{ "docId": "019dd923-622c-750b-8b98-ce8e8f2b4a97", "docSlug": "c5a10320e53e", "documentTitle": "Cintas Corp. (CTAS)", "authorId": "54_Spruce_Point_Capital", "authorName": "Ben Axler", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2019-11-13 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 19, "pageCount": 73, "prevPage": 18, "nextPage": 20, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "dense", "nDataPoints": 0, "notes": "The slide uses a red box and arrow to draw attention to clause (a) of the credit agreement.", "elementsJson": [ "headline_text", "callout_box", "screenshot", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b98-ce8e8f2b4a97/19", "deckHref": "/decks/019dd923-622c-750b-8b98-ce8e8f2b4a97", "deckJsonHref": "/decks/019dd923-622c-750b-8b98-ce8e8f2b4a97.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b98-ce8e8f2b4a97#slide-19", "components": [ { "bbox": { "h": 0.08, "w": 0.9, "x": 0.05, "y": 0.17 }, "kind": "callout", "text": "Cintas made certain Representations and Warranties to its bankers that it \"holds permits, certificates, licenses... necessary for the conduct of its business in compliance with all applicable Laws\".... Is this really true? If the licensing issue is systemic in its Fire Safety business, would this be deemed a Material Adverse Effect? Cintas needs to conduct a full audit of its workforce.", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "e0e65816-562c-43d1-8f81-b64fd5e6f28c", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "callout", "text": "Cintas made certain Representations and Warranties to its bankers that it \"holds permits, certificates, licenses... necessary for the conduct of its business in compliance with all applicable Laws\".... Is this really true?", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-2b65-734e-a979-75fda1dc2d40", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.65, "w": 0.83, "x": 0.11, "y": 0.28 }, "kind": "paragraph", "text": "Section 6.3. Compliance with Laws and Contracts. Each Company: (a) holds permits, certificates, licenses, orders, registrations, franchises, authorizations, and other approvals from any Governmental Authority necessary for the conduct of its business and is in compliance with all applicable Laws relating thereto; (b) is in compliance with all federal, state, local, or foreign applicable statutes, rules, regulations, and orders including, without limitation, those relating to environmental protection, occupational safety and health, and equal employment practices; (c) is not in violation of or in default under any agreement to which it is a party or by which its assets are subject or bound; (d) has ensured that no Person who owns a controlling interest in or otherwise controls a Company is (i) listed on the Specially Designated Nationals and Blocked Person List maintained by the Office of Foreign Assets Control (\"OFAC\"), Department of the Treasury, or any other similar lists maintained by OFAC pursuant to any authorizing statute, executive order or regulation, or (ii) a Person designated under Section 1(b), (c) or (d) of Executive Order No. 13224 (September 23, 2001), any related enabling legislation or any other similar executive orders; (e) is in compliance with all applicable Bank Secrecy Act and anti-money laundering Laws and regulations; (f) is in compliance, in all material respects, with the Patriot Act; (g) has ensured that no Company, or to the knowledge of any Company, a director or officer of a Company, is a Person that is, or is owned or controlled by Persons that are (i) the subject of any Sanctions, or (ii) located, organized or resident in a country or territory that is, or is whose government is, the subject of Sanctions; (h) has ensured that no Company, or to the knowledge of any Company, a director or officer of a Company, is a Person that is, or is owned or controlled by Persons that are (i) the subject of any Sanctions, or (ii) located, organized or resident in a country or territory that is, or is whose government is, the subject of Sanctions; and (i) is in compliance, in all material respects, with Anti-Corruption Laws, and has implemented policies and procedures reasonably necessary to ensure that no Company, any director, officer, agent, employee or other person acting on behalf of a Company has taken any action, directly or indirectly, that would result in a violation by such Person of Anti-Corruption Laws, and the Companies have taken such actions they deem reasonably necessary to ensure continued compliance therewith; except in the case of any of subparts (a) through (f) above, where the failure to hold such permits, certificates, licenses, orders, registrations, franchises, authorizations or approvals, or where any such non-compliance or violation, would not reasonably be expected to have a Material Adverse Effect.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "6548ed6f-457d-4f00-97f0-c930e193bf91", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "(a) holds permits, certificates, licenses, orders, registrations, franchises, authorizations, and other approvals from any Governmental Authority necessary for the conduct of its business and is in compliance with all applicable Laws relating thereto; — Credit Agreement", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-2b65-734e-a979-7bc20d242cd4", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.02, "w": 0.15, "x": 0.11, "y": 0.96 }, "kind": "source-note", "text": "Source: Credit Agreement", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "d37b88e0-a4f1-4fda-96ec-bf23ed9243b6", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.65, "x": 0.31, "y": 0.03 }, "kind": "title", "text": "Cintas Potentially Not In Compliance With Its Credit Agreement", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "f44d6dd3-feeb-4ae2-8205-a5762f451296", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "fraud-exposure", "slug": null, "matchId": "a4cbfad4-5e8a-4f97-acef-ca20aa069242", "evidence": "The slide explicitly questions the truthfulness of company representations to bankers to suggest a potential breach of contract.", "confidence": 0.9 } ], "arcBeats": [ { "to": 20, "from": 6, "beatId": "b73990d4-fb73-4140-9aad-c369561e3c5d", "arcName": "Overcoming the Monster", "arcSlug": "overcoming-monster", "beatName": "The Monster", "beatSlug": "overcoming-monster-the-monster", "evidence": "The deck presents extensive evidence of Cintas' bad business practices.", "position": 1, "confidence": 0.8, "parentBeatName": "Hook", "parentBeatSlug": "hook" } ], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }