Backstop Agreement Amendment Clause Samples
A Backstop Agreement Amendment is a contractual provision that modifies the terms of an existing backstop agreement, which typically guarantees the purchase of securities or assets if other parties do not fulfill their commitments. This amendment may adjust key elements such as the purchase price, the quantity of securities covered, or the timeline for the backstop obligation. For example, it might extend the deadline for the backstop provider to step in or alter the conditions under which the backstop is triggered. The core function of this clause is to provide flexibility and ensure that the backstop arrangement remains effective and relevant as circumstances change, thereby maintaining certainty and support for the underlying transaction.
Backstop Agreement Amendment. Section 2.4 of the Backstop Agreement shall be amended and restated in its entirety to read as follows:
(a) No later than the tenth (10th) Business Day following the Rights Offering Expiration Time, the Rights Offering Subscription Agent shall deliver to each Backstop Party (to the extent applicable) a written notice (the “Rights Offering Notice”) of (i) the amount of Rights Offering Securities elected to be purchased by the Rights Offering Participants and the aggregate Purchase Price therefore; (ii) the aggregate amount of Unsubscribed Securities (and corresponding Participation Equity), if any, and the aggregate Purchase Price therefor; (iii) the amount of Unsubscribed Securities (based upon such Backstop Party’s Backstop Commitment Percentage) to be purchased by such Backstop Party and the Purchase Price therefor as determined in accordance with Section 2.2; (iv) the amount of Holdback Securities to be purchased by such Backstop Party and the Purchase Price therefor as determined in accordance with Section 2.2; (v) the aggregate Purchase Price to be paid by such Backstop Party for the Unsubscribed Securities and Holdback Securities purchased in accordance with Section 2.4(a)(iii) and (iv) above, plus the aggregate Purchase Price of the Rights Offering Securities to be purchased by such Backstop Party in the Rights Offering (the “Aggregate Purchase Price”); and (vi) the escrow account to which such Backstop Party shall deliver and pay the Aggregate Purchase Price, as may be adjusted in the Funding Notice for Backstop Parties that are also DIP Lenders (the “Backstop Escrow Account”). The Rights Offering Subscription Agent shall promptly provide any written backup, information and documentation relating to the information contained in the Rights Offering Notice as any Backstop Party may reasonably request.
(b) No later than fifteen (15) Business Days prior to the Closing (and on or after the date on which the Rights Offering Notice is delivered), the Company will deliver written notice (the “Funding Notice”) to the Backstop Parties setting forth:
(i) if the Backstop Party is not a DIP Lender, the Aggregate Purchase Price;
(ii) if the Backstop Party is a DIP Lender and the outstanding obligations under the DIP Credit Agreement and the other loan documents entered into in connection therewith owed by the Company or any of its subsidiaries (the “Outstanding Obligations”) to such Backstop Party that is a DIP Lender as of such date exceed the Aggregate Purchas...