Page 7 of 12 – SEC Filing
directly or indirectly beneficially own the shares of Common Stock held by each of FS Equity VI and FS Affiliates VI and reported on the cover pages to this Schedule 13D for such Reporting Person. FS Equity VI disclaims beneficial ownership of the shares of Common Stock held by FS Affiliates VI. FS Affiliates VI disclaims beneficial ownership of the shares of Common Stock held by FS Equity VI. See also items 11 and 13 of the cover pages to, and Item 2 of, this Schedule 13D for the aggregate number of shares of Common Stock and percentage of Common Stock beneficially owned by each of the Reporting Persons.
Based upon information included in the Issuers filings with the Securities and Exchange Commission, ACOF in the aggregate holds 52,192,278 shares of Class A Common Stock which are included in items 8 and 11 of the cover pages to this Schedule 13D: The Reporting Persons expressly disclaim the existence of, or membership in, a group within the meaning of Section 13(d)(3) of the Act and Rule 13d-5(b) thereunder with ACOF as a result of the Investor Rights Agreement or otherwise, as well as beneficial ownership with respect to any shares of Common Stock beneficially owned by ACOF, and neither the filing of this statement on Schedule 13D nor any of its contents shall be deemed to constitute an admission by any Reporting Person that it is the beneficial owner of any of the shares of Common Stock referred to herein for purposes of Section 13(d) of the Act, or for any other purpose, and such beneficial ownership is expressly disclaimed by the Reporting Persons.
(b) Power to vote and dispose. See items 7 through 10 of the cover pages to, and Item 2 of, this Schedule 13D for the number of shares of Common Stock beneficially owned by each of the Reporting Persons as to which there is sole or shared power to vote or to direct the vote, and sole or shared power to dispose or to direct the disposition. The Reporting Persons expressly disclaim the power to vote or dispose of the shares held by ACOF included in item 8 of the cover pages of this Schedule 13D, as a result of the Investor Rights Agreement or otherwise.
(c) Transactions within the past 60 days. Except for the information set forth herein, including in Items 3, 4 and 6, which is incorporated herein by reference, none of the Reporting Persons has effected any transaction related to the Common Stock during the past 60 days.
(d) Certain rights of other persons. Except as described herein, no other person has the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, securities covered by this statement.
(e) Date ceased to be a 5% owner. Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer
Investor Rights Agreement
In connection with the completion of the IPO, FS Equity VI and FS Affiliates VI entered into an Investor Rights Agreement, dated May 2, 2017 (the Investor Rights Agreement), with ACOF (FS Equity IV, FS Affiliates VI and ACOF, collectively, the Sponsors) and the Issuer. Pursuant to the terms of the Investor Rights Agreement, each Sponsor is entitled to nominate (a) five directors for election to the Board for so long as it holds 40% or more of the Issuers outstanding Common Stock, (b) three directors for election to the Board for so long as it holds 30% or more of the Issuers outstanding Common Stock, (c) two directors for election to the Board for so long as it holds 15% or more of the Issuers outstanding Common Stock and (d) one director for election to the Board for so long as it holds 5% or more of the Issuers outstanding Common Stock. ACOF has nominated Norman H. Axelrod, David B. Kaplan, Rachel H. Lee, Peter M. Starrett, and Felicia D. Thornton to the Board, and FS has nominated Brad J. Brutocao and John M. Roth for election to the Board. Pursuant to the terms of the Investor Rights Agreement, each Sponsor has agreed to vote in favor of the other Sponsors nominees and for the election of the Issuers then-current chief executive officer to the Board, and subject to any applicable securities exchange or equivalent listing requirements, the Issuer will agree to take all necessary and desirable actions to support the election of such director nominees, including soliciting proxies in favor of such nominees, at each annual or special meeting of the Issuers stockholders called for the election of directors. The Investor Rights Agreement also provides that the size of the Issuers board of directors may not exceed 12 members unless otherwise agreed by the Sponsors. In addition, subject to certain conditions, the Investor Rights Agreement provides each Sponsor with certain rights with respect to Board committee membership, except to the extent that such membership would violate applicable securities laws or stock exchange or stock market rules. Directors nominated by the Sponsors may be removed with or without cause by the affirmative vote of the Sponsor entitled to nominate such director. In all other cases and at any other time, directors may only be removed for cause by the affirmative vote of at least a majority of the voting power of our common stock. The Issuer is required to bear the expenses associated with any transactions contemplated under the Investor Rights Agreement.
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