo or any of its Subsidiaries (or any tender or exchange offer by a third party that Super HoldCo or any of its Subsidiaries (or the Board of Directors) recommends that Super HoldCo’s stockholders accept) or (z) a registered offering for which the applicable Qualifying Party would have “piggyback” registration rights following a Tendered Unit Acquisition, in which case, for purposes of such Tendered Unit Acquisition, notwithstanding anything to the contrary in this Agreement, “Trading Price” shall mean the price per Class A Share implied by the applicable Change of Control Transaction, tender or exchange offer or offering, as applicable.
(ii) The Partnership shall effect a Redemption with respect to a Notice of Redemption from a Tendering Party no later than immediately following the close of business on the sixth (6th) Business Day following receipt of such Notice of Redemption (such sixth (6th) Business Day, the “Specified Redemption Date”). Notwithstanding the foregoing, the Partnership shall not be obligated to effect a Redemption to the extent Super HoldCo exercises its purchase rights pursuant to and in accordance with Section 14.1(b).
(iii) In the event of a Redemption, any applicable A Cash Amount shall be delivered by wire transfer of immediately available funds promptly, and in any event no later than the Specified Redemption Date.
(b) (i) Notwithstanding the provisions of Section 14.1(a) hereof but subject to Section 14.3, at or before the Cut-Off Time, Super HoldCo may, in accordance with this Section 14.1(b), elect to acquire (any such acquisition, a “Tendered Unit Acquisition”) some or all (the percentage of A Tendered Units with respect to which such election is made being referred to as the “Acquired Percentage”) of the A Tendered Units from the Tendering Party (in lieu of a Redemption of the Acquired Percentage of the A Tendered Units) by so notifying the applicable Tendering Party in writing no later than the Cut-Off Time. Subject to Section 14.3, if (x) Super HoldCo has not notified the applicable Tendering Party on or prior to the Cut-Off Time of its election to effect a Tendered Unit Acquisition or (y) Super HoldCo notifies the applicable Tendering Party in writing (at the direction, and with the approval, of the Redemption Committee) on or prior to the Cut-Off Time that it declines to exercise its purchase rights pursuant to this Section 14.1(b), then, in each case of clauses (x) and (y), Super HoldCo shall be deemed to have declined to exercise its purchase rights pursuant to this Section 14.1(b) (a “Declination”) unless the applicable Tendering Party otherwise agrees.
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(ii) Subject to Section 14.3, in the case of a Tendered Unit Acquisition:
(1) as soon as reasonably practicable (and in any event, no later than the Specified Redemption Date), the Tendering Party shall sell such number of the A Tendered Units to Super HoldCo in exchange for either (A) a number of Class A Shares equal to the product of the A-to- A Shares Amount and the Acquired Percentage, provided, that no fraction of a Class A Share will be issued pursuant to this provision, but in lieu thereof each Tendering Party that would otherwise be entitled to a fraction of a Class A Share shall in lieu of such fractional share, be paid an amount of cash (rounded to the nearest whole cent), without interest, equal to the product of such fraction multiplied by the Trading Price, or (B) at the direction, and with the approval, of the Redemption Committee, cash in an amount equal to the product of the A Cash Amount and the Acquired Percentage as determined in the sole and absolute discretion of Super HoldCo in accordance with this Section 14.1(b) and calculated based on the portion of A Tendered Units being acquired in a manner consistent with clause (A) compared to clause (B) of this Section 14.1(b)(ii)(1) and, in any case, notified to the Tendering Party no later than the Cut-Off Time; and
(2) unless Super HoldCo does not consummate the applicable Tendered Unit Acquisition on or prior to the Specified Redemption Date, (A) the Tendering Party shall no longer have the right to cause the Partnership to effect a Redemption of the applicable portion of such A Tendered Units and (B) upon notice to the Tendering Party by Super HoldCo, given at or before the Cut-Off Time, that Super HoldCo has elected to acquire some or all of the A Tendered Units pursuant to this Section 14.1(b), the obligation of the Partnership to effect a Redemption of the A Tendered Units which Super HoldCo will acquire as set forth in such notice relates shall not accrue or arise;
(iii) If Super HoldCo elects to acquire the A Tendered Units for Class A Shares, then a number of Class A Shares equal to the product of the Acquired Percentage and the A-to- A Shares Amount, if applicable, shall be delivered by Super HoldCo as duly authorized, validly issued, fully paid and non-assessable Class A Shares, free of any pledge, lien, encumbrance or restriction, other than restrictions provided in the Charter, the Securities Act and relevant state securities or “blue sky” laws as soon as reasonably practicable (and in any event, no later than the Specified Redemption Date), provided, that no fraction of a Class A Share will be delivered pursuant to this provision, but in lieu thereof Super HoldCo shall deliver in lieu of such fractional share an amount of cash (rounded to the nearest whole cent), without interest, equal to the product of such fraction multiplied by the Trading Price. If Super HoldCo elects to acquire all or any portion of A Tendered Units for cash, then cash equal to the product of the Acquired Percentage (appropriately adjusted in the case of an acquisition for both Class A Shares and cash) and the A Cash Amount shall be delivered by wire transfer of immediately available funds as soon as reasonably practicable (and in any event, no later than on the Specified Redemption Date).
(iv) None of any Tendering Party whose A Tendered Units are acquired by Super HoldCo pursuant to this Section 14.1(b), any Partner, any Assignee or any other interested Person shall have any right under this Article XIV to require or cause Super HoldCo to register, qualify or list any Class A Shares owned or held by such Person, whether or not such Class A Shares are issued pursuant to this Section 14.1(b), with the SEC, with any state securities commissioner, department or agency, under the Securities Act or the Exchange Act or with any stock exchange; provided, however, that this limitation shall not be in derogation of any registration or similar rights granted pursuant to any other written agreement between Super HoldCo and any such Person, including this Agreement.
(v) Notwithstanding any delay in the delivery of any Class A Shares, the Tendering Party shall be deemed the owner of such Class A Shares for all purposes, as of no later than the Specified Redemption Date. Class A Shares issued upon a Tendered Unit Acquisition by Super HoldCo pursuant to this Section 14.1(b) may contain such legends regarding restrictions under the Securities Act and applicable state securities laws as Super HoldCo in good faith determines to be necessary or advisable in order to ensure compliance with such laws.
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(c) Subject to Section 14.3, in the event of a Declination, the Partnership may elect to raise amounts for the payment of any applicable A Cash Amount or A-to-A Shares Amount (i) by requiring that Super HoldCo or its Subsidiaries contribute to the Partnership Class A Shares or cash, as applicable, from any sources available to Super HoldCo or its Subsidiaries or (ii) from any other sources available to the Partnership; provided, however, that, in the event of a Declination described in clause (x) of Section 14.1(b)(i), unless the Redemption Committee has otherwise directed and approved the payment of cash for the applicable A Tendered Units, the Partnership shall require that Super HoldCo or its Subsidiaries contribute to the Partnership Class A Shares, and shall redeem the applicable Tendered Units pursuant to Section 14.1(a)(i) in exchange for the A-to- A Shares Amount. If the A Cash Amount is not paid on or before the Specified Redemption Date (whether by the Partnership or by Super HoldCo in the event of a Tendered Unit Acquisition), interest shall accrue with respect to the A Cash Amount from the day after the Specified Redemption Date to and including the date on which the A Cash Amount is paid at a rate equal to the applicable U.S. federal short-term rate as published monthly by the IRS plus a margin of 5.00%, compounding monthly, the amount of which interest shall be paid to the Tendering Party in cash simultaneously with the payment of the A Cash Amount. Notwithstanding anything to the contrary herein, a Tendering Party may withdraw or amend its Notice of Redemption, in whole or in part, at any time prior to 4:00 p.m. New York, New York time, on the trading day immediately prior to the Specified Redemption Date by giving written notice to the General Partner specifying: (A) the number of withdrawn Partnership Class A Common Units to the extent known; (B) the number of Partnership Class A Common Units as to which the Notice of Redemption remains in effect, if any, to the extent known; and (C) if the Tendering Party so determines, a new Specified Redemption Date or any other new or revised information permitted in a Notice of Redemption, which such notice may similarly be withdrawn or amended, in whole or in part, at any time prior to 4:00 p.m. New York, New York time, on the trading day immediately prior to the Specified Redemption Date specified in such notice; provided, that a Notice of Redemption shall be irrevocable if Super HoldCo has (x) delivered notice to the Tendering Party in accordance with this Agreement that it has elected to acquire all A Tendered Units, with the approval of the Redemption Committee, for cash, or (y) has actually delivered notice to the Tendering Party of its Declination and the Partnership has irrevocably notified the Tendering Party that it is settling in cash, unless (I) the Tendering Party shall not receive such cash on the Specified Redemption Date (at which point the Notice of Redemption shall again be revocable by the Tendering Party, which remedy shall not be exclusive and shall be cumulative with any other remedy available to the Tendering Party) or (II) the price per Class A Share implied by the hypothetical distribution contemplated by clause (i)(IV) of the definition of “Exchange Factor” is less than the Trading Price.
(d) Notwithstanding anything herein to the contrary, with respect to any Redemption (or any tender of Partnership Class A Common Units for Redemption if the A Tendered Units are acquired by Super HoldCo (directly or through any of its Subsidiaries) pursuant to Section 14.1(b) hereof) pursuant to this Section 14.1:
(i) If (A) a Tendering Party surrenders A Tendered Units during the period after the Applicable Record Date with respect to a distribution payable to Holders of Partnership Common Units, and before the record date established by Super HoldCo for a dividend to its stockholders of some or all of its portion of such Partnership distribution, and (B) Super HoldCo elects to acquire (directly or through any of its Subsidiaries) any of such A Tendered Units in exchange for Class A Shares pursuant to Section 14.1(b), then such Tendering Party shall pay to Super HoldCo (or a Subsidiary of Super HoldCo designated by Super HoldCo), promptly following its receipt of such dividend from Super HoldCo, an amount in cash equal to such dividend from Super HoldCo in respect of the Class A Shares in exchange for which Super HoldCo acquired such
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A Tendered Units. If (A) a Tendering Party surrenders A Tendered Units during the period prior to the Applicable Record Date with respect to a distribution payable to Holders of Partnership Common Units, and after the record date established by Super HoldCo for a dividend to its stockholders of some or all of its portion of such Partnership distribution, and (B) Super HoldCo elects to acquire (directly or through any of its Subsidiaries) any of such A Tendered Units in exchange for Class A Shares pursuant to Section 14.1(b), then Super HoldCo shall pay to the Tendering Party on the Specified Redemption Date an amount in cash equal to the Partnership distribution paid or payable in respect of such A Tendered Units to be acquired in exchange for Class A Shares.
(ii) The consummation of such Redemption (or an acquisition of A Tendered Units by Super HoldCo (directly or through any of its Subsidiaries) pursuant to Section 14.1(b) hereof, as the case may be) may be subject to the expiration or termination of the applicable waiting period, if any, under the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.
(iii) The Tendering Party shall continue to own (subject, in the case of an Assignee, to the provisions of Section 10.5) all Partnership Common Units subject to any Redemption, and be treated as a Limited Partner or an Assignee, as applicable, with respect to such Partnership Common Units for all purposes of this Agreement, until such A Tendered Units are either paid for by the Partnership pursuant to Section 14.1(a) or transferred to Super HoldCo (or a Subsidiary of Super HoldCo designated by Super HoldCo) and paid for by the issuance of Class A Shares or payment of cash pursuant to Section 14.1(b). Until a Specified Redemption Date and an acquisition of the A Tendered Units by Super HoldCo (directly or through any of its Subsidiaries) for Class A Shares pursuant to Section 14.1(b) hereof, the Tendering Party shall have no rights as a stockholder of Super HoldCo with respect to the Class A Shares issuable in connection with such acquisition.
(e) Each of the Partnership and Super HoldCo (directly or through any of its Subsidiaries) shall be entitled to deduct and withhold from any consideration payable or otherwise deliverable upon a Redemption such amounts as may be required to be deducted or withheld therefrom under the Code or any provision of applicable law, and to the extent deduction and withholding is required, such deduction and withholding may be taken in Class A Shares. To the extent that amounts are so withheld and paid over to the appropriate taxing authority (or, if taken in Class A Shares, cash in the amount of the fair market value of such shares is paid over to the appropriate taxing authority), such amounts will be treated for purposes of this Agreement as having been paid to the Tendering Party.
(f) Super HoldCo shall at all times reserve and keep available out of its authorized but unissued Class A Shares, solely for the purpose of issuance upon a Redemption, the maximum number of shares of Class A Shares as shall be issuable upon Redemption of all outstanding Partnership Class A Common Units issuable upon the Conversion of all outstanding Partnership Class PI Common Units. If any Class A Shares require registration with or approval of any governmental entity under any U.S. federal or state law before such shares may be issued upon a Redemption, Super HoldCo shall use reasonable efforts to cause the issuance of such Class A Shares to be duly registered or approved, as the case may be. Super HoldCo covenants that all Class A Shares issued upon a Redemption will, upon issuance, be validly issued, fully paid and non-assessable.
(g) Unless otherwise required by applicable law, the parties hereto acknowledge and agree that any Redemption shall be treated as a direct exchange between Super HoldCo and the applicable Partner for U.S. federal and applicable state and local income tax purposes. The parties hereto intend to treat any Redemption consummated hereunder as a taxable sale of the A Tendered Units by the applicable Partner to Super HoldCo for U.S. federal and applicable state and local income tax purposes and no party hereto shall take a position inconsistent with such intended tax treatment on any tax return, amendment thereof or any other communication with a taxing authority, in each case unless otherwise required by a “determination” within the meaning of Section 1313 of the Code.
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Section 14.2 Certain Adjustments. To the extent not reflected in an adjustment to the Adjustment Factor, if there is any reclassification, reorganization, recapitalization or other similar transaction in which any equity security of Super HoldCo is converted or changed or exchanged into or for another security, securities or other property (including any subdivision (by any split, distribution or dividend or otherwise) or combination (by reverse split or otherwise) or distribution thereon), then upon any subsequent exchange, a Tendering Party shall be entitled to receive the amount of such security, securities or other property that such Tendering Party would have received if such exchange had occurred immediately prior to the effective date of such reclassification, reorganization, recapitalization or other similar transaction, taking into account any adjustment as a result of any subdivision (by any split, distribution or dividend, reclassification, reorganization, recapitalization or otherwise) or combination (by reverse split, reclassification, recapitalization or otherwise) of, or distribution on, such security, securities or other property that occurs after the effective time of such reclassification, reorganization, recapitalization or other similar transaction. For the avoidance of doubt, if there is any reclassification, reorganization, recapitalization or other similar transaction in which any equity securities of Super HoldCo are converted or changed or exchanged into or for another security, securities or other property, this Section 14.2 shall continue to be applicable, mutatis mutandis, with respect to such security or other property. Except with the prior written consent of the Management Representative, unless otherwise expressly permitted by this Agreement, the Partnership shall not engage in any subdivision (by any unit split, unit dividend or distribution, reclassification, reorganization, recapitalization or otherwise), or combination (by reverse unit split, reclassification, reorganization, recapitalization or otherwise) or other similar transaction, or otherwise take any related action or omit to take any related action, that would or would reasonably be expected to disproportionately and adversely impact the rights, privileges, preferences or obligations of the Partnership Class PI Common Units or the Partnership Class A Common Units relative to any other Partnership Interest or the rights, privileges, preferences or obligations of any Limited Partner in its capacity as a holder of any class of Partnership Common Units relative to any other Limited Partner in its capacity as a holder of the same class of Partnership Common Units.
Section 14.3 Coordination and Cooperation; Cash Election. From time to time, if a Qualifying Party in good faith believes that it may deliver a Notice of Redemption, then such Qualifying Party may request in writing that Super HoldCo advise it in advance in writing of its decision as to whether (and the manner in which) Super HoldCo will elect to exercise its rights pursuant to Section 14.1(b) (and, if it will so elect, whether it will do so in accordance with clause (A) or (B) of Section 14.1(b)(ii)(1)) (an “Advance Super HoldCo Election”). The Advance Super HoldCo Election shall include a certification that any such determination was made at the direction, and with the approval, of the Redemption Committee. Any Advance Super HoldCo Election shall be binding upon Super HoldCo with respect to any Notice of Redemption delivered in the ten (10) Business Day period following Super HoldCo’s delivery of such Advance Super HoldCo Election to the applicable Qualifying Party. If Super HoldCo does not deliver, within ten (10) Business Days of its receipt of such Qualifying Party’s request, an Advance Super HoldCo Election (at the direction, and with the approval, of the Redemption Committee) indicating that it will not elect to effect a Tendered Unit Acquisition or that it will elect to effect a Tendered Unit Acquisition and will effect such Tendered Unit Acquisition for cash, then (i) Super HoldCo shall forfeit the right to effect a Tendered Unit Acquisition for cash (in whole or in part, other than cash in lieu of fractional shares), (ii) the Partnership shall forfeit the right to effect a Redemption and (iii) Super HoldCo shall be obligated to effect a Tendered Unit Acquisition for Class A Shares, in each case of clauses (i) through (iii), for the time period set forth above unless otherwise agreed by the applicable Qualifying Party. Notwithstanding the provisions of Section 14.1 or the other provisions of this Section 14.3, to the extent the A Tendered Units are Ineligible Cash Election Class A Units, (x) neither Super HoldCo nor the Partnership may elect to acquire such
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Ineligible Cash Election Class A Units for cash (other than in respect of fractional shares), (y) Super HoldCo shall ensure that the Redemption Committee does not, and is not authorized to, elect or otherwise direct or approve the payment of cash for Ineligible Cash Election Class A Units (other than in respect of fractional shares) and (z) in furtherance of the foregoing, (1) if Super HoldCo does not effect a Declination with respect to the Ineligible Cash Election Class A Units then Super HoldCo shall be deemed to have elected to acquire such Ineligible Cash Election Class A Units for Class A Shares in accordance with this Agreement and (2) if Super HoldCo effects a Declination with respect to the Ineligible Cash Election Class A Units then the Partnership shall be deemed to have elected to acquire such Ineligible Cash Election Class A Units for Class A Shares in accordance with this Agreement.
ARTICLE XV
PARTNERSHIP CLASS PI COMMON UNIT CONVERSION
Section 15.1 Conversion Mechanics and Notice. At any time, upon written notice to the General Partner in accordance with Section 16.9 and the final sentence in the definition of “Trading Price,” any holder of Vested Profits Interests (including, in the case of a Contingent Notice, any Profits Interests that would become Vested Profits Interests upon the consummation of the contingent transaction specified in such Contingent Notice) may elect to convert (in each case, a “Conversion”) all or a portion of such Vested Profits Interests into the number of nonassessable Partnership Class A Common Units equal to the product of (a) the number of Vested Profits Interests to be converted, multiplied by (b) the Exchange Factor as of the date of such Conversion. Before any holder of Vested Profits Interests shall be entitled to convert any such Vested Profits Interests, such holder shall give written notice substantially in the form of Exhibit D attached hereto (a “Notice of Conversion”), to the General Partner in accordance with Section 16.9 and the final sentence in the definition of “Trading Price,” of the election to convert the same and shall state therein the name of such holder. Such conversion shall be deemed to have occurred immediately prior to the close of business on the date of delivery of the applicable Notice of Conversion, and such holder shall be treated for all purposes as the record holder or holders of such Partnership Class A Common Units as of the close of business on such date. The Partnership shall, as soon as practicable thereafter, issue and deliver at such office to such holder of Vested Profits Interests, a document evidencing the number of Partnership Class A Common Units to which such holder shall be entitled as aforesaid and such holder shall, as soon as practicable thereafter, surrender any documents evidencing such Vested Profits Interests to be converted, duly endorsed, at the principal office of the Partnership. Each Vested Profits Interest that is converted pursuant to this Section 15.1 shall be retired by the Partnership and shall not be available for reissuance. For the avoidance of doubt, a holder of Vested Profits Interests may simultaneously deliver a Notice of Conversion pursuant to this Section and a Notice of Redemption with respect to the Partnership Class A Common Units issuable upon the applicable Conversion. Any Notice of Conversion may be made contingent on (and effective immediately prior to) the consummation of a Change of Control Transaction, a tender or exchange offer conducted by Super HoldCo or any of its Subsidiaries (or any tender or exchange offer by a third party that Super HoldCo or any of its Subsidiaries (or the Board of Directors) recommends that Super HoldCo’s stockholders accept) or a registered offering for which the applicable holder of Vested Profits Interests would have “piggyback” registration rights following a Conversion and Tendered Unit Acquisition, in which case, for purposes of such Conversion, notwithstanding anything to the contrary in this Agreement, “Trading Price” shall mean the price per Class A Share implied by the applicable Change of Control Transaction, tender offer or offering, as applicable.
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ARTICLE XVI
MISCELLANEOUS
Section 16.1 Partnership Counsel. THE PARTNERSHIP, THE GENERAL PARTNER AND EACH OF THE OTHER WW ENTITIES MAY BE REPRESENTED BY THE SAME COUNSEL. THE ATTORNEYS, ACCOUNTANTS AND OTHER EXPERTS WHO PERFORM SERVICES FOR THE PARTNERSHIP MAY ALSO PERFORM SERVICES FOR SUPER HOLDCO AND EACH OF THE OTHER WW ENTITIES AND AFFILIATES THEREOF. THE GENERAL PARTNER MAY, WITHOUT THE CONSENT OF THE NON-SUPER HOLDCO PARTNERS, EXECUTE ON BEHALF OF THE PARTNERSHIP ANY CONSENT TO THE REPRESENTATION OF THE PARTNERSHIP THAT COUNSEL MAY REQUEST PURSUANT TO THE NEW YORK RULES OF PROFESSIONAL CONDUCT OR SIMILAR RULES IN ANY OTHER JURISDICTION. THE PARTNERSHIP HAS INITIALLY SELECTED SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP AND MAPLES AND CALDER (EACH, A “PARTNERSHIP COUNSEL”) AS LEGAL COUNSEL TO THE PARTNERSHIP. EACH HOLDER ACKNOWLEDGES THAT NEITHER PARTNERSHIP COUNSEL REPRESENTS ANY HOLDER IN ITS CAPACITY AS SUCH IN THE ABSENCE OF A CLEAR AND EXPLICIT WRITTEN AGREEMENT TO SUCH EFFECT BETWEEN SUCH HOLDER AND SUCH PARTNERSHIP COUNSEL (AND THEN ONLY TO THE EXTENT SPECIALLY SET FORTH IN SUCH AGREEMENT), AND THAT IN ABSENCE OF ANY SUCH AGREEMENT NEITHER PARTNERSHIP COUNSEL SHALL OWE ANY DUTIES TO ANY HOLDER. EACH HOLDER FURTHER ACKNOWLEDGES THAT, WHETHER OR NOT EITHER PARTNERSHIP COUNSEL HAS IN THE PAST REPRESENTED OR IS CURRENTLY REPRESENTING SUCH HOLDER WITH RESPECT TO OTHER MATTERS, SUCH PARTNERSHIP COUNSEL HAS NOT REPRESENTED THE INTERESTS OF ANY HOLDER IN THE PREPARATION AND/OR NEGOTIATION OF THIS AGREEMENT.
Section 16.2 Damages not an Adequate Remedy. Without prejudice to any other rights or remedies that the General Partner may have, each Partner and the Management Representative hereby acknowledges and agrees that damages alone would not be an adequate remedy for any breach of the terms of this Agreement by such party. Accordingly, the General Partner shall be entitled to the remedies of injunction, specific performance or other equitable relief for any threatened or actual breach of the terms of this Agreement.
Section 16.3 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 Cayman Islands, without regard to its conflict of laws rules.
Section 16.4 Arbitration. Any unresolved controversy or claim arising out of or relating to this Agreement, except as (a) otherwise provided in this Agreement, or (b) any such controversies or claims arising out of either party’s intellectual property rights for which a provisional remedy or equitable relief is sought, shall be submitted to arbitration by one arbitrator mutually agreed upon by the parties, and if no agreement can be reached within thirty (30) days after names of potential arbitrators have been proposed by the American Arbitration Association (the “AAA”), then by one arbitrator having reasonable experience in corporate finance transactions of the type provided for in this Agreement and who is chosen by the AAA. The arbitration shall take place in the State of Delaware, County of New Castle, in accordance with the AAA rules then in effect, and judgment upon any award rendered in such arbitration will be binding and may be entered in any court having jurisdiction thereof. There shall be limited discovery prior to the arbitration hearing as follows: (i) exchange of witness lists and copies of documentary evidence and documents relating to or arising out of the issues to be arbitrated; (ii) depositions of all party witnesses; and (iii) such other depositions as may be allowed by the arbitrators upon a showing of good cause. Depositions shall be conducted in accordance with this Section 16.4, the arbitrator shall be required to provide in writing to the parties the basis for the award or order of such arbitrator, and a court reporter shall record all hearings, with such record constituting the official transcript of such proceedings. The prevailing party shall be entitled to reasonable attorney’s fees, costs, and necessary disbursements in addition to any other relief to which such party may be entitled.
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Section 16.5 Accounting and Fiscal Year. Subject to Section 448 of the Code, the books of the Partnership shall be kept on such method of accounting for tax and financial reporting purposes as may be determined by the General Partner. The fiscal year of the Partnership (the “Fiscal Year”) shall be the calendar year, or, in the case of the first and last Fiscal Years of the Partnership, the fraction thereof commencing on the First Restatement Date of this Agreement or ending on the date on which the winding up of the Partnership is completed, as the case may be, unless otherwise determined by the General Partner and permitted under the Code.
Section 16.6 Waiver of Jury Trial. EACH PARTY HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, THE PARTNERSHIP UNITS OR THE SUBJECT MATTER HEREOF. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF ANY TRANSACTION CONTEMPLATED BY THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS (INCLUDING NEGLIGENCE), BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. THIS SECTION HAS BEEN FULLY DISCUSSED BY EACH OF THE PARTIES HERETO, AND THESE PROVISIONS WILL NOT BE SUBJECT TO ANY EXCEPTIONS. EACH PARTY HERETO HEREBY FURTHER WARRANTS AND REPRESENTS THAT SUCH PARTY HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT SUCH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.
Section 16.7 Entire Agreement. This Agreement, together with any side letter or similar agreements entered into and incorporated herein pursuant to Section 16.16, constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof and fully supersedes any and all prior or contemporaneous agreements or understandings between the parties hereto pertaining to the subject matter hereof, including the Original Agreement, the July 15, 2019 Agreement and the October 30, 2019 Agreement. For the avoidance of doubt, this Agreement shall not supersede the governing agreement (including a Limited Partnership Agreement or Limited Liability Company Agreement) of PIU Aggregator, the Amended and Restated Registration Rights Agreement, dated as of October 30, 2019, by and among Super HoldCo and the stockholders party thereto or, except as provided therein, any Profits Interests Award Agreement. Nothing contained in this Agreement shall limit, restrict, inhibit, derogate or waive any right that any individual that is a Limited Partner has in any other capacity, including as a stockholder of Super HoldCo.
Section 16.8 Further Assurances. Each of the parties hereto does hereby covenant and agree on behalf of itself, its successors and its assigns, without further consideration, to prepare, execute, acknowledge, file, record, publish and deliver such other instruments, documents and statements, and to take such other action as may be required by law or reasonably necessary to effectively carry out the purposes of this Agreement.
Section 16.9 Notices. Any notice, consent, payment, demand or communication required or permitted to be given by any provision of this Agreement shall be in writing and shall be (a) delivered personally to the Person or to an officer of the Person to whom the same is directed, (b) sent by facsimile, overnight mail or registered or certified mail, return receipt requested, postage prepaid, or (c) sent by e-mail, in each case addressed as follows: if to the Partnership or the General Partner, to it at the principal place of business of Super HoldCo c/o its General Counsel or to such other address as the Partnership may from time to time specify by notice to the Partners, with a copy to Skadden, Arps, Slate, Meagher & Flom
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LLP, 500 Boylston Street, Boston, Massachusetts 02116, E-mail: graham.robinson@skadden.com, laura.knoll@skadden.com, sonia.nijjar@skadden.com, Attn: Graham Robinson, Laura Knoll and Sonia K. Nijjar; if to the Management Representative, to the Partnership in accordance with the foregoing, with a copy to Paul, Weiss, Rifkind, Wharton & Garrison LLP, 1285 Avenue of the Americas, New York, NY 10019, E-mail: rschumer@paulweiss.com, ajdeckelbaum@paulweiss.com, mvogel@paulweiss.com, Attn: Robert B. Schumer, Ariel J. Deckelbaum and Michael Vogel; and if to any Limited Partner, to such Limited Partner at the address set forth in the records of the Partnership. Any such notice shall be deemed to be delivered, given and received for all purposes as of: (i) the date so delivered, if delivered personally, (ii) upon electronic or written confirmation of receipt, if sent by facsimile or e-mail (provided, that the Partnership shall in each case deliver confirmation of receipt of such notice on the same day as such notice is received by the Partnership, unless such notice is received by the Partnership after business hours, in which case confirmation shall be delivered as of the opening of business on the next Business Day of the Partnership; provided, further, that if such confirmation is not received on the date of delivery, such notice shall nevertheless be deemed to be delivered, given and received on the date of delivery if (A) other than in the case of a Notice of Conversion or Notice of Redemption, notice is effected on the next Business Day by alternative means permitted by this Section 16.9 or (B) in the case of a Notice of Conversion or Notice of Redemption, such confirmation is received by the party giving notice (for the avoidance of doubt, subject to the final sentence in the definition of “Trading Price”)), or (iii) on the date of receipt or refusal indicated on the return receipt, if sent by registered or certified mail, return receipt requested, postage and charges prepaid and properly addressed. Sections 8 and 19 of the Electronic Transactions Law (2008 Revision) of the Cayman Islands shall not apply.
Section 16.10 Construction. This Agreement shall be construed as if all parties hereto prepared this Agreement.
Section 16.11 Binding Effect. Except as otherwise expressly provided herein, this Agreement shall be binding on and inure to the benefit of the Partners, their heirs, executors, administrators, successors and all other Persons hereafter holding, having or receiving an interest in the Partnership, whether as Assignees, Substituted Limited Partners or otherwise. The Management Representative shall be an express third party beneficiary under, and have the right to enforce, this Agreement.
Section 16.12 Severability. In the event that any provision of this Agreement, as applied to any party or to any circumstance, shall be adjudged by a court to be void, unenforceable or inoperative as a matter of law, then the same shall in no way affect any other provision in this Agreement, the application of such provision in any other circumstance or with respect to any other party, or the validity or enforceability of the Agreement as a whole.
Section 16.13 Consent to Use of Name. Each Partner hereby consents to the use and inclusion of its name in the Register and the Partnership’s books and records hereto and any and all other notices or communications required or permitted to be given by the General Partner to any other WW Entity or any member(s) thereof.
Section 16.14 Consent by Spouse. Each Limited Partner who is a natural person and is married (and not formally separated with an agreed-upon division of assets) and may be subject to the community property laws of any jurisdiction shall deliver a duly executed consent by her or his spouse, in the form prescribed in Exhibit E attached hereto (“Consent by Spouse”), and at the time of execution of this Agreement. Each such Limited Partner shall also have such Consent by Spouse executed by any spouse married to him or her at any time subsequent thereto while such natural person is a Limited Partner. Each Limited Partner agrees and acknowledges that compliance with the requirements of this Section 16.14 by each other Limited Partner constitutes an essential part of the consideration for his or her execution of this Agreement.
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Section 16.15 Counterparts. This Agreement may be executed in any number of multiple counterparts, each of which shall be deemed to be an original copy and all of which shall constitute one agreement, binding on all parties hereto.
Section 16.16 Other Agreements. Notwithstanding any other provision of this Agreement (including Section 13.2), it is hereby acknowledged and agreed that the General Partner on its own behalf and on behalf of the Partnership shall have the power and authority, upon the approval of the Compensation Committee of the Board of Directors, to enter into any side letter or similar agreement (including any Profits Interest Award Agreement) to or with a Limited Partner that has the effect of establishing rights or otherwise benefiting such Limited Partner (in its capacity as a Limited Partner) in a manner more favorable in a material respect to such Limited Partner than the rights and benefits established under, or otherwise altering or supplementing the terms of, this Agreement.
Section 16.17 Survival and Third Party Rights. The provisions of Section 6.6 and Article XVI (and any other provisions herein necessary for the effectiveness of the foregoing sections) shall survive the termination of the Partnership. Subject to the last sentence of Section 16.11, a Person who is not a party to this Agreement may not, in its own right or otherwise, enforce any term of this Agreement except that each Indemnitee (or any other person who is not a party to this Agreement) may enforce any right afforded to them hereunder subject to and in accordance with the provisions of the Contracts (Rights of Third Parties) Law, 2014, as amended, modified, re-enacted or replaced. Notwithstanding any other term of this Agreement, except as expressly provided in the first sentence of Section 13.2, the consent of any Person who is not a party to this Agreement is not required for any amendment to, or variation, release, rescission or termination of this Agreement.
Section 16.18 Anti-Money Laundering Representations and Undertakings. Each Partner acknowledges that it has read the representations and undertakings contained on Exhibit F attached hereto and hereby confirms they are true and correct.
[Signature Page Follows]
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IN WITNESS WHEREOF, this Agreement has been executed as a deed on the date first written above.
| THE WE COMPANY MC LLC |
THE WE COMPANY MANAGEMENT LLC | |||||||
| By: | /s/ Jared DeMatteis |
By: | /s/ Jared DeMatteis | |||||
| Name: Jared DeMatteis Title: General Counsel |
Name: Jared DeMatteis Title: General Counsel | |||||||
| THE WE COMPANY PI LP | ||||||||
| EUCLID WW HOLDINGS INC. | BY: THE WE COMPANY MC LLC, ITS GENERAL PARTNER | |||||||
| By: | /s/ Jared DeMatteis |
By: | /s/ Jared DeMatteis | |||||
| Name: Jared DeMatteis Title: General Counsel |
Name: Jared DeMatteis Title: General Counsel | |||||||
[Signature Page to Third A&R Agreement of Exempted Limited Partnership of The We Company Management Holdings L.P.]
And, in it is capacity as the parent company of TWC MC and not as a Partner in the Partnership:
| WEWORK INC. | ||
| By: | /s/ Jared DeMatteis | |
| Name: Jared DeMatteis Title: General Counsel | ||
[Signature Page to Third A&R Agreement of Exempted Limited Partnership of The We Company Management Holdings L.P.]
EXHIBIT A
NOTICE OF REDEMPTION
The We Company Management Holdings L.P.
[●]
[●]
[●]
The undersigned Limited Partner or Assignee hereby (subject to Article XIV of the Agreement (as defined below)) tenders, for Redemption, Partnership Class A Common Units or Vested Profits Interests in The We Company Management Holdings L.P. in accordance with the terms of the Third Amended and Restated Agreement of Exempted Limited Partnership of The We Company Management Holdings L.P., dated on October 20, 2021 (the “Agreement”), and the Redemption rights referred to therein in Section 14.1(a). All capitalized terms used and not otherwise defined herein shall have the respective meanings ascribed to them in the Agreement. The undersigned Limited Partner or Assignee:
(a) undertakes to surrender such Partnership Common Units (if in certificated form) at the closing of the Redemption;
(b) directs that a wire transfer of immediately available funds equal to the A Cash Amount (if applicable), deliverable upon the closing of such Redemption be delivered to the address or bank account, as applicable, specified below;
(c) represents, warrants, certifies and agrees that: (i) the undersigned Limited Partner or Assignee is a Qualifying Party; (ii) the undersigned Limited Partner or Assignee has, and at the closing of the Redemption will have, good title to such Partnership Common Units; (iii) the undersigned Limited Partner or Assignee has, and at the closing of the Redemption will have, the full right, power and authority to tender and surrender such Partnership Common Units as provided herein; (iv) the undersigned Limited Partner or Assignee, and the tender and surrender of such Partnership Common Units for Redemption as provided herein complies with all conditions and requirements for redemption of Partnership Common Units set forth in the Agreement; and (v) the undersigned Limited Partner or Assignee has obtained the consent or approval of all persons and entities, if any, having the right to consent to or approve such tender and surrender;
(d) acknowledges that the undersigned will continue to own such Partnership Common Units unless and until either (1) such Partnership Common Units are acquired by Super HoldCo (directly or through any of its Subsidiaries) pursuant to Section 14.1(b) of the Agreement or (2) such redemption transaction closes[; and
(e) delivers this notice contingent on the consummation of ].
Dated:
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| Name of Limited Partner or Assignee |
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| Signature of Limited Partner or Assignee |
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| Street Address |
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| City, State and Zip Code |
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| Social security or identifying number |
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| Signature Medallion Guaranteed by* |
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| Issue shares in the name of (if applicable) |
| Bank Account Details: |
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| * | Required unless waived by the General Partner or Transfer Agent. |
A-2
EXHIBIT B
ADDRESS OF DOMICILE OR PRINCIPAL PLACE OF BUSINESS
[Redacted]
[***]
B-1
EXHIBIT C
CAPITAL ACCOUNTS
[Redacted]
[***]
C-1
EXHIBIT D
NOTICE OF CONVERSION
The We Company Management Holdings L.P.
[●]
[●]
[●]
The undersigned Limited Partner or Assignee hereby (subject to Article XV of the Agreement (as defined below)) tenders, for Conversion, Vested Profits Interests in The We Company Management Holdings L.P. in accordance with the terms of the Third Amended and Restated Agreement of Exempted Limited Partnership of The We Company Management Holdings L.P., dated on October 20, 2021 (the “Agreement”), and the Conversion rights referred to therein in Article XV. All capitalized terms used and not otherwise defined herein shall have the respective meanings ascribed to them in the Agreement. The undersigned Limited Partner or Assignee:
(a) undertakes to surrender such Vested Profits Interests at the closing of the Conversion and to furnish to the Partnership the documentation, instruments and information required under Article XV of the Agreement;
(b) requests that the Partnership provide a document evidencing the number of Partnership Class A Common Units to which such holder shall be entitled pursuant to the Conversion;
(c) represents, warrants, certifies and agrees that: (i) the undersigned Limited Partner or Assignee is a Qualifying Party; (ii) the undersigned Limited Partner or Assignee has, and at the closing of the Conversion will have, good title to such Vested Profits Interests; (iii) the undersigned Limited Partner or Assignee has, and at the closing of the Conversion will have, the full right, power and authority to tender and surrender such Vested Profits Interests as provided herein; (iv) the undersigned Limited Partner or Assignee, and the tender and surrender of such Vested Profits Interests for Conversion as provided herein complies with all conditions and requirements for conversion of Vested Profits Interests set forth in Article XV of the Agreement; and (v) the undersigned Limited Partner or Assignee has obtained the consent or approval of all persons and entities, if any, having the right to consent to or approve such tender and surrender;
(d) acknowledges that the undersigned will continue to own such Vested Profits Interests unless and until such conversion transaction closes[; and
(e) delivers this notice contingent on the consummation of ].
Dated:
D-1
EXHIBIT E
CONSENT BY SPOUSE
I acknowledge that I have read the Third Amended and Restated Agreement of Exempted Limited Partnership (the “Partnership Agreement”) of The We Company Management Holdings L.P. (the “Partnership”), dated on October 20, 2021, and that I know its contents. I am aware that by its provisions, my spouse agrees to sell, convert, dispose of, or otherwise transfer his or her interest in the Partnership, including any property or other interest that I have or acquire therein, under certain circumstances. I hereby consent to such sale, conversion, disposition or other transfer; and approve of the provisions of the Partnership Agreement and any action hereafter taken by my spouse thereunder with respect to his or her interest, and I agree to be bound thereby.
I further agree that in the event of my death or a dissolution of marriage or legal separation, my spouse shall have the absolute right to have my interest, if any, in the Partnership set apart to him or her, whether through a will, a trust, a property settlement agreement or by decree of court, or otherwise, and that if he or she be required by the terms of such will, trust, settlement or decree, or otherwise, to compensate me for said interest, that the price shall be an amount equal to its appraised value as determined by a reputable accounting firm, investment bank or other qualified appraiser selected by me and my spouse (or if we cannot agree on an appraiser within five (5) Business Days, such appraiser as is selected by the Partnership), payable in cash or on such other terms as may be agreed upon by me and my spouse.
This consent, including its existence, validity, construction, and operating effect, and the rights of each of the parties hereto, shall be governed by and construed in accordance with the laws of the [●]* without regard to otherwise governing principles of choice of law or conflicts of law.
Dated:
Name:
| * | Insert jurisdiction of residence of Partner and Spouse. |
E-1
EXHIBIT F
ANTI-MONEY LAUNDERING REPRESENTATIONS AND UNDERTAKINGS
Each Partner hereby makes the following representations, warranties and covenants as of the date of this Agreement, and for so long as each such Partner holds any Partnership Interest thereafter:
(a) The acceptance of this Agreement, together with the appropriate remittance, will not breach any applicable money laundering or related rules or regulations, including any statutes, rules, regulations or guidance pertaining to prohibitions on money laundering or terrorist financing in effect under the laws of the United States that are in effect at the time this Agreement is submitted to the Partnership, including but not limited to the Bank Secrecy Act, as amended by the USA PATRIOT Act of 2001, and the Bank Secrecy Act’s implementing regulations, or that becomes effective at any future time (the “AML Laws”) or the Sanctions Laws (as defined below).
(b) The monies used to fund the Partner’s acquisition of an interest in the Partnership, and the monies that have been or will be used to make Capital Contributions are, and will be, from legitimate sources in connection with the Partner’s regular business activities, and have not been, and will not in any case be, derived from or related to any activity that would be illegal or constitute the proceeds of criminal conduct or criminal property in any Relevant Jurisdiction (“Illegal Activity”). In addition, the proceeds from the Partner’s investment in the Partnership will not be used to finance, or in furtherance of, any Illegal Activities. To the best of the Partner’s knowledge, the funds for the Partner’s acquisition of the Partnership Interest do not originate from, nor will they be routed through, an account maintained at a shell bank[1] and/or a bank organized or chartered under the laws of a Non-Cooperative Jurisdiction.[2] “Relevant Jurisdiction” means the United States, the Cayman Islands, and the Partner’s place of organization and/or principal place of business.
(c) No contribution or payment, in and of itself, by any Partner to the Partnership will cause the Partnership or its Affiliates to be in violation of any applicable AML Laws or Sanctions Laws.
(d) Neither a Partner nor any person or entity owned or controlled by or owning or controlling the Partner (excluding, in the event the Partner or any person or entity controlled by or controlling the Partner is a public company traded on a recognized securities exchange, such persons or entities that are shareholders of the Partner or any person or entity controlled by or controlling the Partner), or any Person for whom the Partner is acting for or on behalf of in connection with this Agreement is:
(i) on OFAC’s List of Specially Designated Nationals and Blocked Persons or any other list of sanctioned persons or entities maintained by the United States, the European Union, the United Kingdom (including as the latter are extended to the Cayman Islands by Statutory Instrument) or the respective governmental institutions and agencies of any of the foregoing, including OFAC, the United States Department of State, and Her Majesty’s Treasury (each, a “Sanctions Authority”);
(ii) located, organized, or resident in a country or territory in relation to which country-wide or territory-wide sanctions have been imposed by a Sanctions Authority (including, as of the date of this Agreement, Cuba, Iran, North Korea, Syria, and the Crimea region of Ukraine), a jurisdiction designated by the United States Department of the Treasury as warranting special measures due to money laundering concerns, or a Non-Cooperative Jurisdiction;
| [1] | A “shell bank” means any institution that accepts currency for deposit and that (a) has no physical presence in the jurisdiction in which it is incorporated or in which it is operating, as the case may be, and (b) is unaffiliated with a regulated financial group that is subject to consolidated supervision. |
| [2] | A “Non-Cooperative Jurisdiction” is any foreign country or territory that is designated as non-cooperative with international anti-money laundering principles or procedures by an intergovernmental group or organization, such as the Financial Action Task Force. |
F-1
(iii) otherwise the target of any sanction, embargo, regulation, law, or other restrictive measure promulgated by a Sanctions Authority (such sanctions, regulations, embargoes, laws, or restrictive measures, together with any supplement or amendment thereto, the “Sanctions Laws”);
(iv) a shell bank.
(e) (i) To the best of the Partner’s knowledge, none of (A) the Partner; (B) any beneficial owner of the Partner; (C) any Person controlling or controlled by the Partner; (D) if the Partner is a privately held entity, any Person having a beneficial interest in the Partner; or (E) any Person for whom the Partner is acting as agent or nominee in connection with this investment is a Politically Exposed Person[3], or a family member[4] or close associate[5] of a Politically Exposed Person as such terms are defined in the footnotes below; or (ii) to the extent that any party in (A)-(E) is a Politically Exposed Person, the Partner has disclosed that fact to the General Partner and the Partnership and agrees to promptly obtain and provide all information regarding such Person as the General Partner and/or the Partnership may request, including as may be required to comply with the AML Laws. The General Partner reserves the right to decline the acquisition of the Partnership Interest, where any party in (A)-(E) is a Politically Exposed Person, or a family member or close associate of a Politically Exposed Person.
(f) The Partners understand that the Partnership (and/or its Affiliates) may be subject to certain legal requirements that require verification of the source of funds paid to the Partnership by the Partners, as well as the Partners’ identity and that of any associated persons. The Partners agree that they will provide such materials as may from time to time be reasonably requested by the Partnership or the General Partner for such purposes. In addition, the Partners agree to provide to the Partnership and its Affiliates any additional information regarding itself and any person or entity controlled by or controlling the Partner (excluding, in the event the Partner or any person or entity controlled by or controlling the Partner is a public company traded on a recognized securities exchange, such persons or entities that are shareholders of the Partner or any person or entity controlled by or controlling the Partner), that may be deemed necessary to ensure compliance with all applicable AML Laws and Sanctions Laws. The Partnership may take such actions as the General Partner may reasonably determine if this information is not provided or on the basis of information that is provided.
(g) All evidence of identity and related information concerning each Partner and any person controlling or controlled by the Partner (excluding, in the event the Partner or any person or entity controlled by or controlling the Partner is a public company traded on a recognized securities exchange, such persons or entities that are shareholders of the Partner or any person or entity controlled by or controlling the Partner), provided to the Partnership is and will be true, accurate and complete.
(h) The General Partner may segregate and/or redeem a Partner’s investment in the Partnership, prohibit future investments or capital contributions, or take other appropriate action if the General
| [3] | A “Politically Exposed Person” means: (a) a person who is or has been entrusted with prominent public functions by any country, for example a Head of State or of government, a senior politician, a senior government, judicial or military official, a senior executive of a state owned corporation, or an important political party official; or (b) a person who is or has been entrusted with a prominent function by an international organization like a member of senior management, such as a director, a deputy director or a member of the board or equivalent function. |
| [4] | “Family member” includes the spouse, parent, sibling, child and in-laws of a Politically Exposed Person. |
| [5] | A “close associate” means any natural person who is known to hold the ownership or control of a legal instrument or person jointly with a Politically Exposed Person, who maintains some other kind of close business or personal relationship with a Politically Exposed Person, or who holds the ownership or control of a legal instrument or person which is known to have been established to the benefit of a Politically Exposed Person. |
F-2
Partner determines that the continued participation of any Partner could materially adversely affect the Partnership or if the action is necessary in order for the Partnership to comply with applicable laws, regulations, orders, directives or special measures, including AML Laws or Sanctions Laws. The Partners further understand that the Partnership and the General Partner (and any of their Affiliates) may release confidential information about each such Partner and, if applicable, any of its direct or indirect beneficial owners, to proper authorities if, in their sole and absolute discretion, they determine that such release is in the interest of any of the foregoing in light of applicable laws and regulations. The General Partner will take such steps as it determines are necessary to comply with applicable laws, regulations, orders, directives and special measures.
(i) Each Partner will promptly notify the Partnership and the General Partner if any of the representations in this section cease to be true and accurate.
F-3
ANNEX A
THE WE COMPANY MANAGEMENT HOLDINGS L.P.
PARTNERSHIP UNIT DESIGNATION
OF
PARTNERSHIP PREFERRED UNITS
[***]
Annex A-1
Exhibit 10.4
WEWORK INC.
2021 EQUITY INCENTIVE PLAN
Section 1. Purpose of Plan.
The name of the plan is the WeWork 2021 Equity Incentive Plan (the “Nan”). The purposes of the Plan are to provide an additional incentive to officers, employees, non-employee directors, and consultants of the Company or its Affiliates (as hereinafter defined) whose contributions are essential to the growth and success of the business of the Company and its Affiliates, in order to strengthen the commitment of such persons to the Company and its Affiliates, motivate such persons to faithfully and diligently perform their responsibilities, and attract and retain competent and dedicated persons whose efforts will result in the long-term growth and profitability of the Company and its Affiliates. To accomplish such purposes, the Plan provides that the Company may grant Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Stock Bonuses, Other Stock-Based Awards, Cash Awards or any combination of the foregoing.
Section 2. Definitions.
For purposes of the Plan, the following terms shall be defined as set forth below:
(a) “Acquisition Award” means any Award that is assumed, converted or substituted under the Plan as a result of the Company’s acquisition of another company (including by way of merger, combination or similar transactions).
(b) “Administrator” means the Board or the Committee (or a delegate appointed in accordance with Section 3).
(c) “Affiliate” means a Person that, at the applicable time, directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person specified. The term Affiliate shall, unless otherwise determined by the Administrator, include entities in which the Company holds 50% or more voting control.
(d) “Aggregate Fully Diluted Company Capital Stock” has the meaning set forth in the Merger Agreement.
(e) “Award” means any Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Stock Bonus, Other Stock-Based Award, or Cash Award granted under the Plan.
(f) “Award Agreement” means any written or electronic agreement, contract or other instrument or document evidencing an Award.
(g) “Base Price” has the meaning set forth in Section 8(b).
(h) “Beneficial Owner” (or any variant thereof) has the meaning defined in Rule 13d-3 under the Exchange Act.
(i) “Board” means the Board of Directors of the Company.
(j) “Cash Award” means an Award granted pursuant to Section 12.
(k) “Cause” shall have the meaning ascribed to such term in the Participant’s employment, consulting, or severance agreement with the Company or its Affiliates, if such agreement contains a defmition of “cause” for termination of employment or other applicable relationship. Otherwise, “Cause” has the meaning determined by the Administrator and set forth in the applicable Award Agreement or, if there is no such definition in the Award Agreement, shall mean (1) repeated failure by the Participant to perform the Participant’s reasonably assigned duties; (2) the Participant’s engagement in dishonesty, gross negligence or misconduct, which in the case of dishonesty only has had a material adverse effect on the Company’s or its Affiliates’ business or affairs; (3) the Participant’s conviction of, or entrance of a pleading of guilty or nolo contendere to, any crime involving moral turpitude or any felony as permitted by law; (4) material breach by the Participant of any invention or nondisclosure agreement and/or non-competition agreement and/or non-solicitation agreement with the Company or its Affiliates, as applicable; (5) intentional misconduct by the Participant or intentional failure by the Participant to perform the Participant’s responsibilities to the Company or its Affiliates; (6) the Participant’s failure to cooperate or assist with any investigation involving the Company or its Affiliates; or (7) the Participant’s failure to comply with any of the Company’s or its Affiliates’ policies, including, but not limited to, their harassment, workplace conduct and/or discrimination policies. Prior to the occurrence of a Change in Control, and solely for purposes of the Plan and Awards granted hereunder, the Company shall have the sole authority (including by action of the Administrator), to make a finding or determination of “Cause” and a fmding or determination of “Cause” by the Company shall be fmal and binding on all parties. The Participant’s employment or other relationship shall be considered to have been terminated for “Cause” if the Company determines within 30 days after the Participant’s resignation that termination for Cause was warranted.
(l) “Change in Capitalization” means any (1) merger, consolidation, reclassification, recapitalization, spinoff, spin-out, repurchase or other reorganization or corporate transaction or event; (2) special or extraordinary dividend or other extraordinary distribution (whether in the form of cash, Common Stock, or other property), stock split, reverse stock split, subdivision or consolidation; (3) combination or exchange of shares; or (4) other change in corporate structure, which, in any such case, the Administrator determines, in its sole discretion, affects the Common Stock such that an adjustment pursuant to Section 5 is appropriate.
(m) “Change in Control” means the occurrence, in a single transaction or a series of related transactions, of any one or more of the events set forth in the following paragraphs:
(1) any Exchange Act Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing more than 50% of the combined voting power of the Company’s then outstanding securities other than in connection with a transaction described in clause (I) of paragraph (3) below; or
2
(2) the following individuals cease for any reason to constitute a majority of the number of directors then serving on the Board: individuals who, as of the Effective Date, constitute the Board and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including, but not limited to, a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company’s shareholders was approved or recommended by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors on the Effective Date or whose appointment, election or nomination for election was previously so approved or recommended (“Incumbent Directors”); or
(3) there is consummated a merger or consolidation of the Company or any direct or indirect Subsidiary with any other corporation or other entity, other than (I) a merger or consolidation which results in (A) 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 or, if the Company or the entity surviving such merger or consolidation is then a Subsidiary, the ultimate parent thereof), in combination with the ownership of any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any Subsidiary, more than 50% of the combined voting power of the securities outstanding immediately after such merger or consolidation of either the Company or such surviving entity or, if the Company or the entity surviving such merger is then a Subsidiary, the ultimate parent thereof (with such securities being held by the shareholders of the Company prior to the transaction in substantially the same proportions as their ownership of the voting securities of the Company immediately after such merger or consolidation) and (B) the Incumbent Directors continuing immediately thereafter to represent at least a majority of the board of directors of the Company, the entity surviving such merger or consolidation or, if the Company or the entity surviving such merger is then a Subsidiary, the ultimate parent thereof, or (II) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Exchange Act Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities Beneficially Owned by such Exchange Act Person any securities acquired directly from the Company or its Affiliates) representing more than 50% of the combined voting power of the Company’s then outstanding securities; or
(4) the shareholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is consummated a sale or disposition by the Company of all or substantially all of the Company’s assets, other than (A) a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, more than 50% of the combined voting power of the voting securities of which are owned by shareholders of the Company following the completion of such transaction in substantially the same proportions as their ownership of the voting securities of the Company immediately prior to such sale, or (B) a sale or disposition of all or substantially all of the Company’s assets immediately following which the individuals who comprise the Board immediately prior thereto constitute at least a majority of the board of directors of the entity to which such assets are sold or disposed or, if such entity is a subsidiary, the ultimate parent thereof.
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Notwithstanding the foregoing, (i) a Change in Control shall not be deemed to have occurred by virtue of an initial public offering of securities of a Subsidiary or an Affiliate, or the consummation of any transaction or series of integrated transactions immediately following which the shareholders of the Company immediately prior to such transaction or series of transactions continue to have substantially the same proportionate ownership in an entity which owns all or substantially all of the voting securities or assets of the Company immediately following such transaction or series of transactions; and (ii) for each Award that constitutes deferred compensation under Section 409A of the Code, and to the extent required to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, a Change in Control shall be deemed to have occurred under the Plan with respect to such Award only if a change in the ownership or effective control of the Company or a change in ownership of a substantial portion of the assets of the Company shall also be deemed to have occurred under Section 409A of the Code. In addition, and for the avoidance of doubt, a Change in Control shall not be deemed to have occurred by virtue of the Closing.
(n) “Closing” has the meaning set forth in the Merger Agreement.
(o) “Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto.
(p) “Committee” means the Compensation Committee of the Board (or any other committee or subcommittee of the Board which the Board may appoint to administer the Plan). Subject to the discretion of the Board, the Committee shall be composed entirely of individuals who meet the qualifications of (i) a “non-employee director” within the meaning of Rule 16b-3 and (ii) any other qualifications required by the applicable exchange on which the Common Stock is traded. If at any time or to any extent the Board shall not administer the Plan, then the functions of the Administrator specified in the Plan shall be exercised by the Committee (except as such functions may be delegated pursuant to Section 3).
(q) “Common Stock” means the Class A common stock, par value $0.0001 per share, of the Company.
(r) “Company” means WeWork Inc., a Delaware corporation (or any successor company).
(s) “Disability” means, with respect to any Participant, that such Participant, as determined by the Administrator in its sole discretion, is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months.
(t) “Effective Date” has the meaning set forth in Section 19.
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(u) “Eligible Recipient” means an officer, employee, non-employee director, or individual consultant of the Company or any Affiliate of the Company who has been selected as an eligible participant by the
Administrator; provided, however, to the extent required to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, an Eligible Recipient of an Option or a Stock Appreciation Right means an employee, non-employee director, or consultant of the Company or any Affiliate of the Company with respect to whom the Company is an “eligible issuer of service recipient stock” within the meaning of Section 409A of the Code.
(v) “Employer” means the Company or an Affiliate or Subsidiary that employs or retains a Participant, as applicable.
(w) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.
(x) “Exchange Act Person” means any natural person, entity or “group” (within the meaning of Section 13(d) or 14(d) of the Exchange Act), except that “Exchange Act Person” will not include (i) the Company or any Subsidiary of the Company; (ii) any employee benefit plan of the Company or any Subsidiary of the Company or any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any Subsidiary of the Company; (iii) an underwriter temporarily holding securities pursuant to a registered public offering of such securities; (iv) an entity owned, directly or indirectly, by the shareholders of the Company in substantially the same proportions as their ownership of shares of the Company; (v) any natural person, entity or “group” (within the meaning of Section 13(d) or 14(d) of the Exchange Act) that, as of the Effective Date, is the owner, directly or indirectly, of securities of the Company representing more than 50% of the combined voting power of the Company’s then outstanding securities (including any Affiliate of any natural person, entity or group described in this clause (v)); or (vi) SoftBank Group Corp., a Japanese joint-stock company, or an affiliate thereof.
(y) “Exercise Price” means, with respect to any Option, the per share price at which a holder of such Option may purchase such shares of Common Stock issuable upon the exercise of such Option. In no event (other than in the case of an Acquisition Award or pursuant to the operation of Section 5) shall the Exercise Price of an Option be less than one hundred percent (100%) of the Fair Market Value of the related shares of Common Stock on the date of grant.
(z) “Fair Market Value” of Common Stock or another security as of a particular date shall mean the fair market value as determined by the Administrator in its sole discretion; provided, however, (i) if the Common Stock or other security is admitted to trading on a national securities exchange, the fair market value on any date shall be the closing sale price reported on such date on such exchange; or (ii) if the Common Stock or other security is then traded in an over-the-counter market, the fair market value on any date shall be the average of the closing bid and asked prices for such share in such over-the-counter market for the last preceding date on which there was a sale of such share in such market.
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(aa) “Free Standing Right” has the meaning set forth in Section 8(a).
(bb) “Incentive Stock Options” shall mean Options which qualify as “incentive stock options” under Section 422 of the Code and the regulations promulgated thereunder.
(cc) “Legacy Plans” means the Company’s 2013 Stock Incentive Plan and its 2015 Equity Incentive Plan, in each case as amended from time to time.
(dd) “Merger Agreement” means that certain Agreement and Plan of Merger, by and among BowX Acquisition Corp., BowX Merger Subsidiary Corp., and WeWork Inc., dated as of March 25, 2021.
(ee) “Nonqualified Stock Options” shall mean Options which are not Incentive Stock Options.
(ff) “Option” means an option to purchase shares of Common Stock granted pursuant to Section 7.
(gg) “Other Stock-Based Award” means an Award granted pursuant to Section 10.
(hh) “Participant” means any Eligible Recipient selected by the Administrator, pursuant to the Administrator’s authority provided for in Section 3, to receive grants of Awards, a Participant’s permitted transferees (if any, as authorized by the Administrator in writing prior to any such Transfer) and, upon a Participant’s death, his or her successors, heirs, executors and administrators, as the case may be.
(ii) “Person” has the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof.
(jj) “Plan” has the meaning set forth in Section 1.
(kk) “Related Right” has the meaning set forth in Section 8(a).
(ll) “Restricted Stock” means Shares granted pursuant to Section 9 subject to certain restrictions that lapse at the end of a specified period or periods.
(mm) “Restricted Stock Unit” means the right, granted pursuant to Section 9, to receive a share of Common Stock or, in the case of an Award denominated in cash, to receive the amount of cash per unit equal to the Fair Market Value of a share of Common Stock as determined by the Administrator in connection with the Award.
(nn) “Rule 16b-3” has the meaning set forth in Section 3(a).
(oo) “Share” or “Shares” means Common Stock reserved for issuance under the Plan, as adjusted pursuant to the Plan, and any successor (pursuant to a merger, consolidation or other reorganization) security.
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(pp) “Stock Appreciation Right” means the right to receive, upon exercise of the right, the applicable amounts as described in Section 8.
(qq) “Stock Bonus” means a bonus payable in fully vested shares of Common Stock granted pursuant to Section 11.
(rr) “Subsidiary” means, with respect to any Person, as of any date of determination, any other Person as to which such first Person owns or otherwise controls, directly or indirectly, 50% or more of the voting shares or other similar interests or a sole general partner interest or managing member or similar interest of such other Person.
(ss) “Transfer” has the meaning set forth in Section 17.
Section 3. Administration(a) .
(a) The Plan shall be administered by the Administrator and, to the extent applicable to permit awards to be exempt from the “short-swing” rules of Section 16(b) of the Exchange Act pursuant to the operation of Rule 16b3 under the Exchange Act (“Rule 16b-3”), the Administrator shall be the Committee or the Board.
(b) Pursuant to the terms of the Plan, the Administrator, subject, in the case of any Committee, to any restrictions on the authority delegated to it by the Board, shall have the power and authority, without limitation:
(1) to select those Eligible Recipients who shall be Participants;
(2) to determine whether and to what extent Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Stock Bonuses, Other Stock-Based Awards, Cash Awards or a combination of any of the foregoing, are to be granted hereunder to Participants;
(3) to determine the number of Shares or the amount of cash to be covered by each Award granted hereunder;
(4) to determine the terms and conditions, not inconsistent with the terms of the Plan, of each Award granted hereunder (including, but not limited to, (i) the restrictions applicable to Restricted Stock and Restricted Stock Units and the conditions under which such restrictions shall lapse; (ii) any performance goals and periods applicable to Awards; (iii) the Exercise Price of each Option and Base Price of each Stock Appreciation Right; (iv) the vesting schedule applicable to each Award; (v) the time or times when Awards may be exercised; and (vi) subject to the requirements of Section 409A of the Code (to the extent applicable), any amendments to the terms and conditions of outstanding Awards, including, but not limited to, extending the exercise period of such Awards and accelerating the vesting schedule of such Awards);
(5) to determine the terms and conditions, not inconsistent with the terms of the Plan, which shall govern all written instruments evidencing Awards;
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(6) to determine the Fair Market Value in accordance with the terms of the Plan;
(7) to determine the duration and purpose of leaves of absence which may be granted to a Participant without constituting termination of the Participant’s employment for purposes of Awards granted under the Plan to the greatest extent permitted by law;
(8) to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall from time to time deem advisable;
(9) to determine whether a Person is an Affiliate;
(10) to determine the treatment of Awards in the event that an entity ceases to be an Affiliate of the Company;
(11) to establish sub-plans under the Plan, containing such limitations and other terms and conditions as the Administrator determines are necessary or desirable, for the purpose of satisfying blue sky, securities, tax or other laws of various jurisdictions in which the Company intends to grant Awards or qualifying for favorable tax treatment under applicable foreign laws;
(12) to determine whether conditions and events described in the Plan or in Award Agreements are satisfied, including whether a Change in Control has occurred and, prior to the occurrence of a Change in Control, whether a Participant’s employment or service has terminated for Cause; and
(13) to construe and interpret the terms and provisions of the Plan and any Award issued under the Plan (and any Award Agreement relating thereto), and to otherwise supervise the administration of the Plan and to exercise all powers and authorities either specifically granted under the Plan or necessary and advisable in the administration of the Plan.
(c) All decisions made by the Administrator pursuant to the provisions of the Plan shall be final, conclusive and binding on all persons, including the Company and the Participants. No member of the Board or the Committee, nor any officer or employee of the Company or any Subsidiary thereof acting on behalf of the Board or the Committee, shall be personally liable for any action, omission, determination, or interpretation taken or made in good faith with respect to the Plan, and all members of the Board or the Committee and each and any officer or employee of the Company and of any Subsidiary thereof acting on their behalf shall, to the maximum extent permitted by law, be fully indemnified and protected by the Company in respect of any such action, omission, determination or interpretation. Subject to applicable laws and regulations, the Board or the Committee may delegate administrative authority hereunder to an officer of the Company or to such other individual or group as the Board or Committee may determine in its discretion.
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(d) Notwithstanding any provision of the Plan, the Administrator, in its sole discretion, shall have the power and authority to: (i) determine which Subsidiaries and Affiliates with employees located outside the United States, if any, shall be covered by the Plan; (ii) determine which individuals, if any, outside the United States are eligible to participate in the Plan; (iii) set the terms and conditions of Awards granted to individuals located outside the United States (which need not be the same as the terms and conditions of Awards granted to individuals located inside the United States), and to modify the terms and conditions of any such Award if necessary or advisable to comply with local law; (iv) establish sub-plans and modify exercise procedures and other terms and procedures, to the extent the Administrator determines such actions to be necessary or advisable; provided, however, that no such sub-plans and/or modifications shall increase the share limitation contained in Section 4; and (v) take any action, before or after an Award is made, that the Administrator determines to be necessary or advisable to obtain approval or comply with any local governmental regulatory exemptions or approvals.
Section 4. Shares Reserved for Issuance; Other Limitations; Director Compensation Limit.
(a) The maximum number of shares of Common Stock reserved for issuance under the Plan as of the Effective Date shall be a number of shares of Common Stock equal to 5% of the Aggregate Fully Diluted Company Capital Stock as of the Closing (subject to adjustment as provided by Section 5, the “Share Reserve”). Commencing on January 1, 2022 and on each subsequent anniversary thereof (but not following the ten year anniversary of the Effective Date), the number of shares of Common Stock in the Share Reserve may be increased, if and to the extent approved by the Board, by a number of shares of Common Stock equal to either (i) 5% of the Aggregate Fully Diluted Company Capital Stock as of the Closing less the remaining Share Reserve immediately prior to such January 1, or (ii) such lesser amount determined by the Board; provided that, in either case, the total number of shares of Common Stock reserved for issuance under the Plan on January 1, 2022 and on each subsequent anniversary thereof (inclusive of any shares allocated to outstanding Awards as of such date) may not exceed 8% of the Aggregate Fully Diluted Company Capital Stock as of the Closing. The Board’s authority to approve any increase to the Share Reserve may not be delegated to the Committee or to any other person pursuant to Section 3 or any other provision of the Plan.
(b) Shares issued under the Plan may, in whole or in part, be authorized but unissued Shares or Shares that shall have been or may be reacquired by the Company in the open market, in private transactions or otherwise. If any shares of Common Stock subject to an Award, or subject to an award under a Legacy Plan, are forfeited, cancelled, exchanged or surrendered, or if an Award or an award under a Legacy Plan otherwise terminates or expires without a distribution of shares to the Participant, the shares shall, to the extent of any such forfeiture, cancellation, exchange, surrender, termination or expiration, be available for Awards under the Plan; provided, however, that such shares will not be available for Awards under the Plan to the extent that making such shares available would cause the total number of shares of Common Stock available for Awards under the Plan (inclusive of any outstanding Awards) to exceed 8% of the Aggregate Fully Diluted Company Capital Stock as of the Closing. Shares that are exchanged by a Participant or withheld by the Company as full or partial payment in connection with any Option or Stock Appreciation Right under the Plan, as well as any Shares exchanged by a Participant or withheld by the Company or any Subsidiary to satisfy the tax withholding obligations related to any Award under the Plan, shall also be available for subsequent Awards under the Plan. To the extent that a Stock Appreciation Right is settled by
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the delivery of a net number of Shares, the number of withheld, unissued Shares underlying such Stock Appreciation Right shall again be available for subsequent Awards under the Plan. Upon the exercise of any Award granted in tandem with any other Awards, such related Awards shall be cancelled to the extent of the number of Shares as to which the Award is exercised and such number of shares shall no longer be available for Awards under the Plan. In addition, (i) to the extent an Award is denominated in shares of Common Stock, but paid or settled in cash, the number of shares of Common Stock with respect to which such payment or settlement is made shall again be available for grants of Awards pursuant to the Plan; (ii) shares of Common Stock underlying Awards that can only be settled in cash and shares underlying Acquisition Awards shall not be counted against the aggregate number of shares of Common Stock available for Awards under the Plan.
(c) The maximum aggregate number of Shares which may be issued pursuant to the exercise of Incentive Stock Options will be equal to the initial Share Reserve determined under paragraph (a), above, as of the Effective Date (7,931,556 shares), subject to adjustment pursuant to Section 5. For the avoidance of doubt, any Shares that become subject to an Award under the Plan and subsequently become available again for grant pursuant to paragraph (b) above, shall not be available for issuance as Incentive Stock Options.
(d) Eligible Recipients who are non-employee members of the Board are eligible for Awards hereunder (other than Incentive Stock Options); provided, however, that the maximum amount of compensation awarded to a non-employee member of the Board (pursuant to this Plan or otherwise) in respect of service on the Board for a calendar year (including the amount of cash plus the Fair Market Value grant date fair value of equity awards (determined on the respective grant dates of such equity awards) made in such calendar year) shall not exceed $1 million (which limitation shall not be subject to proration for a non-employee director’s initial full or partial year of service on the Board).
Section 5. Equitable Adjustments.
(a) In the event of any Change in Capitalization, an equitable substitution or proportionate adjustment shall be made, in each case, as may be determined by the Administrator, in its sole discretion, in (i) the aggregate number of shares of Common Stock reserved for issuance under the Plan and the maximum number of shares of Common Stock or cash that may be subject to Awards granted to any Participant in any calendar year or which may be made subject to Incentive Stock Options; (ii) the kind and number of securities subject to, and the Exercise Price or Base Price of, any outstanding Options and Stock Appreciation Rights granted under the Plan; and (iii) the kind, number and purchase price of shares of Common Stock, or the amount of cash or amount or type of other property, subject to outstanding Restricted Stock, Restricted Stock Units, Stock Bonuses and Other Stock-Based Awards granted under the Plan; provided, however, that any fractional shares resulting from the adjustment shall be eliminated. Such other equitable substitutions or adjustments shall be made as may be determined by the Administrator, in its sole discretion. Notwithstanding the foregoing, nothing in this Section 5 shall be deemed to limit the provisions of Section 13 under the Plan.
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(b) The determinations made by the Administrator or the Board, as applicable, pursuant to this Section 5 shall be fmal, binding and conclusive. Notwithstanding the foregoing, any adjustment made pursuant to this Section 5 shall (i) to the extent necessary to avoid adverse tax consequences under Section 409A of the Code, be made in compliance with the requirements of Section 409A of the Code and (ii) in the case of Incentive Stock Options, unless otherwise determined by the Administrator, be made in compliance with the requirements of Sections 422 and 424(a) of the Code.
Section 6. Eligibility.
The Participants under the Plan shall be selected from time to time by the Administrator, in its sole discretion, from those individuals that qualify as Eligible Recipients.
Section 7. Options.
(a) General. Each Participant who is granted an Option shall enter into an Award Agreement with the Company, containing such terms and conditions as the Administrator shall determine, in its sole discretion, which Award Agreement shall set forth, among other things, the Exercise Price of the Option, the term of the Option, and provisions regarding exercisability of the Option. The provisions of each Option need not be the same with respect to each Participant. More than one Option may be granted to the same Participant and be outstanding concurrently hereunder. Options granted under the Plan shall be subject to the terms and conditions set forth in this Section 7 and shall contain such additional terms and conditions, not inconsistent with the terms of the Plan, as the Administrator shall deem desirable and set forth in the applicable Award Agreement. Options which are not designated as Incentive Stock Options in the Award Agreement or which otherwise do not qualify as Incentive Stock Options shall constitute Nonqualified Stock Options.
(b) Exercise Price. The Exercise Price of Shares purchasable under an Option shall be determined by the Administrator in its sole discretion at the time of grant, but in no event (other than in the case of an Acquisition Award or pursuant to the operation of Section 5) shall the Exercise Price of an Option be less than one hundred percent (100%) of the Fair Market Value of the related shares of Common Stock on the date of grant.
(c) Option Term. The maximum term of each Option shall be fixed by the Administrator, but no Option shall be exercisable on or after the ten (10) year anniversary of the date such Option is granted. Each Option’s term is subject to earlier expiration pursuant to the applicable provisions in the Plan and the Award Agreement.
(d) Exercisability. Each Option shall be exercisable at such time or times and subject to such terms and conditions, including the attainment of pre-established performance goals, as shall be determined by the Administrator in the applicable Award Agreement. The Administrator may also provide that any Option shall be exercisable only in installments, and the Administrator may waive such installment exercise provisions at any time, in whole or in part, based on such factors as the Administrator may determine in its sole discretion. Notwithstanding the foregoing, the Administrator shall have the authority to accelerate the exercisability of any outstanding Option at such time and under such circumstances as the Administrator, in its sole discretion, deems appropriate. Notwithstanding anything to the contrary contained herein, an Option may not be exercised for a fraction of a share.
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(e) Method of Exercise. Options may be exercised in whole or in part by giving written notice of exercise to the Company specifying the number of whole Shares to be purchased, accompanied by payment in full of the aggregate Exercise Price of the Shares so purchased in cash or its equivalent, as determined by the Administrator. Payment in whole or in part may also be made (i) by means of consideration received under any cashless exercise procedure approved by the Administrator (including a broker-assisted cashless procedure or the withholding of Shares otherwise issuable upon exercise), (ii) in the Administrator’s sole discretion, in the form of unrestricted Shares already owned by the Participant which have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the Shares as to which such Option shall be exercised, (iii) with respect to Nonqualified Stock Options, any other form of consideration approved by the Administrator and permitted by applicable law or (iv) any combination of the foregoing.
(f) Rights as Stockholder. A Participant shall have no rights to dividends or distributions or any other rights of a stockholder with respect to the Shares subject to an Option until the Participant has given written notice of the exercise thereof, has paid in full for such Shares and has satisfied the requirements of Section 16.
(g) Termination of Employment or Service. Unless the applicable Award Agreement provides otherwise, in the event that the employment or service of a Participant with the Company and all Affiliates thereof shall terminate, any Options then held by the Participant shall be treated as follows:
(1) If such termination is for any reason other than Disability or death (including a termination by reason of the employer or other service recipient of the Participant ceasing to be a Subsidiary or Affiliate of the Company, as applicable), (A) Options granted to such Participant, to the extent that they are exercisable at the time of such termination, shall remain exercisable until the date that is three (3) months after such termination, on which date they shall expire, and (B) Options granted to such Participant, to the extent that they were not exercisable at the time of such termination, shall expire at the close of business on the date of such termination. The three (3) month period described in this Section 7(g)(1) shall be extended to one (1) year after the date of such termination in the event of the Participant’s death or Disability during such three (3) month period. Notwithstanding the foregoing, no Option shall be exercisable after the expiration of its term.
(2) If such termination is on account of the Disability or death of the Participant, (A) Options granted to such Participant, to the extent that they were exercisable at the time of such termination, shall remain exercisable until the date that is one (1) year after such termination, on which date they shall expire and (B) Options granted to such Participant, to the extent that they were not exercisable at the time of such termination, shall expire at the close of business on the date of such termination. Notwithstanding the foregoing, no Option shall be exercisable after the expiration of its term.
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(h) Incentive Stock Option Provisions. Incentive Stock Options may be granted only to Eligible Recipients who are employees of the Company or a Subsidiary (for purposes of Section 422 of the Code). The aggregate Fair Market Value (determined as of the date of grant) of Shares with respect to which Incentive Stock Options are exercisable for the first time by a Participant during any calendar year (under this Plan or under any other incentive stock option plan of the Company or any Affiliate or Subsidiary of the Company) will not exceed One Hundred Thousand Dollars ($100,000). If the Fair Market Value of Shares on the date of grant with respect to which Incentive Stock Options are exercisable for the first time by a Participant during any calendar year exceeds One Hundred Thousand Dollars ($100,000), then the Options for the first One Hundred Thousand Dollars ($100,000) worth of Shares to become exercisable in such calendar year will be Incentive Stock Options and the Options for the amount in excess of One Hundred Thousand Dollars ($100,000) that become exercisable in that calendar year will be Nonqualified Stock Options. No Incentive Stock Option shall be granted to any Eligible Recipient if such Eligible Recipient owns, immediately prior to the grant of the Incentive Stock Option, stock representing more than 10% of the voting power or more than 10% of the value of all classes of stock of the Company or a parent or a Subsidiary, unless the purchase price for the stock under such Incentive Stock Option shall be at least 110% of its Fair Market Value at the time such Incentive Stock Option is granted and the Incentive Stock Option, by its terms, shall not be exercisable later than the day immediately preceding the fifth anniversary of the date it is granted. In determining such stock ownership, the provisions of Section 424(d) of the Code shall be controlling. Unless otherwise provided in the Award Agreement, if a Participant who was granted an Option designated as an Incentive Stock Option in the Award Agreement exercises such Option more than three months following the termination of the Participant’s employment for the Employer for any reason other than Disability or death (including a termination by reason of the Employer ceasing to be a Subsidiary or Affiliate of the Company, as applicable), then the Option will not qualify as an Incentive Stock Option and will be regarded as a Nonqualified Stock Option.
(i) Non-Exempt Employees. If an Option is granted to an employee of the Company or an Affiliate in the United States who is a non-exempt employee for purposes of the Fair Labor Standards Act of 1938, as amended, the Option will not be first exercisable until at least six (6) months following the date of grant of the Option (although the Option may vest prior to such date). Consistent with the provisions of the Worker Economic Opportunity Act, (i) if such non-exempt employee dies or suffers a Disability, (ii) upon a Change in Control, or (iii) upon such employee’s retirement (as such term may be defined in the applicable Award Agreement or such employee’s employment agreement, or, if no such definition exists, in accordance with the Company’s then current employment policies and guidelines), the vested portion of any Options held by such employee may be exercised earlier than six (6) months following the date of grant. The foregoing provision is intended to operate so that, with respect to a Participant who is a non-exempt employee of the Company or an Affiliate, any income derived in connection with the exercise or vesting of an Option will be exempt from such Participant’s regular rate of pay. To the extent permitted and/or required for compliance with the Worker Economic Opportunity Act to ensure that any income derived by a non-exempt Employee in connection with the exercise, vesting, issuance of any Shares or other property, or payment of any cash under any other Award will be exempt from the Participant’s regular rate of pay, the provisions of this Section 7(i) will apply to all types of Awards.
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Section 8. Stock Appreciation Rights.
(a) General. Stock Appreciation Rights (or “SARs”) may be granted either alone (“Free Standing Rights”) or in conjunction with all or part of any Option granted under the Plan (“Related Rights”). Related Rights may be granted either at or after the time of the grant of such Option. The Administrator shall determine the Eligible Recipients to whom, and the time or times at which, grants of Stock Appreciation Rights shall be made, the number of Shares to be awarded, the Base Price, and all other conditions of Stock Appreciation Rights. Notwithstanding the foregoing, no Related Right may be granted for more Shares than are subject to the Option to which it relates. The provisions of Stock Appreciation Rights need not be the same with respect to each Participant. Stock Appreciation Rights granted under the Plan shall be subject to the following terms and conditions set forth in this Section 8 and shall contain such additional terms and conditions, not inconsistent with the terms of the Plan, as the Administrator shall deem desirable, as set forth in the applicable Award Agreement.
(b) Base Price. Each Stock Appreciation Right shall be granted with a base price (other than in the case of an Acquisition Award or pursuant to the operation of Section 5) that is not less than one hundred percent (100%) of the Fair Market Value of the related shares of Common Stock on the date of grant (such amount, the “Base Price”).
(c) Awards; Rights as Stockholder. A Participant shall have no rights to dividends or any other rights of a stockholder with respect to the shares of Common Stock, if any, subject to a Stock Appreciation Right until the Participant has given written notice of the exercise thereof, has satisfied the requirements of Section 16 and has been transferred such shares of Common Stock.
(d) Exercisability.
(1) Stock Appreciation Rights that are Free Standing Rights shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Administrator in the applicable Award Agreement. The Administrator shall have the authority to accelerate the exercisability of any outstanding Free Standing Right at such time and under such circumstances as the Administrator, in its sole discretion, deems appropriate.
(2) Stock Appreciation Rights that are Related Rights shall be exercisable only at such time or times and to the extent that the Options to which they relate shall be exercisable in accordance with the provisions of Section 7 and this Section 8.
(e) Consideration Upon Exercise.
(1) Upon the exercise of a Free Standing Right, the Participant shall be entitled to receive up to, but not more than, that number of Shares equal in value to (i) the excess of the Fair Market Value as of the date of exercise over the Base Price per share specified in the Free Standing Right, multiplied by (ii) the number of Shares in respect of which the Free Standing Right is being exercised (rounded down to the nearest whole Share).
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(2) A Related Right may be exercised by a Participant by surrendering the applicable portion of the related Option. Upon such exercise and surrender, the Participant shall be entitled to receive up to, but not more than, that number of Shares equal in value to (i) the excess of the Fair Market Value as of the date of exercise over the Exercise Price specified in the related Option, multiplied by (ii) the number of Shares in respect of which the Related Right is being exercised (rounded down to the nearest whole Share). Options which have been so surrendered, in whole or in part, shall no longer be exercisable to the extent the Related Rights have been so exercised.
(3) Notwithstanding the foregoing, the Administrator may determine to grant a Stock Appreciation Right which permits the Administrator to settle the exercise of such Stock Appreciation Right in cash (or in any combination of Shares and cash).
(f) Termination of Employment or Service.
(1) Unless the applicable Award Agreement provides otherwise, in the event that the employment or service of a Participant with the Company and all Affiliates thereof shall terminate, any Free Standing Rights then held by the Participant shall be treated as follows:
(i) If such termination is for any reason other than Disability or death (including a termination by reason of the employer or other service recipient of the Participant ceasing to be a Subsidiary or Affiliate of the Company, as applicable), (A) Free Standing Rights granted to such Participant, to the extent that they are exercisable at the time of such termination, shall remain exercisable until the date that is three (3) months after such termination, on which date they shall expire, and (B) Free Standing Rights granted to such Participant, to the extent that they were not exercisable at the time of such termination, shall expire at the close of business on the date of such termination. The three (3) month period described in this Section 8(f)(1)(i) shall be extended to one (1) year after the date of such termination in the event of the Participant’s death or Disability during such three (3) month period. Notwithstanding the foregoing, no Free Standing Rights shall be exercisable after the expiration of its maximum term.
(ii) If such termination is a result of the Disability or death of the Participant, (A) Free Standing Rights granted to such Participant, to the extent that they were exercisable at the time of such termination, shall remain exercisable until the date that is one (1) year after such termination, on which date they shall expire and (B) Free Standing Rights granted to such Participant, to the extent that they were not exercisable at the time of such termination, shall expire at the close of business on the date of such termination. Notwithstanding the foregoing, no Free Standing Right shall be exercisable after the expiration of its term.
(2) In the event of the termination of employment or service with the Company and all Affiliates thereof of a Participant who has been granted one or more Related Rights, such rights shall be exercisable at such time or times and subject to such terms and conditions as set forth in the related Options.
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(g) Term.
(1) The term of each Free Standing Right shall be fixed by the Administrator, but no Free Standing Right shall be exercisable more than ten (10) years after the date such right is granted.
(2) The term of each Related Right shall be the term of the Option to which it relates, but no Related Right shall be exercisable more than ten (10) years after the date such right is granted.
Section 9. Restricted Stock and Restricted Stock Units.
(a) General. Restricted Stock and Restricted Stock Units may be issued either alone or in addition to other awards granted under the Plan. The Administrator shall determine the Eligible Recipients to whom, and the time or times at which, Restricted Stock or Restricted Stock Units shall be made; the number of Shares to be awarded; the price, if any, to be paid by the Participant for the acquisition of Restricted Stock or Restricted Stock Units; the period of time prior to which Restricted Stock or Restricted Stock Units become vested and free of restrictions on Transfer (the “Restricted Period”); the performance objectives (if any); and all other conditions of the Restricted Stock and Restricted Stock Units. If the restrictions, performance objectives and/or conditions established by the Administrator are not attained or satisfied, a Participant shall forfeit his or her Restricted Stock or Restricted Stock Units, in accordance with the terms of the grant. The provisions of Restricted Stock or Restricted Stock Units need not be the same with respect to each Participant.
(b) Awards and Certificates.
(1) Except as otherwise provided in Section 9(c), (i) each Participant who is granted an award of Restricted Stock may, in the Company’s sole discretion, be issued a stock certificate in respect of such Restricted Stock; and (ii) any such certificate so issued shall be registered in the name of the Participant, and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to any such Award. Restricted Stock may also be evidenced in uncertificated form or by a book entry record. The Company may require that the stock certificates, if any, evidencing Restricted Stock be held in the custody of the Company until the restrictions thereon shall have lapsed and that, as a condition of any award of Restricted Stock, the Participant shall have delivered a stock transfer form, endorsed in blank, relating to the Shares covered by such award. Certificates for shares of unrestricted Common Stock may, in the Company’s sole discretion, be delivered to the Participant only after the Restricted Period has expired without forfeiture in respect of such Restricted Stock.
(2) With respect to Restricted Stock Units to be settled in Shares, at the expiration of the Restricted Period, stock certificates in respect of the shares of Common Stock underlying such Restricted Stock Units may, in the Company’s sole discretion, be delivered to the Participant, or his legal representative, in a number equal to the number of shares of Common Stock underlying the Restricted Stock Units.
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(3) Notwithstanding anything in the Plan to the contrary, any Restricted Stock Units to be settled in Shares (at the expiration of the Restricted Period) may, in the Company’s sole discretion, be issued in uncertificated form or by a book entry record.
(4) Further, notwithstanding anything in the Plan to the contrary, with respect to Restricted Stock Units, at the expiration of the Restricted Period, Shares (either in certificated or uncertificated form) or cash, as applicable, shall promptly be issued to the Participant, unless otherwise deferred in accordance with procedures established by the Company in accordance with Section 409A of the Code (or in accordance with an Award Agreement that complies with Section 409A of the Code), and absent such a deferral such issuance or payment shall in any event be made no later than March 15th of the calendar year following the year of vesting or within other such period as is required to avoid accelerated taxation and/or tax penalties under Section 409A of the Code.
(c) Restrictions and Conditions. The Restricted Stock and Restricted Stock Units granted pursuant to this Section 9 shall be subject to the following restrictions and conditions and any additional restrictions or conditions as determined by the Administrator at the time of grant or, subject to Section 409A of the Code where applicable, thereafter:
(1) The Administrator may, in its sole discretion, provide for the lapse of restrictions in installments and may accelerate or waive such restrictions in whole or in part based on such factors and such circumstances as the Administrator may determine, in its sole discretion, including, but not limited to, the attainment of certain performance related goals, the Participant’s termination of employment or service as an officer, director, or consultant to the Company or any Affiliate thereof, or the Participant’s death or Disability.
(2) Except as provided in the applicable Award Agreement, the Participant shall generally have the rights of a stockholder of the Company with respect to shares of Restricted Stock during the Restricted Period, including the right to vote such shares and, only to the extent specifically provided in the applicable Award Agreement, to receive any dividends declared with respect to such shares. The Participant shall not have the rights of a stockholder with respect to shares of Common Stock subject to Restricted Stock Units during the Restricted Period; provided, however, that, subject to Section 409A of the Code, an amount equal to dividends declared during the Restricted Period with respect to the number of shares of Common Stock covered by Restricted Stock Units may, only to the extent specifically set forth in an Award Agreement, be provided to the Participant in the form and manner set forth in such Award Agreement. Notwithstanding the foregoing, any dividend or dividend equivalent awarded with respect to Restricted Stock or Restricted Stock Units shall, unless otherwise set forth in an applicable Award Agreement, be subject to the same restrictions, conditions and risks of forfeiture as the underlying Restricted Stock or Restricted Stock Units.
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(d) Termination of Employment or Service. The rights of Participants granted Restricted Stock or Restricted Stock Units upon termination of employment or service with the Company and all Affiliates thereof for any reason during the Restricted Period shall be set forth in the Award Agreement; provided, however, that if the Award Agreement does not set forth the treatment of Restricted Stock or Restricted Stock Units upon termination of employment, then upon such termination for any reason, the unvested portion of the Award shall immediately be forfeited.
(e) Form of Settlement. The Administrator reserves the right in its sole discretion to provide (at the time of grant thereof) that any Restricted Stock Unit represents the right to receive the amount of cash per unit equal to the Fair Market Value of the Shares subject to the award at the time of delivery.
Section 10. Other Stock-Based Awards.
Other forms of Awards valued in whole or in part by reference to, or otherwise based on, Common Stock, including but not limited to dividend equivalents, may be granted either alone or in addition to other Awards (provided that dividend equivalents will not be granted in connection with Options or Stock Appreciation Rights) under the Plan. Any dividend or dividend equivalent awarded hereunder shall be subject to the same restrictions, conditions, and risks of forfeiture as the underlying Award. Subject to the provisions of the Plan, the Administrator shall have sole and complete authority to determine the individuals to whom and the time or times at which such Other Stock-Based Awards shall be granted, the number of shares of Common Stock to be granted pursuant to such Other Stock-Based Awards, or the manner in which such Other Stock-Based Awards shall be settled (e.g., in shares of Common Stock, cash or other property), or the conditions to the vesting and/or payment or settlement of such Other Stock-Based Awards (which may include, but not be limited to, achievement of performance criteria), and all other terms and conditions of such Other Stock-Based Awards.
Section 11. Stock Bonuses.
The Administrator may grant Stock Bonuses hereunder to such Eligible Recipients and in such amounts as the Administrator may determine (subject to the terms of the Plan). In the event that the Administrator grants a Stock Bonus, the Shares constituting such Stock Bonus shall, as determined by the Administrator, be evidenced in uncertificated form or by a book entry record or a certificate issued in the name of the Participant to whom such grant was made and delivered to such Participant as soon as practicable after the date on which such Stock Bonus is payable.
Section 12. Cash Awards.
Without limitation of the rights of the Company or any Affiliate to provide cash awards under other non-shareholder approved plans or arrangements, the Administrator may grant awards that are payable solely in cash, as deemed by the Administrator to be consistent with the purposes of the Plan, and such Cash Awards shall be subject to the terms, conditions, restrictions and limitations determined by the Administrator, in its sole discretion, from time to time (subject to the terms of the Plan). Cash Awards may be granted with value and payment contingent upon the achievement of performance criteria.
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Section 13. Change in Control Provisions.
(a) In connection with a Change in Control, Awards shall be subject to the agreement resulting in the Change in Control, which need not treat all outstanding Awards in an identical manner. Subject to the terms of the applicable Award Agreement, the Administrator may provide, in its sole discretion, with respect to the treatment of each outstanding Award (either separately for each Award (or portion of Award) or uniformly for all Awards) for one or more of the following as of the effective date of such Change in Control:
(1) the continuation of such outstanding Awards by the Company (if the Company is the successor entity);
(2) the assumption of outstanding Awards by the successor or acquiring entity (if any) in such Change in Control (or by any of its parents, if any), subject to equitable adjustment, as determined by the Administrator;
(3) the substitution by the successor or acquiring entity in such Change in Control (or by any of its parents, if any) of equivalent awards with substantially the same terms for such outstanding Awards (except that the Exercise Price or Base Price and the number and nature of shares issuable upon exercise of any Option or SAR, or any award that is subject to Section 409A of the Code, will be adjusted appropriately pursuant to Section 424(a) and Section 409A of the Code);
(4) the full or partial exercisability or vesting and accelerated expiration of outstanding Awards; or
(5) the settlement of the full value of such outstanding Award (whether or not then vested or exercisable) in cash, cash equivalents, or securities of the successor entity (or its parent, if any) based upon the Fair Market Value as applicable in the Change in Control (as determined by the Administrator), followed by the cancellation of such Awards; provided however, that such Award may be cancelled without consideration if such Award has no value, or is not vested or immediately exercisable, as determined by the Administrator, in its discretion.
(b) Notwithstanding the forgoing, the Administrator shall have the discretion to accelerate the vesting and exercisability of any outstanding Award in the event of a Change in Control to be fully vested, and to deem any performance conditions imposed with respect to such Award to be fully achieved at, above, or below the target level of performance, immediately prior to such Change in Control or any time after the effective date of such Change in Control, including upon the termination of a Participant’s employment or service with the Company, its successor, or an Affiliate thereof without Cause on or after the effective date of the Change in Control. In the event an Award is not assumed or substituted by a successor entity in connection with a Change in Control, then, in the discretion of the Administrator, such Award may be fully vested immediately prior to such Change in Control, and any performance conditions imposed with respect to such Award may be deemed to be fully achieved at, above, or below the target level of performance.
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Section 14. Amendment and Termination.
The Administrator may amend, alter or terminate the Plan, but no amendment, alteration, or termination shall be made that would materially impair the rights of a Participant under any Award theretofore granted without such Participant’s consent. The Administrator shall obtain approval of the Company’s shareholders for any amendment to the Plan that would require such approval pursuant to any rules of the stock exchange on which the Common Stock is traded or other applicable law, as determined by the Administrator. Subject to Section 29, the Administrator may amend the terms of any Award theretofore granted, prospectively or retroactively, but, subject to Sections 5 and 13 and the immediately preceding sentence, no such amendment shall materially impair the rights of any Participant without his or her consent.
Section 15. Unfunded Status of Plan.
The Plan is intended to constitute an “unfunded” plan for incentive compensation. With respect to any payments not yet made to a Participant by the Company, nothing contained herein shall give any such Participant any rights that are greater than those of a general creditor of the Company.
Section 16. Withholding Taxes.
Each Participant shall, no later than the date as of which the value of an Award first becomes includible in the gross income of such Participant for purposes of applicable taxes, pay to the Company, or make arrangements satisfactory to the Administrator regarding payment of, the amount of any such applicable taxes required by law to be withheld with respect to the Award. The obligations of the Company under the Plan shall be conditional on the making of such payments or arrangements, and the Company shall have the right to deduct any such taxes, up to the maximum amount to the extent permitted by law, from any payment of any kind otherwise due to such Participant. Whenever cash is to be paid pursuant to an Award, the Company shall have the right to deduct therefrom an amount sufficient to satisfy any applicable withholding tax requirements related thereto. Whenever Shares or property other than cash are to be delivered pursuant to an Award, the Company shall have the right to require the Participant to remit to the Company in cash an amount sufficient to satisfy any related taxes to be withheld and applied to the tax obligations; provided, that, with the approval of the Administrator, a Participant may satisfy the foregoing requirement by (i) electing to have the Company withhold from delivery of Shares or other property, as applicable; (ii) by delivering already owned unrestricted shares of Common Stock, in each case, having a value not exceeding the applicable taxes to be withheld and applied to the tax obligations; or (iii) pursuant to a broker-assisted cashless exercise procedure. Such already owned and unrestricted shares of Common Stock shall be valued at their Fair Market Value on the date on which the amount of tax to be withheld is determined and any fractional share amounts resulting therefrom shall be settled in cash. Such an election may be made with respect to all or any portion of the Shares to be delivered pursuant to an award. The Company may also use any other method of obtaining the necessary payment or proceeds, as permitted by law, to satisfy its withholding obligation with respect to any Award and may, subject to any required Participant consent, withhold with respect to amounts up to the maximum statutory withholding rate.
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Section 17. Transfer of Awards.
Until such time as the Awards are fully vested and/or exercisable in accordance with the Plan and the applicable Award Agreement, no purported sale, assignment, mortgage, hypothecation, transfer, charge, pledge, encumbrance, gift, transfer in trust (voting or other) or other disposition of, or creation of a security interest in or lien on, any Award or any agreement or commitment to do any of the foregoing (each, a “Transfer”) by any holder thereof in violation of the provisions of the Plan or an Award Agreement will be valid, except with the prior written consent of the Administrator, which consent may be granted or withheld in the sole discretion of the Administrator. Any purported Transfer of an Award or any economic benefit or interest therein in violation of the Plan or an Award Agreement shall be null and void ab initio, and shall not create any obligation or liability of the Company, and any Person purportedly acquiring any Award or any economic benefit or interest therein transferred in violation of the Plan or an Award Agreement shall not be entitled to be recognized as a holder of any shares of Common Stock or other property underlying such Award. Unless otherwise determined by the Administrator in accordance with the provisions of the immediately preceding sentence, an Option may be exercised, during the lifetime of the Participant, only by the Participant or, during any period during which the Participant is under a legal disability, by the Participant’s guardian or legal representative.
Section 18. Continued Employment or Service; Change in Employment Status.
(a) Neither the adoption of the Plan nor the grant of any Award hereunder shall confer upon any Eligible Recipient any right to continued employment or service with the Company or any Affiliate thereof, as the case may be, nor shall it interfere in any way with the right of the Company or any Affiliate thereof to terminate the employment or service of any of its Eligible Recipients at any time and for any reason. The existence of the Plan and the grant of any Award hereunder shall not be construed to create an employment relationship between the Company or an Affiliate with respect to any Participant retained as a consultant or serving the Company as a non- employee director.
(b) An Award may be affected, both with regard to vesting schedule and termination, by leaves of absence, changes from full-time to part-time employment, partial disability or other changes in the employment status of a Participant, in the discretion of the Administrator. Unless otherwise provided by the Administrator or required by law: (1) a leave of absence approved by the Company or one of its Affiliates, as applicable, will not constitute a termination of employment or service under the Plan; and (2) with respect to Incentive Stock Options only, if a Participant’s leave of absence exceeds three months, the Participant will be deemed to have terminated employment on the first day following the end of the first three months of such leave, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If the Participant has not returned to work as of the end of an approved leave of absence, employment or service shall terminate for purposes of the Plan as of the date the approved leave of absence ends, to the extent permitted by law. The Administrator shall have the discretion to determine at any time whether and to what extent the vesting of an Award (or lapsing of Company repurchase rights) shall be tolled during any leave of absence.
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Section 19. Effective Date.
The Plan was adopted by the Board on September 19, 2021, was approved by the Company’s shareholders on October 19, 2021, and shall become effective without further action as of the later of (a) the date on which the Company’s shareholders approved the Plan, or (b) the Closing (the date of such effectiveness, the “Effective Date”).
Section 20. Term of Plan.
No Award shall be granted pursuant to the Plan on or after the tenth anniversary of the earlier of the date on which it was adopted by the Board or the date it was approved by the Company’s shareholders; provided that Awards theretofore granted may extend beyond that date.
Section 21. Securities Matters and Regulations.
(a) Notwithstanding anything herein to the contrary, the obligation of the Company to sell or deliver Common Stock with respect to any Award granted under the Plan shall be subject to all applicable laws, rules and regulations, including all applicable federal, state and foreign securities laws, and the obtaining of all such approvals by governmental agencies as may be deemed necessary or appropriate by the Administrator. The Administrator may require, as a condition of the issuance and delivery of certificates evidencing shares of Common Stock pursuant to the terms hereof, that the recipient of such shares make such agreements and representations, and that such certificates bear such legends, as the Administrator, in its sole discretion, deems necessary or advisable.
(b) Each Award is subject to the requirement that, if at any time the Administrator determines that the listing, registration or qualification of Common Stock issuable pursuant to the Plan is required by any securities exchange or under any federal, state or foreign law, or the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with, the grant of an Award or the issuance of Common Stock, no such Award shall be granted or payment made or Common Stock issued, in whole or in part, unless listing, registration, qualification, consent or approval has been effected or obtained free of any conditions not acceptable to the Administrator.
(c) In the event that the disposition of Common Stock acquired pursuant to the Plan is not covered by a then current registration statement under the Securities Act of 1933 (as amended, the “Securities Act”) and is not otherwise exempt from such registration, such Common Stock shall be restricted against transfer to the extent required by the Securities Act or regulations thereunder, and the Administrator may require a Participant receiving Common Stock pursuant to the Plan, as a condition precedent to receipt of such Common Stock, to represent to the Company in writing that the Common Stock acquired by such Participant is acquired for investment only and not with a view to distribution.
Section 22. Notification of Election Under Section 83(b) of the Code.
If any Participant shall, in connection with the acquisition of shares of Common Stock under the Plan, make the election permitted under Section 83(b) of the Code, such Participant shall notify the Company of such election within ten (10) days after filing notice of the election with the Internal Revenue Service.
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Section 23. No Fractional Shares.
No fractional shares of Common Stock shall be issued or delivered pursuant to the Plan. The Administrator shall determine whether cash, other Awards, or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.
Section 24. Beneficiary.
A Participant may file with the Administrator a written designation of a beneficiary on such form as may be prescribed by the Administrator and may, from time to time, amend or revoke such designation. In the event of a Participant’s death, if no designated beneficiary survives the Participant, the executor or administrator of the Participant’s estate shall be deemed to be the Participant’s beneficiary.
Section 25. Documentation; Paperless Administration.
Each Award will be evidenced in an Award Agreement, which may be written or electronic, as the Administrator determines. The Award Agreement will contain the terms and conditions applicable to an Award. Each Award may contain terms and conditions in addition to those set forth in the Plan. In the event that the Company establishes, for itself or using the services of a third party, an automated system for the documentation, granting or exercise of Awards, such as a system using an internet website or interactive voice response, then the paperless documentation, granting or exercise of Awards by a Participant shall be permitted through the use of such an automated system.
Section 26. Severability.
If any provision of the Plan is held to be invalid or unenforceable in any jurisdiction or with respect to any Participant, such provision shall be construed or deemed amended to conform with applicable law, or if the provision cannot be so construed or deemed amended without, in the sole discretion of the Board, materially altering the intent of the Plan or the Award, such provision shall be severed as to the jurisdiction or the Participant and the other provisions of the Plan shall not be affected but shall be applied as if the invalid or unenforceable provision had not been included in the Plan.
Section 27. Clawback.
Notwithstanding any other provisions in this Plan, any Award will be subject to both (a) any compensation recovery or clawback policy required pursuant to Section 304 of Sarbanes-Oxley Act of 2002, as amended, and any other legally required recovery or clawback; and (b) any other compensation recovery or clawback policy that the Company or any Affiliate may adopt in the future.
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Section 28. Section 409A of the Code.
The Plan as well as payments and benefits under the Plan are intended to be exempt from, or to the extent subject thereto, to comply with Section 409A of the Code, and, accordingly, to the maximum extent permitted, the Plan shall be interpreted in accordance therewith. Notwithstanding anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, the Participant shall not be considered to have terminated employment or service with the Company for purposes of the Plan and no payment shall be due to the Participant under the Plan or any Award until the Participant would be considered to have incurred a “separation from service” from the Company and its Affiliates within the meaning of Section 409A of the Code. Any payments described in the Plan that are due within the “short term deferral period” as defined in Section 409A of the Code shall not be treated as deferred compensation unless applicable law requires otherwise. Notwithstanding anything to the contrary in the Plan, to the extent that any Awards (or any other amounts payable under any plan, program or arrangement of the Company or any of its Affiliates) are payable upon a separation from service and such payment would result in the imposition of any individual tax and penalty interest charges imposed under Section 409A of the Code, the settlement and payment of such awards (or other amounts) shall instead be made (without interest) on the first business day after the date that is six (6) months following such separation from service (or death, if earlier). Each amount to be paid or benefit to be provided under this Plan shall be construed as a separate identified payment for purposes of Section 409A of the Code. The Company makes no representation that any or all of the payments or benefits described in this Plan will be exempt from or comply with Section 409A of the Code and makes no undertaking to preclude Section 409A of the Code from applying to any such payment. The Participant shall be solely responsible for the payment of any taxes and penalties incurred under Section 409A of the Code.
Section 29. No Re-Pricing.
Without limitation of the authority set forth in Section 5, no Option or SAR shall have its Exercise Price or Base Price lowered nor shall any Option or SAR be settled, cancelled, forfeited, exchanged or surrendered in exchange or otherwise in consideration for a new Option or SAR with an Exercise Price or Base Price that is less than that of such settled, cancelled, forfeited, exchanged or surrendered Option or SAR, unless the shareholders of the Company shall have approved of such transaction. For the avoidance of doubt (and without limitation of the authority set forth in Section 5), Options or Stock Appreciation Rights with an exercise or strike price that is equal to or greater than the current Fair Market Value of the underlying shares of Common Stock shall not be cancelled in exchange for a cash payment.
Section 30. Governing Law.
The Plan shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to principles of conflicts of law of such state.
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Section 31. Construction.
Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation of any provision of the Plan. Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular. Any reference to a regulation shall include any successor regulation. Except where otherwise indicated, references to Sections are references to sections of this Plan.
Section 32. Addenda.
The Administrator may approve such addenda to the Plan or any Award Agreement as it may consider necessary or appropriate for the purpose of granting Awards to Participants, which Awards may contain such terms and conditions as the Administrator deems necessary or appropriate to accommodate differences in local law, tax policy, or custom, which, if so required under applicable law, may deviate from the terms and conditions set forth in this Plan. The terms of any such addenda shall supersede the terms of the Plan to the extent necessary to accommodate such differences but shall not otherwise affect the terms of the Plan as in effect for any other purpose.
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Exhibit 10.5
WEWORK INC.
|2021 EMPLOYEE STOCK PURCHASE PLAN
The purpose of the Plan is to provide eligible employees of the Company and each Designated Company with opportunities to purchase shares of the Company’s Common Stock. A number of shares of Common Stock equal to 1% of the Aggregate Fully Diluted Company Capital Stock as of the Closing ( shares), have been approved and reserved for this purpose. Commencing on January 1, 2023 and on each subsequent anniversary thereof (but not following the ten year anniversary of the Effective Date), the number of shares of Common Stock reserved and available for issuance under the Plan may, subject to the approval of the Board (which approval may not be delegated), be cumulatively increased by a number of shares of Common Stock equal to 1% of the Aggregate Fully Diluted Company Capital Stock as of the Closing (but less any shares authorized but not issued under the Plan as of the date of such increase). Notwithstanding the foregoing, in no event shall the maximum aggregate number of shares available for issuance under the Plan exceed 72,000,000 shares.
The Plan includes two components: a Code Section 423 Component (the “423 Component”) and a non-Code Section 423 Component (the “Non-423 Component”). It is intended for the 423 Component to constitute an “employee stock purchase plan” within the meaning of Section 423(b) of the Code, and the 423 Component shall be interpreted in accordance with that intent. Under the Non-423 Component, which does not qualify as an “employee stock purchase plan” within the meaning of Section 423(b) of the Code, Options shall be granted pursuant to rules, procedures or sub-plans adopted by the Administrator designed to achieve tax, securities laws or other objectives for Eligible Employees. Except as otherwise provided herein, the Non-423 Component shall operate and be administered in the same manner as the 423 Component.
Unless otherwise defined herein, capitalized terms in this Plan shall have the meaning ascribed to them in Section 31.
1. Administration. The Plan shall be administered by the Administrator. The Administrator has full authority at any time to: (i) adopt, alter and repeal such rules, guidelines and practices for the administration of the Plan and for its own acts and proceedings as it shall deem advisable and appoint such agents as it deems appropriate for the proper administration of the Plan; (ii) interpret and construe, reconcile any inconsistency in, correct any default in and supply any omission in, and apply the terms of the Plan and any Enrollment Form or other instrument or agreement relating to the Plan; (iii) determine the terms and conditions of any right to purchase shares of Common Stock under the Plan; (iv) make all determinations and take all actions it deems advisable for the administration of the Plan, including to accommodate the specific requirements of local laws, regulations and procedures for jurisdictions outside the United States, such as adopting rules and procedures regarding payment of interest (if any), conversion of local currency, payroll tax, withholding procedures and handling of stock certificates that vary with local requirements outside of the United States, and adopting sub-plans applicable to particular Designated Companies or locations, which sub-plans may be necessary or appropriate to permit the participation in the Plan by employees who are foreign nationals or employed outside the United States, as further set forth in Section 12 below; (v) determine
eligibility and decide all disputes arising in connection with the Plan, including whether Eligible Employees will participate in the 423 Component or the Non-423 Component and which Subsidiaries and Affiliates will be Designated Companies under the 423 Component or the Non-423 Component; (vi) amend an outstanding right to purchase shares of Common Stock, including any amendments to a right that may be necessary for purposes of effecting a transaction contemplated under Section 16 or Section 17 (including, but not limited to, an amendment to the class or type of stock that may be issued pursuant to the exercise of a right or the Option Price applicable to a right), provided that the amended right otherwise conforms to the terms of the Plan; and (vii) otherwise supervise and take any other actions necessary or desirable for the administration of the Plan. All interpretations and decisions of the Administrator shall be binding on all persons, including the Company and the Participants. Subject to applicable laws and regulations, the Board or the Committee may delegate administrative authority hereunder to an officer of the Company or to such other individual or group as the Board or Committee may determine in its discretion. No member of the Board or individual exercising administrative authority with respect to the Plan shall be liable for any action or determination made in good faith with respect to the Plan or any Option granted hereunder.
2. Offerings. The Company will make one or more Offerings to Eligible Employees to purchase Common Stock under the Plan. The Administrator shall, in its discretion, designate the period of any Offering, provided that no Offering shall exceed 27 months in duration. Unless the Administrator otherwise determines, each Offering shall be for a Purchase Period of six months, beginning on the Offering Date and ending on the Exercise Date.
Subject to applicable law, the Administrator, or its delegate, retains the discretion to impose trading restrictions or holding requirements on Common Stock purchased with respect to a particular Offering. If the Administrator elects to impose such restrictions or requirements, the restrictions or requirements will be described in the enrollment materials for the applicable Offering.
3. Eligibility. All individuals classified as employees on the payroll records of the Company and each Designated Company are eligible to participate in any one or more of the Offerings under the Plan, provided that, unless otherwise determined by the Administrator or required by applicable law or regulations, as of the Offering Date of the applicable Offering such employee is customarily employed by the Company or a Designated Company for more than 20 hours a week and for more than five months in any calendar year (“Eligible Employees”). Notwithstanding any other provision herein, individuals who are not classified as employees of the Company or a Designated Company for purposes of the Company’s or applicable Designated Company’s payroll system on the Offering Date are not considered to be “Eligible Employees” of the Company or any Designated Company and shall not be eligible to participate in the Plan with respect to such Offering. In the event any such individuals are reclassified as employees of the Company or a Designated Company for any purpose, including, without limitation, common law or statutory employees, by any action of any third party, including, without limitation, any government agency, or as a result of any private lawsuit, action or administrative proceeding, such individuals shall, notwithstanding such reclassification, remain ineligible for participation. Notwithstanding the foregoing, the exclusive means for individuals who are not classified as of an Offering Date as employees of the Company or a Designated Company on the Company’s or Designated Company’s payroll system to become eligible to participate in an Offering under this Plan is through an amendment to this Plan, duly executed by the Company, which specifically renders such individuals eligible to participate herein.
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For purposes of the Plan, in accordance with Treas. Reg. § 1.421-1(h)(2), the employment relationship shall be treated as continuing intact while the individual is on military leave, sick leave or other leave of absence approved by the Company or a Designated Company that does not exceed three months and during any period longer than three months if the individual’s right to reemployment is guaranteed by statute or contract.
The Company retains the discretion to determine which Eligible Employees may participate in the Non- 423 Component and the 423 Component pursuant to and consistent with Treasury Regulation §§ 1.423-2(e) and (f).
An Eligible Employee who works for a Designated Company and is a citizen or resident of a jurisdiction other than the United States (without regard to whether such individual also is a citizen or resident of the United States or is a resident alien (within the meaning of Section 7701(b)(1)(A) of the Code)) may be excluded from participation in the Plan or an Offering if the participation of such Eligible Employee is prohibited under the laws of the applicable jurisdiction or if complying with the laws of the applicable jurisdiction would cause the 423 Component to violate Section 423 of the Code. In the case of the Non-423 Component or any Offering thereunder, an Eligible Employee (or group of Eligible Employees) may be excluded from participation in the Plan or an Offering if the Administrator has determined, in its sole discretion, that participation of such Eligible Employee(s) is not advisable or practicable for any reason.
4. Participation.
(a) Participants on Effective Date. An Eligible Employee may elect to participate in the Plan by properly completing and submitting an Enrollment Form (in the manner described in Section 4(b)) at least 15 business days before the Offering Date (or by such other deadline as shall be established by the Administrator for the Offering) and in accordance with enrollment procedures established by the Administrator. Participation in the Plan is entirely voluntary.
(b) Enrollment. The Enrollment Form shall (i) state a whole percentage to be deducted from an Eligible Employee’s Compensation per pay period during an Offering, (ii) authorize the purchase of Common Stock in each Offering in accordance with the terms of the Plan and (iii) specify the exact name or names in which shares of Common Stock purchased for such individual are to be issued pursuant to Section 10. An employee who does not enroll in an Offering in accordance with these procedures shall be deemed to have waived participation in such Offering.
(c) Automatic Re-enrollment. The deduction rate selected in the Enrollment Form shall remain in effect for subsequent Offerings unless the Participant (i) submits a new Enrollment Form authorizing a new level of payroll deductions in accordance with Section 6, (ii) withdraws from the Plan in accordance with Section 7, or (iii) terminates employment or otherwise becomes ineligible to participate in the Plan.
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(d) Electronic Submission of Enrollment Form. The Administrator may specify that Enrollment Forms to be submitted to the Company pursuant to this Section 4 or Section 7 below are to be submitted electronically via the Company’s intranet or the Internet site of a third party or via email or any other means of electronic delivery specified by the Administrator.
(e) Notwithstanding the foregoing, participation in the Plan shall neither be permitted nor denied contrary to the requirements of the Code.
5. Employee Contributions. Each Eligible Employee may, by submitting an Enrollment Form as described in Section 4(b), authorize payroll deductions, in whole percentages, at a minimum of 1% up to a maximum of 15% of such employee’s Compensation, to be deducted on a pro rata basis for each pay period during an Offering. Payroll deductions shall commence on the first payroll date following the Offering Date and end on the last payroll date on or before the last day of the Offering. Payroll deductions shall be made in accordance with the Eligible Employee’s election; however, due to rounding or other administrative reasons, the actual percentage contributed may be less than the elected percentage. The Company shall maintain notional book accounts showing the amount of payroll deductions made by each Participant for each Purchase Period, but the Company will not hold payroll deductions in a trust or in any segregated account, unless otherwise determined by the Administrator or required by applicable law. No interest shall accrue or be paid on payroll deductions, except as may be required by applicable law. If payroll deductions for purposes of the Plan are prohibited or otherwise problematic under applicable law (as determined by the Administrator in its discretion), the Administrator may require Participants to contribute to the Plan by such other means as determined by the Administrator. Any reference to “payroll deductions” in this Section 5 (or in any other section of the Plan) shall similarly cover contributions by other means made pursuant to this Section 5.
6. Deduction Changes. Except as may be determined by the Administrator in advance of an Offering, a Participant may not increase or decrease his or her payroll deduction during any Offering, but may increase or decrease his or her payroll deduction with respect to the next Offering (subject to the limitations of Section 5) by filing a new Enrollment Form at least 15 business days before the next Offering Date (or by such other deadline as shall be established by the Administrator for the Offering). The Administrator may, in advance of any Offering, establish rules permitting a Participant to increase, decrease or terminate his or her payroll deduction during an Offering.
7. Withdrawal. A Participant may withdraw from participation in the Plan by submitting to the Company a revised Enrollment Form indicating his or her election to withdraw (in accordance with such procedures as may be established by the Administrator). The Participant’s withdrawal shall be effective as of the next business day. Following a Participant’s withdrawal, the Company shall promptly refund such individual’s entire account balance under the Plan to him or her (after payment for any Common Stock purchased before the effective date of withdrawal). Partial withdrawals are not permitted. Such an employee may not begin participation again during the remainder of the Offering, but may enroll in a subsequent Offering in accordance with Section 4.
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8. Grant of Options. On each Offering Date, the Company shall grant to each Participant in the Plan an option (“Option”) to purchase, on the Exercise Date and at the Option Price hereinafter provided for, the lowest of (a) a number of shares of Common Stock determined by dividing such Participant’s accumulated payroll deductions on such Exercise Date by the Option Price (as defined herein); (b) 5,000 shares of Common Stock; or (c) such other lesser maximum number of shares as shall have been established by the Administrator in advance of the Offering (in each case subject to adjustment pursuant to Section 16 or Section 17); provided, however, that such Option shall be subject to the limitations set forth below. Each Participant’s Option shall be exercisable only to the extent of such Participant’s accumulated payroll deductions on the Exercise Date. The purchase price for each share purchased under each Option (the “Option Price”) shall be 85% of the Fair Market Value of the Common Stock on the Offering Date or the Exercise Date, whichever is less.
Notwithstanding the foregoing, no Participant may be granted an Option hereunder if such Participant, immediately after the Option was granted, would be treated as owning stock possessing 5% or more of the total combined voting power or value of all classes of stock of the Company or any Parent or Subsidiary. For purposes of the preceding sentence, the attribution rules of Section 424(d) of the Code shall apply in determining the stock ownership of a Participant, and all stock which the Participant has a contractual right to purchase shall be treated as stock owned by the Participant. In addition, no Participant may be granted an Option which permits the Participant’s rights to purchase stock under the Plan, and any other employee stock purchase plan (described in Section 423 of the Code) of the Company and its Parents and Subsidiaries, to accrue at a rate which exceeds $25,000 of the fair market value of such stock (determined on the option grant date or dates) for each calendar year in which the Option is outstanding at any time. The purpose of the limitation in the preceding sentence is to comply with Section 423(b)(8) of the Code and shall be applied taking Options into account in the order in which they were granted.
9. Exercise of Option and Purchase of Shares. Each employee who continues to be a Participant in the Plan on the Exercise Date shall be deemed to have exercised his or her Option on such date and shall acquire from the Company such number of whole shares of Common Stock reserved for the purpose of the Plan as the Participant’s accumulated payroll deductions on such date shall purchase at the Option Price, subject to any other limitations contained in the Plan. Unless otherwise determined by the Administrator in advance of an Offering, any amount remaining in a Participant’s account after the purchase of shares on an Exercise Date of an Offering solely by reason of the inability to purchase a fractional share shall be carried forward to the next Offering; any other balance remaining in a Participant’s account at the end of an Offering shall be refunded to the Participant promptly.
10. Issuance of Certificates. Certificates representing shares of Common Stock purchased under the Plan may be issued only in the name of the employee, in the name of the employee and another person of legal age as joint tenants with rights of survivorship, or in the name of a broker authorized by the employee to be his, her or their, nominee for such purpose. Participants will not have any voting, dividend, or other rights of a shareholder with respect to the shares of Common Stock until such shares have been delivered pursuant to this Section 10.
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All transactions under this Plan are subject to the Company’s insider trading policy as may be in effect from time to time. This includes any blackout period prohibition or requirement to obtain mandatory pre-clearance of transactions such as enrollment, withdrawal, or trading. If the standard enrollment period is scheduled to occur during a blackout period, arrangements will be made to allow for restricted insiders to update their elections during the preceding open trading window.
11. Rights on Termination or Transfer of Employment. If a Participant’s employment terminates for any reason, or if the Participant’s employment status changes such that the Participant is no longer an Eligible Employee, before the Exercise Date for any Purchase Period, no payroll deduction shall be taken from any pay due and owing to the Participant and the balance in the Participant’s notional account shall be paid, as if such Participant had withdrawn from the Plan under Section 7, to such Participant or, in the case of such Participant’s death, to (i) the legal representative of the Participant’s estate; or (ii) if no such legal representative has been appointed to the knowledge of the Company, to such other person(s) as the Company may, in its discretion, designate. An employee shall be deemed to have terminated employment, for this purpose, if the corporation that employs him or her, having been a Designated Company, ceases to be a Subsidiary or Affiliate, or if the employee is transferred to any corporation other than the Company or a Designated Company. Unless otherwise determined by the Administrator, a Participant whose employment transfers between, or whose employment terminates with an immediate rehire (with no break in service) by, Designated Companies or a Designated Company and the Company shall not be treated as having terminated employment for purposes of participating in the Plan or an Offering; provided, however, that if a Participant transfers from an Offering under the 423 Component to an Offering under the Non-423 Component, the exercise of the Participant’s Option shall be qualified under the 423 Component only to the extent that such exercise complies with Section 423 of the Code. If a Participant transfers from an Offering under the Non-423 Component to an Offering under the 423 Component, the exercise of the Participant’s Option shall remain non-qualified under the Non-423 Component.
12. Special Rules and Sub-Plans. Notwithstanding anything herein to the contrary, the Administrator may adopt special rules or sub-plans applicable to the employees of a particular Designated Company, whenever the Administrator determines that such rules are necessary or appropriate for the implementation of the Plan in a jurisdiction where such Designated Company has employees, regarding, without limitation, eligibility to participate in the Plan, handling and making of payroll deductions or contribution by other means, establishment of bank or trust accounts to hold payroll deductions, payment of interest, conversion of local currency, obligations to pay payroll tax, withholding procedures and handling of share issuances, any of which may vary according to applicable requirements; provided that if such special rules or sub-plans are inconsistent with the requirements of Section 423 of the Code, the employees subject to such special rules or sub-plans shall participate in the Non-423 Component, and Options granted thereunder will not be required by the terms of the Plan to comply with Section 423 of the Code.
13. Optionees Not Shareholders. Neither the granting of an Option to a Participant nor the deductions from a Participant’s pay shall result in such Participant becoming a holder of the shares of Common Stock covered by an Option under the Plan until such shares have been purchased by and issued to such Participant.
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14. Rights Not Transferable. Rights under the Plan are not transferable by a Participant other than by will or the laws of descent and distribution, and are exercisable during the Participant’s lifetime only by the Participant.
15. Application of Funds. All funds received or held by the Company under the Plan may be combined with other corporate funds and may be used for any corporate purpose, unless otherwise required under applicable law.
16. Adjustment in Case of Changes Affecting Common Stock. In the event of any stock split, reverse stock split, stock dividend, recapitalization, combination of shares, reclassification of shares, spin-off, or other similar change in capitalization or event, any distribution to holders of Common Stock other than an ordinary cash dividend, or any other change affecting the Common Stock, (i) the number and class of shares approved for the Plan, (ii) the Option Price, and (iii) the share limitation set forth in Section 8 shall be equitably or proportionately adjusted to the extent determined by the Administrator to give proper effect to such event, in accordance with applicable law.
17. Reorganization Events. In connection with a Reorganization Event, the Administrator shall take any one or more of the following actions as to outstanding Options on such terms as the Administrator determines:
(a) provide that Options shall be assumed, or substantially equivalent Options shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof);
(b) upon written notice to Participants, provide that all outstanding Options will be terminated as of the effective date of the Reorganization Event and that all such outstanding Options will become exercisable to the extent of accumulated payroll deductions as of a date specified by the Administrator in such notice, which date shall not be less than ten (10) days preceding the effective date of the Reorganization Event;
(c) upon written notice to Participants, provide that all outstanding Options will be cancelled as of a date prior to the effective date of the Reorganization Event and that all accumulated payroll deductions will be returned to the Participant on such date;
(d) in the event of a Reorganization Event under the terms of which holders of common stock will receive, upon consummation thereof, a cash payment for each share surrendered in the Reorganization Event, make or provide for a cash payment to a Participant equal to (1) the Acquisition Price times the number of shares of Common Stock subject to the Participant’s Option (to the extent the Option Price does not exceed the Acquisition Price) minus (2) the aggregate Option Price of such Option, in exchange for the termination of such Option;
(e) provide that, in connection with a liquidation or dissolution of the Company, Options shall convert into the right to receive liquidation proceeds (net of the Option Price thereof); or
(f) any combination of the foregoing.
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For purposes of clause (a) above, an Option shall be considered assumed if, following consummation of the Reorganization Event, the Option confers the right to purchase, for each share of Common Stock subject to the Option immediately prior to the consummation of the Reorganization Event, the consideration (whether cash, securities, or other property) received as a result of the Reorganization Event by holders of Common Stock for each share of Common Stock held immediately prior to the consummation of the Reorganization Event (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares of Common Stock); provided, however, that if the consideration received as a result of the Reorganization Event is not solely common stock of the acquiring or succeeding corporation (or an affiliate thereof), the Company may, with the consent of the acquiring or succeeding corporation, provide for the consideration to be received upon the exercise of Options to consist solely of common stock of the acquiring or succeeding corporation (or an affiliate thereof) equivalent in value (as determined by the Administrator) to the per share consideration received by holders of outstanding shares of Common Stock as a result of the Reorganization Event.
In addition, with respect to any outstanding Option under the 423 Component of the Plan, any action taken under this Section 17 shall be consistent with the intent that such Options comply with Section 423 of the Code, unless otherwise expressly determined by the Administrator. The Plan shall in no event be construed to restrict in any way the Company’s right to undertake a dissolution, liquidation, merger, consolidation or other Reorganization Event.
18. Amendment of the Plan. The Administrator may at any time and from time to time amend the Plan in any respect, except that, without the approval within 12 months of such Administrator action by the shareholders of the Company, no amendment shall be made increasing the number of shares approved for the Plan or making any other change that would require shareholder approval under the requirements of any stock exchange upon which the shares may then be listed or in order for the 423 Component of the Plan, as amended, to qualify as an “employee stock purchase plan” under Section 423(b) of the Code. In no event may any amendment be made which would cause the Plan to fail to comply with Section 423 of the Code.
19. Suspension of the Plan. The Administrator may, at any time, suspend the Plan; provided that the Company shall provide notice to the Participants prior to the effectiveness of such suspension. The Administrator may resume the operation of the Plan following any such suspension; provided that the Company shall provide notice to the Participants prior to the date of termination of the suspension period. A Participant shall remain a Participant in the Plan during any suspension period (unless the Participant withdraws pursuant to Section 7). However, no Options shall be granted or exercised, and no payroll deductions shall be made in respect of any Participant, during the suspension period.
20. Insufficient Shares. If the total number of shares of Common Stock that would otherwise be purchased on any Exercise Date plus the number of shares purchased under previous Offerings under the Plan exceeds the maximum number of shares issuable under the Plan, the shares then available shall be apportioned in a manner consistent with the requirements of Section 423(b)(4) and (5) of the Code and the regulations thereunder among Participants in proportion to the amount of payroll deductions accumulated on behalf of each Participant that would otherwise be used to purchase Common Stock on such Exercise Date.
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21. Effective Date and Shareholder Approval. The Plan shall become effective on and contingent upon the Closing (the “Effective Date”). For purposes of Treas. Reg. § 1.423-2(c)(2), the Plan shall be considered “adopted” at Closing. In accordance with Treas. Reg. § 1.423-2(a)(2)(ii), the Company shall seek shareholder approval of the Plan within 12 months before or after the date the Plan is adopted. If shareholder approval is not received within 12 months before or after the Plan is adopted, the Plan shall be terminated and any amounts contributed by employees to the Plan shall be returned to the employees without interest (unless otherwise required pursuant to applicable law).
22. Termination of the Plan. Except as otherwise provided in Section 21, the Plan may be terminated at any time by the Administrator. Upon termination of the Plan, all amounts in the accounts of Participants shall be promptly refunded. The Plan shall automatically terminate on the ten-year anniversary of the date the Plan is approved by the Company’s shareholders.
23. Governmental Regulations. The Company’s obligation to sell and deliver Common Stock under the Plan is subject to the completion of any registration or qualification of the Common Stock under any U.S. or non-U.S. local, state or federal securities or exchange control law, or under rulings or regulations of the SEC or of any other governmental regulatory body, and to obtaining any approval or other clearance from any U.S. and non-U.S. local, state or federal governmental agency, which registration, qualification or approval the Company may, in its absolute discretion, deem necessary or advisable. The Company is under no obligation to register or qualify the Common Stock with the SEC or any other U.S. or non-U.S. securities commission or to seek approval or clearance from any governmental authority for the issuance or sale of such stock. If, pursuant to this Section 23, the Administrator determines that the shares of Common Stock will not be issued to any Participant, all accumulated payroll deductions will be promptly refunded, without interest (unless otherwise required pursuant to applicable law), to the Participant, without any liability to the Company or any of its Affiliates.
24. Governing Law. This Plan and all Options and actions taken thereunder shall be governed by, and construed in accordance with, the laws of the State of Delaware, applied without regard to conflict of law principles.
25. Issuance of Shares. Shares may be issued upon exercise of an Option from authorized but unissued Common Stock, from shares held in the treasury of the Company, or from any other proper source.
26. Tax Withholding. Participation in the Plan is subject to any applicable U.S. and non-U.S. federal, state or local tax withholding requirements on income the Participant realizes in connection with the Plan. Each Participant agrees, by entering the Plan, that the Company or any Subsidiary or Affiliate may, but shall not be obligated to, withhold from a Participant’s wages, salary or other compensation at any time the amount necessary for the Company or any Subsidiary or Affiliate to meet applicable withholding obligations, including any withholding required to make available to the Company or any Subsidiary or Affiliate any tax deductions or
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benefits attributable to the sale or disposition of Common Stock by such Participant. In addition, the Company or any Subsidiary or Affiliate may, but shall not be obligated to, withhold from the proceeds of the sale of Common Stock or any other method of withholding that the Company or any Subsidiary or Affiliate deems appropriate to the extent permitted by U.S. Treasury Regulation Section 1.423-2(f) with respect to the 423 Component. The Company shall not be required to issue any Common Stock under the Plan until such obligations are satisfied.
27. Code Section 409A. The 423 Component of the Plan is exempt from the application of Section 409A of the Code and any ambiguities herein shall be interpreted to so be exempt from Section 409A of the Code. The Non-423 Component is intended to be exempt from the application of Section 409A of the Code as Options granted thereunder are intended to constitute “short term deferrals” and any ambiguities herein shall be interpreted such that those Options shall so be exempt from Section 409A of the Code. In furtherance of the foregoing and notwithstanding any provision in the Plan to the contrary, if the Administrator determines that an Option granted under the Plan may be subject to Section 409A of the Code or that any provision in the Plan would cause an Option under the Plan to be subject to Section 409A of the Code, the Administrator may amend the terms of the Plan and/or of an outstanding Option granted under the Plan, or take such other action the Administrator determines is necessary or appropriate, in each case, without the Participant’s consent, to exempt any outstanding Option or future Option that may be granted under the Plan from or to allow any such Options to comply with Section 409A of the Code, but only to the extent any such amendments or action by the Administrator would not violate Section 409A of the Code. Notwithstanding the foregoing, the Company shall have no liability to a Participant or any other party if the Option to purchase Common Stock under the Plan that is intended to be exempt from or compliant with Section 409A of the Code is not so exempt or compliant or for any action taken by the Administrator with respect thereto. The Company makes no representation that the Option to purchase Common Stock under the Plan is compliant with Section 409A of the Code.
28. Notification Upon Sale of Shares Under 423 Component. Each Participant agrees, by entering the 423 Component of the Plan, to give the Company prompt notice of any disposition of shares purchased under the Plan where such disposition occurs within two years after the date of grant of the Option pursuant to which such shares were purchased or within one year after the date such shares were purchased.
29. Equal Rights and Privileges. Notwithstanding any provision of the Plan to the contrary and in accordance with Section 423 of the Code, all Eligible Employees participating in the 423 Component shall have the same rights and privileges.
30. General.
(a) No Right to Options; No Shareholder Rights; No Right to Employment. No person shall have any right to be granted any Option under the Plan. No person shall have any rights as a shareholder with respect to any Common Stock to be issued under the Plan prior to the issuance thereof. The grant of an Option shall not be construed as giving any person the right to be retained in the employ of the Company or any Subsidiary or Affiliate. Further, the Company and each Subsidiary and Affiliate expressly reserves the right at any time to dismiss an employee free from any liability or any claim under the Plan, except as expressly provided herein.
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(b) Successors and Assigns. The Plan shall be binding on the Company and its successors and assigns.
(c) Entire Plan. This Plan constitutes the entire plan with respect to the subject matter hereof and supersedes all prior plans with respect to the subject matter hereof.
(d) Compliance with Applicable Law. The obligations of the Company with respect to payments under the Plan are subject to compliance with all applicable laws and regulations. Common Stock shall not be issued with respect to a right to purchase unless the issuance and delivery of the shares of Common Stock pursuant thereto shall comply with all applicable provisions of law, including, without limitation, the Securities Act of 1933 and the Securities Exchange Act of 1934 (each as amended) and the requirements of any stock exchange upon which the shares may then be listed.
(e) Severability of Provisions. If any provision of the Plan shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision hereof, and the Plan shall be construed and enforced as if such provision had not been included.
(f) Incapacity. Any benefit payable to or for the benefit of a minor, an incompetent person, or other person incapable of accepting receipt shall be deemed paid when paid to such person’s guardian or to the party providing or reasonably appearing to provide for the care of such person, and such payment shall fully discharge any liability or obligation of the Board, the Administrator, the Company and any Designated Company, and all other parties with respect thereto.
(g) Headings and Captions; Rules of Construction. The headings and captions herein are provided for reference and convenience only, shall not be considered part of the Plan, and shall not be employed in the construction of the Plan. Whenever used in the Plan, words in the masculine gender shall be deemed to refer to females as well as to males; words in the singular shall be deemed to refer also to the plural; and references to a statute or statutory provision shall be construed as if they referred also to that provision (or to a successor provision of similar import) as currently in effect, as amended, or as reenacted, and to any regulations and other formal guidance of general applicability issued thereunder. Except where otherwise indicated, references to Sections are references to sections of this Plan.
(h) Unfunded Status of Plan. The Plan is unfunded and shall not create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between any Participant (or beneficiary thereof), on the one hand, and the Company, any Designated Company, the Board, the Administrator, or any other person, on the other hand.
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31. Definitions.
(a) “423 Component” has the meaning set forth in the introductory paragraphs above Section 1.
(b) “Acquisition Price” means the cash payment for each share surrendered in a Reorganization Event.
(c) “Administrator” means the Board or the Committee (or a delegate appointed in accordance with Section 1).
(d) “Aggregate Fully Diluted Company Capital Stock” has the meaning set forth in the Merger Agreement.
(e) “Affiliate” means any entity that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under the common control with, the Company.
(f) “Board” means the Board of Directors of the Company.
(g) “Closing” has the meaning set forth in the Merger Agreement.
(h) “Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto.
(i) “Committee” means the Compensation Committee of the Board (or any other committee or subcommittee of the Board which the Board may appoint to administer the Plan). Subject to the discretion of the Board, the Committee shall be composed entirely of individuals who meet the qualifications of (i) a “non-employee director” within the meaning of Rule 16b-3 and (ii) any other qualifications required by the applicable exchange on which the Common Stock is traded. If at any time or to any extent the Board shall not administer the Plan, then the functions of the Administrator specified in the Plan shall be exercised by the Committee (except as such functions may be delegated pursuant to Section 1).
(j) “Common Stock” means the Class A common stock of the Company, par value $0.0001 per share.
(k) “Company” means WeWork Inc., a Delaware corporation (or any successor company).
(l) “Compensation” means the amount of base pay, prior to salary reduction (such as pursuant to Sections 125, 132(f) or 401(k) of the Code), but excluding overtime, commissions, incentive or bonus awards, allowances and reimbursements for expenses such as relocation allowances or travel expenses, income or gains related to Company stock options or other share-based awards, and similar items. The Administrator shall have the discretion to determine the application of this definition to Participants outside the United States.
(m) “Designated Company” means any present or future Subsidiary or Affiliate that has been designated by the Administrator to participate in the Plan. The Administrator may so designate any Subsidiary or Affiliate, or revoke any such designation, at any time and from time to time, either before or after the Plan is approved by the shareholders, and may further designate such Designated Companies or Participants as participating in the 423 Component or the Non-423 Component. The Administrator may also determine which
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Subsidiaries, Affiliates or Eligible Employees may be excluded from participation in the Plan, to the extent consistent with Section 423 of the Code or as implemented under the Non-423 Component, and determine which Designated Company or Companies shall participate in separate Offerings (to the extent that the Company makes separate Offerings). For purposes of the 423 Component, only the Company and its Subsidiaries may be Designated Companies; provided, however, that at any given time, a Subsidiary that is a Designated Company under the 423 Component shall not be a Designated Company under the Non-423 Component.
(n) “Effective Date” has the meaning set forth in Section 21.
(o) “Eligible Employee” has the meaning set forth in Section 3.
(p) “Enrollment Form” means an agreement, which may be electronic, pursuant to which an Eligible Employee may elect to enroll in the Plan, to authorize a new level of payroll deductions, or to stop payroll deductions and withdraw from an Offering.
(q) “Exercise Date” means the last day of a Purchase Period.
(r) “Fair Market Value of the Common Stock” on any given date means the fair market value of the Common Stock determined in good faith by the Administrator; provided, however, that if the Common Stock is admitted to quotation on the National Association of Securities Dealers Automated Quotation System (“NASDAQ”), NASDAQ Global Market, the New York Stock Exchange or another national securities exchange, the determination shall be made by reference to the closing price on such date. If there is no closing price for such date, the determination shall be made by reference to the last date preceding such date for which there is a closing price.
(s) “Merger Agreement” means that certain Agreement and Plan of Merger, by and among BowX Acquisition Corp., BowX Merger Subsidiary Corp., and WeWork Inc., dated as of March 25, 2021.
(t) “Non-423 Component” has the meaning set forth in the introductory paragraphs above Section 1.
(u) “Offering” means an offering to Eligible Employees to purchase Common Stock under the Plan. Unless otherwise determined by the Administrator, each Offering under the Plan in which Eligible Employees of one or more Designated Companies may participate may be deemed a separate offering for purposes of Section 423 of the Code, even if the dates of the applicable Offering are identical, and the provisions of the Plan will separately apply to each Offering. With respect to Offerings under the 423 Component, the terms of separate Offerings need not be identical provided that all Eligible Employees granted an Option in a particular Offering will have the same rights and privileges, except as otherwise may be permitted by Code Section 423; Offerings under the Non-423 Component need not satisfy such requirements.
(v) “Offering Date” means the first day of an Offering.
(w) “Option” has the meaning set forth in Section 8.
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(x) “Option Price” has the meaning set forth in Section 8.
(y) “Parent” means a “parent corporation” with respect to the Company, as defined in Section 424(e) of the Code.
(z) “Participant” means an individual who is eligible as determined in Section 3 and who has complied with the provisions of Section 4.
(aa) “Plan” means the WeWork 2021 Employee Stock Purchase Plan.
(bb) “Purchase Period” means the period of time specified within an Offering beginning on the Offering Date ending on the Exercise Date.
(cc) “Reorganization Event” means: (i) the sale of all or substantially all of the assets of the Company on a consolidated basis to an unrelated person or entity; (ii) a merger, reorganization or consolidation pursuant to which the holders of the Company’s aggregate outstanding voting power and outstanding stock immediately prior to such transaction do not own a majority of the aggregate outstanding voting power and outstanding stock or other equity interests of the resulting or successor entity (or its ultimate parent, if applicable) immediately upon completion of such transaction; (iii) the sale of all of the Common Stock to an unrelated person, entity or group thereof acting in concert; or (iv) any other transaction in which the owners of the Company’s outstanding voting power immediately prior to such transaction do not own at least a majority of the outstanding voting power of the Company or any successor entity immediately upon completion of the transaction other than as a result of the acquisition of securities directly from the Company.
(dd) “SEC” means the United States Securities and Exchange Commission.
(ee) “Subsidiary” means a “subsidiary corporation” with respect to the Company, as defined in Section 424(f) of the Code.
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Exhibit 10.6
FORM OF
INDEMNITY AGREEMENT
THIS INDEMNITY AGREEMENT (this “Agreement”) dated as of _______________, is made by and between WEWORK INC., a Delaware corporation (the “Company”), and _________________ (“Indemnitee”).
RECITALS
A. The Company desires to attract and retain the services of highly qualified individuals as directors, officers, employees and agents.
B. The Company’s second amended and restated certificate of incorporation (the “Certificate of Incorporation”) and amended and restated bylaws (the “Bylaws”) require that the Company indemnify its directors and officers and empower the Company to indemnify its employees and agents, as authorized by the Delaware General Corporation Law, as amended (the “Code”), under which the Company is organized. Such Certificate of Incorporation and Bylaws expressly provide that the indemnification provided therein is not exclusive and contemplates that the Company may enter into separate agreements with its directors, officers and other persons to set forth specific indemnification provisions.
C. The Board of Directors of the Company (the “Board”) has concluded that, to retain and attract talented and experienced individuals to serve or continue to serve as officers or directors of the Company or otherwise as an Agent (as hereinafter defined), and to encourage such individuals to take the business risks necessary for the success of the Company, it is necessary for the Company to contractually indemnify Agents and to assume for itself, to the fullest extent permitted by law, expenses and damages in connection with claims against such Agents in connection with their service to the Company.
D. The Company desires and has requested Indemnitee to serve or continue to serve as an Agent of the Company, as the case may be, and has proffered this Agreement to Indemnitee as an additional inducement to serve in such capacity.
E. Indemnitee is willing to serve, or to continue to serve, as an Agent of the Company, as the case may be, if Indemnitee is furnished the indemnity provided for herein by the Company.
AGREEMENT
NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the parties hereto, intending to be legally bound, hereby agree as follows:
1. Definitions.
(a) Agent. For purposes of this Agreement, the term “Agent” of the Company means any person who: (i) is or was a director, officer, employee, agent, or other fiduciary of the Company or a subsidiary of the Company; or (ii) is or was serving at the request or for the convenience of, or representing the interests of, the Company or a subsidiary of the Company as a director, officer, employee, agent, or other fiduciary of a foreign or domestic corporation, partnership, joint venture, trust or other enterprise. Any person who is or was serving as a director, officer, employee or agent of the Company or a subsidiary of the Company shall be deemed to be serving, or have served, at the request of the Company.
(b) Change in Control. For purposes of this Agreement, a “Change in Control” shall be deemed to have occurred if (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), 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 in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the Company’s then outstanding Voting Securities; (ii) during any period of two consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period are members of the Company’s Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the members of the Company’s Board (provided, however, that if the appointment or election (or nomination for election) of any new Board member was approved or recommended by a majority vote of the members of the Incumbent Board then still in office, such new member shall be considered as a member of the Incumbent Board); or (iii) the stockholders of the Company approve a merger or consolidation of the Company with any other corporation, other than a merger or consolidation which would result in the Voting Securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into Voting Securities of the surviving entity) at least 80% of the total voting power represented by the Voting Securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, or the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of (in one transaction or a series of transactions) all or substantially all of the Company’s assets.
(c) Expenses. For purposes of this Agreement, the term “Expenses” shall include any and all direct and indirect costs (including all reasonable and customary attorneys’, witness, or other professional fees and related disbursements, and other reasonable out-of-pocket costs) actually and reasonably incurred by Indemnitee in connection with the investigation, defense, settlement or appeal of a proceeding or establishing or enforcing a right to indemnification under this Agreement, the Code or otherwise.
(d) Enterprise. For purposes of this Agreement, the term “Enterprise” means any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other entity for which Indemnitee is or was serving at the request of the Company as an Agent.
(e) Independent Counsel. For purposes of this Agreement, the term “Independent Counsel” means a law firm, or a partner (or, if applicable, member) of such a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent: (i) the Company or any of its subsidiaries or affiliates, or Indemnitee in any matter material to either such party, 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 Indemnitee’s rights under this Agreement. The Company will pay the reasonable fees and expenses of the Independent Counsel referred to above.
(f) Liabilities. For purposes of this Agreement, the term “Liabilities” shall be broadly construed and shall include, without limitation, judgments, damages, deficiencies, liabilities, losses, penalties, excise taxes, fines, assessments and amounts paid in settlement, including any interest and any federal, state, local or foreign taxes imposed as a result of the actual or deemed receipt of any payment under this Agreement.
(g) Proceedings. For purposes of this Agreement, the term “proceeding” shall be broadly construed and shall include, without limitation, 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 in the right of the Company or otherwise and whether of a civil, criminal, administrative or investigative nature, and whether formal or informal in any case, in which Indemnitee was, is or will be involved as a party, potential party, non-party witness or otherwise by reason of: (i) the fact that Indemnitee is or was a director or officer of the Company; (ii) the fact that any action taken (or failure to take action) by Indemnitee or of any action (or failure to act) on Indemnitee’s part while acting as an Agent; or (iii) the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan, or other enterprise, and in any such case described above, whether or not serving in any such capacity at the time any Liability or Expense is incurred for which indemnification, reimbursement, or advancement of Expenses may be provided under this Agreement. If the Indemnitee reasonably believes in good faith that a given situation may lead to or culminate in the institution of a proceeding, such situation shall be considered a proceeding under this paragraph.
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(h) Subsidiary. For purposes of this Agreement, the term “subsidiary” means any corporation, limited liability company, or other entity, of which more than 50% of the outstanding voting securities or equity interests are owned, directly or indirectly, by the Company and one or more of its subsidiaries, and any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other enterprise of which Indemnitee is or was serving at the request of the Company as an Agent.
(i) Voting Securities. For purposes of this Agreement, “Voting Securities” shall mean any securities of the Company that vote generally in the election of directors.
2. Agreement to Serve. Indemnitee will serve, or continue to serve, as the case may be, as an Agent, faithfully and to the best of Indemnitee’s ability, at the will of such entity designated by the Company and at the request of the Company (or under separate agreement, if such agreement exists), in the capacity Indemnitee currently serves such entity, so long as Indemnitee is duly appointed or elected and qualified in accordance with the applicable provisions of the governance documents of such entity, or until such time as Indemnitee tenders their resignation in writing; provided, however, that nothing contained in this Agreement is intended as an employment agreement between Indemnitee and the Company or any of its subsidiaries or to create any right to continued employment of Indemnitee with the Company or any of its subsidiaries in any capacity.
The Company acknowledges that it has entered into this Agreement and assumes the obligations imposed on it hereby, in addition to and separate from its obligations to Indemnitee under the Certificate of Incorporation and the Bylaws, to induce Indemnitee to serve, or continue to serve, as an Agent, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving as an Agent.
3. Indemnification.
(a) Indemnification in Third Party Proceedings. Subject to Section 10 below, the Company shall indemnify Indemnitee to the fullest extent permitted by the Code, as the same may be amended from time to time (but, to the fullest extent of the law, only to the extent that such amendment permits Indemnitee to broader indemnification rights than the Code permitted prior to adoption of such amendment), if (i) Indemnitee is a party to or threatened to be made a party to or otherwise involved in any proceeding, other than a proceeding by or in the right of the Company to procure a judgment in its favor, for any and all Expenses and Liabilities (including all interest, assessments and other charges paid or payable in connection with or in respect of such Expenses and Liabilities) incurred by Indemnitee in connection with the investigation, defense, settlement or appeal of such proceeding, and (ii) 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, in the case of a criminal proceeding, had no reasonable cause to believe that Indemnitee’s conduct was unlawful. The parties hereto intend that this Agreement shall provide to the fullest extent permitted by law for indemnification in excess of that expressly permitted by statute, including, without limitation, any indemnification provided by the Certificate of Incorporation, the Bylaws, vote of the Company’s stockholders or disinterested directors, or applicable law.
(b) Indemnification in Derivative Actions and Direct Actions by the Company. Subject to Section 10 below, the Company shall indemnify Indemnitee to the fullest extent permitted by the Code, as the same may be amended from time to time (but, to the fullest extent permitted by applicable law, only to the extent that such amendment permits Indemnitee to broader indemnification rights than the Code permitted prior to adoption of such amendment), if Indemnitee is a party to or threatened to be made a party to or otherwise involved in any proceeding by or in the right of the Company to procure a judgment in its favor, against any and all (i) Expenses and (ii) to the fullest extent permitted by law, Liabilities actually and reasonably incurred by Indemnitee in connection with the investigation, defense, settlement, or appeal of such proceedings, 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, except that with respect to both clauses (i) and (ii) hereof, no indemnification for Expenses shall be made under this Section 3(b) in respect of any claim, issue or matter as to which Indemnitee shall have been finally adjudged by a court of competent jurisdiction to be liable to the Company, unless and only to the extent that the Chancery Court of the State of Delaware or any court in which the proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnification.
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4. Indemnification of Expenses of Successful Party. To the fullest extent permitted by law, the Company shall indemnify Indemnitee against all Expenses in connection with a proceeding to the extent that Indemnitee has been successful on the merits or otherwise in defense of any proceeding or in defense of any claim, issue or matter therein, in whole or part, including the dismissal of any action without prejudice. 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, to the fullest extent permitted by law, against all Expenses incurred by Indemnitee or on Indemnitee’s behalf in connection with or related to each successfully resolved claim, issue or matter.
5. Partial Indemnification; Witness Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any Expenses and Liabilities incurred by Indemnitee in the investigation, defense, settlement or appeal of a proceeding, but is precluded by applicable law or the specific terms of this Agreement to indemnification for the total amount thereof, then the Company shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled. 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 Indemnitee’s acting as an Agent, a witness or otherwise asked to participate in any proceeding to which Indemnitee is not a party, Indemnitee shall be indemnified against all Expenses incurred by Indemnitee or on Indemnitee’s behalf in connection therewith.
6. Advancement of Expenses. To the extent not prohibited by law, the Company shall advance the Expenses incurred by Indemnitee in connection with any proceeding, and such advancement shall be made within 30 days after the receipt by the Company of a statement or statements requesting such advances (which shall include invoices received by Indemnitee in connection with such Expenses but, in the case of invoices in connection with legal services, any references to legal work performed or to expenditures made that would cause Indemnitee to waive any privilege accorded by applicable law shall not be included with the invoice). Advances shall be unsecured, interest free and without regard to Indemnitee’s ability to repay the Expenses. Advances shall include any and all Expenses incurred by Indemnitee pursuing an action to enforce Indemnitee’s right to indemnification under this Agreement or otherwise and this right of advancement. Indemnitee acknowledges that the execution and delivery of this Agreement shall constitute an undertaking providing that Indemnitee shall, to the fullest extent required by law, repay the advance (without interest) if and to the extent that it is ultimately determined by a court of competent jurisdiction in a final judgment, not subject to appeal, that Indemnitee is not entitled to be indemnified by the Company. The right to advances under this Section shall continue until final disposition of any proceeding, including any appeal therein. This Section 6 shall not apply to any claim made by Indemnitee for which indemnity is excluded pursuant to Section 10.
7. Notice and Other Indemnification Procedures.
(a) Notification of Proceeding/Cooperation. Indemnitee will notify the Company in writing promptly, and in no event later than 10 days after service, upon being served with 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 written notification to the Company shall include a description of the nature of the proceeding and the facts underlying the proceeding. The failure of Indemnitee to so notify the Company shall not relieve the Company of any obligation which it may have to Indemnitee under this Agreement or otherwise, and any delay in so notifying the Company shall not constitute a waiver by Indemnitee of any rights under this Agreement. The Company will be entitled to participate in the proceeding at its own expense.
(b) Request for Indemnification Payments. 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 under the terms of this Agreement, and shall request payment thereof by the Company.
(c) Selection of Counsel. In the event the Company shall be obligated hereunder to pay the Expenses of Indemnitee, the Company, if appropriate, shall be entitled to assume the defense or representation related to such proceeding against Indemnitee with counsel approved by Indemnitee (not to be unreasonably withheld) upon the delivery to Indemnitee of written notice of the Company’s election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same Claim; provided that, (i) Indemnitee shall have the right to employ Indemnitee’s separate counsel in any such
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Claim at Indemnitee’s own expense and (ii) if (A) the engagement of separate counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense, or (C) the Company shall not continue to retain such counsel to defend such Claim, then the fees and expenses of Indemnitee’s separate counsel shall be considered an Expense.
(d) Determination of Right to Indemnification Payments. Upon written request by Indemnitee for indemnification pursuant to the Section 7(b) hereof, a determination with respect to Indemnitee’s 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, 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 the Indemnitee; or (4) if so directed by the Board, by the stockholders of the Company; provided, however, that if there has been a Change in Control, then such determination shall be made by Independent Counsel selected by Indemnitee and approved by the Company (which approval shall not be unreasonably withheld). 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. Determination of Indemnitee’s entitlement to indemnification shall be made by the Company within 60 days after receipt of the written request of Indemnitee. Claims for advancement of Expenses shall be made under the provisions of Section 6 herein.
(e) Application for Enforcement. In the event the Company fails to make timely payments as set forth in Sections 6 or 7(d) above, Indemnitee shall have the right to apply to the Chancery Court of the State of Delaware for the purpose of enforcing Indemnitee’s right to indemnification or advancement of Expenses pursuant to this Agreement. In such an enforcement hearing or proceeding, the burden of proof shall be on the Company to prove that indemnification or advancement of Expenses to Indemnitee is not required under this Agreement or permitted by applicable law. Any determination by the Company (including its Board, a committee thereof or Independent Counsel) or its stockholders that Indemnitee is not entitled to indemnification hereunder shall not be a defense by the Company to the action nor create any presumption that Indemnitee is not entitled to indemnification or advancement of Expenses hereunder.
(f) Indemnification of Certain Expenses. The Company shall indemnify Indemnitee against all Expenses incurred in connection with any hearing or proceeding under this Section 7 unless the Company prevails in such hearing or proceeding on the merits in all material respects.
8. Presumptions and Effect of Certain Proceedings.
(a) In making a determination with respect to entitlement to indemnification hereunder, the person or persons or entity making such determination will, to the fullest extent not prohibited by law, presume Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 7 of this Agreement, and the Company will, to the fullest extent not prohibited by law, have the burden of proof to overcome that presumption. Neither the failure of the Company (including by its directors or Independent 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, will be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.
(b) If the determination of Indemnitee’s entitlement to indemnification has not made pursuant to Section 7 within 60 days after the later of (i) receipt by the Company of Indemnitee’s written request for indemnification pursuant to Section 7 and (ii) the final disposition of the proceeding for which Indemnitee requested indemnification (the “Determination Period”), the requisite determination of entitlement to indemnification will, to the fullest extent not prohibited by law, be deemed to have been made; and Indemnitee will be entitled to such indemnification, absent (A) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification, or (B) a prohibition of such indemnification under applicable law. The Determination Period may be extended for a reasonable time, not to exceed an additional 30 days, if the person, persons or entity making the determination with respect to entitlement to indemnification in good faith requires such additional time for the obtaining or evaluating of documentation and/or information relating thereto; and provided, further, the Determination Period may be extended an additional 15 days if the determination of entitlement to indemnification is to be made by the stockholders pursuant to Section 7(d) of this Agreement.
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(c) 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, will 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 Indemnitee 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 Indemnitee’s conduct was unlawful.
(d) For purposes of any determination of good faith, Indemnitee will be deemed to have acted in good faith if Indemnitee acted based on the records or books of account of the Company, its subsidiaries, or an Enterprise, including financial statements; or on information supplied to Indemnitee by the directors or officers of the Company, its subsidiaries, or an Enterprise in the course of their duties; or on the advice of legal counsel for the Company, its subsidiaries, or an Enterprise; or on information or records given or reports made to the Company or an Enterprise by an independent certified public accountant or by an appraiser, financial advisor or other expert selected with reasonable care by or on behalf of the Company, its subsidiaries, or an Enterprise. Further, Indemnitee will be deemed to have acted in a manner “not opposed to the best interests of the Company,” as referred to in this Agreement, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan. The provisions of this Section 8(d) are not exclusive and do not limit in any way the other circumstances in which the Indemnitee may be deemed to have met the applicable standard of conduct set forth in this Agreement.
(e) The knowledge and/or actions, or failure to act, of any director, officer, trustee, partner, managing member, fiduciary, agent or employee of the Enterprise may not be imputed to Indemnitee for purposes of determining Indemnitee’s right to indemnification under this Agreement.
9. Insurance. To the extent that the Company maintains an insurance policy or policies providing liability insurance for Agents or for agents of any other Enterprise, 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 Agent or agent under such policy or policies. If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company has director and officer liability insurance in effect or otherwise potentially available, 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 the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.
10. Exceptions.
(a) Certain Matters. Any provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement to indemnify Indemnitee on account of any proceeding with respect to: (i) remuneration paid to Indemnitee if it is determined by final judgment or other final adjudication that such remuneration was in violation of law (and, in this respect, both the Company and Indemnitee have been advised that the Securities and Exchange Commission believes that indemnification for liabilities arising under the federal securities laws is against public policy and is, therefore, unenforceable; and that claims for indemnification should be submitted to appropriate courts for adjudication, as indicated in Section 10(d) below); (ii) a final judgment rendered against Indemnitee for an accounting, disgorgement or repayment of profits made from the purchase or sale by Indemnitee of securities of the Company against Indemnitee pursuant to the provisions of Section 16(b) of the Exchange Act or other provisions of any federal, state or local statute or rules and regulations thereunder; (iii) a final judgment or other final adjudication that Indemnitee’s conduct was in bad faith, knowingly fraudulent or deliberately dishonest or constituted willful misconduct (but only to the extent of such specific determination); or (iv) a final judgment by a court of competent jurisdiction determining that indemnification of Indemnitee is prohibited by applicable law. For purposes of the foregoing sentence, a final judgment or other adjudication may be reached in either the underlying proceeding or action in connection with which indemnification is sought or a separate proceeding or action to establish rights and liabilities under this Agreement.
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(b) Claims Initiated by Indemnitee. Any provision herein to the contrary notwithstanding, the Company shall not be obligated to indemnify or advance Expenses to Indemnitee with respect to proceedings or claims initiated or brought by Indemnitee or its agents and not by way of defense, except (i) with respect to proceedings brought against the Company to establish or enforce a right to indemnification or advancement under this Agreement or under any other agreement, provision in the Certificate of Incorporation or Bylaws or applicable law; or (ii) with respect to any other proceeding initiated by Indemnitee that is either approved by the Board or Indemnitee’s participation is required by applicable law. However, indemnification or advancement of Expenses may be provided by the Company in specific cases if the Board determines it to be appropriate.
(c) Unauthorized Settlements. Any provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement to indemnify Indemnitee under this Agreement for any amounts paid in settlement of a proceeding effected without the Company’s written consent. Neither the Company nor Indemnitee shall unreasonably withhold consent to any proposed settlement; provided, however, that the Company may decline to consent to (or to otherwise admit or agree to any liability for indemnification hereunder in respect of) any proposed settlement if the Company is also a party in such proceeding and determines in good faith that such settlement is not in the best interests of the Company and its stockholders. The Company shall not settle any proceeding in which Indemnitee is a party without Indemnitee’s written consent unless such settlement solely involves the payment of money and includes a complete and unconditional release of Indemnitee from all liability on any claims that are the subject matter of such proceeding; provided, however, that Indemnitee will not unreasonably withhold consent to any proposed settlement.
(d) Securities Act Liabilities. Any provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement to indemnify Indemnitee if such indemnification would be a violation of any undertaking appearing in and required by the rules and regulations promulgated under the Securities Act of 1933, or in any registration statement filed with the SEC under the Act. Indemnitee acknowledges that paragraph (h) of Item 512 of Regulation S-K currently generally requires the Company to undertake in connection with any registration statement filed under the Act to submit the issue of the enforceability of Indemnitee’s rights under this Agreement in connection with any liability under the Act on public policy grounds to a court of appropriate jurisdiction and to be governed by any final adjudication of such issue. Indemnitee specifically agrees that any such undertaking shall supersede the provisions of this Agreement and agrees to be bound by any such undertaking.
(e) Prior Payments. Any provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement to indemnify or advance Expenses to Indemnitee under this Agreement 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 indemnity policy.
11. Nonexclusivity and Survival of Rights. The provisions for indemnification and advancement of Expenses set forth in this Agreement shall not be deemed exclusive of any other rights which Indemnitee may at any time be entitled under any provision of applicable law, the Certificate of Incorporation, Bylaws or other agreements, both as to action in Indemnitee’s official capacity and Indemnitee’s action as an Agent, in any court in which a proceeding is brought, and Indemnitee’s rights hereunder shall continue after Indemnitee has ceased acting as an Agent and shall inure to the benefit of the heirs, executors, administrators and assigns of Indemnitee. The obligations and duties of the Company to Indemnitee under this Agreement shall be binding on the Company and its successors and assigns until terminated in accordance with its terms. The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business 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.
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 their corporate status prior to such amendment, alteration or repeal. To the extent that a change in the Code, whether by statute or judicial decision, permits greater indemnification or advancement of Expenses than would be afforded currently under the Certificate of Incorporation, 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, by Indemnitee shall not prevent the concurrent assertion or employment of any other right or remedy by Indemnitee.
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12. Term. All the rights and privileges afforded by this agreement, including the right to indemnification and the advancement of legal fees provided under this Agreement, shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity pertaining to an indemnifiable event even though Indemnitee may have ceased to serve in such capacity at the time of any proceeding. No legal action shall be brought, and no cause of action shall be asserted, by or in the right of the Company against an Indemnitee or an Indemnitee’s estate, spouse, heirs, executors or personal or legal representatives after the expiration of five years from the date of accrual of such cause of action; and any claim or cause of action of the Company shall be extinguished and deemed released unless asserted by the timely filing of a legal action within such five-year period; provided, however, that if any shorter period of limitations is otherwise applicable to such cause of action, such shorter period shall govern.
13. Other Rights to Indemnification or Advancement; Subrogation.
(a) The Company hereby acknowledges that Indemnitee may have certain rights to indemnification, advancement of Expenses and/or insurance provided by one or more other Persons, other than an Enterprise, with whom or which Indemnitee may be associated (collectively, the “Secondary Indemnitors”). The relationship between the Company and such Secondary Indemnitors with respect to Indemnitee’s rights to indemnification, advancement of Expenses, and insurance is described by this subsection, subject to the provisions of subsection (b) of this Section 13 with respect to a proceeding concerning Indemnitee’s status with an Enterprise.
i. The Company hereby acknowledges and agrees:
(A) the Company is the indemnitor of first resort with respect to any request for indemnification or advancement of Expenses made pursuant to this Agreement concerning any proceeding;
(B) the Company is primarily liable for all indemnification and indemnification or advancement of Expenses obligations for any proceeding, whether created by law, organizational or constituent documents, contract (including this Agreement) or otherwise;
(C) any obligation of any Secondary Indemnitor to indemnify Indemnitee and/or advance Expenses to Indemnitee in respect of any proceeding are secondary to the obligations of the Company’s obligations; and
(D) the Company will indemnify Indemnitee and advance Expenses to Indemnitee hereunder to the fullest extent provided herein without regard to any rights Indemnitee may have against any Secondary Indemnitor.
ii. The Company irrevocably waives, relinquishes and releases (A) any Secondary Indemnitor from any claim of contribution, subrogation, reimbursement, exoneration or indemnification, or any other recovery of any kind in respect of amounts paid by the Company to Indemnitee pursuant to this Agreement and (B) any right to participate in any claim or remedy of Indemnitee against any Secondary Indemnitor, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including, without limitation, the right to take or receive from any Secondary Indemnitor, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right.
iii. In the event any Secondary Indemnitor or its respective insurers advances or extinguishes any liability or loss for Indemnitee, the payor has a right of subrogation against the Company or its insurers for all amounts so paid which would otherwise be payable by the Company or its insurers under this Agreement. In no event will payment by any Secondary Indemnitor or their respective insurers affect the obligations of the Company hereunder or shift primary liability for the Company’s obligation to indemnify or advance of Expenses to any Secondary Indemnitor.
iv. Any indemnification or advancement of Expenses provided by any Secondary Indemnitor is specifically in excess over the Company’s obligation to indemnify and advance Expenses or any valid and collectible insurance (including but not limited to any malpractice insurance or professional errors and omissions insurance) provided by the Company.
(b) The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee for any proceeding concerning Indemnitee’s status with an Enterprise will be reduced by any amount Indemnitee has actually received as indemnification or advancement of Expenses from such Enterprise. The Company and Indemnitee intend that any such Enterprise (and its insurers) be the indemnitor of first resort with respect to indemnification and advancement
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of Expenses for any proceeding related to or arising from Indemnitee’s status with such Enterprise. The Company’s obligation to indemnify and advance Expenses to Indemnitee is secondary to the obligations the Enterprise or its insurers owe to Indemnitee. Indemnitee agrees to take all reasonably necessary and desirable action to obtain from an Enterprise indemnification and advancement of Expenses for any proceeding related to or arising from Indemnitee’s corporate status with such Enterprise.
(c) In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee from any insurance carrier or Enterprise. Indemnitee shall, at the request and expense of the Company, execute all papers required and shall do everything that may be reasonably necessary to secure such rights, including the execution of such documents necessary to enable the Company effectively to bring suit to enforce such rights.
14. Interpretation of Agreement. It is understood that the parties hereto intend this Agreement to be interpreted and enforced so as to provide indemnification and advancement of Expenses to Indemnitee to the fullest extent now or hereafter permitted by law.
15. Severability. If any provision of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever, (a) the validity, legality and enforceability of the remaining provisions of the Agreement (including without limitation, all portions of any paragraphs of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (b) to the fullest extent possible, the provisions of this Agreement (including, without limitation, all portions of any paragraph of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable and to give effect to Section 14 hereof.
16. Amendment and Waiver. No supplement, modification, amendment, or cancellation of this Agreement shall be binding unless executed in writing by the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.
17. Notice. Except as otherwise provided herein, any notice or demand which, by the provisions hereof, is required or which may be given to or served upon the parties hereto shall be in writing and by by electronic transmission delivered to legal@wework.com, shall be deemed to have been validly served, given or delivered when sent, if by overnight delivery, courier or personal delivery, shall be deemed to have been validly served, given or delivered upon actual delivery and, if mailed, shall be deemed to have been validly served, given or delivered three business days after deposit in the United States mail, as registered or certified mail, with proper postage prepaid and addressed to the party or parties to be notified at the addresses set forth on the signature page of this Agreement (or such other address(es) as a party may designate for itself by like notice). If to the Company, notices and demands shall be delivered to the attention of the Chief Legal Officer of the Company and to Legal@wework.com.
18. Governing Law. This Agreement shall be governed exclusively by and construed according to the laws of the State of Delaware, as applied to contracts between Delaware residents entered into and to be performed entirely within Delaware.
19. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute but one and the same Agreement. Only one such counterpart need be produced to evidence the existence of this Agreement.
20. Headings. The headings of the sections of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction hereof.
21. Entire Agreement. Subject to Section 11 hereof, this Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior agreements, understandings and negotiations, written and oral, between the parties with respect to the subject matter of this Agreement; provided, however, that this Agreement is a supplement to and in furtherance of the Certificate of Incorporation, the Bylaws, the Code and any other applicable law, and shall not be deemed a substitute therefor, and does not diminish or abrogate any rights of Indemnitee thereunder.
9
22. Information Sharing. If Indemnitee is the subject of or is implicated in any way during an investigation, whether formal or informal, the Company shall promptly notify Indemnitee of such investigation. The Company shall further share with Indemnitee any information it has turned over to any third parties concerning the investigation (“Shared Information”) at the time such information is so furnished, unless such notice is prohibited by any law, rule, regulation or formal order from a regulatory agency, would breach a confidentiality obligation owed to a third party or would waive the Company’s attorney-client privilege. By executing this agreement, Indemnitee agrees that such Shared Information is material non-public information that Indemnitee is obligated to hold in confidence and may not disclose publicly; provided, however, that Indemnitee is permitted to use the Shared Information and to disclose such Shared information to Indemnitee’s legal counsel and third parties solely in connection with defending Indemnitee from legal liability.
23. Contribution. 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 Indemnitee in connection with such event(s) and/or transaction(s).
23. 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. 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, (iii) agree to appoint, to the extent such party is not otherwise subject to service of process in the State of Delaware, an agent in the State of Delaware as such party’s agent for acceptance of legal process in connection with any such action or proceeding against such party with the same legal force and validity as if served upon such party personally within the State of Delaware, (iv) waive any objection to the laying of venue of any such action or proceeding in the Delaware Court, and (v) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Delaware Court has been brought in an improper or inconvenient forum.
[Signature Page to Follow]
10
IN WITNESS WHEREOF, the parties hereto have entered into this Agreement effective as of the date first above written.
| WEWORK INC. | ||
| By: |
| |
| Name: | ||
| Title: Address: WeWork Inc., 575 Lexington Avenue, New York, NY 10022 Attn: Chief Legal Officer | ||
| INDEMNITEE | ||
|
| ||
| Signature of Indemnitee | ||
|
| ||
| Print or Type Name of Indemnitee | ||
| Address of Indemnitee | ||
[Signature Page to Indemnity Agreement]
Exhibit 16.1
October 26, 2021
Office of the Chief Accountant
Securities and Exchange Commission
100 F Street, NE
Washington, D.C. 20549
Ladies and Gentlemen:
We have read WeWork Inc. statements (formerly known as BowX Acquisition Corp.) included under Item 4.01 of its Form 8-K/A dated October 26, 2021. We agree with the statements concerning our Firm under Item 4.01, in which we were informed of our dismissal on October 20, 2021. We are not in a position to agree or disagree with other statements contained therein.
| Very truly yours, |
| /s/ WithumSmith+Brown, PC |
| New York, New York |
Exhibit 21.1
Subsidiaries of WeWork Inc.
| Legal Name |
Jurisdiction of Incorporation | |||
| 1 Alie Street Tenant Limited |
England |
United Kingdom | ||
| 1 America Square Q Tenant Limited |
England |
United Kingdom | ||
| 1 Ariel Way Tenant Limited |
England |
United Kingdom | ||
| 1 Augustijnenstraat Tenant |
Belgium | |||
| 1 Beacon Street Tenant LLC |
New York |
United States | ||
| 1 Belvedere Drive Tenant LLC |
New York |
United States | ||
| 1 Carlisle Place Tenant Limited |
England |
United Kingdom | ||
| 1 Commons Street Tenant Limited |
Ireland | |||
| 1 George’s Quay Tenant Limited |
Ireland | |||
| 1 Glenwood Ave Tenant LLC |
New York |
United States | ||
| 1 Jermyn Street Tenant Limited |
England |
United Kingdom | ||
| 1 Lincoln Street Tenant LLC |
New York |
United States | ||
| 1 Lloyd’s Avenue Tenant Limited |
England |
United Kingdom | ||
| 1 Locatellikade Q B.V. |
Netherlands | |||
| 1 London Wall Q Tenant Limited |
England |
United Kingdom | ||
| 1 Mark Square Tenant Limited |
England |
United Kingdom | ||
| 1 Milk Street Tenant LLC |
New York |
United States | ||
| 1 Post Street Tenant LLC |
New York |
United States | ||
| 1 Poultry Tenant Limited |
England and Wales |
United Kingdom | ||
| 1 South Dearborn Street Tenant LLC |
New York |
United States | ||
| 1 St Katharine’s Way Tenant Limited |
England |
United Kingdom | ||
| 1 St Peter’s Square Tenant Limited |
England and Wales |
United Kingdom | ||
| 1 Sussex Street Pty Ltd |
Australia | |||
| 1 Union Square West HQ LLC |
New York |
United States | ||
| 1 Waterhouse Square Tenant Limited |
England and Wales |
United Kingdom | ||
| 10 Back Hill Tenant Limited |
England |
United Kingdom | ||
| 10 East 38th Street Tenant LLC |
New York |
United States | ||
| 10 East 40th Street HQ LLC |
New York |
United States | ||
| 10 East Road Tenant Limited |
England |
United Kingdom | ||
| 10 Fenchurch Avenue Tenant Limited |
England |
United Kingdom | ||
| 10 Hazerem Street Tenant Ltd |
Israel | |||
| 10 Wandsworth Road Tenant Limited |
England |
United Kingdom | ||
| 100 Bayview Circle Tenant LLC |
New York |
United States | ||
| 100 Broadway Tenant LLC |
New York |
United States | ||
| 100 Brompton Road Q Limited |
England |
United Kingdom | ||
| 100 Harris Tenant Pty Ltd |
Australia | |||
| 100 S State Street Tenant LLC |
New York |
United States | ||
| 100 Summer Street Tenant LLC |
New York |
United States | ||
| 10000 Washington Boulevard Tenant LLC |
New York |
United States |
| 1001 Woodward Ave Tenant LLC |
New York |
United States | ||
| 1003 East 4th Place Tenant LLC |
New York |
United States | ||
| 101 East Washington Street Tenant LLC |
New York |
United States | ||
| 101 Karl-Marx-Straße Tenant GmbH |
Germany | |||
| 101 Marietta Street NorthWest Tenant LLC |
New York |
United States | ||
| 101 North 1st Avenue Tenant LLC |
New York |
United States | ||
| 101 St Martin’s Lane Tenant Limited |
England |
United Kingdom | ||
| 10-12 Russell Square Q Limited |
England |
United Kingdom | ||
| 10250 Constellation Tenant LLC |
New York |
United States | ||
| 1031 South Broadway Tenant LLC |
New York |
United States | ||
| 10585 Santa Monica Boulevard Tenant LLC |
New York |
United States | ||
| 10845 Griffith Peak Drive Tenant LLC |
New York |
United States | ||
| 10885 NE 4th Street Tenant LLC |
New York |
United States | ||
| 109 S 5th Street Tenant LLC |
New York |
United States | ||
| 1090 West Pender Street Tenant LP |
Canada | |||
| 10900 Stonelake Boulevard Tenant LLC |
New York |
United States | ||
| 1099 Stewart Street Tenant LLC |
New York |
United States | ||
| 11 Neue Bahnhofstraße Q GmbH |
Germany | |||
| 11 Park Pl Tenant LLC |
New York |
United States | ||
| 11 Spittelmarkt Tenant GmbH |
Germany | |||
| 110 110th Avenue Northeast Tenant LLC |
New York |
United States | ||
| 110 Corcoran Street Tenant LLC |
New York |
United States | ||
| 110 Wall Manager LLC |
New York |
United States | ||
| 1100 15th Street NW Tenant LLC |
New York |
United States | ||
| 1100 Ludlow Street Tenant LLC |
New York |
United States | ||
| 1100 Main Street Tenant LLC |
New York |
United States | ||
| 1101 Connecticut Ave NW Q LLC |
New York |
United States | ||
| 1111 Broadway Tenant LLC |
New York |
United States | ||
| 1111 West 6th Street Tenant LLC |
New York |
United States | ||
| 1114 W Fulton Market Q LLC |
New York |
United States | ||
| 1115 Broadway Q LLC |
New York |
United States | ||
| 1115 Howell Mill Road Tenant LLC |
New York |
United States | ||
| 1115 W Fulton Market Q LLC |
New York |
United States | ||
| 114 East 4th Avenue Tenant LP |
Canada | |||
| 115 Broadway Tenant LLC |
New York |
United States | ||
| 115 East 23rd Street Tenant LLC |
New York |
United States | ||
| 1150 South Olive Street Tenant LLC |
New York |
United States | ||
| 1155 Perimeter Center West Tenant LLC |
New York |
United States | ||
| 1155 West Fulton Street Tenant LLC |
New York |
United States | ||
| 1156 6th Avenue Tenant LLC |
New York |
United States | ||
| 117 NE 1st Ave Tenant LLC |
New York |
United States | ||
| 1175 Peachtree Tenant LLC |
New York |
United States | ||
| 11801 Domain Blvd Tenant LLC |
New York |
United States |
2
| 119 Marylebone Road Tenant Limited |
England |
United Kingdom | ||
| 12 East 49th Street Tenant LLC |
New York |
United States | ||
| 12 Hammersmith Grove Tenant Limited |
England |
United Kingdom | ||
| 12 Moorgate Tenant Limited |
England |
United Kingdom | ||
| 12 South 1st Street Tenant LLC |
New York |
United States | ||
| 120 Fenchurch Street Tenant Limited |
England |
United Kingdom | ||
| 120 Moorgate Tenant Limited |
England |
United Kingdom | ||
| 120 Old Broad St Q Limited |
England |
United Kingdom | ||
| 120 Spencer Street Pty Ltd |
Australia | |||
| 120 West Trinity Place Tenant LLC |
New York |
United States | ||
| 1200 17th Street Tenant LLC |
New York |
United States | ||
| 1200 Franklin Avenue Tenant LLC |
New York |
United States | ||
| 1201 3rd Avenue Tenant LLC |
New York |
United States | ||
| 1201 Wills Street Tenant LLC |
New York |
United States | ||
| 1201 Wilson Blvd Tenant LLC |
New York |
United States | ||
| 12130 Millennium Drive Tenant LLC |
New York |
United States | ||
| 123 Buckingham Palace Road Tenant Limited |
England |
United Kingdom | ||
| 123 Eagle Street Tenant Pty Ltd |
Australia | |||
| 123 Schönhauser Allee Tenant GmbH |
Germany | |||
| 1240 Rosecrans Tenant LLC |
New York |
United States | ||
| 125 Deansgate Tenant Limited |
England |
United Kingdom | ||
| 125 Kingsway Tenant Limited |
England |
United Kingdom | ||
| 125 S Clark Street Tenant LLC |
New York |
United States | ||
| 125 Shaftesbury Tenant Limited |
England |
United Kingdom | ||
| 125 West 25th Street Tenant LLC |
New York |
United States | ||
| 12655 Jefferson Blvd Tenant LLC |
New York |
United States | ||
| 128 South Tryon Street Tenant LLC |
New York |
United States | ||
| 130 5th Avenue Tenant LLC |
New York |
United States | ||
| 130 Madison Avenue Tenant LLC |
New York |
United States | ||
| 130 W 42nd Street Tenant LLC |
New York |
United States | ||
| 130 Wood Street Tenant Limited |
England |
United Kingdom | ||
| 1305 2nd Street Q LLC |
New York |
United States | ||
| 131 Finsbury Pavement Tenant Limited |
England and Wales |
United Kingdom | ||
| 133 Fleet Street Tenant Limited |
England |
United Kingdom | ||
| 133 Houndsditch Tenant Limited |
England |
United Kingdom | ||
| 1330 Lagoon Avenue Tenant LLC |
New York |
United States | ||
| 1333 New Hampshire Avenue Northwest Tenant LLC |
New York |
United States | ||
| 135 E 57th Street Tenant LLC |
New York |
United States | ||
| 135 Madison Ave Tenant LLC |
New York |
United States | ||
| 1372 Peachtree Street NE Tenant LLC |
New York |
United States | ||
| 1389 Peachtree Street Northwest Tenant LLC |
New York |
United States | ||
| 14 Bonhill Street Tenant Limited |
England |
United Kingdom | ||
| 1400 Lavaca Street Tenant LLC |
New York |
United States |
3
| 1410 Broadway Tenant LLC |
New York |
United States | ||
| 1411 4th Avenue Tenant LLC |
New York |
United States | ||
| 14-16 Great Chapel Tenant Limited |
England |
United Kingdom | ||
| 142 Old Street Q Tenant Limited |
England |
United Kingdom | ||
| 142 W 57th Street Tenant LLC |
New York |
United States | ||
| 142 Wardour Street Tenant Limited |
England |
United Kingdom | ||
| 1430 Walnut Street Tenant LLC |
New York |
United States | ||
| 144 Menachem Begin Tenant Ltd. |
Israel | |||
| 1440 Broadway Tenant LLC |
New York |
United States | ||
| 1448 NW Market Street Tenant LLC |
New York |
United States | ||
| 1449 Woodward Avenue Tenant LLC |
New York |
United States | ||
| 145 W 45th Street Tenant LLC |
New York |
United States | ||
| 1450 Broadway Tenant LLC |
New York |
United States | ||
| 1453 3rd Street Promenade Q LLC |
New York |
United States | ||
| 1455 Market Street Tenant LLC |
New York |
United States | ||
| 146 Derech Menachem Begin Tenant Ltd. |
Israel | |||
| 1460 Broadway Tenant LLC |
New York |
United States | ||
| 148 Lafayette Street Tenant LLC |
New York |
United States | ||
| 149 5th Avenue Tenant LLC |
New York |
United States | ||
| 149 Madison Avenue Tenant LLC |
New York |
United States | ||
| 15 Bishopsgate Tenant Limited |
England |
United Kingdom | ||
| 15 Herzogstraße Tenant GmbH |
Germany | |||
| 15 West 27th Street Tenant LLC |
New York |
United States | ||
| 150 4th Ave N Tenant LLC |
New York |
United States | ||
| 150 9 Avenue Southwest Tenant LP |
Canada | |||
| 152 3rd Street Tenant LLC |
New York |
United States | ||
| 152 Saint Georges Terrace Pty Ltd |
Australia | |||
| 1525 11th Ave Tenant LLC |
New York |
United States | ||
| 1535 Broadway Tenant LLC |
New York |
United States | ||
| 154 W 14th Street Tenant LLC |
New York |
United States | ||
| 1547 9th Street HQ LLC |
New York |
United States | ||
| 155 Townsend St Q Limited |
Ireland | |||
| 1557 West Innovation Way Tenant LLC |
New York |
United States | ||
| 1560 Broadway Tenant LLC |
New York |
United States | ||
| 16 East 34th Street Tenant LLC |
New York |
United States | ||
| 16 Efal Tenant Ltd. |
Israel | |||
| 16 Helkikey Ha’Or Tenant Ltd |
Israel | |||
| 160 Shelbourne Road Q Limited |
Ireland | |||
| 160 Varick Street Tenant LLC |
New York |
United States | ||
| 160 W Santa Clara St Tenant LLC |
New York |
United States | ||
| 1600 7th Avenue Tenant LLC |
Washington |
United States | ||
| 1601 Elm Street Tenant LLC |
New York |
United States | ||
| 1601 Market Street Tenant LLC |
New York |
United States |
4
| 1601 Vine Street Tenant LLC |
New York |
United States | ||
| 161 Avenue of the Americas Tenant LLC |
New York |
United States | ||
| 161 Castlereagh Street Pty Ltd |
Australia | |||
| 1615 Platte Street Tenant LLC |
New York |
United States | ||
| 1619 Broadway Tenant LLC |
New York |
United States | ||
| 165 Fleet Street Tenant Limited |
England |
United Kingdom | ||
| 166 Geary Street HQ LLC |
New York |
United States | ||
| 1660 Lincoln Street Tenant LLC |
New York |
United States | ||
| 167 N Green Street Tenant LLC |
New York |
United States | ||
| 17 St Helen’s Place Tenant Limited |
England |
United Kingdom | ||
| 1700 Lincoln Street Tenant LLC |
New York |
United States | ||
| 1701 Rhode Island Avenue Northwest Tenant LLC |
New York |
United States | ||
| 1725 Hughes Landing Boulevard Tenant LLC |
New York |
United States | ||
| 1730 Minor Avenue Tenant LLC |
New York |
United States | ||
| 17300 Laguna Canyon Road Tenant LLC |
New York |
United States | ||
| 177 E Colorado Blvd Tenant LLC |
New York |
United States | ||
| 1775 Tysons Boulevard Tenant LLC |
New York |
United States | ||
| 18 West 18th Street Tenant LLC |
New York |
United States | ||
| 180 Geary Street HQ LLC |
New York |
United States | ||
| 180 Sansome Street Tenant LLC |
New York |
United States | ||
| 1814 Franklin St Q LLC |
New York |
United States | ||
| 18191 Von Karman Avenue Tenant LLC |
New York |
United States | ||
| 1825 South Grant Street Tenant LLC |
New York |
United States | ||
| 1828 Walnut St Tenant LLC |
New York |
United States | ||
| 183 Madison Avenue Q LLC |
New York |
United States | ||
| 184 Shepherds Bush Road Tenant Limited |
England and Wales |
United Kingdom | ||
| 1840 Gateway Dr Tenant LLC |
New York |
United States | ||
| 185 Madison Avenue Tenant LLC |
New York |
United States | ||
| 18691 Jamboree Road Tenant LLC |
New York |
United States | ||
| 1875 K Street NW Tenant LLC |
New York |
United States | ||
| 1881 Broadway HQ LLC |
New York |
United States | ||
| 19 Schillerstraße Tenant GmbH |
Germany | |||
| 1900 Market Street Tenant LLC |
New York |
United States | ||
| 1900 Powell Street Tenant LLC |
New York |
United States | ||
| 1910 North Ola Avenue Tenant LLC |
New York |
United States | ||
| 192 Ann Street Tenant Pty Ltd |
Australia | |||
| 1920 McKinney Ave Tenant LLC |
New York |
United States | ||
| 195 Montague Street Tenant LLC |
New York |
United States | ||
| 199 Water Street Tenant LLC |
New York |
United States | ||
| 2 Belvedere Drive Tenant LLC |
New York |
United States | ||
| 2 Eastbourne Tenant Limited |
England |
United Kingdom | ||
| 2 Embarcadero Center Tenant LLC |
New York |
United States | ||
| 2 Minster Court Tenant Limited |
England |
United Kingdom |
5
| 2 North LaSalle Street Tenant LLC |
New York |
United States | ||
| 2 Semple Street Tenant Limited |
Scotland |
United Kingdom | ||
| 2 Southbank Tenant Limited |
England |
United Kingdom | ||
| 20 Cadogan Street Tenant Limited |
Scotland |
United Kingdom | ||
| 20 Heinrich-Heine-Allee Tenant GmbH |
Germany | |||
| 20 Rotherstrasse Tenant GmbH |
Germany | |||
| 20 W Kinzie Tenant LLC |
New York |
United States | ||
| 200 Berkeley Street Tenant LLC |
New York |
United States | ||
| 200 Massachusetts Ave NW Tenant LLC |
New York |
United States | ||
| 200 Portland Tenant LLC |
New York |
United States | ||
| 200 South Biscayne Blvd Tenant LLC |
New York |
United States | ||
| 200 South Orange Avenue Tenant LLC |
New York |
United States | ||
| 200 Spectrum Center Drive Tenant LLC |
New York |
United States | ||
| 201 Spear St Tenant LLC |
New York |
United States | ||
| 2031 3rd Ave Tenant LLC |
New York |
United States | ||
| 205 Hudson Street Tenant LLC |
New York |
United States | ||
| 205 North Detroit Street Tenant LLC |
New York |
United States | ||
| 207 Old Street Tenant Limited |
England |
United Kingdom | ||
| 21 Penn Plaza Tenant LLC |
New York |
United States | ||
| 21 Soho Square Tenant Limited |
England |
United Kingdom | ||
| 210 N Green Partners LLC |
New York |
United States | ||
| 210 N Green Promoter LLC |
New York |
United States | ||
| 2120 Berkeley Way Tenant LLC |
New York |
United States | ||
| 21255 Burbank Boulevard Tenant LLC |
New York |
United States | ||
| 214 West 29th Street Tenant LLC |
New York |
United States | ||
| 22 Cortlandt Street HQ LLC |
New York |
United States | ||
| 22 Long Acre Tenant Limited |
England |
United Kingdom | ||
| 2201 Broadway Tenant LLC |
New York |
United States | ||
| 221 6th Street Tenant LLC |
New York |
United States | ||
| 2211 Michelson Drive Tenant LLC |
New York |
United States | ||
| 222 Exhibition St Pty Ltd |
Australia | |||
| 222 Kearny Street Tenant LLC |
New York |
United States | ||
| 222 North Sepulveda Tenant LLC |
New York |
United States | ||
| 222 S Riverside Plaza Tenant LLC |
New York |
United States | ||
| 2221 Park Place Tenant LLC |
New York |
United States | ||
| 2222 Ponce De Leon Blvd Tenant LLC |
New York |
United States | ||
| 225 South 6th St Tenant LLC |
New York |
United States | ||
| 225 W 39th Street Tenant LLC |
New York |
United States | ||
| 229 West 36th Street Tenant LLC |
New York |
United States | ||
| 23 Schocken Street Tenant Ltd |
Israel | |||
| 231 11th Ave Tenant LLC |
New York |
United States | ||
| 2323 Delgany Street Tenant LLC |
New York |
United States | ||
| 24 Farnsworth Street Q LLC |
New York |
United States |
6
| 2-4 Herald Square Tenant LLC |
New York |
United States | ||
| 2401 Elliott Avenue Tenant LLC |
New York |
United States | ||
| 242 Prenzlauer Allee Tenant GmbH |
Germany | |||
| 2420 17th Street Tenant LLC |
New York |
United States | ||
| 2425 East Camelback Road Tenant LLC |
New York |
United States | ||
| 245 Livingston St Q LLC |
New York |
United States | ||
| 25 K Street Pty Ltd |
Australia | |||
| 25 Turmstraße Tenant GmbH |
Germany | |||
| 25 West 45th Street HQ LLC |
New York |
United States | ||
| 250 E 200 S Tenant LLC |
New York |
United States | ||
| 250 Park Avenue Tenant LLC |
New York |
United States | ||
| 255 Giralda Avenue Tenant LLC |
New York |
United States | ||
| 255 Greenwich Street Tenant LLC |
New York |
United States | ||
| 255 S King St Tenant LLC |
New York |
United States | ||
| 26 Hatton Garden Tenant Limited |
England and Wales |
United Kingdom | ||
| 260 Queen Street Pty Ltd |
Australia | |||
| 2600 Executive Parkway Tenant LLC |
New York |
United States | ||
| 27 O’Connell Street Tenant Limited |
Ireland | |||
| 2700 Post Oak Blvd. Tenant LLC |
New York |
United States | ||
| 27-01 Queens Plaza North Tenant LLC |
New York |
United States | ||
| 2755 Canyon Blvd WW Tenant LLC |
New York |
United States | ||
| 28 2nd Street Tenant LLC |
New York |
United States | ||
| 28 West 44th Street HQ LLC |
New York |
United States | ||
| 28-42 Banner Street Q Limited |
England |
United Kingdom | ||
| 29 West 30th Street Tenant LLC |
New York |
United States | ||
| 3 Aluf Kalman Magen Tenant Ltd. |
Israel | |||
| 3 Cuvrystraße Tenant GmbH |
Germany | |||
| 3 Herbal Hill Tenant Limited |
England |
United Kingdom | ||
| 3 Paris Garden Q Limited |
England |
United Kingdom | ||
| 3 Waterhouse Square Tenant Limited |
England |
United Kingdom | ||
| 30 Churchill Place Tenant Limited |
England |
United Kingdom | ||
| 30 Hudson Street Tenant LLC |
Delaware |
United States | ||
| 30 Ibn Gabirol Tenant Ltd. |
Israel | |||
| 30 Wall Street Tenant LLC |
New York |
United States | ||
| 300 Morris Street Tenant LLC |
New York |
United States | ||
| 300 Park Avenue Tenant LLC |
New York |
United States | ||
| 3000 Olym Boulevard Tenant LLC |
New York |
United States | ||
| 3000 S Robertson Blvd Q LLC |
New York |
United States | ||
| 3001 Bishop Drive Tenant LLC |
New York |
United States | ||
| 3003 Woodbridge Ave Tenant LLC |
New York |
United States | ||
| 3090 Olive Street Tenant LLC |
New York |
United States | ||
| 31 Handelsstraat Tenant |
Belgium | |||
| 31 St James Ave Tenant LLC |
New York |
United States |
7
| 3101 Park Boulevard Tenant LLC |
New York |
United States | ||
| 311 W 43rd Street Tenant LLC |
New York |
United States | ||
| 3120 139th Avenue Southeast Tenant LLC |
New York |
United States | ||
| 315 East Houston Tenant LLC |
New York |
United States | ||
| 315 W 36th Street Tenant LLC |
New York |
United States | ||
| 316 West 12th Street Tenant LLC |
New York |
United States | ||
| 32 King George Tenant Ltd. |
Israel | |||
| 320 Pitt Street Pty Ltd |
Australia | |||
| 3200 Park Center Drive Tenant LLC |
New York |
United States | ||
| 3219 Knox Street Tenant LLC |
New York |
United States | ||
| 3280 Peachtree Road NE Tenant LLC |
New York |
United States | ||
| 33 Arch Street Tenant LLC |
New York |
United States | ||
| 33 Bloor Street East Tenant LP |
Canada | |||
| 33 East 33rd Street Tenant LLC |
New York |
United States | ||
| 33 Irving Tenant LLC |
New York |
United States | ||
| 33 Q Street Tenant Limited |
England |
United Kingdom | ||
| 33 Rue La Fayette Tenant SAS |
France | |||
| 330 North Wabash Tenant LLC |
New York |
United States | ||
| 3300 N. Interstate 35 Tenant LLC |
New York |
United States | ||
| 332 S Michigan Tenant LLC |
New York |
United States | ||
| 333 George Street Pty Ltd |
Australia | |||
| 333 West San Carlos Tenant LLC |
New York |
United States | ||
| 3365 Piedmont Road Tenant LLC |
New York |
United States | ||
| 340 Bryant Street HQ LLC |
New York |
United States | ||
| 345 4th Street Tenant LLC |
New York |
United States | ||
| 345 Bourke Street Tenant Pty Ltd |
Australia | |||
| 345 West 100 South Tenant LLC |
New York |
United States | ||
| 35 East 21st Street HQ LLC |
New York |
United States | ||
| 35 Kalvebod Brygge Tenant ApS |
Denmark | |||
| 353 Sacramento Street Tenant LLC |
New York |
United States | ||
| 35-37 36th Street Tenant LLC |
New York |
United States | ||
| 360 NW 27th Street Tenant LLC |
New York |
United States | ||
| 3600 Brighton Boulevard Tenant LLC |
New York |
United States | ||
| 37 Shaul HaMelech Boulevard Tenant Ltd |
Israel | |||
| 37-63 Southampton Row Tenant Limited |
England |
United Kingdom | ||
| 38 Chancery Lane Tenant Limited |
England and Wales |
United Kingdom | ||
| 38 West 21st Street Tenant LLC |
New York |
United States | ||
| 383 George Street Tenant Pty Ltd |
Australia | |||
| 385 5th Avenue Q LLC |
New York |
United States | ||
| 3900 W Alameda Ave Tenant LLC |
New York |
United States | ||
| 391 San Antonio Road Tenant LLC |
New York |
United States | ||
| 4 Maale HaShichrur Tenant Ltd |
Israel | |||
| 4 Sint-Lazaruslaan Tenant |
Belgium |
8
| 40 Long Acre Q Limited |
England |
United Kingdom | ||
| 40 Rue du Colisée Tenant SAS |
France | |||
| 40 Tuval Tenant Ltd. |
Israel | |||
| 40 Water Street Tenant LLC |
New York |
United States | ||
| 400 California Street Tenant LLC |
New York |
United States | ||
| 400 Capitol Mall Tenant LLC |
New York |
United States | ||
| 400 Concar Drive Tenant LLC |
New York |
United States | ||
| 400 Lincoln Square Tenant LLC |
New York |
United States | ||
| 400 Spectrum Center Drive Tenant LLC |
New York |
United States | ||
| 4005 Miranda Ave Tenant LLC |
New York |
United States | ||
| 401 Collins Street Tenant Pty Ltd |
Australia | |||
| 401 San Antonio Road Tenant LLC |
New York |
United States | ||
| 404 Fifth Avenue Tenant LLC |
New York |
United States | ||
| 4041 Macarthur Boulevard Tenant LLC |
New York |
United States | ||
| 405 Mateo Street Tenant LLC |
New York |
United States | ||
| 408 Broadway Tenant LLC |
New York |
United States | ||
| 41 Blackfriars Road Tenant Limited |
England and Wales |
United Kingdom | ||
| 410 North Scottsdale Road Tenant LLC |
New York |
United States | ||
| 414 West 14th Street HQ LLC |
New York |
United States | ||
| 415 Mission Street Tenant LLC |
New York |
United States | ||
| 419 Park Avenue South Tenant LLC |
New York |
United States | ||
| 42 Charlemont Street Tenant Limited |
Ireland | |||
| 420 5th Avenue Q LLC |
New York |
United States | ||
| 420 Commerce Street Tenant LLC |
New York |
United States | ||
| 424 Fifth Avenue Holdings LLC |
Delaware |
United States | ||
| 424 Fifth Avenue Junior Holdings LLC |
Delaware |
United States | ||
| 424 Fifth Avenue LLC |
Delaware |
United States | ||
| 424 Fifth Avenue Senior Holdings LLC |
Delaware |
United States | ||
| 424-438 Fifth Avenue Tenant LLC |
New York |
United States | ||
| 428 Broadway Tenant LLC |
New York |
United States | ||
| 429 Lenox Ave Tenant LLC |
New York |
United States | ||
| 43 Brook Green Tenant Limited |
England |
United Kingdom | ||
| 430 Park Avenue Tenant LLC |
New York |
United States | ||
| 4311 11th Avenue Northeast Tenant LLC |
New York |
United States | ||
| 433 Hamilton Avenue Tenant LLC |
New York |
United States | ||
| 437 5th Avenue Q LLC |
New York |
United States | ||
| 437 Madison Avenue Tenant LLC |
New York |
United States | ||
| 44 East 30th Street HQ LLC |
New York |
United States | ||
| 44 Montgomery Street Tenant LLC |
New York |
United States | ||
| 44 Newhall Street Tenant Limited |
England |
United Kingdom | ||
| 44 Wall Street HQ LLC |
New York |
United States | ||
| 448 North LaSalle Street Tenant LLC |
New York |
United States | ||
| 45 Francis Street Tenant Pty Ltd |
Australia |
9
| 45 HaAtzmaut Tenant Ltd. |
Israel | |||
| 45 Robertson Street Tenant Limited |
Scotland |
United Kingdom | ||
| 45 West 18th Street Tenant LLC |
New York |
United States | ||
| 450 Lexington Tenant LLC |
New York |
United States | ||
| 460 Park Ave South Tenant LLC |
New York |
United States | ||
| 460 West 50 North Tenant LLC |
New York |
United States | ||
| 4635 Lougheed Highway Tenant LP |
Canada | |||
| 475 Sansome St Tenant LLC |
New York |
United States | ||
| 483 Broadway Tenant LLC |
New York |
United States | ||
| 49 West 27th Street HQ LLC |
New York |
United States | ||
| 490 Broadway Tenant LLC |
New York |
United States | ||
| 5 Canada Square Tenant Limited |
England |
United Kingdom | ||
| 5 Churchill Place Tenant Limited |
England |
United Kingdom | ||
| 5 Harcourt Road Tenant Limited |
Ireland | |||
| 5 Martin Place Tenant Pty Ltd |
Australia | |||
| 5 Merchant Square Tenant Limited |
England and Wales |
United Kingdom | ||
| 5 Norwich Street Tenant Limited |
England |
United Kingdom | ||
| 50 Bothwell Street Tenant Limited |
Scotland |
United Kingdom | ||
| 50 Miller Street Pty Ltd |
Australia | |||
| 50 W 28th Street Tenant LLC |
New York |
United States | ||
| 500 11th Ave North Tenant LLC |
New York |
United States | ||
| 500 7th Avenue Tenant LLC |
New York |
United States | ||
| 500 Bloor Street West Tenant LP |
Canada | |||
| 501 Boylston Street Tenant LLC |
New York |
United States | ||
| 501 East Kennedy Boulevard Tenant LLC |
New York |
United States | ||
| 501 East Las Olas Blvd Tenant LLC |
New York |
United States | ||
| 501 Eastlake Tenant LLC |
New York |
United States | ||
| 5049 Edwards Ranch Tenant LLC |
New York |
United States | ||
| 505 Main Street Tenant LLC |
New York |
United States | ||
| 505 Park Avenue Q LLC |
New York |
United States | ||
| 50-60 Francisco Street Tenant LLC |
New York |
United States | ||
| 50-60 Station Road Tenant Limited |
England and Wales |
United Kingdom | ||
| 51 Eastcheap Tenant Limited |
England |
United Kingdom | ||
| 511 W 25th Street Tenant LLC |
New York |
United States | ||
| 515 Folsom Street Tenant LLC |
New York |
United States | ||
| 515 N State Street Tenant LLC |
New York |
United States | ||
| 5161 Lankershim Boulevard Tenant LLC |
New York |
United States | ||
| 52 Bedford Row Tenant Limited |
England |
United Kingdom | ||
| 5215 North O’Connor Boulevard Tenant LLC |
New York |
United States | ||
| 524 Broadway Tenant LLC |
New York |
United States | ||
| 525 Broadway Tenant LLC |
New York |
United States | ||
| 53 Beach Street Tenant LLC |
New York |
United States | ||
| 53 Belliardstraat Tenant |
Belgium |
10
| 540 Broadway Q LLC |
New York |
United States | ||
| 545 Boylston Street Q LLC |
New York |
United States | ||
| 546 5th Avenue Tenant LLC |
New York |
United States | ||
| 55 Colmore Row Tenant Limited |
England |
United Kingdom | ||
| 550 7th Avenue HQ LLC |
New York |
United States | ||
| 550 Kearny Street HQ LLC |
New York |
United States | ||
| 56 Schildergasse Tenant GmbH |
Germany | |||
| 57 E 11th Street Tenant LLC |
New York |
United States | ||
| 575 5th Avenue Tenant LLC |
New York |
United States | ||
| 575 Lexington Avenue Tenant LLC |
New York |
United States | ||
| 5750 Wilshire Boulevard Tenant LLC |
New York |
United States | ||
| 5960 Berkshire Lane Tenant LLC |
New York |
United States | ||
| 599 Broadway Tenant LLC |
New York |
United States | ||
| 6 Brindley Place Tenant Limited |
England |
United Kingdom | ||
| 6 Devonshire Square Tenant Limited |
England |
United Kingdom | ||
| 6 East 32nd Street WW Q LLC |
New York |
United States | ||
| 6 Totzeret Haaretz Tenant Ltd. |
Israel | |||
| 60 London Wall Tenant Limited |
England |
United Kingdom | ||
| 60 Moorgate Tenant Limited |
England |
United Kingdom | ||
| 600 B Street Tenant LLC |
New York |
United States | ||
| 600 California Street Tenant LLC |
New York |
United States | ||
| 600 H Apollo Tenant LLC |
New York |
United States | ||
| 6001 Cass Avenue Tenant LLC |
New York |
United States | ||
| 601 South Figueroa Street Tenant LLC |
New York |
United States | ||
| 606 Broadway Tenant LLC |
New York |
United States | ||
| 609 5th Avenue Tenant LLC |
New York |
United States | ||
| 609 Greenwich Street Tenant LLC |
New York |
United States | ||
| 609 Main street Tenant LLC |
New York |
United States | ||
| 611 North Brand Boulevard Tenant LLC |
New York |
United States | ||
| 615 S. Tenant LLC |
New York |
United States | ||
| 625 Massachusetts Tenant LLC |
New York |
United States | ||
| 625 West Adams Street Tenant LLC |
New York |
United States | ||
| 63 Madison Avenue Tenant LLC |
New York |
United States | ||
| 64 York Street Pty Ltd |
Australia | |||
| 65 East State Street Tenant LLC |
New York |
United States | ||
| 650 California Street Tenant LLC |
New York |
United States | ||
| 6543 South Las Vegas Boulevard Tenant LLC |
New York |
United States | ||
| 655 15th Street NW Tenant LLC |
New York |
United States | ||
| 655 Montgomery St Tenant LLC |
New York |
United States | ||
| 655 New York Avenue Northwest Tenant LLC |
New York |
United States | ||
| 65-70 White Lion Street Tenant Limited |
England |
United Kingdom | ||
| 66 King Street Tenant Pty Ltd |
Australia | |||
| 660 J Street Tenant LLC |
New York |
United States |
11
| 660 North Capitol St NW Tenant LLC |
New York |
United States | ||
| 6655 Town Square Tenant LLC |
New York |
United States | ||
| 67 Irving Place Tenant LLC |
New York |
United States | ||
| 6900 North Dallas Parkway Tenant LLC |
New York |
United States | ||
| 695 Town Center Drive Tenant LLC |
New York |
United States | ||
| 7 Menachem Begin Tenant Ltd. |
Israel | |||
| 7 West 18th Street Tenant LLC |
New York |
United States | ||
| 70 Wilson Street Tenant Limited |
England and Wales |
United Kingdom | ||
| 700 2 Street Southwest Tenant LP |
Canada | |||
| 700 K Street NW Tenant LLC |
New York |
United States | ||
| 700 SW 5th Tenant LLC |
New York |
United States | ||
| 708 Main St Tenant LLC |
New York |
United States | ||
| 71 5th Avenue Tenant LLC |
New York |
United States | ||
| 71 Stevenson Street Q LLC |
New York |
United States | ||
| 711 Atlantic Ave Tenant LLC |
New York |
United States | ||
| 7-11 Lexington Street Tenant Limited |
England |
United Kingdom | ||
| 71-91 Aldwych House Tenant Limited |
England |
United Kingdom | ||
| 72 Knesebeckstraße Tenant GmbH |
Germany | |||
| 725 Ponce De Leon Ave NE Tenant LLC |
New York |
United States | ||
| 7272 Wisconsin Avenue Tenant LLC |
New York |
United States | ||
| 729 Washington Ave Tenant LLC |
New York |
United States | ||
| 7300 Dallas Parkway Tenant LLC |
New York |
United States | ||
| 731 Sansome Street Tenant LLC |
New York |
United States | ||
| 75 Arlington Street Tenant LLC |
New York |
United States | ||
| 75 E Santa Clara Street Tenant LLC |
New York |
United States | ||
| 75 Mosley Street Tenant Limited |
England |
United Kingdom | ||
| 75 Rock Plz Tenant LLC |
New York |
United States | ||
| 750 Lexington Avenue Tenant LLC |
New York |
United States | ||
| 750 White Plains Road Tenant LLC |
New York |
United States | ||
| 755 Sansome Street Tenant LLC |
New York |
United States | ||
| 756 W Peachtree Tenant LLC |
New York |
United States | ||
| 76 Moorgate Tenant Limited |
England |
United Kingdom | ||
| 76-78 Clerkenwell Road Tenant Limited |
England |
United Kingdom | ||
| 77 Leadenhall Street Tenant Limited |
England |
United Kingdom | ||
| 77 Sands Tenant LLC |
New York |
United States | ||
| 77 Sands WW Corporate Tenant LLC |
New York |
United States | ||
| 77 Sleeper Street Tenant LLC |
New York |
United States | ||
| 7761 Greenhouse Rd Tenant LLC |
New York |
United States | ||
| 777 6th Street NW Tenant LLC |
New York |
United States | ||
| 78 Sir John Rogerson’s Quay Tenant Limited |
Ireland | |||
| 78 SW 7th Street Tenant LLC |
New York |
United States | ||
| 8 W 40th Street Tenant LLC |
New York |
United States | ||
| 80 George Street Tenant Limited |
Scotland |
United Kingdom |
12
| 80 M Street SE Tenant LLC |
New York |
United States | ||
| 800 Bellevue Way Tenant LLC |
New York |
United States | ||
| 800 Market Street Tenant LLC |
New York |
United States | ||
| 800 North High Street Tenant LLC |
New York |
United States | ||
| 801 B. Springs Road Tenant LLC |
New York |
United States | ||
| 808 Wilshire Boulevard Tenant LLC |
New York |
United States | ||
| 8-14 Meard Street Tenant Limited |
England |
United Kingdom | ||
| 820 18th Ave South Tenant LLC |
New York |
United States | ||
| 821 17th Street Tenant LLC |
New York |
United States | ||
| 83 Maiden Lane Q LLC |
New York |
United States | ||
| 830 Brickell Plaza Tenant LLC |
New York |
United States | ||
| 830 NE Holladay Street Tenant LLC |
New York |
United States | ||
| 8305 Sunset Boulevard HQ LLC |
New York |
United States | ||
| 8687 Melrose Avenue Tenant LLC |
New York |
United States | ||
| 8687 Melrose Green Tenant LLC |
New York |
United States | ||
| 88 K Tenant Limited |
England |
United Kingdom | ||
| 88 U Place Tenant LLC |
New York |
United States | ||
| 880 3rd Ave Tenant LLC |
New York |
United States | ||
| 881 Peachtree Street Northeast Tenant LLC |
New York |
United States | ||
| 8910 University Center Lane Tenant LLC |
New York |
United States | ||
| 89-115 Mare Street Tenant Limited |
England |
United Kingdom | ||
| 9 Dawson Street Tenant Limited |
Ireland | |||
| 90 South 400 West Tenant LLC |
New York |
United States | ||
| 90 York Way Tenant Limited |
England and Wales |
United Kingdom | ||
| 901 North Glebe Road Tenant LLC |
New York |
United States | ||
| 901 Woodland St Tenant LLC |
New York |
United States | ||
| 902 Broadway Tenant LLC |
New York |
United States | ||
| 91 Baker Street Tenant Limited |
England |
United Kingdom | ||
| 920 5th Ave Tenant LLC |
New York |
United States | ||
| 920 SW 6th Avenue Tenant LLC |
New York |
United States | ||
| 9200 Timpanogos Highway Tenant LLC |
New York |
United States | ||
| 925 4th Avenue Tenant LLC |
New York |
United States | ||
| 925 N La Brea Ave Tenant LLC |
New York |
United States | ||
| 9670416 CANADA Inc. |
Canada | |||
| 97 Hackney Road Tenant Limited |
England |
United Kingdom | ||
| 9777 Wilshire Boulevard Q LLC |
New York |
United States | ||
| 980 6th Avenue Tenant LLC |
New York |
United States | ||
| 9830 Wilshire Boulevard Tenant LLC |
New York |
United States | ||
| 99 Chauncy Street Q LLC |
New York |
United States | ||
| 99 High Street Tenant LLC |
New York |
United States | ||
| 99 Q Victoria Street Tenant Limited |
England |
United Kingdom | ||
| Alexanderplatz 1 Tenant GmbH |
Germany | |||
| ARK Investment Group Holdings LLC |
Delaware |
United States |
13
| ARK Investment Group Master GP LLC |
Delaware |
United States | ||
| ARK Investment Group Master GP LP |
Delaware |
United States | ||
| ARK Master Fund GP LLC |
Delaware |
United States | ||
| Arnulfstraße 60 Tenant GmbH |
Germany | |||
| Avonmore Road Tenant Limited |
England |
United Kingdom | ||
| Axel-Springer-Platz 3 Tenant GmbH |
Germany | |||
| Ballindamm 40 Tenant GmbH |
Germany | |||
| Bird Investco LLC |
Delaware |
United States | ||
| Bischoffsheimlaan Tenant |
Belgium | |||
| Britain Quay Tenant Limited |
Ireland | |||
| Central Plaza Tenant Limited |
Ireland | |||
| Chausseestraße 29 Tenant GmbH |
Germany | |||
| Christchurch Court Tenant Limited |
England and Wales |
United Kingdom | ||
| Cities by We LLC |
Delaware |
United States | ||
| Clubhouse TS LLC |
New York |
United States | ||
| Corporation Street Tenant Limited |
England and Wales |
United Kingdom | ||
| Corsham Tenant Limited |
England |
United Kingdom | ||
| Creator Fund Managing Member LLC |
Delaware |
United States | ||
| Dalton Place Tenant Limited |
England |
United Kingdom | ||
| DSQ Partners LP |
Delaware |
United States | ||
| DSQ Partners Lux S.à r.l. |
Luxembourg | |||
| Dublin Landings Tenant Limited |
Ireland | |||
| Eichhornstraße 3 Tenant GmbH |
Germany | |||
| Emprendimientos y Proyectos del Peru S.A.C. |
Peru | |||
| Emprendimientos y Proyectos EYP, S.A. |
Costa Rica | |||
| Euclid LLC |
Delaware |
United States | ||
| Euclid WW Holdings Inc. |
Delaware |
United States | ||
| FieldLens LLC |
New York |
United States | ||
| Five Hundred Fifth Avenue HQ LLC |
New York |
United States | ||
| Friedrichstraße 76 Tenant GmbH |
Germany | |||
| Friesenplatz Tenant GmbH |
Germany | |||
| Gänsemarkt 43 Tenant GmbH |
Germany | |||
| Gerhofstraße 1-3 Tenant GmbH |
Germany | |||
| Gravity Coworking Pty Ltd |
Australia | |||
| Hagfish Mumbai Private Limited |
India | |||
| Hammerjaw Bengaluru Private Limited |
India | |||
| Herengracht 206 Tenant B.V. |
Netherlands | |||
| Houndshark Delhi Private Limited |
India | |||
| Icefish APAC Holdco B.V. |
Netherlands | |||
| Icefish Investment Holdco B.V. |
Netherlands | |||
| Insurance Services by WeWork LLC |
Delaware |
United States | ||
| International Quarter Building Tenant Limited |
England |
United Kingdom | ||
| Inversiones Inmobiliarias Bonavista IIBV, SRL |
Costa Rica |
14
| Iveagh Court Tenant Limited |
Ireland | |||
| Junghofstrasse 13 Tenant GmbH |
Germany | |||
| Junghofstraße 22 Tenant GmbH |
Germany | |||
| Kape LLC |
New York |
United States | ||
| Karl-Liebknecht Street Tenant GmbH |
Germany | |||
| Keizersgracht 271 Tenant B.V. |
Netherlands | |||
| Keizersgracht 572 Tenant B.V. |
Netherlands | |||
| Kemperplatz 1 Tenant GmbH |
Germany | |||
| Kurfürstendamm 11 Tenant GmbH |
Germany | |||
| Lackington Street Tenant Limited |
England |
United Kingdom | ||
| Legacy Tenant LLC |
New York |
United States | ||
| LT Build Limited |
United Kingdom | |||
| Mailroom Bar at 110 Wall LLC |
New York |
United States | ||
| Mayor Street Lower Tenant Limited |
Ireland | |||
| Midtown Music Club Ltd. |
Israel | |||
| MissionU PBC |
Delaware |
United States | ||
| naked Hub Vietnam Holdings Limited |
Virgin Islands, British | |||
| Neue Schönhauser Straße 3-5 Tenant GmbH |
Germany | |||
| Neuturmstraße 5 Tenant GmbH |
Germany | |||
| NHNP VN Limited |
Virgin Islands, British | |||
| No. 1 Spinningfields Tenant Limited |
England |
United Kingdom | ||
| One Gotham Center Tenant LLC |
New York |
United States | ||
| One Metropolitan Square Tenant LLC |
New York |
United States | ||
|
Oskar-von-Miller-Ring 20 Tenant GmbH |
Germany | |||
|
Oskar-von-Miller-Ring 33 Q GmbH |
Germany | |||
| Parkmerced Partner LLC |
Delaware |
United States | ||
| Play by WeWork LLC |
Delaware |
United States | ||
| Powered By We Germany GmbH |
Germany | |||
| Powered By We LLC |
New York |
United States | ||
| Powered By We UK Limited |
England and Wales |
United Kingdom | ||
| Premier Place Tenant Limited |
England and Wales |
United Kingdom | ||
| Project Caesar LLC |
Delaware |
United States | ||
| Project Standby I LLC |
New York |
United States | ||
| Prolific Interactive LLC |
New York |
United States | ||
| Provost and East Tenant Limited |
England |
United Kingdom | ||
| PT PoweredByWe Services Indonesia |
Indonesia | |||
| PT WeWork Services International |
Indonesia | |||
| Puddle Dock Tenant Limited |
England and Wales |
United Kingdom | ||
| PxWe Facility & Asset Management Services LLC |
Delaware |
United States | ||
| PxWe India Private Limited |
India | |||
| Quay Street Tenant Limited |
England |
United Kingdom | ||
| Rosenthaler Straße 43-45 Tenant GmbH |
Germany | |||
| Rudolfplatz 7 Tenant GmbH |
Germany |
15
| Rue des Archives 64/66 Tenant SAS |
France | |||
| Sarphatistraat 8 Tenant B.V. |
Netherlands | |||
| Sheriff Street Lower Tenant Limited |
Ireland | |||
| Shoreditch the Bard Tenant Limited |
England and Wales |
United Kingdom | ||
| Skelbækgade 2-4 Tenant ApS |
Denmark | |||
| South Tryon Street Tenant LLC |
New York |
United States | ||
| Spacemob Pte. Ltd. |
Singapore | |||
| Spacious Technologies, LLC |
Delaware |
United States | ||
| Stadhouderskade 5-6 Q B.V. |
Netherlands | |||
| Stamford Street Tenant Limited |
England |
United Kingdom | ||
| Standby I Tenant GmbH |
Germany | |||
| Stralauer Allee 6 Tenant GmbH |
Germany | |||
| Strawinskylaan 4117 Tenant B.V. |
Netherlands | |||
| Stresemannstraße 123 Tenant GmbH |
Germany | |||
| Taunusanlage 8 Tenant GmbH |
Germany | |||
| The Hewitt Shoreditch Tenant Limited |
England and Wales |
United Kingdom | ||
| The Hub Tenant LLC |
New York |
United States | ||
| The We Company Management Holdings L.P. |
Cayman Islands | |||
| The We Company Management LLC |
Delaware |
United States | ||
| The We Company MC LLC |
Delaware |
United States | ||
| The We Company PI L.P. |
Cayman Islands | |||
| The We Company ROU S.R.L. |
Romania | |||
| The We Company Worldwide Limited |
England |
United Kingdom | ||
| Unomy Ltd. |
Israel | |||
| Waller Creek Holdings LLC |
Delaware |
United States | ||
| Waller Creek Holdings LP |
Delaware |
United States | ||
| Waltz Merger Sub LLC |
Delaware |
United States | ||
| Warschauer Platz Tenant GmbH |
Germany | |||
| We Rise Shell LLC |
New York |
United States | ||
| We Work 154 Grand LLC |
New York |
United States | ||
| We Work 349 5th Ave LLC |
New York |
United States | ||
| We Work Management LLC |
New York |
United States | ||
| We Work Retail LLC |
New York |
United States | ||
| WeInsure Holdco LLC |
Delaware |
United States | ||
| Welkio LLC |
New York |
United States | ||
| WeWork (Austria) GmbH |
Austria | |||
| WeWork (Czech Republic) s.r.o. |
Czech Republic | |||
| WeWork (Thailand) Limited |
Thailand | |||
| WeWork 156 2nd LLC |
Delaware |
United States | ||
| WeWork 175 Varick LLC |
Delaware |
United States | ||
| WeWork 25 Taylor LLC |
Delaware |
United States | ||
| WeWork 261 Madison LLC |
New York |
United States | ||
| WeWork 54 West 40th LLC |
New York |
United States |
16
| WeWork APAC Partner Holdings B.V. |
Netherlands | |||
| WeWork Asia Holding Company B.V. |
Netherlands | |||
| WeWork Asset Management LLC |
New York |
United States | ||
| WeWork Australia Pty Ltd |
Australia | |||
| WeWork Belgium |
Belgium | |||
| WeWork Bryant Park LLC |
New York |
United States | ||
| WeWork Busan 1-Ho Yuhan Hoesa |
Korea, Republic of | |||
| WeWork Canada GP B.V. |
Netherlands | |||
| WeWork Canada GP ULC |
Nova Scotia |
Canada | ||
| WeWork Canada LP B.V. |
Netherlands | |||
| WeWork Canada LP ULC |
Nova Scotia |
Canada | ||
| WeWork Capital Advisors LLC |
Delaware |
United States | ||
| WeWork Capital Advisors UK Limited |
England |
United Kingdom | ||
| WeWork Commons LLC |
New York |
United States | ||
| WeWork Community Workspace Ireland Limited |
Ireland | |||
| WeWork Community Workspace UK Limited |
England and Wales |
United Kingdom | ||
| WeWork Community Workspace, S. L. |
Spain | |||
| WeWork Companies (International) B.V. |
Netherlands | |||
| WeWork Companies LLC |
Delaware |
United States | ||
| WeWork Companies Partner (International) B.V. |
Netherlands | |||
| WeWork Companies Partner LLC |
New York |
United States | ||
| WeWork Construction LLC |
New York |
United States | ||
| WeWork Denmark ApS |
Denmark | |||
| WeWork France SAS |
France | |||
| WeWork Germany GmbH |
Germany | |||
| Wework Gulf I FZ-LLC |
United Arab Emirates | |||
| WeWork Holding (Thailand) Company Limited |
Thailand | |||
| WeWork Holdings LLC |
Delaware |
United States | ||
| WeWork Hungary Kft. |
Hungary | |||
| WeWork Interco LLC |
New York |
United States | ||
| WeWork International Limited |
England |
United Kingdom | ||
| WeWork Israel Ltd. |
Israel | |||
| WeWork Italy S.R.L. |
Italy | |||
| WeWork Korea Yuhan Hoesa |
Korea, Republic of | |||
| WeWork LA LLC |
Delaware |
United States | ||
| WeWork Labs Entity LLC |
Delaware |
United States | ||
| WeWork Little West 12th LLC |
Delaware |
United States | ||
| WeWork Magazine LLC |
New York |
United States | ||
| WeWork Malaysia Sdn. Bhd. |
Malaysia | |||
| WeWork Middle East DWTC FZE |
United Arab Emirates | |||
| WeWork Middle East Gazelle Limited |
United Arab Emirates | |||
| WeWork Middle East Holdings B.V. |
Netherlands | |||
| WeWork Netherlands B.V. |
Netherlands |
17
| WeWork New Zealand |
New Zealand | |||
| WeWork New Zealand Holdco B.V. |
Netherlands | |||
| WeWork Norway AS |
Norway | |||
| WeWork Paris I Tenant SAS |
France | |||
| WeWork Paris II Tenant SAS |
France | |||
| WeWork Paris III Tenant SAS |
France | |||
| WeWork Paris IV Tenant SAS |
France | |||
| WeWork Peru Management S.R.L. |
Peru | |||
| WeWork Peru S.R.L |
Peru | |||
| WeWork Poland sp. z o.o. |
Poland | |||
| WeWork Property Investors LLC |
Delaware |
United States | ||
| WeWork Property Investors OPGP LP |
Delaware |
United States | ||
| WeWork Real Estate LLC |
New York |
United States | ||
| WeWork Rus LLC |
Russian Federation | |||
| WeWork Saudi Arabia Limited |
Saudi Arabia | |||
| WeWork Seoul 1-Ho Yuhan Hoesa |
Korea, Republic of | |||
| WeWork Seoul 2-Ho Yuhan Hoesa |
Korea, Republic of | |||
| WeWork Seoul 3-Ho Yuhan Hoesa |
Korea, Republic of | |||
| WeWork Seoul 4-Ho Yuhan Hoesa |
Korea, Republic of | |||
| WeWork Seoul 5-ho Yuhan Hoesa |
Korea, Republic of | |||
| WeWork Services LLC |
Delaware |
United States | ||
| WeWork Singapore Pte. Ltd. |
Singapore | |||
| WeWork South Africa (Pty) Ltd |
South Africa | |||
| WeWork Space Services Inc. |
Delaware |
United States | ||
| WeWork Space Services LLC |
New York |
United States | ||
| WeWork Space Services UK Limited |
England |
United Kingdom | ||
| WeWork Technology Israel Ltd. |
Israel | |||
| WeWork Uruguay S.R.L. |
Uruguay | |||
| WeWork Vietnam Limited |
Vietnam | |||
| WeWork Wellness LLC |
New York |
United States | ||
| Wildgoose I LLC |
New York |
United States | ||
| Wilmersdorferstrasse 59 Tenant GmbH |
Germany | |||
| WW 1010 Hancock LLC |
New York |
United States | ||
| WW 107 Spring Street LLC |
New York |
United States | ||
| WW 11 John LLC |
New York |
United States | ||
| WW 110 Wall LLC |
New York |
United States | ||
| WW 111 West Illinois LLC |
New York |
United States | ||
| WW 115 W 18th Street LLC |
New York |
United States | ||
| WW 1161 Mission LLC |
New York |
United States | ||
| WW 120 E 23rd Street LLC |
New York |
United States | ||
| WW 1328 Florida Avenue LLC |
New York |
United States | ||
| WW 1550 Wewatta Street LLC |
New York |
United States | ||
| WW 1601 Fifth Avenue LLC |
New York |
United States |
18
| WW 1875 Connecticut LLC |
New York |
United States | ||
| WW 2015 Shattuck LLC |
New York |
United States | ||
| WW 205 E 42nd Street LLC |
New York |
United States | ||
| WW 210 N Green LLC |
New York |
United States | ||
| WW 220 NW Eighth Avenue LLC |
New York |
United States | ||
| WW 222 Broadway LLC |
New York |
United States | ||
| WW 2221 South Clark LLC |
New York |
United States | ||
| WW 240 Bedford LLC |
New York |
United States | ||
| WW 25 Broadway LLC |
New York |
United States | ||
| WW 26 JS Member LLC |
New York |
United States | ||
| WW 312 Arizona LLC |
New York |
United States | ||
| WW 350 Lincoln LLC |
New York |
United States | ||
| WW 379 W Broadway LLC |
New York |
United States | ||
| WW 401 Park Avenue South LLC |
New York |
United States | ||
| WW 5 W 125th Street LLC |
New York |
United States | ||
| WW 500 Yale LLC |
New York |
United States | ||
| WW 51 Melcher LLC |
Delaware |
United States | ||
| WW 520 Broadway LLC |
New York |
United States | ||
| WW 535 Mission LLC |
New York |
United States | ||
| WW 555 West 5th Street LLC |
New York |
United States | ||
| WW 5782 Jefferson LLC |
New York |
United States | ||
| WW 600 Congress LLC |
New York |
United States | ||
| WW 641 S Street LLC |
New York |
United States | ||
| WW 718 7th Street LLC |
New York |
United States | ||
| WW 745 Atlantic LLC |
Delaware |
United States | ||
| WW 79 Madison LLC |
New York |
United States | ||
| WW 81 Prospect LLC |
New York |
United States | ||
| WW 811 West 7th Street LLC |
New York |
United States | ||
| WW 85 Broad LLC |
New York |
United States | ||
| WW 995 Market LLC |
New York |
United States | ||
| WW Aldgate Limited |
England |
United Kingdom | ||
| WW Bishopsgate Limited |
England |
United Kingdom | ||
| WW Brooklyn Navy Yard LLC |
New York |
United States | ||
| WW BuildCo LLC |
New York |
United States | ||
| WW Community Workspaces Philippines, Inc. |
Philippines | |||
| WW Co-Obligor Inc. |
Delaware |
United States | ||
| WW Costa Rica FTZ SRL |
Costa Rica | |||
| WW Costa Rica SRL |
Costa Rica | |||
| WW Devonshire Limited |
England |
United Kingdom | ||
| WW Enlightened Hospitality Investor LLC |
New York |
United States | ||
| WW Fox Court Limited |
England |
United Kingdom | ||
| WW Hanover House Operations Limited |
England |
United Kingdom | ||
| WW HoldCo LLC |
Delaware |
United States |
19
| WW Journal Square Holdings LLC |
New York |
United States | ||
| WW Journal Square Member LLC |
New York |
United States | ||
| WW Medius Limited |
England |
United Kingdom | ||
| WW Metropool B.V. |
Netherlands | |||
| WW Moor Place Limited |
England |
United Kingdom | ||
| WW Onsite Services AAG LLC |
New York |
United States | ||
| WW Onsite Services EXP LLC |
New York |
United States | ||
| WW Onsite Services LLC |
New York |
United States | ||
| WW Onsite Services SFI LLC |
New York |
United States | ||
| WW Onsite Services SUM LLC |
New York |
United States | ||
| WW Project Swift Development LLC |
Delaware |
United States | ||
| WW Project Swift Member LLC |
Delaware |
United States | ||
| WW Sea Containers Limited |
England |
United Kingdom | ||
| WW Sweden AB |
Sweden | |||
| WW VendorCo LLC |
New York |
United States | ||
| WW Weteringschans B.V. |
Netherlands | |||
| WW Worldwide C.V. |
Netherlands | |||
| WWCO Architecture Holdings LLC |
Delaware |
United States | ||
| WW-DSQ Partner LLC |
Delaware |
United States |
20
Exhibit 99.1
WeWork and BowX Acquisition Corp. Announce Closing of Business Combination to Create Publicly-Traded Leading Flexible Space Provider
| • | WeWork to begin trading on the New York Stock Exchange under the ticker symbol “WE” starting October 21, 2021 |
| • | Business combination that closed on October 20, 2021 provides WeWork with the previously announced gross cash proceeds of approximately $1.3 billion, prior to expenses, which includes the cash held in the trust account, a fully committed PIPE and an equity backstop facility provided by Cushman & Wakefield |
| • | WeWork has shown strong global momentum after reporting five months of consecutive revenue growth |
| • | Executive Chairman Marcelo Claure and CEO Sandeep Mathrani will continue to lead the company as it executes its strategic plan |
MENLO PARK and NEW YORK, October 20, 2021 – BowX Acquisition Corp. (NASDAQ: BOWX, BOWXU, AND BOWXW) (“BowX”), a special purpose acquisition company, and WeWork Inc., a leading global flexible space provider, today announced the completion of their business combination. The combined company will now operate as WeWork Inc. and will begin trading on the New York Stock Exchange under the ticker symbol “WE” on October 21, 2021.
Sandeep Mathrani, CEO of WeWork, said, “Today is a testament to the determination of our company to not only transform our business, but also to adapt and deliver the options that today’s workforce demands. As companies around the world reimagine their workplace, WeWork is uniquely positioned to offer the space and services that can power solutions built around flexibility. Providing employers and landlords around the world with our holistic offering of space-as-a-service, All Access and workplace management technology will enable WeWork to lead the market in mainstream adoption of flexible space.”
Marcelo Claure, Executive Chairman of WeWork, said, “SoftBank is proud to support WeWork on this important day, a day that recognizes years of hard work and executing on our vision. As the way we live and work has fundamentally changed, WeWork is leading one of the biggest disruptions in commercial real estate with a workspace solution that has never been more in demand. This milestone is just the beginning and we look forward to continuing to support WeWork on its journey.”
Vivek Ranadivé, Board Member at WeWork and former Chairman and Co-CEO of BowX Acquisition Corp., said, “WeWork has long been a pioneer in establishing what the future of work could look like, and today cements the company’s trajectory towards achieving this mission. With a strong leadership team in place and new platform offerings that will leverage WeWork’s decade of expertise and proprietary technology, we can’t imagine a business better equipped to lead continued growth in the flexible space market. While the pandemic has created many uncertainties, flexibility is here to stay and WeWork has the space and technology to power this global shift.”
Today, WeWork is a transformed company primed to meet the growing demand for flexible space solutions. As evidenced by sequential monthly increases in revenue and occupancy in the third quarter of 2021, WeWork has demonstrated the resiliency of its business model and a strong long-term value proposition. Q3 2021 preliminary total revenue was $658 million, an increase of approximately 10% compared to Q2 2021 revenue of $593 million. Across consolidated operations, total occupancy continued to increase to 60% at the end of Q3 2021, up from 52% at the end of Q2 2021. Consolidated gross desk sales totaled 154,000 in Q3 2021 representing approximately 9.2 million square feet sold. Consolidated new desk sales totaled 84,000 in Q3 2021.
.WeWork has also begun to realize new revenue opportunities by digitizing its real estate offerings and productizing its existing technology. As of Q3 2021, All Access, our pay-as-you-go or subscription-based product, and other virtual memberships have reached 32,000. The company has begun to build out its proprietary workplace management platform, WeWork Workplace, to offer landlords and members the ability to manage flex space across their portfolios and recently announced strategic partnerships with Hudson’s Bay Company, Cushman & Wakefield and Ivanhoé Cambridge.
PJT Partners served as sole financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP served as legal counsel to WeWork. UBS Investment Bank served as sole financial and capital markets advisor to BowX. Cooley LLP served as legal counsel to BowX. UBS Investment Bank and PJT Partners acted as joint placement agents with respect to the private placement. Paul Hastings LLP served as placement agent counsel and Morrison & Foerster LLP served as legal counsel to SoftBank Group.
About WeWork
WeWork was founded in 2010 with the vision to create environments where people and companies come together and do their best work. Since opening our first location in New York City, we’ve grown into a global flexible space provider committed to delivering technology-driven flexible solutions, inspiring spaces, and unmatched community experiences. Today, we’re constantly reimagining how the workplace can help everyone, from freelancers to Fortune 500s, be more motivated, productive, and connected. For more information about WeWork, please visit us at https://wework.com.
About BowX Acquisition Corp.
BowX Acquisition Corp. is a Special Purpose Acquisition Company formed by management of Bow Capital, including Vivek Ranadivé and Murray Rode. Bow Capital is a venture capital fund bridging the best of academia, business, and entertainment. Mr. Ranadivé has four decades of experience and is founder and managing director of Bow Capital, as well as previous founder and CEO of TIBCO. Mr. Rode is senior advisor of Bow Capital and former CEO of TIBCO, with over 30 years of experience in tech.
Forward-Looking Statements
Certain statements made in this press release are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” with respect to the proposed transaction between WeWork and BowX include statements regarding the benefits and timing of the transaction, the anticipated timing of the trading of the combined company and expectations regarding the combined company’s position to serve the multi-trillion office space market and enable the future of work. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “pipeline,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and
assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this press release, including but not limited to: (i) the effect of the announcement of the transaction on WeWork’s business relationships, operating results, and business generally, (ii) risks that the transaction disrupts current plans and operations of WeWork and potential difficulties in WeWork employee retention as a result of the transaction, (iii) the outcome of any legal proceedings that may be instituted against WeWork or against BowX related to the Merger Agreement or the transaction, (iv) the ability to maintain the listing of WeWork’s securities on a national securities exchange, (v) the price of WeWork’s securities may be volatile due to a variety of factors, including changes in the competitive and regulated industries in which WeWork operates, variations in operating performance across competitors, changes in laws and regulations affecting WeWork’s business, WeWork’s inability to implement its business plan or meet or exceed its financial projections and changes in the combined capital structure, (vi) changes in general economic conditions, including as a result of the COVID-19 pandemic, and (vii) the ability to implement business plans, forecasts, and other expectations after the completion of the transaction, and identify and realize additional opportunities. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the registration statement on Form S-4, the proxy statement/prospectus and other documents filed or that may be filed by BowX or WeWork from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and WeWork and BowX assume no obligation and do not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. Neither WeWork nor BowX gives any assurance that the combined company will achieve its expectations.
Investors
Chandler Salisbury
investor@wework.com
Media
Nicole Sizemore / Julia Sullivan
press@wework.com
Exhibit 99.2
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
Defined terms included below have the same meaning as terms defined and included elsewhere in the Current Report on Form 8-K (the “Form 8-K”) filed by the Company with the Securities and Exchange Commission (the “SEC”) on October 26, 2021. Unless the context otherwise requires, “Prior WeWork” refers to WeWork Inc. prior to the Closing Date, the “Company” refers to WeWork Inc. (“WeWork”) (f/k/a BowX Acquisition Corp.) after the Closing, and BowX Acquisition Corp (“BowX”) prior to the Closing Date.
The following unaudited pro forma condensed combined balance sheet as of June 30, 2021, the unaudited pro forma condensed combined statement of operations for the six months ended June 30, 2021, and the year ended December 31, 2020, present the combination of the financial information of BowX and Prior WeWork after giving effect to the Business Combination, PIPE Investment, recapitalization (collectively, the “Business Combination and Related Transactions”) and related adjustments described in the accompanying notes, and have been prepared in accordance with Article 11 of Regulation S-X.
The unaudited pro forma condensed combined balance sheet as of June 30, 2021 combines the historical balance sheet of BowX and the historical consolidated balance sheet of Prior WeWork on a pro forma basis as if the Business Combination and Related Transactions, summarized below, had been consummated on June 30, 2021. The unaudited pro forma condensed combined statement of operations for the six months ended June 30, 2021, and for the year ended December 31, 2020, combine the historical statement of operations of BowX and Prior WeWork for such period on a pro forma basis as if the transaction, summarized below, had been consummated on January 1, 2020, the beginning of the earliest period presented:
| • | The merger of Prior WeWork with and into BowX Merger Sub, a wholly owned subsidiary of BowX, with Prior WeWork surviving the merger as a wholly owned subsidiary of BowX; |
| • | The issuance and sale of 80,000,000 shares of WeWork Class A Common Stock for $10.00 per share and an aggregate purchase price of $800 million in the PIPE Investment pursuant to the Subscription Agreements, executed concurrently with the Merger Agreement; |
| • | The conversion of 9,075,000 shares of BowX Class B Common Stock into 9,075,000 shares of WeWork Class A Common Stock in connection with the transaction in accordance with the terms of the Merger Agreement; |
| • | The exchange of all issued and outstanding Prior WeWork Preferred Stock into a number of shares of WeWork Class A Common Stock based on the Exchange Ratio (using the rounded Exchange Ratio of 0.82619); |
| • | The issuance of the First Warrant to SBWW and/or its designees to purchase WeWork Class A Common Stock based on the Exchange Ratio (using the rounded Exchange Ratio of 0.82619); |
| • | The exchange of all issued and outstanding Prior WeWork Common Stock into a number of shares of WeWork Common Stock based on the Exchange Ratio (using the rounded Exchange Ratio of 0.82619); |
| • | The redemption of 15,006,786 BowX public shares subsequent to BowX public shareholders exercising their right to redeem public shares for their pro rata share of the trust account; |
| • | The issuance and sale of 150,000,000 shares of WeWork Class A Common Stock for $10.00 per share and an aggregate purchase price of $150 million to Backstop Investor pursuant to the Backstop Subscription Agreement (“Backstop Facility”); |
| • | The repayment of the $349.0 million short-term loan (“LC Debt Facility”) and accrued interest. |
At the Closing, all outstanding Prior WeWork Options, Prior WeWork Restricted Stock Units Awards (RSUs) and warrants were converted into WeWork Options and WeWork Warrants to purchase WeWork Class A Common Stock, and WeWork Restricted Stock Unit Awards.
Each Prior WeWork option was converted into an option to purchase shares of WeWork Class A Common Stock with the number of shares of Prior WeWork Class A Common Stock issuable for such Prior WeWork option determined by multiplying the number of Prior WeWork shares that were issuable upon exercise of such Prior WeWork option multiplied by the Exchange Ratio, rounded down to the nearest whole share. Additionally, the exercise price of each converted option will be determined by dividing the exercise price of the respective Prior WeWork Options by the Exchange Ratio, rounded up to the nearest whole cent.
Each award of Prior WeWork restricted stock units was converted into WeWork Restricted Stock Units with the number of restricted stock units to be converted determined by multiplying the number of Prior WeWork Common Stock underlying such WeWork Restricted Stock Units multiplied by the Exchange Ratio.
The following summarizes the pro forma WeWork Class A Common Stock and WeWork Class C Common Stock issued and outstanding immediately after the Business Combination and Related Transactions, excluding the potential dilutive effect of outstanding stock options, restricted stock units, and common stock warrants:
| Pro Forma Combined Share Ownership in WeWork |
||||||||
|
|
Number of Shares |
% Ownership | ||||||
| WeWork Stockholders(1) |
578,619,732 | 80.8% | ||||||
| BowX Sponsor & Sponsor Persons |
9,075,000 | 1.3% | ||||||
| BowX Public Stockholders |
33,293,214 | 4.6% | ||||||
| PIPE Investors |
80,000,000 | 11.2% | ||||||
| Backstop Investor |
15,000,000 | 2.1% | ||||||
|
|
|
|
|
|||||
| Total (excluding certain WeWork shares)(1) |
715,987,946 | 100% | ||||||
|
|
|
|
|
|||||
| WeWork remaining consideration(1) |
76,680,268 | |||||||
|
|
|
|||||||
| Total shares at Closing(1) |
792,668,214 | |||||||
|
|
|
|||||||
| (1) | Total Consideration issued to Prior WeWork is 655,300,000 shares of WeWork Common Stock. The total shares of WeWork Class A Common Stock issued includes shares of WeWork Class A Common Stock issued in respect of outstanding Prior WeWork Common Stock and Prior WeWork Preferred Stock plus shares of WeWork Class A Common Stock underlying or exchangeable for unvested and/or unexercised stock options, restricted stock units, restricted stock awards, warrants, WeWork Partnerships Profits Interest Units (including corresponding shares of WeWork Class C Common Stock) and warrants, respectively, at the Closing. As of October 20, 2021, the final Exchange Ratio is 0.82619 and there were issued 558,926,179 shares of WeWork Class A Common Stock and 19,938,089 shares of WeWork Class C Common Stock to Prior WeWork stockholders as of the Closing (not including shares of WeWork Class A Common Stock underlying or exchangeable for unvested and/or unexercised stock options, restricted stock units, restricted stock awards, warrants and WeWork Partnerships Profits Interest Units). The numbers in this table reflect the pro forma combined share ownership in WeWork using the final Exchange Ratio as of October 20, 2021, and the number of shares as of June 30, 2021, based on the actual redemptions and transactions described above. Inclusion of all such securities would dilute the ownership of all stockholders of WeWork. |
The unaudited pro forma condensed combined financial information is based on and should be read in conjunction with the audited historical financial statements of each of BowX and Prior WeWork and the notes thereto, as well as the disclosures contained in the sections titled “BowX’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “WeWork’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” within the Form S-4 filed with the SEC on September 16, 2021.
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF JUNE 30, 2021
| (Amounts in thousands, except share and per share amounts) |
Prior WeWork Inc. (Historical) |
BowX (Historical) |
Reclassification Adjustments |
Pro Forma Transaction Accounting Adjustments |
Pro Forma Combined |
Note | ||||||||||||||||||
| Assets |
||||||||||||||||||||||||
| Current assets: |
||||||||||||||||||||||||
| Cash and cash equivalents |
$ | 843,957 | $ | 506 | $ | — | $ | 830,584 | $ | 1,675,047 | A | |||||||||||||
| Accounts receivable and accrued revenue, net of allowance |
118,205 | — | — | — | 118,205 | |||||||||||||||||||
| Other current assets |
435,448 | — | 323 | 20,417 | 456,188 | B | ||||||||||||||||||
| Prepaid expense |
— | 323 | (323 | ) | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total current assets |
1,397,610 | 829 | — | 851,001 | 2,249,440 | |||||||||||||||||||
| Property and equipment, net |
5,991,011 | — | — | — | 5,991,011 | |||||||||||||||||||
| Lease right-of-use assets, net |
13,923,373 | — | — | — | 13,923,373 | |||||||||||||||||||
| Restricted cash |
11,528 | — | — | — | 11,528 | |||||||||||||||||||
| Equity method and other investments |
198,163 | — | — | — | 198,163 | |||||||||||||||||||
| Investments held in trust account |
— | 483,072 | — | (483,072 | ) | — | C | |||||||||||||||||
| Goodwill |
678,668 | — | — | — | 678,668 | |||||||||||||||||||
| Intangible assets, net |
53,806 | — | — | — | 53,806 | |||||||||||||||||||
| Other assets |
932,151 | — | — | (515 | ) | 931,636 | D | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total assets |
$ | 23,186,310 | $ | 483,901 | $ | — | $ | 367,414 | $ | 24,037,625 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Liabilities |
||||||||||||||||||||||||
| Current liabilities: |
||||||||||||||||||||||||
| Accounts payable and accrued expenses |
$ | 537,600 | $ | 3,674 | $ | — | $ | (5,166 | ) | $ | 536,108 | E | ||||||||||||
| Members’ service retainers |
347,057 | — | — | — | 347,057 | |||||||||||||||||||
| Deferred revenue |
138,207 | — | — | — | 138,207 | |||||||||||||||||||
| Current lease obligations |
873,531 | — | — | — | 873,531 | |||||||||||||||||||
| Other current liabilities |
440,374 | — | 48 | (349,011 | ) | 91,411 | F | |||||||||||||||||
| Franchise tax payable |
— | 48 | (48 | ) | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total current liabilities |
2,336,769 | 3,722 | — | (354,177 | ) | 1,986,314 | ||||||||||||||||||
| Long-term lease obligations |
18,977,544 | — | — | — | 18,977,544 | |||||||||||||||||||
| Unsecured related party debt |
2,200,000 | — | — | — | 2,200,000 | |||||||||||||||||||
| Convertible related party liabilities, net |
57,944 | — | — | (57,944 | ) | — | G | |||||||||||||||||
| Long-term debt, net |
659,446 | — | — | 659,446 | ||||||||||||||||||||
| Other liabilities |
242,522 | — | — | — | 242,522 | |||||||||||||||||||
| Deferred underwriting commissions in connection with the initial public offering |
— | 16,905 | — | (16,905 | ) | — | H | |||||||||||||||||
| Warrant liabilities |
25,963 | — | — | 25,963 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total liabilities |
24,474,225 | 46,590 | — | (429,026 | ) | 24,091,789 | ||||||||||||||||||
| Convertible preferred stock |
8,379,182 | — | — | (8,379,182 | ) | — | I | |||||||||||||||||
| Redeemable noncontrolling interests |
291,901 | — | — | (291,901 | ) | — | J | |||||||||||||||||
| Redeemable BowX Class A Common Stock |
— | 432,311 | — | (432,311 | ) | — | K | |||||||||||||||||
| (Amounts in thousands, except share and per share amounts) |
Prior WeWork Inc. (Historical) |
BowX (Historical) |
Reclassification Adjustments |
Pro Forma Transaction Accounting Adjustments |
Pro Forma Combined |
Note | ||||||||||||||||||
| Equity |
||||||||||||||||||||||||
| New WeWork shareholders’ equity (deficit): |
||||||||||||||||||||||||
| Prior WeWork Class A Common Stock |
177 | — | — | (177 | ) | — | L | |||||||||||||||||
| Prior WeWork Class B Common Stock |
— | — | — | — | — | |||||||||||||||||||
| Prior WeWork Class C Common Stock |
24 | — | — | (24 | ) | — | M | |||||||||||||||||
| Prior WeWork Class D Common Stock |
— | — | — | — | — | |||||||||||||||||||
| BowX Class A Common Stock |
— | 1 | — | 70 | 71 | N | ||||||||||||||||||
| BowX Class B Common Stock |
— | 1 | — | (1 | ) | — | O | |||||||||||||||||
| BowX Class C Common Stock |
— | — | — | 2 | 2 | P | ||||||||||||||||||
| Additional paid-in capital |
2,775,762 | 26,609 | — | 9,605,585 | 12,407,956 | Q | ||||||||||||||||||
| Accumulated other comprehensive income (loss) |
(116,269 | ) | — | — | — | (116,269 | ) | |||||||||||||||||
| Accumulated deficit |
(12,624,690 | ) | (21,611 | ) | — | 2,478 | (12,643,823 | ) | R | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total WeWork Shareholders’ equity (deficit) |
(9,964,996 | ) | 5,000 | — | 9,607,933 | (352,063 | ) | |||||||||||||||||
| Noncontrolling interests |
5,998 | — | — | 291,901 | 297,899 | S | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total equity (deficit) |
(9,958,998 | ) | 5,000 | — | 9,899,834 | (54,164 | ) | |||||||||||||||||
| Total liabilities and equity |
$ | 23,186,310 | $ | 483,901 | $ | — | $ | 367,414 | $ | 24,037,625 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
The accompanying notes are an integral part of these pro forma financial statements.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2021
| (Amounts in thousands, except share and per share amounts) | Prior WeWork Inc. (Historical) |
BowX (Historical) |
Reclassification Adjustments |
Pro Forma Transaction Accounting Adjustments |
|
Pro Forma Combined |
||||||||||||||||||
| Revenue |
$ | 1,191,331 | $ | — | $ | — | $ | — | $ | 1,191,331 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Expenses: |
||||||||||||||||||||||||
| Location operating expenses |
1,598,812 | — | 1,598,812 | |||||||||||||||||||||
| Pre-opening location expenses |
76,839 | — | 76,839 | |||||||||||||||||||||
| Selling, general and administrative expenses |
499,502 | 4,091 | 99 | 551 | AA | 504,243 | ||||||||||||||||||
| Franchise tax expense |
— | 99 | (99 | ) | — | |||||||||||||||||||
| Restructuring and other related costs |
466,045 | — | 466,045 | |||||||||||||||||||||
| Impairment/(gain on sale) of goodwill, intangibles and other assets |
541,585 | — | 541,585 | |||||||||||||||||||||
| Depreciation and amortization |
364,341 | — | 364,341 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total expenses |
3,547,124 | 4,190 | — | 551 | 3,551,865 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Loss from operations |
(2,355,793 | ) | (4,190 | ) | — | (551 | ) | (2,360,534 | ) | |||||||||||||||
| Interest and other income (expense), net: |
||||||||||||||||||||||||
| Income (loss) from equity method and other investments |
(24,510 | ) | — | (24,510 | ) | |||||||||||||||||||
| Interest expense |
(217,828 | ) | — | 198 | BB | (217,630 | ) | |||||||||||||||||
| Interest income |
9,455 | — | 9,455 | |||||||||||||||||||||
| Change in fair value of warrant liabilities |
— | (12,671 | ) | (12,671 | ) | |||||||||||||||||||
| Net gain from investments held in trust account |
— | 60 | (60 | ) | CC | — | ||||||||||||||||||
| Foreign currency gain (loss) |
(37,925 | ) | — | (37,925 | ) | |||||||||||||||||||
| Gain (loss) from change in fair value of related party financial instruments |
(350,822 | ) | — | 350,822 | DD | — | ||||||||||||||||||
| Loss on extinguishment of debt |
— | — | — | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total interest and other income (expense), net |
(621,630 | ) | (12,611 | ) | — | 350,762 | (283,281 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Pre-tax loss |
(2,977,423 | ) | (16,801 | ) | 350,211 | (2,643,815 | ) | |||||||||||||||||
| Income tax benefit (provision) |
(7,282 | ) | — | — | EE | (7,282 | ) | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net loss |
(2,984,705 | ) | (16,801 | ) | — | 350,211 | (2,651,097 | ) | ||||||||||||||||
| Net loss attributable to noncontrolling interests: |
||||||||||||||||||||||||
| Redeemable noncontrolling interests —mezzanine |
64,120 | — | 64,120 | |||||||||||||||||||||
| Noncontrolling interest — equity |
(615 | ) | — | (615 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net loss attributable to WeWork |
$ | (2,921,200 | ) | $ | (16,801 | ) | $ | — | $ | 350,211 | $ | (2,587,592 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net loss per share attributable to WeWork Class A common stockholders: |
||||||||||||||||||||||||
| Basic |
$ | (16.81) | ||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Diluted |
$ | (16.81) | ||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Weighted-average shares used to compute net loss per share attributable to WeWork Class A common stockholders, basic and diluted |
173,751,116 | |||||||||||||||||||||||
| Pro forma net loss per share attributable to WeWork Class A common stockholders |
||||||||||||||||||||||||
| Basic |
$ | (4.17) | ||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Diluted |
$ | (4.17) | ||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Weighted-average shares used to compute net loss per share attributable to WeWork Class A common stockholders, basic and diluted |
713,929,498 | |||||||||||||||||||||||
The accompanying notes are an integral part of these pro forma financial statements.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2020
| (Amounts in thousands, except share and per share amounts) |
Prior WeWork Inc. (Historical) |
BowX (Historical) |
Reclassification Adjustments |
Pro Forma Transaction Accounting Adjustments |
|
Pro Forma Combined |
||||||||||||||||||
| Revenue |
$ | 3,415,865 | $ | — | $ | — | $ | — | $ | 3,415,865 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Expenses: |
||||||||||||||||||||||||
| Location operating expenses |
3,542,918 | — | 3,542,918 | |||||||||||||||||||||
| Pre-opening location expenses |
273,049 | — | 273,049 | |||||||||||||||||||||
| Selling, general and administrative expenses |
1,604,669 | 220 | 122 | 47,522 | AA | 1,652,533 | ||||||||||||||||||
| Franchise tax expense |
— | 122 | (122 | ) | — | |||||||||||||||||||
| Restructuring and other related costs |
206,703 | — | 206,703 | |||||||||||||||||||||
| Impairment/(gain on sale) of goodwill, intangibles and other assets |
1,355,921 | — | 1,355,921 | |||||||||||||||||||||
| Depreciation and amortization |
779,368 | — | 779,368 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total expenses |
7,762,628 | 342 | — | 47,522 | 7,810,492 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Loss from operations |
(4,346,763 | ) | (342 | ) | — | (47,522 | ) | (4,394,627 | ) | |||||||||||||||
| Interest and other income (expense), net: |
||||||||||||||||||||||||
| Income (loss) from equity method and other investments |
(44,788 | ) | — | (44,788 | ) | |||||||||||||||||||
| Interest expense |
(331,217 | ) | — | — | BB | (331,217 | ) | |||||||||||||||||
| Interest income |
16,910 | — | 16,910 | |||||||||||||||||||||
| Change in fair value of warrant liabilities |
— | (4,664 | ) | (4,664 | ) | |||||||||||||||||||
| Offering costs associated with private placement warrants |
— | (9 | ) | (9 | ) | |||||||||||||||||||
| Net gain from investments held in trust account |
— | 227 | (227 | ) | CC | — | ||||||||||||||||||
| Foreign currency gain (loss) |
149,196 | — | 149,196 | |||||||||||||||||||||
| Gain (loss) from change in fair value of related party financial instruments |
819,647 | — | (819,647 | ) | DD | — | ||||||||||||||||||
| Loss on extinguishment of debt |
(77,336 | ) | — | (77,336 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Total interest and other income (expense), net |
532,412 | (4,446 | ) | — | (819,874 | ) | (291,908 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Pre-tax loss |
(3,814,351 | ) | (4,788 | ) | (867,396 | ) | (4,686,535 | ) | ||||||||||||||||
| Income tax benefit (provision) |
(19,506 | ) | (22 | ) | — | EE | (19,528 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net loss |
(3,833,857 | ) | (4,810 | ) | — | (867,396 | ) | (4,706,063 | ) | |||||||||||||||
| Net loss attributable to noncontrolling interests: |
||||||||||||||||||||||||
| Redeemable noncontrolling interests — mezzanine |
675,631 | — | 675,631 | |||||||||||||||||||||
| Noncontrolling interest — equity |
28,868 | — | 28,868 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net loss attributable to WeWork |
$ | (3,129,358 | ) | $ | (4,810 | ) | $ | — | $ | (867,396 | ) | $ |
(4,001,564 |
) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
| Net loss per share attributable to WeWork Class A common stockholders: |
|
|||||||||||||||||||||||
| Basic |
$ | (18.38 | ) | |||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Diluted |
$ | (18.38 | ) | |||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Weighted-average shares used to compute net loss per share attributable to WeWork Class A common stockholders, basic and diluted |
170,275,761 | |||||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Pro forma net loss per share attributable to WeWork Class A common stockholders |
||||||||||||||||||||||||
| Basic |
$ | (6.39 | ) | |||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Diluted |
$ | (6.39 | ) | |||||||||||||||||||||
|
|
|
|||||||||||||||||||||||
| Weighted-average shares used to compute net loss per share attributable to WeWork Class A common stockholders, basic and diluted |
687,531,572 | |||||||||||||||||||||||
The accompanying notes are an integral part of these pro forma financial statements.
Note 1. Basis of Presentation
The pro forma adjustments have been prepared as if the Business Combination and Related Transactions had been consummated on June 30, 2021, in the case of the unaudited pro forma condensed combined balance sheet and on January 1, 2020, the beginning of the earliest period presented in the unaudited pro forma condensed combined statement of operations. The unaudited pro forma condensed combined financial information has been prepared assuming that, as of October 20, 2021, the final Exchange Ratio is 0.82619.
The unaudited pro forma condensed combined financial information has been prepared assuming the following methods of accounting in accordance with U.S. GAAP and SEC rules and regulations.
The historical financial information of BowX and Prior WeWork has been adjusted in the unaudited pro forma condensed combined financial information to reflect transaction accounting adjustments related to the Business Combination and Related Transactions in accordance with U.S. GAAP.
Transaction costs that are determined to be directly attributable and incremental to the transaction will be deferred and recorded as other assets in the balance sheet leading up until the Closing. For the pro forma purposes, such costs will be recorded as a reduction in cash with a corresponding reduction of additional paid-in capital.
Notwithstanding the legal form of the Business Combination pursuant to the Merger Agreement, the Business Combination will be accounted for under Financial Accounting Standards Board’s Accounting Standards Codification Topic 805, Business Combinations (“ASC 805”) as a reverse acquisition and a recapitalization of WeWork. The Business Combination will be accounted for as a reverse acquisition because WeWork has been determined to be the accounting acquirer primarily based on the evaluation of the following facts and circumstances taking into consideration both the no redemption and maximum redemption scenario:
| • | Prior WeWork stockholders comprised a relative majority of the voting power of the combined company, |
| • | Prior WeWork’s operations prior to the acquisition comprise the only ongoing operations of WeWork, |
| • | The majority of WeWork’s board of directors were appointed by Prior WeWork Stockholders, and |
| • | All of WeWork’s senior management are comprised of Prior WeWork’s senior management. |
Accordingly, the Business Combination is expected to be reflected as the equivalent of Prior WeWork issuing stock for the net assets of BowX, accompanied by a recapitalization. Under this method of accounting, BowX is treated as the “acquired” company for financial reporting purposes. The net assets of BowX are stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Business Combination are those of Prior WeWork.
Following the Closing (as defined below) of the Business Combination and Related Transactions, holders of BowX Class A Common Stock exercising redemption rights received their per share redemption price out of the funds in the trust account. Each BowX Stockholder that was a holder of BowX Class A Common Stock may have elected to redeem all or a portion of its BowX Class A Common Stock at a per-share price, payable in cash, equal to a pro rata share of the aggregate amount on deposit in the trust account (including any interest earned on the funds held in the trust account).
As part of the preparation of these unaudited pro forma condensed combined financial statements, certain reclassifications were made to align Prior WeWork’s and BowX’s financial statement presentation. Upon completion of the Business Combination and Related Transactions, management will perform a comprehensive review of Prior WeWork’s and BowX’s accounting policies. As a result of the review, management may identify differences between the accounting policies of the two entities which, when conformed, could have a material impact on the financial statements of the post-combination company.
Note 2. Description of Business Combination
On March 25, 2021, BowX entered into the Merger Agreement with Merger Sub and WeWork, pursuant to which, among other things, (i) Merger Sub merged with and into WeWork, the separate corporate existence of Merger Sub ceased and WeWork became the surviving corporation and a wholly owned subsidiary of BowX (the “First Merger”) and (ii) as soon as practicable following the First Merger and as part of the same overall transaction as the First Merger, the surviving corporation merged with and into Merger Sub II, with Merger Sub II being the surviving entity of such merger (the “Second Merger” and together with the First Merger, the “Mergers”). In connection with the transaction, BowX ceased to exist, and the Company will operate under the name “WeWork Inc.”.
As a result of and upon the Closing, among other things, all outstanding shares of Prior WeWork capital stock immediately prior to the effective time of the First Merger (the “Effective Time”) (other than (A) shares of Class C common stock of Prior WeWork, which were converted into the right to receive a number of shares of Company Class C common stock, par value $0.0001 per share (the “Class C Common Stock”), equal to (x) the exchange ratio under the Merger Agreement (which was equal to 0.82619) (the “Exchange Ratio”) multiplied by (y) the number of shares of Class C common stock of Prior WeWork held by such holder as of immediately prior to the Closing, (B) treasury shares, (C) dissenting shares and (D) shares of capital stock of Prior WeWork subject to stock awards) were cancelled in exchange for the right to receive a portion of an aggregate of 655,300,000 shares of Company Class A common stock, par value $0.0001 (at a deemed value of $10.00 per share) representing a pre-transaction equity value of Prior WeWork of approximately $6.553 billion. Upon Closing, the Company received approximately $1.3 billion in gross cash proceeds consisting of approximately $333.0 million from the BowX trust account, $150.0 million from the previously announced backstop investment by DTZ Worldwide Limited, a parent company to Cushman & Wakefield U.S., Inc., and $800.0 million from the PIPE Investment.
Prior to the Special Meeting, a total of 15,006,786 shares of Class A Common Stock were presented for redemption for cash at a price of $10.00 per share in connection with the Special Meeting. As previously disclosed, the Backstop Investor committed to subscribe for the number of shares of Class A Common Stock equal to the amount of the Redemptions, subject to a cap of 15,000,000 shares of Class A Common Stock. The purchase price for such shares of Class A Common Stock was equal to $10.00 per share multiplied by the number of Redemptions, subject to the Cap, for an aggregate purchase price of up to $150,000,000. Substantially concurrently with the Closing, the Backstop Investor subscribed for 15,000,000 shares of Class A Common Stock for $150,000,000. So long as the Backstop Investor continues to hold a specified amount of shares of Class A Common Stock, then the Backstop Investor has the right to designate a board observer.
Note 3. Pro Forma Adjustments
Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet
The adjustments included in the unaudited pro forma condensed combined balance sheet as of June 30, 2021 are as follows:
(A) Cash. Reflects the impact of the Business Combination and Related Transactions on the cash balance of WeWork. The table below reflects the sources and uses of funds related to the Business Combination and Related Transactions:
| (Amounts in thousands) |
Note | |||||||
| Cash balance of Prior WeWork prior to Business Combination |
$ | 843,957 | ||||||
| Cash balance of BowX prior to Business Combination |
506 | |||||||
|
|
|
|||||||
| Total Pre-adjustment cash balance |
844,463 | |||||||
| Proceeds from cash held in trust account |
1 | 332,997 | ||||||
| Payment of underwriter fees |
2 | (16,905 | ) | |||||
| PIPE Investment |
3 | 800,000 | ||||||
| Backstop Investment |
4 | 150,000 | ||||||
| Payment of transaction costs |
5 | (59,817 | ) | |||||
| Payment of employee bonuses |
6 | (26,482 | ) | |||||
| Payment of short-term loan and accrued interest |
7 | (349,209 | ) | |||||
|
|
|
|||||||
| Adjustment to cash in connection with the Business Combination |
830,584 | |||||||
|
|
|
|||||||
| Ending cash and cash equivalents balance |
$ | 1,675,047 | ||||||
|
|
|
|||||||
(1) Reflects the reclassification of cash and cash equivalents held in the trust account subsequent to BowX public shareholders exercising their right to redeem 15,006,786 public shares for their pro rata share of the trust account of approximately $150 million.
(2) Reflects the payment of $16.9 million of deferred underwriters’ fees. The fees are expected to be paid at closing out of the monies in the trust account.
(3) Represents the proceeds from the PIPE subscription agreements of 80,000,000 shares of BowX Class A Common Stock at $10 per share.
(4) Represents the proceeds from the Backstop subscription agreement of 15,000,000 shares of WeWork Class A Common Stock at $10.00 per share.
(5) Represents expected settlement of BowX and WeWork transaction costs at close in connection with the Mergers. Of the total, $44.8 million relates to financial advisory, legal and other fees to be incurred, and $15.0 million relates to PIPE fees. Of the amount shown, $4.9 million was incurred or accrued on the balance sheet as of June 30, 2021.
(6) Represents the payment of $26.5 million in bonuses to employees upon closing of the transaction, of which $24.5 million is subject to clawback if the employee does not meet certain service conditions and is therefore presented as deferred compensation expense that will be amortized over the requisite service period.
(7) Represents funds from the transaction used to repay the short-term loan and related accrued interest under WeWork’s LC Debt Facility.
(B) Other Current Assets. Represents the payment of $26.5 million in bonuses to employees upon closing of the transaction, of which $24.5 million is subject to clawback if the employee does not meet certain service conditions and is therefore presented as deferred compensation expense that will be amortized over the requisite service period.
(C) Investments held in Trust Account. Reflects the reclassification of cash and cash equivalents held in the trust account subsequent to BowX public shareholders exercising their right to redeem 15,006,786 public shares for their pro rata share of the trust account of approximately $150 million.
(D) Other Assets. Reflects the impact of the Business Combination and Related Transactions on the other assets balance of WeWork. The table below reflects the impacts related to the Business Combination and Related Transactions:
| (Amounts in thousands) |
Note | |||||||
| Other assets balance of Prior WeWork prior to Business Combination |
$ | 932,151 | ||||||
| Other assets balance of BowX prior to Business Combination |
— | |||||||
|
|
|
|||||||
| Total Pre-adjustment other assets |
932,151 | |||||||
| Deferred employee bonuses |
1 | 4,083 | ||||||
| Transaction costs incurred |
2 | (4,598 | ) | |||||
|
|
|
|||||||
| Adjustment to other assets with the Business Combination |
(515 | ) | ||||||
|
|
|
|||||||
| Ending other assets of WeWork |
$ | 931,636 | ||||||
|
|
|
|||||||
(1) Represents the payment of $26.5 million in bonuses to employees upon closing of the transaction, of which $24.5 million is subject to clawback if the employee does not meet certain service conditions and is therefore presented as deferred compensation expense that will be amortized over the requisite service period.
(2) Represents WeWork transaction costs previously capitalized, including $3.2 million paid as of June 30, 2021.
(E) Accounts payable and accrued expenses. Reflects the impact of the Business Combination and Related Transactions on the accounts payable and accrued expenses balance of WeWork. The table below reflects the impacts related to the Business Combination and Related Transactions:
| (Amounts in thousands) |
Note | |||||||
| Accounts payable and accrued expenses balance of Prior WeWork prior to Business Combination |
$ | 537,600 | ||||||
| Accounts payable and accrued expenses balance of BowX prior to Business Combination |
3,674 | |||||||
|
|
|
|||||||
| Total Pre-adjustment accounts payable and accrued expenses |
541,274 | |||||||
| Payment of transaction costs incurred |
1 | (4,968 | ) | |||||
| Payment of accrued interest on WeWork’s short-term loan |
2 | (198 | ) | |||||
|
|
|
|||||||
| Adjustment to accounts payable and accrued expenses with the Business Combination |
(5,166 | ) | ||||||
|
|
|
|||||||
| Ending accounts payable and accrued expenses of WeWork |
$ | 536,108 | ||||||
|
|
|
|||||||
(1) Reflects transaction expenses, including WeWork amounts previously capitalized and not paid of $1.4 million, and BowX amounts incurred and not paid of $3.5 million.
(2) Reflects payment of accrued interest on WeWork’s short-term loan.
(F) Other current liabilities. Represents payment of short-term loan under WeWork’s LC Debt Facility.
(G) Convertible related party liabilities, net. Reflects exchange of Prior WeWork Preferred Stock warrants into BowX Class A Common Stock warrants, pursuant to the terms of the Merger Agreement. Prior WeWork Preferred Stock warrants were previously redeemable, resulting in Prior WeWork classifying such warrants as liabilities in its historical financial statements. The WeWork Class A Common Stock warrants exchanged for Prior WeWork Preferred Stock warrants are equity-classified warrants and the adjustment reflects the reclassification of the warrants from liability to additional paid-in capital.
(H) Deferred underwriting commissions in connection with the initial public offering. Reflects the payment of $16.9 million of deferred underwriters’ fees. The fees are expected to be paid at closing out of the monies in the trust account.
(I) Convertible Preferred Stock. Reflects the impact of the Business Combination and Related Transactions on the Convertible Preferred Stock. The table below reflects the impacts related to the Business Combination and Related Transactions:
| (Amounts in thousands) |
Note | |||||||
| Convertible Preferred Stock of Prior WeWork prior to Business Combination |
$ | 8,379,182 | ||||||
| Convertible Preferred Stock of BowX prior to Business Combination |
— | |||||||
|
|
|
|||||||
| Total Pre-adjustment Convertible Preferred Stock |
8,379,182 | |||||||
| Conversion of Prior WeWork Preferred Stock to Class A Common Stock |
1 | (8,376,150 | ) | |||||
| Cancellation and automatic conversion of Prior WeWork Series C Convertible Note to BowX Class A Common Stock |
2 | (3,032 | ) | |||||
|
|
|
|||||||
| Adjustment to Convertible Preferred Stock with the Business Combination |
(8,379,182 | ) | ||||||
|
|
|
|||||||
| Ending Convertible Preferred Stock of WeWork |
$ | — | ||||||
|
|
|
|||||||
(1) Represents conversion of 499,018,795 shares of Preferred Stock to 412,284,338 shares of BowX Class A Common Stock as part of recapitalization of Prior WeWork equity and issuance of post-combination Common Stock to Prior WeWork Preferred Stockholders as consideration for the reverse recapitalization.
(2) Represents cancellation and automatic conversion of Prior WeWork Series C Convertible Notes (convertible into 566,933 shares of Series C Preferred Stock if converted prior to Closing) to 468,394 shares of BowX Class A Common Stock.
(J) Redeemable noncontrolling interests. Represents reclassification of noncontrolling interests from temporary equity to permanent equity, reflecting cancellation of redemption feature upon occurrence of liquidity event.
(K) Mezzanine BowX Class A Common Stock. Represents the reclassification of BowX public shares, from temporary equity to permanent equity, subsequent to BowX public shareholders exercising their right to redeem 15,006,786 public shares for their pro rata share of the trust account of approximately $150 million.
(L) WeWork Common Stock, Class A. Represents conversion of 176,628,752 Prior WeWork Class A Common Stock to 145,928,908 shares of BowX Class A Common Stock as consideration for the reverse recapitalization.
(M) WeWork Common Stock, Class C. Represents conversion of 24,132,575 shares of Prior WeWork Class C Common Stock to 19,938,089 shares of BowX Class C Common Stock as consideration for the reverse recapitalization.
(N) BowX Class A Common Stock. Reflects the impact of the Business Combination and Related Transactions on the BowX Class A Common Stock not subject to redemption. The table below reflects the impacts related to the Business Combination and Related Transactions:
| (Amounts in thousands) |
Note | |||||||
| Prior WeWork Class A Common Stock prior to Business Combination |
$ | — | ||||||
| BowX Class A Common Stock prior to Business Combination |
1 | |||||||
|
|
|
|||||||
| Total Pre-adjustment Class A Common Stock |
1 | |||||||
| PIPE Investment proceeds |
1 | 8 | ||||||
| Backstop Investment proceeds |
2 | 2 | ||||||
| Reclassification of BowX public shares to BowX Class A Common Stock |
3 | 3 | ||||||
| Conversion of Prior WeWork Preferred Stock to BowX Class A Common Stock |
4 | 41 | ||||||
| Conversion of Prior WeWork Series C Convertible Note to BowX Class A Common Stock |
5 | — | ||||||
| Conversion of Prior WeWork Class A Common Stock to BowX Class A Common Stock |
6 | 15 | ||||||
| Forfeiture and conversion of BowX Class B Common Stock to BowX Class A Common Stock |
7 | 1 | ||||||
|
|
|
|||||||
| Adjustment to Class A Common Stock with the Business Combination |
70 | |||||||
| Ending Class A Common Stock of WeWork |
$ | 71 | ||||||
|
|
|
|||||||
(1) Represents the proceeds from the PIPE subscription agreements of 80,000,000 shares of BowX Class A Common Stock at $10 per share.
(2) Represents the proceeds from the Backstop subscription agreement of 15,000,000 shares of WeWork Class A Common Stock at $10.00 per share.
(3) Represents the reclassification of BowX public shares, from temporary equity to permanent equity, subsequent to BowX public shareholders exercising their right to redeem 15,006,786 public shares for their pro rata share of the trust account of approximately $150 million.
(4) Represents conversion of 499,018,795 shares of Preferred Stock to 412,284,338 shares of BowX Class A Common Stock as part of recapitalization of Prior WeWork equity and issuance of post-combination Common Stock to Prior WeWork Preferred Stockholders as consideration for the reverse recapitalization.
(5) Represents cancellation and automatic conversion of Prior WeWork Series C Convertible Notes (convertible into 566,933 shares of Series C Preferred Stock if converted prior to Closing) to 468,394 shares of BowX Class A Common Stock.
(6) Represents conversion of 176,628,752 Prior WeWork Class A Common Stock to 145,928,908 shares of BowX Class A Common Stock as consideration for the reverse recapitalization.
(7) Represents sponsor’s forfeiture of 3,000,000 shares of BowX Class B Common Stock pursuant to the terms of the Sponsor Support Agreement, with such shares cancelled by BowX, and the conversion of the remaining 9,075,000 shares of BowX Class B Common Stock to a like number of shares of BowX Class A Common Stock.
(O) BowX Class B Common Stock. Represents sponsor’s forfeiture of 3,000,000 shares of BowX Class B Common Stock pursuant to the terms of the Sponsor Support Agreement, with such shares cancelled by BowX, and the conversion of the remaining 9,075,000 shares of BowX Class B Common Stock to a like number of shares of BowX Class A Common Stock.
(P) BowX Class C Common Stock. Represents conversion of 24,132,575 shares of Prior WeWork Class C Common Stock to 19,938,089 shares of BowX Class C Common Stock as consideration for the reverse recapitalization.
(Q) Additional paid-in capital. Reflects the impact of the Business Combination and Related Transactions on the additional paid-in capital of WeWork. The table below reflects the impacts related to the Business Combination and Related Transactions:
| (Amounts in thousands) |
Note | |||||
| Additional paid-in capital of Prior WeWork prior to Business Combination |
$ | 2,775,762 | ||||
| Additional paid-in capital of BowX prior to Business Combination |
26,609 | |||||
|
|
|
|||||
| Total Pre-adjustment additional paid-in capital |
2,802,371 | |||||
| PIPE Investment proceeds |
1 | 799,992 | ||||
| Backstop Investment proceeds |
2 | 149,999 | ||||
| Reclassification of BowX public shares to BowX Class A Common Stock |
3 | 282,233 | ||||
| Conversion of WeWork Preferred Stock to BowX Class A Common Stock |
4 | 8,376,109 | ||||
| Cancellation and automatic conversion of Prior WeWork Series C Convertible Note to BowX Class A Common Stock |
5 | 3,032 | ||||
| Conversion of Prior WeWork Class A Common Stock to BowX Class A Common Stock |
6 | 162 | ||||
| Conversion of Prior WeWork Class C Common Stock to BowX Class C Common Stock |
7 | 22 | ||||
| Sponsor’s forfeiture of 3,000,000 BowX Class B Common Stock |
8 | — | ||||
| Reclassification of BowX accumulated deficit |
9 | (18,079 | ) | |||
| Payment of transaction costs |
10 | (62,980 | ) | |||
| Exchange of Prior WeWork Preferred Stock warrants into BowX Class A Common Stock warrants |
11 | 57,944 | ||||
| Issuance of equity-classified warrant to an existing Prior WeWork preferred shareholder |
12 | 390,945 | ||||
| Fair value of contingently issuable shares related to warrants issued to principal stockholders |
12 | (390,945 | ) | |||
| Incremental stock-based compensation expense |
13 | 17,151 | ||||
|
|
|
|||||
| Adjustment to additional paid-in capital with the Business Combination |
9,605,585 | |||||
|
|
|
|||||
| Ending additional paid-in capital of WeWork |
$ | 12,407,956 | ||||
|
|
|
|||||
(1) Represents the proceeds from the PIPE subscription agreements of 80,000,000 shares of BowX Class A Common Stock at $10 per share.
(2) Represents the proceeds from the Backstop subscription agreement of 15,000,000 shares of WeWork Class A Common Stock at $10.00 per share.
(3) Represents the reclassification of BowX public shares, subject to possible redemption, from temporary equity to permanent equity, subsequent to BowX public shareholders exercising their right to redeem 15,006,786 public shares for their pro rata share of the trust account.
(4) Represents conversion of 499,018,795 shares of Preferred Stock to 412,284,338 shares of BowX Class A Common Stock as part of recapitalization of Prior WeWork equity and issuance of post-combination Common Stock to Prior WeWork Preferred Stockholders as consideration for the reverse recapitalization.
(5) Represents cancellation and automatic conversion of Prior WeWork Series C Convertible Notes (convertible into 566,933 shares of Series C Preferred Stock if converted prior to Closing) to 468,394 shares of BowX Class A Common Stock.
(6) Represents conversion of 176,628,752 Prior WeWork Class A Common Stock to 145,928,908 shares of BowX Class A Common Stock as consideration for the reverse recapitalization.
(7) Represents conversion of 24,132,575 shares of Prior WeWork Class C Common Stock to 19,938,089 shares of BowX Class C Common Stock as consideration for the reverse recapitalization.
(8) Represents sponsor’s forfeiture of 3,000,000 shares of BowX Class B Common Stock pursuant to the terms of the Sponsor Support Agreement, with such shares cancelled by BowX, and the conversion of the remaining 9,075,000 shares of BowX Class B Common Stock to a like number of shares of BowX Class A Common Stock.
(9) Represents the reclassification of BowX’s historical accumulated deficit.
(10) Represents expected settlement of BowX and WeWork transaction costs at close in connection with the Mergers. Of the total, $48 million relates to financial advisory, legal and other fees to be incurred, and $15.0 million relates to PIPE fees.
(11) Reflects exchange of Prior WeWork Preferred Stock warrants into BowX Class A Common Stock warrants, pursuant to the terms of the Merger Agreement. Prior WeWork Preferred Stock warrants were previously redeemable, resulting in Prior WeWork classifying such warrants as liabilities in its historical financial statements. The WeWork Class A Common Stock warrants exchanged for Prior WeWork Preferred Stock warrants are equity-classified warrants and the adjustment reflects the reclassification of the warrants from liability to additional paid-in capital.
(12) Represents issuance of equity-classified warrant to existing Prior WeWork preferred shareholder, to purchase 39,133,649 shares of BowX Class A Common Stock (giving effect to the Exchange Ratio) at an exercise price of approximately $0.01 per share. The fair value of the warrants is also reflected as a charge to additional paid-in capital representing an inducement to exercise existing conversion rights of WeWork’s Convertible Preferred Stock by the shareholder. The fair value is calculated using a $10 per share reference price. The actual fair value of the warrants will be dependent on the value of BowX Class A Common Stock at Closing of the Mergers. The fair value of the warrants will fluctuate by approximately $39.1 million for every $1.00 change in share price.
(13) Reflects incremental stock-based compensation expense related to restricted stock units for which the performance condition is deemed to be satisfied upon Closing.
(R) Accumulated deficit. Represents pro forma adjustments to accumulated deficit to reflect the following:
| (Amounts in thousands) |
Note | |||||||
| Accumulated deficit of Prior WeWork prior to Business Combination |
$ | (12,624,690 | ) | |||||
| Accumulated deficit of BowX prior to Business Combination |
(21,611 | ) | ||||||
|
|
|
|||||||
| Total Pre-adjustment accumulated deficit |
(12,646,301 | ) | ||||||
| Reclassification of BowX accumulated deficit |
1 | 18,079 | ||||||
| Non-recurring transaction costs incurred by BowX |
2 | 3,532 | ||||||
| Payment of employee bonuses not subject to service conditions |
3 | (1,982 | ) | |||||
| Incremental stock-based compensation |
4 | (17,151 | ) | |||||
|
|
|
|||||||
| Adjustment to accumulated deficit with the Business Combination |
2,478 | |||||||
|
|
|
|||||||
| Ending accumulated deficit of WeWork |
$ | (12,643,823 | ) | |||||
|
|
|
|||||||
(1) Represents the reclassification of BowX’s historical accumulated deficit.
(2) Represents BowX transaction costs incurred but not paid as of June 30, 2021.
(3) Represents the payment of bonuses to employee management upon closing of the transaction not subject to clawback discussed in (A), (B) and (D) above.
(4) Reflects incremental stock-based compensation expense related to restricted stock units for which the performance condition is deemed to be satisfied upon Closing.
(S) Noncontrolling interest. Represents reclassification of noncontrolling interests from temporary equity to permanent equity, reflecting cancellation of redemption feature upon occurrence of liquidity event.
Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations
The adjustments included in the unaudited pro forma condensed combined statement of operations for the six months ended June 30, 2021 and for the year ended December 31, 2020 are as follows:
(AA) Selling, general and administrative expenses. Reflects the impact of the Business Combination and Related Transactions on the selling, general and administrative expenses of WeWork. The table below reflects the impacts related to the Business Combination and Related Transactions:
| (Amounts in thousands) |
Note | For the Six Months Ended June 30, 2021 |
For the Year Ended December 31, 2020 |
|||||||||
| Selling, general and administrative expenses of Prior WeWork prior to Business Combination |
$ | 499,502 | $ | 1,604,669 | ||||||||
| Selling, general and administrative expenses of BowX prior to Business Combination |
4,091 | 220 | ||||||||||
| Reclassification of BowX franchise tax expense |
99 | 122 | ||||||||||
|
|
|
|
|
|||||||||
| Total Pre-adjustment selling, general and administrative expenses |
503,692 | 1,605,011 | ||||||||||
| Incremental incentive compensation expense |
1 | 4,083 | 22,399 | |||||||||
| Non-recurring transaction costs incurred by BowX |
2 | (3,532 | ) | — | ||||||||
| Incremental stock-based compensation |
3 | — | 25,123 | |||||||||
|
|
|
|
|
|||||||||
| Adjustment to Selling, general and administrative expenses with the Business Combination |
551 | 47,522 | ||||||||||
|
|
|
|
|
|||||||||
| Ending Selling, general and administrative expenses of WeWork |
$ | 504,243 | $ | 1,652,533 | ||||||||
|
|
|
|
|
|||||||||
(1) Reflects incremental incentive compensation expense related to bonus awards related to the Business Combination.
(2) Elimination of non-recurring transaction costs incurred by BowX in connection with the transaction.
(3) Reflects incremental stock-based compensation expense related to restricted stock units for which the performance condition is deemed to be satisfied upon Closing.
(BB) Elimination of the interest expense incurred during the the six months ended June 30, 2021 following the repayment of the short-term loan under WeWork’s LC Debt Facility in connection with the transaction.
(CC) Elimination of net gain from investments held in trust account.
(DD) Reflects the elimination of remeasurement gains on WeWork’s Convertible Preferred Stock warrant liability. See (G) above for further details on convertible related party liabilities.
(EE) No pro forma tax effect reflected due to full valuation allowance as of June 30, 2021 and December 31, 2020.
Note 4. Pro Forma Net Loss Per Share
On February 26, 2021, in connection with the Settlement Agreement (as defined in Note 16 of the notes to Prior WeWork’s unaudited interim condensed consolidated financial statements included in the proxy statement/prospectus filed with the SEC on September 16, 2021), all of the outstanding shares of Class B Common Stock were automatically converted into shares of Class A Common Stock and the shares of Class C Common Stock of Prior WeWork now have one vote per share, instead of three (the “Class B Conversion”).
The unaudited pro forma basic and diluted loss per share attributable to Class A Common Stockholders for the six months ended June 30, 2021 and Class A and Class B Common Stockholders for the year ended December 31, 2020 has been prepared to give effect to adjustments to the numerator in the pro forma basic and diluted net loss per share calculation to:
| • | include incremental incentive compensation expense related to bonus awards related to the Business Combination and Related Transactions; |
| • | include incremental stock-based compensation expense related to restricted stock units for which the performance condition is deemed to be satisfied upon Closing; |
| • | include incremental expense related to the fair value of contingently issuable shares related to warrants issued to principal stockholders; |
| • | remove net gain from investments held in trust account; |
| • | remove remeasurement gains on Prior WeWork’s Convertible Preferred Stock warrant liability; and |
The unaudited pro forma net basic and diluted net loss per share attributable to Class A Common Stockholders for the six months ended June 30, 2021 and Class A and Class B Common Stockholders for the year ended December 31, 2020 has been prepared to give effect to adjustments to the denominator in the pro forma basic and diluted net income per share calculation to give effect to:
| • | the conversion of 9,075,000 shares of BowX Class B Common Stock into 9,075,000 shares of WeWork Class A Common Stock in connection with the transaction in accordance with the terms of the Merger Agreement; |
| • | the issuance of 33,293,214 shares of WeWork Class A Common Stock related to the BowX Public Stockholders subsequent to BowX Public Stockholders exercising their right to redeem 15,006,786 public shares for their pro rata share of the trust account pursuant to the Subscription Agreements, executed concurrently with the Merger Agreement; |
| • | the issuance of 80,000,000 shares of New WeWork Class A Common Stock related to the PIPE Investment pursuant to the Subscription Agreements, executed concurrently with the Merger Agreement; |
| • | the automatic conversion of warrants issued to principal stockholder including contingently issuable shares, into shares of WeWork Class A Common Stock based on the Exchange Ratio, which automatically converts in connection with the Business Combination. The Company used the if-converted method as though the conversion had occurred as of the beginning of the period or the original date of issuance, if later; |
| • | the issuance of 15,000,000 shares of WeWork Class A Common Stock related to the Backstop subscription agreement; |
| • | the conversion of all outstanding convertible preferred stock into WeWork Class A Common Stock based on the Exchange Ratio, which automatically converts in connection with the Business Combination. The Company used the if-converted method as though the conversion had occurred as of the beginning of the period or the original date of issuance, if later; |
| • | the automatic conversion of the convertible note that is convertible into shares of WeWork Class A Common Stock based on the Exchange Ratio, which automatically converts in connection with the Business Combination. The convertible note is convertible into 566,933 shares of Prior WeWork Series C Preferred Stock if converted prior to Closing. The Company used the if- converted method as though the conversion had occurred as of the beginning of the period or the original date of issuance, if later; |
| • | the issuance of WeWork Class A Common Stock upon the vesting and settlement of RSUs for which the service-based vesting condition was satisfied as of June 30, 2021 and December 31, 2020 and the qualifying liquidity-based vesting condition will be satisfied in connection with the Closing of the Business Combination (“liquidity-based RSUs”). |
The numerators and denominators of the basic and diluted pro forma net loss per share computations for our Common Stock are calculated as follows for the six months ended June 30, 2021:
| (Amounts in thousands, except share and per share data) |
||||
| Numerator: |
||||
| Pro forma combined net loss attributable to WeWork |
$ | (2,587,592 | ) | |
| Fair value of contingently issuable shares related to warrants issued to principal stockholders |
(390,945 | ) | ||
|
|
|
|||
| Net loss attributable to New WeWork Class A Common Stockholders |
$ | (2,978,537 | ) | |
|
|
|
|||
| Denominator: |
||||
| Basic shares: |
||||
| Pro forma WeWork Inc. weighted-average shares outstanding used for basic net loss per share computation |
143,551,434 | |||
| Pro forma BowX Sponsor & Sponsor Persons shares |
9,075,000 | |||
| Pro forma BowX Public Stockholders shares |
33,293,214 | |||
| Pro forma PIPE Investor Shares |
80,000,000 | |||
| Pro forma adjustment to reflect warrants issued to principal stockholder |
44,183,540 | |||
| Pro forma Backstop Investor |
15,000,000 | |||
| Pro forma adjustment to reflect assumed conversion of Series A, B, C, D-1, D-2, E, F, G, G-1, H-1, Acquisition and Junior preferred stock to WeWork Class A Common Stock |
387,874,403 | |||
| Pro forma adjustment to reflect assumed conversion of convertible notes to Class A Common Stock |
569,067 | |||
| Pro forma adjustment to reflect assumed conversion of vested liquidity-based RSUs |
382,840 | |||
|
|
|
|||
| Number of shares used for pro forma basic net loss per share computation |
713,929,498 | |||
|
|
|
|||
| Diluted shares: |
||||
| Weighted-average shares—Diluted |
713,929,498 | |||
|
|
|
|||
| Pro forma net loss per share attributable to WeWork Class A Common Stockholders: |
||||
| Basic |
$ | (4.17 | ) | |
|
|
|
|||
| Diluted |
$ | (4.17 | ) | |
|
|
|
|||
The numerators and denominators of the basic and diluted pro forma net loss per share computations for our Common Stock are calculated as follows for the year ended December 31, 2020:
| (Amounts in thousands, except share and per share data) |
||||
| Numerator: |
||||
| Pro forma combined net loss attributable to WeWork |
$ | (4,001,564 | ) | |
| Fair value of contingently issuable shares related to warrants issued to principal stockholders |
(390,945 | ) | ||
|
|
|
|||
| Net loss attributable to WeWork Class A Common Stockholders |
$ | (4,392,509 | ) | |
|
|
|
|||
| Denominator: |
||||
| Basic shares: |
||||
| Pro forma WeWork Inc. weighted-average shares outstanding used for basic net loss per share computation |
140,680,131 | |||
| Pro forma BowX Sponsor & Sponsor Persons shares |
9,075,000 | |||
| Pro forma BowX Public Stockholders shares |
33,293,214 | |||
| Pro forma PIPE Investor Shares |
80,000,000 | |||
| Pro forma Backstop Investor |
15,000,000 | |||
| Pro forma adjustment to reflect warrants issued to principal stockholder |
151,503,055 | |||
| Pro forma adjustment to reflect assumed conversion of Series A, B, C, D-1, D-2, E, F, G, G-1, H-1, Acquisition and Junior preferred stock to WeWork Class A Common Stock |
256,250,237 | |||
| Pro forma adjustment to reflect assumed conversion of convertible notes to Class A Common Stock |
648,809 | |||
| Pro forma adjustment to reflect assumed conversion of vested liquidity-based RSUs |
1,081,126 | |||
|
|
|
|||
| Number of shares used for pro forma basic net loss per share computation |
687,531,572 | |||
|
|
|
|||
| Diluted shares: |
||||
| Weighted-average shares—Diluted |
687,531,572 | |||
|
|
|
|||
| Pro forma net loss per share attributable to WeWork Class A Common Stockholders: |
||||
| Basic |
$ | (6.39 | ) | |
|
|
|
|||
| Diluted |
$ | (6.39 | ) | |
|
|
|
|||