Letter Agreement, dated June 7, 2018, among the Company, the Sponsor, the Companys officers and directors and the other parties thereto
Exhibit 10.1
June 7, 2018
GS Acquisition Holdings Corp
200 West Street
New York, New York 10282
Re: Initial Public Offering
Ladies and Gentlemen:
This letter (this Letter Agreement) is being delivered to you in accordance with the Underwriting Agreement (the Underwriting Agreement) entered into or proposed to be entered into by and between GS Acquisition Holdings Corp, a Delaware corporation (the Company), and Goldman Sachs & Co. LLC, as the representative of the several underwriters (each an Underwriter and collectively, the Underwriters), relating to an underwritten initial public offering (the Public Offering), of 69,000,000 of the Companys units (including up to 9,000,000 units that may be purchased to cover the Underwriters option to purchase additional units, if any) (the Units), each comprised of one share of Class A common stock of the Company, par value $0.0001 per share (the Class A Common Stock), and one-third of one warrant (each, a Warrant). Each whole Warrant entitles the holder thereof to purchase one share of Class A Common Stock at a price of $11.50 per share, subject to adjustment. The Units shall be sold in the Public Offering pursuant to a registration statement on Form S-1 and prospectus (the Prospectus) filed by the Company with the Securities and Exchange Commission (the Commission). Certain capitalized terms used herein are defined in paragraph 11 hereof.
In order to induce the Company and the Underwriters to enter into the Underwriting Agreement and to proceed with the Public Offering and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, GS DC Sponsor I LLC, a Delaware limited liability company (the Sponsor), each of the undersigned members of the Sponsor (each, a Member and together, the Members) and the other undersigned persons (each, such other undersigned persons, an Insider and collectively, the Insiders), hereby agrees with the Company as follows:
1. The Sponsor, each Member and each Insider agrees that if the Company seeks shareholder approval of a proposed Business Combination, then in connection with such proposed Business Combination, it, he or she shall (i) vote any Shares owned by it, him or her in favor of any proposed Business Combination and (ii) not redeem any Shares owned by it, him or her in connection with such shareholder approval.
2. The Sponsor, each Member and each Insider hereby agrees that in the event that the Company fails to consummate a Business Combination within 24 months from the closing of the Public Offering, or such later period approved by the Companys shareholders in accordance with the Companys amended and restated certificate of incorporation, the Sponsor, each Member and each Insider shall take all reasonable steps to cause the Company to (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not
more than ten (10) business days thereafter, subject to lawfully available funds therefor, redeem 100% of the Class A Common Shares sold as part of the Units in the Public Offering (the Offering Shares), at a per share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of taxes payable and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Offering Shares, which redemption will completely extinguish all Public Shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Companys remaining shareholders and the Companys board of directors, dissolve and liquidate, subject in each case to the Companys obligations under Delaware law to provide for claims of creditors and other requirements of applicable law. The Sponsor, each Member and each Insider agrees to not propose any amendment to the Companys amended and restated certificate of incorporation that would affect the substance or timing of the Companys obligation to redeem 100% of the Offering Shares if the Company does not complete a Business Combination within 24 months from the closing of the Public Offering, unless the Company provides its Public Shareholders with the opportunity to redeem their Offering Shares upon approval of any such amendment at a per share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding Offering Shares.
The Sponsor, each Member and each Insider acknowledges that it, he or she has no right, title, interest or claim of any kind in or to any monies held in the Trust Account or any other asset of the Company as a result of any liquidation of the Company with respect to the Founder Shares held by it. The Sponsor, each Member and each Insider hereby further waives, with respect to any Shares held by it, him or her, if any, any redemption rights it, he or she may have in connection with the consummation of a Business Combination, including, without limitation, any such rights available in the context of a shareholder vote to approve such Business Combination or in the context of a tender offer made by the Company to purchase Class A Common Shares (although the Sponsor, the Members and the Insiders shall be entitled to redemption and liquidation rights with respect to any Offering Shares it or they hold if the Company fails to consummate a Business Combination within 24 months from the date of the closing of the Public Offering.
3. Notwithstanding the provisions set forth in paragraphs 7(a) and (b) below, during the period commencing on the effective date of the Underwriting Agreement and ending 180 days after such date, the Sponsor, each Member and each Insider shall not, without the prior written consent of Goldman Sachs & Co. LLC, (i) offer, sell, contract to sell, pledge or otherwise dispose of (or enter into any transaction that is designed to, or might reasonably be expected to, result in the disposition (whether by actual disposition or effective economic disposition due to cash settlement or otherwise)), directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning of Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder, with respect to, any Units, Shares, Warrants or any securities convertible into, or exercisable, or exchangeable for, Class A Common Stock, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any Units, shares of Common
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Stock, Warrants or any securities convertible into, or exercisable, or exchangeable for, shares of Common Stock owned by it, him or her, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (iii) or publicly announce an intention to effect any such transaction. Each of the Insiders and Members and the Sponsor acknowledges and agrees that, prior to the effective date of any release or waiver, of the restrictions set forth in this paragraph 3 or paragraph 7 below, the Company shall announce the impending release or waiver by press release through a major news service at least two business days before the effective date of the release or waiver. Any release or waiver granted shall only be effective two business days after the publication date of such press release. The provisions of this paragraph will not apply if (i) the release or waiver is effected solely to permit a transfer of securities that is not for consideration and (ii) the transferee has agreed in writing to be bound by the same terms described in this Letter Agreement to the extent and for the duration that such terms remain in effect at the time of the transfer.
4. In the event of the liquidation of the Trust Account, the Sponsor (which for purposes of clarification shall not extend to any other shareholders, members or managers of the Sponsor) agrees to indemnify and hold harmless the Company against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, whether pending or threatened, or any claim whatsoever) to which the Company may become subject as a result of any claim by (i) any third party (other than the Companys independent accountants) for services rendered or products sold to the Company or (ii) a prospective target business with which the Company has discussed entering into an acquisition agreement (a Target); provided, however, that such indemnification of the Company by the Sponsor shall apply only to the extent necessary to ensure that such claims by a third party for services rendered (other than the Companys independent public accountants) or products sold to the Company or a Target do not reduce the amount of funds in the Trust Account to below (i) $10.00 per share of the Offering Shares or (ii) such lesser amount per share of the Offering Shares held in the Trust Account due to reductions in the value of the trust assets as of the date of the liquidation of the Trust Account, in each case, net of the amount of interest earned on the property in the Trust Account which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Companys indemnity of the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended. In the event that any such executed waiver is deemed to be unenforceable against such third party, the Sponsor shall not be responsible to the extent of any liability for such third party claims. The Sponsor shall have the right to defend against any such claim with counsel of its choice reasonably satisfactory to the Company if, within 15 days following written receipt of notice of the claim to the Sponsor, the Sponsor notifies the Company in writing that it shall undertake such defense.
5. To the extent that the Underwriters do not exercise their option to purchase up to an additional 9,000,000 Units within 45 days from the date of the Prospectus (and as further described in the Prospectus), the Sponsor agrees that it shall forfeit, at no cost, a number of Founder Shares in the aggregate equal to 2,250,000 multiplied by a fraction, (i) the numerator of which is 9,000,000 minus the number of Units purchased by the Underwriters upon the exercise of their option to purchase additional Units, and (ii) the denominator of which is 9,000,000. All references in this Letter Agreement to Founder Shares of the Company being forfeited shall take
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effect as a contribution of such Founder Shares to the Companys capital as a matter of Delaware law. The forfeiture will be adjusted to the extent that the option to purchase additional Units is not exercised in full by the Underwriters so that the Initial Shareholders will own an aggregate of 20.0% of the Companys issued and outstanding Shares after the Public Offering. The Initial Shareholders further agree that to the extent that the size of the Public Offering is increased or decreased, the Company will effect a capitalization or share repurchase or redemption, as applicable, immediately prior to the consummation of the Public Offering in such amount as to maintain the ownership of the Initial Shareholders prior to the Public Offering at 20.0% of the Companys issued and outstanding Shares upon the consummation of the Public Offering. In connection with such increase or decrease in the size of the Public Offering, then (A) the references to 9,000,000 in the numerator and denominator of the formula in the first sentence of this paragraph shall be changed to a number equal to 15.0% of the number of Class A Common Shares included in the Units issued in the Public Offering and (B) the reference to 2,250,000 in the formula set forth in the immediately preceding sentence shall be adjusted to such number of Founder Shares that the Sponsor would have to return to the Company in order to hold (with all of the Initial Shareholders) an aggregate of 20.0% of the Companys issued and outstanding Shares after the Public Offering.
6. (a) The Sponsor and each Insider who is an officer and/or director of the Company have agreed not to participate in the formation of, or become an officer or director of, any other special purpose acquisition company with a class of securities registered under the Securities Exchange Act of 1934, as amended, until the Company has entered into a definitive agreement regarding its initial Business Combination or it has failed to complete its initial Business Combination within 24 months after the closing of the Public Offering.
(b) The Sponsor, each Member and each Insider hereby agrees and acknowledges that: (i) the Underwriters and the Company would be irreparably injured in the event of a breach by such Sponsor, Member or Insider of its, his or her obligations under paragraphs 1, 2, 3, 4, 5, 7(a), 7(b), and 9 of this Letter Agreement (ii) monetary damages may not be an adequate remedy for such breach and (iii) the non-breaching party shall be entitled to seek injunctive relief, in addition to any other remedy that such party may have in law or in equity, in the event of such breach.
7. (a) The Sponsor, each Member and each Insider agrees that it, he or she shall not Transfer (as defined below) any Founder Shares (or Class A Common Shares issuable upon conversion thereof) until the earlier of (A) one year after the completion of the Companys initial Business Combination and (B) subsequent to the Business Combination, (x) if the last reported sale price of the Class A Common Stock equals or exceeds $12.00 per share (as adjusted for share splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Companys initial Business Combination or (y) the date following the completion of the Companys initial Business Combination on which the Company completes a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of the Companys shareholders having the right to exchange their Class A Common Shares for cash, securities or other property (the Founder Shares Lock-up Period).
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(b) The Sponsor, each Member and each Insider agrees that it, he or she shall not Transfer any Private Placement Warrants (or Class A Common Shares issued or issuable upon the conversion or exercise of the Private Placement Warrants), until 30 days after the completion of a Business Combination (the Private Placement Warrants Lock-up Period, together with the Founder Shares Lock-up Period, the Lock-up Periods).
(c) Notwithstanding the provisions set forth in paragraphs 7(a) and (b), Transfers of the Founder Shares, Private Placement Warrants and Class A Common Shares issued or issuable upon the exercise or conversion of the Private Placement Warrants or the Founder Shares and that are held by the Sponsor, any Member or any Insider or any of their permitted transferees (that have complied with this paragraph 7(c)), are permitted (a) to the Companys officers or directors, any affiliates or family members of any of the Companys officers or directors, any members of the Sponsor, or any affiliates of the Sponsor, (b) in the case of an individual, by gift to a member of the individuals immediate family or to a trust, the beneficiary of which is a member of the individuals immediate family or an affiliate of such person, or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with the consummation of the Companys Business Combination at prices no greater than the price at which the securities were originally purchased; (f) in the event of the Companys liquidation prior to the Companys completion of an initial Business Combination; (g) by virtue of the laws of Delaware or the Sponsors limited liability company agreement, as amended, upon dissolution of the Sponsor; or (h) in the event of the Companys completion of a liquidation, merger, stock exchange, reorganization or other similar transaction which results in all of the Companys public stockholders having the right to exchange their shares of Class A Common Stock for cash, securities or other property subsequent to the Companys completion of an initial Business Combination; provided, however, that in the case of clauses (a) through (e) these permitted transferees must enter into a written agreement with the Company agreeing to be bound by the transfer restrictions in this Agreement.
8. The Sponsor, each Member and each Insider represents and warrants that it, he or she has never been suspended or expelled from membership in any securities or commodities exchange or association or had a securities or commodities license or registration denied, suspended or revoked. Each Insiders biographical information furnished to the Company, if any (including any such information included in the Prospectus), is true and accurate in all respects and does not omit any material information with respect to such Insiders background. The Sponsor, each Member and each Insiders questionnaire furnished to the Company, if any, is true and accurate in all respects. The Sponsor, each Member and each Insider represents and warrants that: it is not subject to or a respondent in any legal action for, any injunction, cease-and-desist order or order or stipulation to desist or refrain from any act or practice relating to the offering of securities in any jurisdiction; it has never been convicted of, or pleaded guilty to, any crime (i) involving fraud, (ii) relating to any financial transaction or handling of funds of another person, or (iii) pertaining to any dealings in any securities and it is not currently a defendant in any such criminal proceeding.
9. Except as disclosed in the Prospectus, neither the Sponsor nor any Member or Insider nor any affiliate of the Sponsor, any Member or any Insider, nor any director or officer of
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the Company, shall receive from the Company any finders fee, reimbursement, consulting fee, monies in respect of any repayment of a loan or other compensation prior to, or in connection with any services rendered in order to effectuate the consummation of the Companys initial Business Combination (regardless of the type of transaction that it is), other than the following, none of which will be made from the proceeds held in the Trust Account prior to the completion of the initial Business Combination: (i) repayment of a loan and advances up to an aggregate of $300,000 made to the Company by an affiliate of the Sponsor; (ii) payment to an affiliate of the Sponsor for office space, administrative and secretarial support for a total of $10,000 per month; (iii) payment of customary fees for financial advisory services; (iv) reimbursement for any reasonable out-of-pocket expenses related to identifying, investigating and consummating an initial Business Combination; and (v) repayment of loans, if any, and on such terms as to be determined by the Company from time to time, made by the Sponsor or any of the Companys officers or directors to finance transaction costs in connection with an intended initial Business Combination, provided, that, if the Company does not consummate an initial Business Combination, a portion of the working capital held outside the Trust Account may be used by the Company to repay such loaned amounts so long as no proceeds from the Trust Account are used for such repayment. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.50 per warrant at the option of the lender. Such warrants would be identical to the Private Placement Warrants, including as to exercise price, exercisability and exercise period.
10. The Sponsor, each Member and each Insider has full right and power, without violating any agreement to which it is bound (including, without limitation, any non-competition or non-solicitation agreement with any employer or former employer), to enter into this Letter Agreement and, as applicable, to serve as an officer and/or a director on the board of directors of the Company and hereby consents to being named in the Prospectus as an officer and/or a director of the Company.
11. As used herein, (i) Business Combination shall mean a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination, involving the Company and one or more businesses; (ii) Shares shall mean, collectively, the Class A Common Shares and the Founder Shares; (iii) Class A Common Shares shall mean shares of Class A Common Stock; (iv) Founder Shares shall mean the 17,250,000 shares of Class B common stock, par value $0.0001 per share, issued and outstanding immediately prior to the consummation of the Public Offering; (v) Initial Shareholders shall mean the Sponsor and any Insider that holds Founder Shares; (vi) Private Placement Warrants shall mean the Warrants to purchase up to 9,333,333 Class A Common Shares of the Company (or 10,533,333 Class A Common Shares if the over-allotment option is exercised in full) that the Sponsor has agreed to purchase for an aggregate purchase price of $14,000,000 in the aggregate (or $15,800,000 if the over-allotment option is exercised in full), or $1.50 per Warrant, in a private placement that shall occur simultaneously with the consummation of the Public Offering; (vii) Public Shareholders shall mean the holders of securities issued in the Public Offering; (viii) Trust Account shall mean the trust fund into which a portion of the net proceeds of the Public Offering shall be deposited; and (ix) Transfer shall mean the (a) sale or assignment of, offer to sell, contract or agreement to sell, hypothecate, pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment or increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position within the meaning of Section 16 of the Securities Exchange Act of 1934, as amended,
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and the rules and regulations of the Commission promulgated thereunder with respect to, any security, (b) entry into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (c) public announcement of any intention to effect any transaction specified in clause (a) or (b).
12. This Letter Agreement constitutes the entire agreement and understanding of the parties hereto in respect of the subject matter hereof and supersedes all prior understandings, agreements, or representations by or among the parties hereto, written or oral, to the extent they relate in any way to the subject matter hereof or the transactions contemplated hereby. This Letter Agreement may not be changed, amended, modified or waived (other than to correct a typographical error) as to any particular provision, except by a written instrument executed by the Sponsor and each Member and Insider that is the subject of any such change, amendment modification or waiver.
13. No party hereto may assign either this Letter Agreement or any of its rights, interests, or obligations hereunder without the prior written consent of the other parties. Any purported assignment in violation of this paragraph shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported assignee. This Letter Agreement shall be binding on the Sponsor, each Member and each Insider and their respective successors, heirs and assigns and permitted transferees.
14. Nothing in this Letter Agreement shall be construed to confer upon, or give to, any person or corporation other than the parties hereto any right, remedy or claim under or by reason of this Letter Agreement or of any covenant, condition, stipulation, promise or agreement hereof. All covenants, conditions, stipulations, promises and agreements contained in this Letter Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors, heirs, personal representatives and assigns and permitted transferees.
15. This Letter Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.
16. This Letter 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 Letter 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 Letter Agreement a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.
17. This Letter Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York. The parties hereto (i) all agree that any action, proceeding, claim or dispute arising out of, or relating in any way to, this Letter Agreement shall be brought and enforced in the courts of New York City, in the State of New York, and irrevocably submit to such jurisdiction and venue, which jurisdiction and venue shall be exclusive and (ii) waive any objection to such exclusive jurisdiction and venue or that such courts represent an inconvenient forum.
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18. Any notice, consent or request to be given in connection with any of the terms or provisions of this Letter Agreement shall be in writing and shall be sent by express mail or similar private courier service, by certified mail (return receipt requested), by hand delivery or facsimile transmission.
19. Each party hereto shall not be liable for any breaches or misrepresentations contained in this Letter Agreement by any other party to this Letter Agreement (including, for the avoidance of doubt, any Member or Insider with respect to any other Member or Insider), and no party shall be liable or responsible for the obligations of another party, including, without limitation, indemnification obligations and notice obligations.
20. This Letter Agreement shall terminate on the earlier of (i) the expiration of the Lock-up Periods or (ii) the liquidation of the Company; provided, however, that this Letter Agreement shall earlier terminate in the event that the Public Offering is not consummated and closed by December 31, 2018; provided further that paragraph 4 of this Letter Agreement shall survive such liquidation.
[Signature Page follows]
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Sincerely, | ||||
GS DC SPONSOR I LLC | ||||
By: | GS Sponsor LLC | |||
By: | /s/ Raanan A. Agus | |||
Name: Raanan A. Agus | ||||
Title: President | ||||
By: | Cote SPAC 1 LLC | |||
By: | /s/ David M. Cote | |||
Name: David M. Cote | ||||
Title: Member | ||||
GS SPONSOR LLC | ||||
By: | /s/ Raanan A. Agus | |||
Name: Raanan A. Agus | ||||
Title: President | ||||
COTE SPAC 1 LLC | ||||
By: | /s/ David M. Cote | |||
Name: David M. Cote | ||||
Title: President | ||||
/s/ David M. Cote | ||||
David Cote | ||||
/s/ Raanan A. Agus | ||||
Raanan A. Agus | ||||
/s/ James Albaugh | ||||
James Albaugh | ||||
/s/ Roger Fradin | ||||
Roger Fradin | ||||
/s/ Steven S. Reinemund | ||||
Steven S. Reinemund |
Acknowledged and Agreed:
GS ACQUISITION HOLDINGS CORP | ||
By: | /s/ David M. Cote | |
Name: David M. Cote | ||
Title: Chief Executive Officer, President and Secretary |
[Signature Page to Letter Agreement]