Sec Form 13G Filing - Alclear Investments II LLC filing for CLEAR SECURE INC (YOU) - 2024-11-14

⁽¹⁾ Represents shares of 5,541,891 Class A Common Stock of the Issuer issuable to the reporting person at any time upon (x)(i) the exchange of 5,416,444 non-voting common units of Alclear Units, together with an equal number of shares of Class D Common Stock of the Issuer directly held by the reporting person for shares of Class B Common Stock of the Issuer, on a one-for-one basis, and (ii) the conversion of such shares of Class B Common Stock into shares of Class A Common Stock, on a one-for-one basis, and (y) the conversion of 125,447 shares of Class B Common Stock directly held by the reporting person into shares of Class A Common Stock, on a one-for-one basis.

⁽²⁾ Pursuant to the terms of the Exchange Agreement, dated June 29, 2021, by and among the Issuer, Alclear and the equityholders of Alclear (including Alclear Investments II, LLC), Alclear Units, together with an equal number of shares of Class D Common Stock or shares of Class C Common Stock, may be exchanged for, at the Issuer’s option, (i) shares of Class B Common Stock or shares of Class A Common Stock, as applicable, on a one-for-one basis, or (ii) cash from a substantially concurrent public offering or private sale of shares of Class A Common Stock (based on the market price of the Class A Common Stock in such public offering or private sale). The exchange rights under the Exchange Agreement do not expire.

⁽³⁾ Pursuant to the terms of the Issuer’s Certificate of Incorporation, each share of Class B Common Stock held by Kenneth L. Cornick’s permitted ownership group (including Alclear Investments II, LLC) as described in the Issuer’s Certificate of Incorporation will automatically convert into a share of Class A Common Stock, on a one-for-one basis, and each share of Class D Common Stock held by Kenneth L. Cornick’s permitted ownership group (including Alclear Investments II, LLC) will automatically convert into a share of Class C common stock, par value $0.00001 per share (“Class C Common Stock”), of the Issuer, on a one-for-one basis, (i) at the option of the holder, (ii) immediately prior to any sale or other transfer of such share to a person or entity that is not a member of Kenneth L. Cornick’s permitted ownership group as described in the Issuer’s Certificate of Incorporation, (iii) upon the fifth anniversary of the consummation of the Issuer’s initial public offering, (iv) with respect to any shares of Class B Common Stock or Class D Common Stock held by Kenneth L. Cornick or any other person in his permitted ownership group, (a) such time as Kenneth L. Cornick is removed as a director from the board of directors of the Issuer with his consent, (b) upon the violation of any material non-compete or non-solicitation covenants by Kenneth L. Cornick set forth in any written agreement entered into by the Issuer and Kenneth L. Cornick on or after the filing and effectiveness of the Issuer’s Certificate of Incorporation, which violation is finally determined by a court of competent jurisdiction or (c) upon the death or disability (as defined in the Issuer’s Certificate of Incorporation) of Kenneth L. Cornick or (v) if Kenneth L. Cornick and his permitted transferees cease to hold or control, in the aggregate, at least 25% of the aggregate shares of the Class B Common Stock and Class D Common Stock held by or subject to the voting control of Kenneth L. Cornick and his permitted transferees as of the consummation of the Issuer’s initial public offering.