TripAdvisor 2011 Annual Report Download - page 60

Table of Contents
We have agreed that, without the prior approval of Liberty and/or Mr. Diller, as applicable, we will not engage in any transaction that
would result in Liberty or Mr. Diller having to divest any part of their interests in TripAdvisor or any other material assets, or that would render
any such ownership illegal or would subject Mr. Diller or Liberty to any fines, penalties or material additional restrictions or limitations.
In addition, for so long as the Consent Conditions apply, if we (or any of our subsidiaries) incur any indebtedness (other than a customary
refinancing not to exceed the principal amount of the existing obligation being refinanced), after which our total debt ratio (as defined in the
Governance Agreement) equals or exceeds 8:1, then for so long as the total debt ratio continues to equal or exceed 8:1, we may not take any of
the following actions without the prior approval of Liberty and/or Mr. Diller:
Preemptive Rights
In the event that we issue or propose to issue any shares of Common Stock or Class B Common Stock (with certain limited exceptions),
including shares issued upon exercise, conversion or exchange of options, warrants and convertible securities, Liberty will have preemptive
rights that entitle it to purchase a number of shares of our Common Stock so that Liberty will maintain the identical ownership interest in us
(subject to certain adjustments) that Liberty had immediately prior to such issuance or proposed issuance (but not in excess of 20.01%). Any
purchase by Liberty will be allocated between Common Stock and Class B Common Stock in the same proportion as the issuance or issuances
giving rise to the preemptive right, except to the extent that Liberty opts to acquire shares of Common Stock in lieu of shares of Class B
Common Stock.
Registration Rights
Liberty and Mr. Diller are entitled to customary, transferable registration rights with respect to shares of our Common Stock owned by
them. Liberty is entitled to four demand registration rights and Mr. Diller is entitled to three demand registration rights. We will pay the costs
associated with such registrations (other than underwriting discounts, fees and commissions). We will not be required to register shares of our
Common Stock if a stockholder could sell the shares in the quantities proposed to be sold at such time in one transaction under Rule 144 of the
Securities Act or under another comparable exemption from registration.
In connection with a transfer of our securities to an unaffiliated third party, Liberty or Mr. Diller may assign any of its or his then-
remaining demand registration rights to the third party transferee, if upon the transfer the transferee acquires beneficial ownership of more than
5% of our outstanding equity securities. If upon the
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•
In the case of Mr. Diller, he owns at least 2,500,000 of our Common Shares (including options to purchase Common Shares, whether
or not then exercisable), continues to serve as the Chairman of our Board of Directors and has not become disabled, or the Diller
Condition (the Diller Condition together with the Liberty Condition are referred to herein as the Consent Conditions);
•
Acquire or dispose of any assets, issue any debt or equity securities, repurchase any debt or equity securities, or incur indebtedness, if
the aggregate value of such transaction or transactions (alone or in combination) during any six month period equals 10% or more of
our market capitalization;
•
Voluntarily commence any liquidation, dissolution or winding up of TripAdvisor or any of our material subsidies;
•
Make any material amendments to our certificate of incorporation or bylaws;
•
Engage in any line of business other than online and offline media and related businesses, or other businesses engaged in by us as of
the date of determination of the total debt ratio;
•
Adopt any stockholder rights plan that would adversely affect Liberty or Mr. Diller, as applicable; or
•
Grant additional consent rights to any of our stockholders.