Common use of Board Designation Rights Clause in Contracts

Board Designation Rights. (a) From the Effective Date, ▇▇▇▇▇ ▇▇▇▇▇ shall have the right, but not the obligation, to designate to the Board a number of designees equal to at least: (i) 100% of the Total Number of Directors (as defined below), so long as ▇▇▇▇▇ ▇▇▇▇▇ continuously from the time of the IPO Beneficially Owns shares of common stock, par value $0.0001 per share (the “Common Stock”), representing at least 40% of the Original Amount of ▇▇▇▇▇ ▇▇▇▇▇ (as defined below), (ii) 40% of the Total Number of Directors, in the event that ▇▇▇▇▇ ▇▇▇▇▇ continuously from the time of the IPO Beneficially Owns shares of Common Stock representing at least 30% but less than 40% of the Original Amount of ▇▇▇▇▇ ▇▇▇▇▇, (iii) 30% of the Total Number of Directors, in the event that ▇▇▇▇▇ ▇▇▇▇▇ continuously from the time of the IPO Beneficially Owns shares of Common Stock representing at least 20% but less than 30% of the Original Amount of ▇▇▇▇▇ ▇▇▇▇▇, (iv) 20% of the Total Number of Directors, in the event that ▇▇▇▇▇ ▇▇▇▇▇ continuously from the time of the IPO Beneficially Owns shares of Common Stock representing at least 10% but less than 20% of the Original Amount of ▇▇▇▇▇ ▇▇▇▇▇, and (v) one Director, in the event that ▇▇▇▇▇ ▇▇▇▇▇ continuously from the time of the IPO Beneficially Owns shares of Common Stock representing at least 5% of the Original Amount of ▇▇▇▇▇ ▇▇▇▇▇ (such persons, the “Nominees”). For purposes of calculating the number of Directors that ▇▇▇▇▇ ▇▇▇▇▇ is entitled to designate pursuant to the immediately preceding sentence, any fractional amounts shall automatically be rounded up to the nearest whole number (e.g., 1 1/4 Directors shall equate to 2 Directors) and any such calculations shall be made after taking into account any increase in the Total Number of Directors. (b) In the event that ▇▇▇▇▇ ▇▇▇▇▇ has designated less than the total number of designees ▇▇▇▇▇ ▇▇▇▇▇ shall be entitled to designate pursuant to Section 1(a), ▇▇▇▇▇ ▇▇▇▇▇ shall have the right, at any time, to designate such additional designees to which it is entitled, in which case, the Company shall take, and the Company hereby covenants that the Directors shall take, all necessary corporation action to (i) enable ▇▇▇▇▇ ▇▇▇▇▇ to designate and effect the election or appointment of such additional individuals, whether by increasing the size of the Board, or otherwise and (ii) appoint such additional individuals designated by ▇▇▇▇▇ ▇▇▇▇▇ to fill such newly created directorships or to fill any other existing vacancies in accordance with Section 1(e) of this Agreement. (c) If the size of the Board is expanded, ▇▇▇▇▇ ▇▇▇▇▇ shall be entitled to designate a number of Nominees to fill the newly created directorships such that the total number of Nominees serving on the Board following such expansion will be equal to that number of Nominees that ▇▇▇▇▇ ▇▇▇▇▇ would be entitled to designate in accordance with Section 1(a) if such expansion occurred immediately prior to any meeting of the stockholders of the Company called with respect to the election of members of the Board. The Company shall take, and the Company hereby covenants that the Directors shall take, all necessary corporation action to (i) enable ▇▇▇▇▇ ▇▇▇▇▇ to designate and effect the election or appointment of additional designees in accordance with the preceding sentence and (ii) appoint such additional designees in accordance with Section 1(e) of this Agreement. (d) In the event that any Nominee shall cease to serve as a Director for any reason, ▇▇▇▇▇ ▇▇▇▇▇ shall be entitled to designate such person’s successor in accordance with this Agreement (regardless of the number of shares of Common Stock Beneficially Owned by ▇▇▇▇▇ ▇▇▇▇▇ at the time of such vacancy). The Company shall take, and the Company hereby covenants that the Directors shall take, all necessary corporation action to (i) enable ▇▇▇▇▇ ▇▇▇▇▇ to designate and effect the election or appointment of successor designees in accordance with the preceding sentence and (ii) appoint such successor designees in accordance with Section 1(e) of this Agreement. It is understood that any such designee shall serve the remainder of the term of the Director whom such designee replaces. (e) In each case where the Company has covenanted that the Directors shall take action to appoint a Nominee as a Director pursuant to any of Sections 1(a) through 1(d) of this Agreement: (i) The Directors shall appoint such Nominee unless the Board determines, in good faith, that appointing such Nominee would cause the Directors to breach their fiduciary duties to the Company or its stockholders, in which case the Company shall provide ▇▇▇▇▇ ▇▇▇▇▇ with a notice explaining in reasonable detail the basis for the Board’s determination, and ▇▇▇▇▇ ▇▇▇▇▇ shall have the right to designate an alternative Nominee in accordance with Sections 1(a) through Section 1(d) of this Agreement; and (ii) The Company hereby covenants that the Directors shall not fill any vacant or newly created directorship for which ▇▇▇▇▇ ▇▇▇▇▇ is entitled to designate a Nominee other than in accordance with Sections 1(a) through Section 1(d) of this Agreement. Without limiting the remedies available against the Company for breach of its covenants set forth in this Agreement, during any time that the Directors have failed to appoint a Nominee as a Director (including without limitation for the reasons set forth in the foregoing clauses (i) or (ii)), or if the Directors have appointed a person as a Director in lieu of a Nominee that ▇▇▇▇▇ ▇▇▇▇▇ has designated in accordance with this Agreement: (x) the Company shall not, without the prior written consent of ▇▇▇▇▇ ▇▇▇▇▇, consummate (and, to the fullest extent permitted by applicable law shall not enter into) any transaction that would constitute a “Business Combination” under any of clauses (i) through (iii) of Section 4(c) of Article Ten of the Company’s Certificate of Incorporation, except for purposes of applying this sentence the term “Interested Stockholder” shall mean any person or entity, whether or not a record or beneficial owner of stock of the Company, other than ▇▇▇▇▇ ▇▇▇▇▇; and