Participation Thresholds Clause Samples
The Participation Thresholds clause sets minimum levels of involvement or contribution required for parties to take part in certain activities or decisions under an agreement. For example, it may specify that only stakeholders holding a certain percentage of shares can vote on major resolutions, or that a minimum number of participants must be present for a meeting to proceed. This clause ensures that only sufficiently invested or relevant parties influence key outcomes, thereby preventing minor stakeholders from disproportionately affecting important decisions and maintaining efficient governance.
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Participation Thresholds.
1. If the State Participation Threshold has been satisfied by the State Participation Date, each of the Settling States will use reasonable efforts to ensure that, by March 31, 2023, or such later date as agreed to in writing by Walmart and the Enforcement Committee prior to March 31, 2023 (the “Threshold Subdivision Participation Date”), the Settling States have met the following “Subdivision Participation Thresholds”: (1) more than 85% of the aggregate population of all Litigating Subdivisions located in the Settling States and Separately Settling States (calculated on an aggregated basis and not a State-by- State basis): (a) have become Participating Subdivisions by executing a Subdivision Participation Agreement, including a release (subject to Section VII.D), in accordance with Section VII.C, (b) are subject to a Bar or Case-Specific Resolution or (c) have joined a settlement between Walmart and a Separately Settling State by executing a participation form, including a release; and (2) more than 85% of the aggregate population of all Non- Litigating Threshold Subdivisions located in the Settling States and Separately Settling States (calculated on an aggregated basis and not a State-by-State basis): (a) have become Participating Subdivisions by executing a Subdivision Participation Agreement, including a release (subject to Section VII.D), in accordance with Section VII.B, (b) are subject to a Bar or Case-Specific Resolution, or (c) have joined a settlement between Walmart and a Separately Settling State by executing a participation form, including a release (together, the “Participating Population Levels”). For the avoidance of doubt, for purposes of calculating the Participating Population Levels for the Subdivision Participation Thresholds, all Litigating Subdivisions and Non-Litigating Threshold Subdivisions located in Separately Settling States shall be included in the denominator for purposes of calculating whether the Subdivision Participation Thresholds have been satisfied, and any such Litigating Subdivisions or Non-Litigating Threshold Subdivisions located in Separately Settling States that have joined such separate settlement agreement with Walmart by executing a participation form, including a release, shall be included in the numerator for purposes of calculating whether the Subdivision Participation Thresholds have been satisfied.6
2. As soon as practicable following the Threshold Subdivision Participation Date, the Settlement Fund Adm...
Participation Thresholds. On the date of each grant of Class F Units to a Member who is, or as a result of such grant becomes, a holder of Class F Units pursuant to a grant made under a Management Unit Subscription Agreement or similar agreement, the Management Committee shall establish an initial “Participation Threshold” amount with respect to each Class F Unit granted on such date. Unless otherwise determined by the Management Committee, the Participation Threshold with respect to a Class F Unit shall be equal to or greater than the Liquidation Value of a Class B Unit, disregarding the value of any return of Capital Contributions pursuant to Section 4.4(a)(iii), on the date of grant of such Class F Unit. The Management Committee may designate a series number for each subset of Class F Units consisting of Class F Units having the same Participation Threshold, which Participation Threshold differs from the Participation Thresholds of all Class F Units not included in such subset. If the Management Committee elects to so designate Class F Units, then the first Class F Unit issued on or after the date hereof shall be designated a “Series 1 Class F Unit.” Each Class F Unit’s Participation Threshold shall be adjusted after the grant of such Class F Unit in the following manner:
Participation Thresholds. On the date of each grant of Class C Units to a Management Unitholder who is, or as a result of such grant becomes, a holder of Class C Units pursuant to a grant made under an incentive unit grant agreement or similar agreement, the Board shall establish an initial Participation Threshold amount with respect to each Class C Unit granted on such date. The Participation Threshold with respect to a Class C Unit shall be equal to or greater than the Fair Market Value of a Class B Unit on the date of grant of such Class C Unit. The Board may designate a series number for each subset of Class C Units consisting of Class C Units having the same Participation Threshold, which Participation Threshold differs from the Participation Thresholds of all Class C Units not included in such subset. Each Class C Unit's Participation Threshold shall be adjusted after the grant of such Class C Unit in the following manner:
(i) in the event of any Distribution made pursuant to Section 4.1 or Section 4.2, the Participation Threshold of each Class C Unit outstanding at the time of such Distribution shall be reduced (but not below zero) by the amount that each Class B Unit receives in such Distribution less the amount that such Class C Unit is entitled to receive in such Distribution, if any (with such reduction occurring immediately after the determination of the portion of such Distribution, if any, that such Class C Unit is entitled to receive). For this purpose, Distributions shall include Tax Distributions made pursuant to Section 4.2 only (A) to the extent such Tax Distributions are made as a result of the recognition of the built-in gain in any asset that existed at the time the relevant Class C Unit was issued or (B) to the extent that the relevant Class C Unit is not also entitled to a Tax Distribution with respect to the item or tier of taxable income giving rise to the Tax Distribution. For this purpose, the Tax Distribution that arises from the recognition of the built-in gain in an asset may be bifurcated between the Tax Distribution that relates to the built-in gain that existed at the time the relevant Class C Unit was issued and the Tax Distribution that relates to any additional gain in the asset that accrued since the time the relevant Class C Unit was issued. In order to preserve the economic results intended by this Agreement, the Board may determine whether any Tax Distribution (or portion of any Tax Distribution) not described in clauses (A) or (B) of this S...
Participation Thresholds. On the date of each grant of Capital Incentive Units to a Management Unitholder who is, or as a result of such grant becomes, a holder of Capital Incentive Units pursuant to a grant made under an Employee Equity Agreement, the Board shall establish an initial "Participation Threshold" amount with respect to each Capital Incentive Unit granted on such date. The Participation Threshold with respect to a Capital Incentive Unit shall be equal to (or, to the extent provided in such Management Unitholder's Employee Equity Agreement, greater than) the Fair Market Value of a Class B Unit on the date of grant of such Capital Incentive Unit. The Board may designate a series number for each subset of Capital Incentive Units consisting of Capital Incentive Units having the same Participation Threshold, which Participation Threshold differs from the Participation Thresholds of all Capital Incentive Units not included in such subset. If the Board elects to so designate Capital Incentive Units, then the first Capital Incentive Units issued on or after the date hereof shall be designated "Series 1 Capital Incentive Units". Each Capital Incentive Unit's Participation Threshold shall be adjusted after the grant of such Capital Incentive Unit in the following manner:
(i) in the event of any Distribution made pursuant to Section 4.1(b) or Section 4.2 (but in the latter case, only with respect to the portion of any Tax Distribution made in respect of taxable income allocated to each Class B Unit by virtue of the applicability of Section 4.1(b)), the Participation Threshold of each Capital Incentive Unit outstanding at the time of such Distribution shall be reduced (but not below zero) by the amount that each Class B Unit receives in such Distribution less the amount that such Capital Incentive Unit is entitled to receive in such Distribution, if any (with such reduction occurring immediately after the determination of the portion of such Distribution, if any, that such Capital Incentive Unit receives). For this purpose, Distributions shall include Tax Distributions made pursuant to Section 4.2 only (A) to the extent such Tax Distributions are made as a result of the recognition of the built-in gain in any asset that existed at the time the relevant Capital Incentive Unit was issued or (B) to the extent that the relevant Capital Incentive Unit is not also entitled to a Tax Distribution with respect to the item or tier of taxable income giving rise to the Tax Distribution. For t...
Participation Thresholds. On the date of each grant of Management Incentive Units to a Unitholder who is, or as a result of such grant becomes, a holder of Management Incentive Units pursuant to a grant made under a Senior Management Agreement or other Equity Agreement, the Board shall establish an initial Participation Threshold with respect to each Management Incentive Unit granted on such date. Unless otherwise determined by the Board, the Participation Threshold with respect to a Management Incentive Unit shall be equal to or greater than the Total Equity Value Proceeds (determined by using the Valuation Procedures) on the date of grant of such Management Incentive Unit. The Board may designate a series number for each subset of Management Incentive Units consisting of Management Incentive Units having the same Participation Threshold, which Participation Threshold differs from the Participation Thresholds of all Management Incentive Units not included in such subset. In the event of any Capital Contribution by any Unitholder made after the date a Management Incentive Unit is issued, unless the Board determines otherwise, the Participation Threshold (if any) of such Incentive Unit shall be increased by the amount of such Capital Contribution. The Participation Thresholds applicable to outstanding Management Incentive Units shall be set forth on Schedule A, and Schedule A shall be amended from time to time as necessary to reflect any adjustments to the Participation Thresholds of outstanding Management Incentive Units required pursuant to this Section 3.9.
Participation Thresholds. When Class C-l Units are granted, the Board will establish an initial “Participation Threshold” amount with respect to such Class C-1 Units. Unless otherwise determined by the Board, the Participation Threshold with respect to such Class C-l Units will be equal to or greater than the amount that would be distributed with respect to all Class B Units and Class C Units pursuant to Section 4.1(a) in a hypothetical transaction on the issue date in which the Company sold all of its assets for Fair Market Value and distributed the net proceeds in liquidation of the Company pursuant to Section 4.1(a) (as determined immediately before the issuance of such Class C-1 Units, but taking into account any Capital Contributions made in respect of such Class C-l Units).
Participation Thresholds. Notwithstanding anything to the contrary in this Agreement, the Managers, in their sole and absolute discretion, shall be authorized to establish a Participation Threshold with respect to Class B Units issued to any Member. Such Participation Threshold shall be the fair market value of the Company at the date of grant of such Class B Units. Pursuant to each such Participation Threshold, (i) such Member shall be entitled to partici- ▇▇▇▇ in distributions in respect of such Class B Units pursuant to Section 9.3(a) only if the cumu- lative amount distributed to Members (other than such Member holding the Class B Units to which the Participation Threshold applies) pursuant to Section 9.3(a) after the issuance of such Class B Units equals the Participation Threshold applicable to such Class B Units, and (ii) the distributions that such Member holding the Class B Units would have received in respect of such Class B Units but for the preceding clause (i) shall be distributed to the Members pursuant to Sec- tion 9.3(a), as applicable, subject to the provisions of this Section 4.5(c).
Participation Thresholds. Notwithstanding anything to the contrary in this Section 8, no distribution (other than tax distributions pursuant to Section 8(c)) shall be made in respect of any Incentive Units with a Participation Threshold greater than zero (“Positive Participation Threshold Interest”) until the aggregate distributions made to all Limited Partners pursuant to Section 8(a) after the date of issuance of such Incentive Units equals the Participation Threshold applicable to such Incentive Units, and then each Management Holder shall only be entitled to receive, with respect to such Positive Participation Threshold Interest, distributions made after such time and priority. An amount equal to the amount of any reduction in distributions resulting from the application of the foregoing sentence (i.e., the incremental amount that would otherwise have been distributed in respect of such Incentive Units) shall be distributed pursuant to Section 8(a), subject to the provisions of this Section 8(b). The General Partner may determine to amend this Agreement in accordance with Section 25(i) in order to make such changes to this Agreement as the General Partner determines are necessary to reflect the principles set forth in this Section 8(b). For the avoidance of doubt, there shall be no “catch-up” distributions made to any Management Holder holding an Incentive Unit of the amount such Management Holder otherwise would have received (i) had there been no Participation Threshold applicable to such Incentive Unit or (ii) had tax distributions made pursuant to Section 8(c) been included in determining whether such Participation Threshold had been met.
Participation Thresholds. The Participation Threshold of the Incentive Units shall at all times be equal to the amount of any Distributions to be made pursuant to clauses (a) through (f), inclusive, of Section 4.1 of the LP Agreement (i.e., the Incentive Units shall always constitute “Participating Units” for purposes of clauses (g) and (h) of Section 4.1 of the LP Agreement but, for avoidance of doubt, shall not be entitled to any Distribution made pursuant to clauses (a) through (f), inclusive, of Section 4.1 of the LP Agreement). No further adjustment of the Participation Threshold of the Incentive Units shall be made pursuant to Section 3.5(c) of the LP Agreement.