Closing Payments and Deliveries. (a) At least four (4) Business Days (or one (1) Business Day, in the case of clause (ii) below) prior to the Closing Date, the Company shall: (i) deliver to Parent a statement (the “Closing Date Statement”) setting forth in reasonable detail (w) the Company’s good faith estimate of (1) the Closing Cash (the “Estimated Closing Cash”), (2) the Closing Net Working Capital (the “Estimated Closing Net Working Capital”), (3) the Closing Indebtedness (the “Estimated Closing Indebtedness”) and (4) the Transaction Expenses (the “Estimated Transaction Expenses”), (x) the Aggregate Preferred Stock Closing Accrued Value and Aggregate Preferred Option Closing Accrued Value, (y) the Aggregate Option Exercise Price and (z) the Company’s determination of the Aggregate Estimated Closing Merger Consideration based on the foregoing clauses (together with reasonably detailed supporting calculations, in each case, determined in accordance with this Agreement); provided, that the Company shall consider in good faith any comments provided by Parent in writing with respect to the Closing Date Statement, and if the Company accepts any such written comments, it shall deliver to Parent an updated version of the Closing Date Statement, which updated version shall replace the prior version for all purposes hereunder except, for purposes of determination of the Closing Date pursuant to Section 2.1, such updated version shall be deemed to have been delivered on the date on which the prior version of the Closing Date Statement was delivered and; and provided, further, that the Company shall, and shall cause the Company Group to, use commercially reasonable efforts to make its financial records, accounting personnel and advisors available to Parent, its accountants and other representatives at reasonable times during the review by Parent of the Closing Date Statement; (ii) deliver to Parent the Payoff Letter (provided that a substantially final draft of the Payoff Letter but without the amounts filled in shall be delivered to Parent three (3) Business Days prior to the Closing Date); (iii) deliver to Parent a certificate, duly completed and executed pursuant to Sections 1.897-2(h) and 1.1445-2(c) of the U.S. Treasury Regulations, issued by the Company certifying that an interest in the Company is not a United States real property interest within the meaning of Section 897 of the Code; and (iv) notify Parent in writing of, to the extent then known, the respective amounts payable pursuant to Section 2.6(c)(i) through Section 2.6(c)(viii) and bank accounts to which each of such amounts shall be paid. (b) At or prior to the Closing, Parent shall deposit with (i) the Paying Agent, (A) for the benefit of the Stockholders (other than Dissenting Common Stockholders) the portion of the Aggregate Estimated Closing Merger Consideration (less any amounts payable to Dissenting Common Stockholders) payable to the Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to (x) the Closing Merger Consideration Per Share, multiplied by (y) the total number of issued and outstanding shares of Common Stock at the time of the Closing other than any shares of Common Stock to be canceled pursuant to Section 2.5(b) (less any amounts payable to Dissenting Common Stockholders), and (B) for the benefit of the Preferred Stockholders (other than Dissenting Preferred Stockholders), the Aggregate Preferred Stock Closing Accrued Value (less any amounts payable to Dissenting Preferred Stockholders) payable to the Preferred Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to the sum of the Closing Preferred Stock Accrued Values for each issued and outstanding share of Preferred Stock at the time of the Closing other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d) (less any amounts payable to Dissenting Preferred Stockholders), pursuant to this Agreement (the amount so deposited with the Paying Agent, the “Exchange Fund”) and (ii) the Company or the Company’s designated Subsidiary, (A) the portion of the Aggregate Estimated Closing Merger Consideration payable to the Optionholders (in their capacities as such) pursuant to this Agreement and (B) the Aggregate Preferred Option Closing Accrued Value payable to the Preferred Optionholders (in their capacities as such) pursuant to this Agreement. Notwithstanding anything to the contrary herein, the parties acknowledge and agree, the Equityholder Representative agrees on behalf of the Equityholders, and each Equityholder shall acknowledge and agree in such Equityholder’s Letter of Transmittal, that Parent shall be entitled to rely on the Company’s calculation of the respective portions of the Aggregate Estimated Closing Merger Consideration payable to the Stockholders, the Preferred Stockholders, the Optionholders and the Preferred Optionholders (in their respective capacities as such) as a true, complete and accurate calculation of the amounts to which each such Equityholder is entitled pursuant to the Company Certificate of Incorporation as in effect as of immediately prior to the Effective Time, in connection with the transactions contemplated by this Agreement, and in no event shall Parent or any of its Affiliates (including, following the Closing, the Surviving Corporation and its Subsidiaries) have any liability to any Equityholder or to any other Person for the calculation of any of the foregoing. (c) At the Closing: (i) Parent shall pay an amount equal to the Credit Agreement Payoff Amount pursuant to a customary payoff letter delivered to Parent prior to the Closing Date pursuant to Section 2.6(a)(ii) above (the “Payoff Letter”); (ii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Escrow Agent an amount equal to the Adjustment Escrow Amount, which amount shall be held by the Escrow Agent in a separate account (the “Adjustment Escrow Account”) pursuant to an escrow agreement in a form reasonably acceptable to the Equityholder Representative and Parent (the “Escrow Agreement”), by and among Parent, the Equityholder Representative and the Escrow Agent; (iii) Parent shall pay or cause to be paid to the account designated by the Company to Parent prior to the Closing Date of each Person to whom Transaction Expenses described in clauses (a) and (c) of the definition thereof are owed an amount equal to the portion of the Transaction Expenses owed to such Person (other than Transaction Expenses that are payable to any Company Group Employee, which shall be delivered to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries in accordance with the terms of the applicable arrangements to such Person); (iv) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions provided by the Equityholder Representative, to the account of each Stockholder (excluding holders of Dissenting Shares) with respect to each share of Common Stock outstanding immediately prior to the Effective Time (other than any shares of Common Stock to be canceled pursuant to Section 2.5(b)) for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Merger Consideration Per Share for each such share of Common Stock; (v) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions and calculations provided by the Equityholder Representative to the account of each Preferred Stockholder (excluding holders of Dissenting Shares) with respect to each share of Preferred Stock outstanding immediately prior to the Effective Time (other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d)) held by such Preferred Stockholder and for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Preferred Stock Accrued Value for each such share of Preferred Stock; (vi) with respect to each Optionholder, Parent shall pay or cause to be paid to each such Optionholder in respect of each share of Common Stock underlying each of such Optionholder’s Options (other than any Underwater Options), for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Option Consideration Per Share with respect to each such share of Common Stock underlying each such Option held by such Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Optionholder; (vii) with respect to each Preferred Optionholder, Parent shall pay or cause to be paid to each such Preferred Optionholder in respect of each share of Preferred Stock underlying each of such Preferred Optionholder’s Preferred Options, an amount equal to the Closing Preferred Option Accrued Value with respect to each such share of Preferred Stock underlying each such Preferred Option held by such Preferred Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Preferred Optionholder; and (viii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Equityholder Representative, the Equityholder Representative Expense Amount. (d) At or prior to the Closing, the Company will deliver or cause to be delivered to Parent: (i) resignation letters (which resignation letters will not constitute a termination of employment) or other evidence of removal providing for the resignation or removal of the directors and officers of the Company Group from such positions as directors or officers of members of the Company Group effective as of the Effective Time, as requested by Parent in writing no later than five (5) Business Days prior to the Closing Date. (e) Notwithstanding anything in this Agreement to the contrary, each Dissenting Stockholder (the shares of Common Stock held by each Dissenting Common Stockholder and the shares of Preferred Stock held by each Dissenting Preferred Stockholders, collectively, the “Dissenting Shares”) shall not have the right to receive any payment in accordance with Section 2.6(c) with respect to such Dissenting Stockholder’s respective Dissenting Shares, but instead and in lieu thereof shall have the right to receive payment from the Surviving Corporation with respect to its Dissenting Shares in accordance with the DGCL, unless and until such Dissenting Stockholder shall have effectively withdrawn or lost its rights to appraisal under the DGCL. If any such formerly Dissenting Stockholder shall have effectively withdrawn or lost such right, such Stockholder shall have the right to receive such Equityholder’s consideration as set forth in Section 2.5(a) or Section 2.5(c), as the case may be. The Company will give Parent prompt notice of any demands received by the Company for appraisal rights, and Parent will have the right to participate in (at its own expense) all negotiations and proceedings with respect to such demands. The Company will not, except with the prior written consent of Parent (not to be unreasonably withheld, conditioned or delayed), make any payment with respect to, or settle or offer to settle, any such demands.
Appears in 1 contract
Closing Payments and Deliveries. (a) At least four two (42) Business Days (or one (1) Business Day, in the case of clause (ii) below) prior to the Closing Date, the Company shall:
(i) deliver to Parent a written statement (such statement, as the same may be amended at any time prior to the Closing with the consent of Parent, the “Closing Date Statement”) (A) setting forth in reasonable detail (w) the Company’s good faith estimate estimates of (1) the Closing Cash (the “Estimated Closing Cash”), (2) the Closing Net Working Capital (the “Estimated Closing Net Working Capital”), and (3) the Closing Indebtedness (the “Estimated Closing Indebtedness”) ), each of which shall be calculated by the Company and presented in accordance with this Agreement and Exhibit B hereto, and (4B) the Transaction Expenses (the “Estimated Transaction Expenses”), setting forth (x) the Aggregate Preferred Stock Closing Accrued Value Option Exercise Price, and Aggregate Preferred Option Closing Accrued Value, (y) the Aggregate Option Exercise Price and Transaction Expenses that are to be paid at or following the Closing (z) the Company’s determination aggregate amount of the Aggregate Estimated Closing Merger Consideration based on the foregoing clauses (together with reasonably detailed supporting calculations, such Transaction Expenses set forth in each case, determined in accordance with this Agreement); provided, that the Company shall consider in good faith any comments provided by Parent in writing with respect to the Closing Date Statement, and if the Company accepts any such written comments, it shall deliver to Parent an updated version of the “Closing Date Statement, which updated version shall replace the prior version for all purposes hereunder except, for purposes of determination of the Closing Date pursuant to Section 2.1, such updated version shall be deemed to have been delivered on the date on which the prior version of the Closing Date Statement was delivered Transaction Expenses Amount”); and; and provided, further, that the Company shall, and shall cause the Company Group to, use commercially reasonable efforts to make its financial records, accounting personnel and advisors available to Parent, its accountants and other representatives at reasonable times during the review by Parent of the Closing Date Statement;
(ii) deliver to Parent the Payoff Letter (provided that notify Parent, in a substantially final draft certificate signed by an executive officer of the Payoff Letter but without the amounts filled in shall be delivered to Parent three (3) Business Days prior to the Closing Date);
(iii) deliver to Parent a certificateCompany, duly completed and executed pursuant to Sections 1.897-2(h) and 1.1445-2(c) of the U.S. Treasury Regulations, issued by the Company certifying that an interest in the Company is not a United States real property interest within the meaning of Section 897 names of the Code; and
(iv) notify Parent in writing of, to the extent then known, recipients of the respective amounts payable pursuant to Section 2.6(c)(i) through Section 2.6(c)(viiiSections 2.6(c) and bank accounts 2.6(d) and the amount of each such payment (the “Allocation Certificate”). All payments by Parent or the Surviving Company pursuant to which each of such amounts this Section 2.6 shall be paidmade by wire transfer of immediately available funds unless otherwise designated by the payee thereof in its properly delivered Letter of Transmittal, or unless the payment is less than $1,000 in which case payment may be made by check. The Company shall deliver amended Allocation Certificates to reflect any amendments to the Closing Date Statement and may deliver amended Allocation Certificates to reflect any properly delivered Letters of Transmittal following the delivery of the Closing Date Statement and prior to the Closing.
(b) At or prior to the Closing, Parent shall deposit with (i) the Paying Agent, (A) for the benefit of the Stockholders (other than Dissenting Common Stockholders) the portion of the Aggregate Estimated Closing Merger Consideration (less any amounts payable to Dissenting Common Stockholders) payable to the Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to (x) From 12:00 A.M. on the Closing Merger Consideration Per Share, multiplied by (y) the total number of issued Date and outstanding shares of Common Stock at the time of the Closing other than any shares of Common Stock to be canceled pursuant to Section 2.5(b) (less any amounts payable to Dissenting Common Stockholders), and (B) for the benefit of the Preferred Stockholders (other than Dissenting Preferred Stockholders), the Aggregate Preferred Stock Closing Accrued Value (less any amounts payable to Dissenting Preferred Stockholders) payable to the Preferred Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to the sum of the Closing Preferred Stock Accrued Values for each issued and outstanding share of Preferred Stock at the time of the Closing other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d) (less any amounts payable to Dissenting Preferred Stockholders), pursuant to this Agreement (the amount so deposited with the Paying Agent, the “Exchange Fund”) and (ii) the Company or the Company’s designated Subsidiary, (A) the portion of the Aggregate Estimated Closing Merger Consideration payable to the Optionholders (in their capacities as such) pursuant to this Agreement and (B) the Aggregate Preferred Option Closing Accrued Value payable to the Preferred Optionholders (in their capacities as such) pursuant to this Agreement. Notwithstanding anything to the contrary herein, the parties acknowledge and agree, the Equityholder Representative agrees on behalf of the Equityholders, and each Equityholder shall acknowledge and agree in such Equityholder’s Letter of Transmittal, that Parent shall be entitled to rely on the Company’s calculation of the respective portions of the Aggregate Estimated Closing Merger Consideration payable to the Stockholders, the Preferred Stockholders, the Optionholders and the Preferred Optionholders (in their respective capacities as such) as a true, complete and accurate calculation of the amounts to which each such Equityholder is entitled pursuant to the Company Certificate of Incorporation as in effect as of immediately prior to the Effective Time, in connection with the transactions contemplated by this Agreement, and in no event shall Parent or any of its Affiliates (including, following until the Closing, the Surviving Corporation Company shall not, and shall not permit any of its Subsidiaries) have Subsidiaries to, use any liability Cash to pay any Equityholder Transaction Expenses or to repay any other Person for the calculation of any of the foregoingClosing Indebtedness.
(c) At the Closing, Parent shall, or shall cause the Surviving Company to, make the following cash payments:
(i) Parent shall pay an amount equal to the Credit Agreement account specified in each Payoff Letter (other than a Payoff Letter in respect of Closing NMP Indebtedness), on behalf of the Company and its Subsidiaries, the Payoff Amount pursuant with respect to a customary payoff letter delivered to Parent prior to the Closing Date pursuant to Section 2.6(a)(ii) above (the “such Payoff Letter”);
(ii) Parent shall pay or cause to be paid to an account (the “Purchase Price Adjustment Escrow Account”) designated prior to the Closing Date by the Escrow Agent an amount equal to Agent, the Purchase Price Adjustment Escrow Amount, which amount shall be held by the Escrow Agent in a separate account (the “Adjustment Escrow Account”) pursuant to an escrow agreement the Escrow Agreement and disbursed in a form reasonably acceptable to accordance with the Equityholder Representative and Parent (the “Escrow Agreement”), by and among Parent, the Equityholder Representative applicable provisions of Section 2.8 and the Escrow AgentAgreement;
(iii) Parent shall pay or cause to be paid to a separate account of the account Surviving Company as designated by the Company to Parent prior to the Closing Date Date, not to be commingled with any other funds, the Substitution Plan Holdback Amount, to be disbursed in accordance with the applicable provisions of Section 2.9 and the Escrow Agreement;
(iv) to the account of each Person to whom which any of the Transaction Expenses described in clauses (a) and (c) of the definition thereof are owed owed, an amount equal to the portion of the Transaction Expenses owed owing to such Person as such amount is set forth in the invoice provided by such Person, which invoice the Company shall provide to Parent in connection with the Closing;
(other than Transaction Expenses that are payable v) to any Company Group Employeean account designated by the Escrow Agent, an amount equal to Four Million Dollars ($4,000,000) (the “Unitholders’ Representative Expense Amount”), which shall be held and disbursed in accordance with Sections 2.9 and 9.1(d);
(vi) to the account of each Unitholder with respect to each Unit outstanding immediately prior to the Effective Time for which a Letter of Transmittal that includes such Unitholder’s payment information has been properly delivered to the Surviving Corporation Company (with a copy to Parent) as specified therein at least two (2) Business Days prior to the Closing (or one such earlier time as the Company and Parent may agree), an amount equal to that portion of its Subsidiaries for payroll the Net Estimated Merger Consideration payable in respect of a Class A Unit or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries Class P Unit (as applicable), calculated in accordance with the terms of the applicable arrangements Operating Agreement as though the Company had sold all its assets for an amount equal to the Net Estimated Merger Consideration and distributed such Personamount to the Equityholders pursuant to Section 10.02 of the Operating Agreement (such amounts, the “Net Estimated Merger Consideration Per Class A Unit” and “Net Estimated Merger Consideration Per Class P Unit,” respectively), as set forth in the Allocation Certificate;
(ivvii) Parent and to a separate account of the Equityholder Representative shall direct Escrow Agent, not to be commingled with any other funds, the Paying Agent to pay, following sum of (A) the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions provided Net Estimated Merger Consideration Per Class A Unit multiplied by the Equityholder Representative, to the account number of each Stockholder (excluding holders of Dissenting Shares) with respect to each share of Common Stock Class A Units outstanding immediately prior to the Effective Time (other than any shares in respect of Common Stock to be canceled pursuant to Section 2.5(b)) for which a duly completed and executed Letter no Letters of Transmittal has been were properly delivered to the Company (with a copy to Parent) at least two (2) Business Days prior to the Closing Date, an amount equal to (or such earlier time as the Closing Company and Parent may agree) plus (B) the Net Estimated Merger Consideration Per Share for each such share of Common Stock;
(v) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions and calculations provided Class P Unit multiplied by the Equityholder Representative to the account number of each Preferred Stockholder (excluding holders of Dissenting Shares) with respect to each share of Preferred Stock Class P Units outstanding immediately prior to the Effective Time in respect of which no Letters of Transmittal were properly delivered to the Company (other than any shares of Preferred Stock with a copy to Parent) at least two (2) Business Days prior to the Closing (or such earlier time as the Company and Parent may agree), such sum to be canceled pursuant held for the benefit of the holders of such Units and disbursed in accordance with Section 2.7(b) (the “Unit Exchange Fund”); and
(viii) to Section 2.5(d)) held a separate account of the Company as designated by such Preferred Stockholder and for which a duly completed and executed Letter of Transmittal has been properly delivered the Company prior to the Closing Date, an amount equal to the Closing Preferred Stock Accrued Value for each such share of Preferred Stock;
(vi) with respect to each Optionholder, Parent shall pay or cause not to be paid to each such Optionholder in respect of each share of Common Stock underlying each of such Optionholder’s Options (commingled with any other than any Underwater Options), for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Datefunds, an amount equal to the Closing Option Net Estimated Merger Consideration Per Share Class A Unit multiplied by the aggregate number of Class A Units subject to issuance upon exercise of all Options outstanding immediately prior to the Effective Time for which no Option Payment Letters were properly delivered to the Company (with a copy to Parent) at least two (2) Business Days prior to the Closing (or such earlier time as the Company and Parent may agree) minus the aggregate exercise price in respect of all such Class A Units, to be held in trust for the benefit of the holders of such Options and disbursed in accordance with Section 2.7(b) (the “Option Exchange Fund”).
(d) No later than on the Surviving Company’s first regular payroll date (and in any event within three (3) Business Days) following the Closing, Parent shall, or shall cause the Surviving Company to, pay in cash, through the Company’s payroll system, to each Optionholder who held Options immediately prior to the Effective Time for which an Option Payment Letter was properly delivered to the Company (with a copy to Parent) at least two (2) Business Days prior to the Closing (or such earlier time as the Company and Parent may agree), an amount equal to the Net Estimated Merger Consideration Per Class A Unit multiplied by the number of Class A Units subject to issuance upon exercise of such Options held by such Optionholder minus the aggregate exercise price in respect of all such Class A Units.
(e) From and after the Effective Time, the Equityholders shall cease to have any rights with respect to any Units or Options outstanding as of immediately prior to the Effective Time (or any Units underlying such Options) or with respect to any rights set forth in the Operating Agreement except for the right to receive their respective shares of the consideration payable pursuant to Section 2.5(a) or 2.5(b), as applicable, of this Agreement. The consideration paid by Parent or the Surviving Company to each Equityholder as set forth in Section 2.5(a) or 2.5(b), as applicable, in exchange for such share Equityholder’s Units, or Units underlying such Optionholder’s Options, shall be deemed to be full payment and satisfaction of Common Stock all rights pertaining to the Units held by such Unitholder immediately prior to the Effective Time or the Options and the Units underlying each such Option the Options held by such Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment Time (subject to the Surviving Corporation or one of its Subsidiaries for payroll or any other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Optionholder;
(vii) with respect to each Preferred Optionholder, Parent shall pay or cause to be paid to each such Preferred Optionholder in respect of each share of Preferred Stock underlying each rights of such Preferred Optionholder’s Preferred Options, an amount equal to the Closing Preferred Option Accrued Value with respect to each such share of Preferred Stock underlying each such Preferred Option held by such Preferred Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Preferred Optionholder; and
(viii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Equityholder Representative, the Equityholder Representative Expense Amountunder this Agreement).
(d) At or prior to the Closing, the Company will deliver or cause to be delivered to Parent:
(i) resignation letters (which resignation letters will not constitute a termination of employment) or other evidence of removal providing for the resignation or removal of the directors and officers of the Company Group from such positions as directors or officers of members of the Company Group effective as of the Effective Time, as requested by Parent in writing no later than five (5) Business Days prior to the Closing Date.
(e) Notwithstanding anything in this Agreement to the contrary, each Dissenting Stockholder (the shares of Common Stock held by each Dissenting Common Stockholder and the shares of Preferred Stock held by each Dissenting Preferred Stockholders, collectively, the “Dissenting Shares”) shall not have the right to receive any payment in accordance with Section 2.6(c) with respect to such Dissenting Stockholder’s respective Dissenting Shares, but instead and in lieu thereof shall have the right to receive payment from the Surviving Corporation with respect to its Dissenting Shares in accordance with the DGCL, unless and until such Dissenting Stockholder shall have effectively withdrawn or lost its rights to appraisal under the DGCL. If any such formerly Dissenting Stockholder shall have effectively withdrawn or lost such right, such Stockholder shall have the right to receive such Equityholder’s consideration as set forth in Section 2.5(a) or Section 2.5(c), as the case may be. The Company will give Parent prompt notice of any demands received by the Company for appraisal rights, and Parent will have the right to participate in (at its own expense) all negotiations and proceedings with respect to such demands. The Company will not, except with the prior written consent of Parent (not to be unreasonably withheld, conditioned or delayed), make any payment with respect to, or settle or offer to settle, any such demands.
Appears in 1 contract
Closing Payments and Deliveries. (a) At least four (4) Business Days (or one (1) Business Day, in the case of clause (ii) below) prior to the Closing Date, the Company shall:
(i) deliver The Cash Consideration payable to Parent a statement Sellers at the Closing (the “Closing Date StatementNet Cash Consideration”) setting forth in reasonable detail (w) shall equal the Company’s good faith estimate difference between the Cash Consideration minus the sum of (1A) all Indebtedness of the Closing Cash Company (the “Estimated Closing CashCompany Indebtedness”), including all Related Party Indebtedness and all Indebtedness identified in Section 3.08(i) of the Disclosure Schedules, then outstanding; (2B) all other Liabilities of the Closing Net Working Capital Company, including the Liabilities identified in Section 3.07 of the Disclosure Schedules (other than the “Estimated Closing Net Working Capital”), (3) the Closing Indebtedness (the “Estimated Closing Indebtedness”Liabilities identified in Item 1 and Item 2 thereof) and (4) the Transaction Expenses (the “Estimated Transaction Expenses”), (x) the Aggregate Preferred Stock Closing Accrued Value and Aggregate Preferred Option Closing Accrued Value, (y) the Aggregate Option Exercise Price and (z) the Company’s determination of the Aggregate Estimated Closing Merger Consideration based on the foregoing clauses (together with reasonably detailed supporting calculations, in each case, determined in accordance with this Agreement); provided, that the Company shall consider in good faith any comments provided by Parent in writing all Liabilities with respect to the Closing Date Statement, and if the Company accepts any such written comments, it shall deliver to Parent an updated version legal proceedings identified as “Other Legal Items” in Section 3.17(a) of the Closing Date StatementDisclosure Schedules as noted thereon, which updated version shall replace but excluding Liabilities incurred and payable in the prior version for all purposes hereunder except, for purposes ordinary course of determination business consistent with past practices; and (C) any accrued salaries and payroll taxes in excess of the Closing Date pursuant to Section 2.1, such updated version shall be deemed to have been delivered on the date on which the prior version of the Closing Date Statement was delivered and; Accrued Salary and provided, further, that the Company shall, and shall cause the Company Group to, use commercially reasonable efforts to make its financial records, accounting personnel and advisors available to Parent, its accountants and other representatives at reasonable times during the review by Parent of the Closing Date Statement;Payroll Tax Cap.
(ii) deliver All amounts payable to Parent the Payoff Letter (provided that a substantially final draft of the Payoff Letter but without the amounts filled in shall be delivered Casual Dining Ventures, Inc., Mxxx Xxxxxxxxxxx, Fxxx Xxxxx, Kxxxx Xxxxx and any Greenstalk Entity for their respective options to Parent three (3) Business Days prior to the Closing Date);
(iii) deliver to Parent a certificateacquire, duly completed and executed pursuant to Sections 1.897-2(h) and 1.1445-2(c) of the U.S. Treasury Regulationsor other rights with respect to, issued by the Company certifying that an interest membership interests in the Company is not a United States real property interest within and the meaning of Section 897 of the Code; and
“Liquidating Event Compensation” payable to T&T Holdings LLC (iv“T&T”) notify Parent in writing of, pursuant to the extent then knownAgreement dated February 15, 2011 between the respective amounts payable pursuant Company and T&T shall be paid by the issuance to Section 2.6(c)(i) through Section 2.6(c)(viii) and bank accounts such Persons of Seller Units with a value as close as possible, without issuance of any fractional Units, equal to the amount to which each of such amounts shall be paid.
Person is entitled (b) At or prior to the Closing, Parent shall deposit with (i) the Paying Agent, (A) for the benefit of the Stockholders (other than Dissenting Common Stockholders) the portion of the Aggregate Estimated Closing Merger Consideration (less any amounts payable to Dissenting Common Stockholders) payable to the Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to (x) the Closing Merger Consideration Per Share, multiplied by (y) the total number of issued it being understood and outstanding shares of Common Stock at the time of the Closing other than any shares of Common Stock to be canceled pursuant to Section 2.5(b) (less any amounts payable to Dissenting Common Stockholders), and (B) for the benefit of the Preferred Stockholders (other than Dissenting Preferred Stockholders), the Aggregate Preferred Stock Closing Accrued Value (less any amounts payable to Dissenting Preferred Stockholders) payable to the Preferred Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to the sum of the Closing Preferred Stock Accrued Values for each issued and outstanding share of Preferred Stock at the time of the Closing other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d) (less any amounts payable to Dissenting Preferred Stockholders), pursuant to this Agreement (the amount so deposited with the Paying Agent, the “Exchange Fund”) and (ii) the Company or the Company’s designated Subsidiary, agreed that (A) the portion of the Aggregate Estimated Closing Merger Consideration maximum amount that may be payable to the Optionholders (in their capacities as such) pursuant to T&T shall be utilized for this Agreement purpose and (B) the Aggregate Preferred Option number of Seller Units issuable to Sellers shall be reduced by the number of Seller Units issued to each such Person).
(iii) All amounts described in clauses (A) and (B) of Section 2.02(b)(i) will be payable by Buyer at the Closing Accrued Value payable to in accordance with the Preferred Optionholders (wire transfer instructions provided by Sellers in their capacities as such) the Closing Worksheet delivered by Sellers pursuant to this Agreement. Notwithstanding anything to the contrary herein, the parties acknowledge and agree, the Equityholder Representative agrees on behalf of the Equityholders, and each Equityholder shall acknowledge and agree in such Equityholder’s Letter of Transmittal, that Parent shall be entitled to rely on the Company’s calculation of the respective portions of the Aggregate Estimated Closing Merger Section 2.02(c).
(iv) The Net Cash Consideration payable to the Stockholders, the Preferred Stockholders, the Optionholders and the Preferred Optionholders (Sellers pursuant to Section 2.02(b)(i) shall be paid to Sellers in accordance with their respective capacities interests therein, as such) as a trueset forth in the Closing Worksheet, complete and accurate calculation by wire transfer of the amounts to which each such Equityholder is entitled pursuant immediately available funds to the Company Certificate of Incorporation as accounts identified by Sellers in effect as of immediately prior to the Effective Time, in connection with the transactions contemplated by this Agreement, and in no event shall Parent or any of its Affiliates (including, following the Closing, the Surviving Corporation and its Subsidiaries) have any liability to any Equityholder or to any other Person for the calculation of any of the foregoingClosing Worksheet.
(cv) At The Seller Units shall be issued in the Closing:
(i) Parent shall pay an amount equal name of each Seller or other Person entitled to the Credit Agreement Payoff Amount pursuant to a customary payoff letter delivered to Parent prior to Seller Units in accordance with their respective interests therein as set forth in the Closing Date pursuant to Section 2.6(a)(ii) above (the “Payoff Letter”);
(ii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Escrow Agent an amount equal to the Adjustment Escrow AmountWorksheet, which amount but shall be held by the Escrow Agent Buyer in a separate account (the “Adjustment Escrow Account”) pursuant to an escrow agreement in a form reasonably acceptable to the Equityholder Representative and Parent (the “Escrow Agreement”), by and among Parent, the Equityholder Representative and the Escrow Agent;
(iii) Parent shall pay or cause to be paid to the account designated by the Company to Parent prior to the Closing Date of each Person to whom Transaction Expenses described in clauses (a) and (c) of the definition thereof are owed an amount equal to the portion of the Transaction Expenses owed to such Person (other than Transaction Expenses that are payable to any Company Group Employee, which shall be delivered to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries in accordance with the terms of the applicable arrangements to such Person);
(iv) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions as provided by the Equityholder Representative, to the account of each Stockholder (excluding holders of Dissenting Shares) with respect to each share of Common Stock outstanding immediately prior to the Effective Time (other than any shares of Common Stock to be canceled pursuant to Section 2.5(b)) for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Merger Consideration Per Share for each such share of Common Stock;
(v) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions and calculations provided by the Equityholder Representative to the account of each Preferred Stockholder (excluding holders of Dissenting Shares) with respect to each share of Preferred Stock outstanding immediately prior to the Effective Time (other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d)) held by such Preferred Stockholder and for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Preferred Stock Accrued Value for each such share of Preferred Stock;
(vi) with respect to each Optionholder, Parent shall pay or cause to be paid to each such Optionholder in respect of each share of Common Stock underlying each of such Optionholder’s Options (other than any Underwater Options), for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Option Consideration Per Share with respect to each such share of Common Stock underlying each such Option held by such Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Optionholder;
(vii) with respect to each Preferred Optionholder, Parent shall pay or cause to be paid to each such Preferred Optionholder in respect of each share of Preferred Stock underlying each of such Preferred Optionholder’s Preferred Options, an amount equal to the Closing Preferred Option Accrued Value with respect to each such share of Preferred Stock underlying each such Preferred Option held by such Preferred Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Preferred Optionholder; and
(viii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Equityholder Representative, the Equityholder Representative Expense Amountherein.
(d) At or prior to the Closing, the Company will deliver or cause to be delivered to Parent:
(i) resignation letters (which resignation letters will not constitute a termination of employment) or other evidence of removal providing for the resignation or removal of the directors and officers of the Company Group from such positions as directors or officers of members of the Company Group effective as of the Effective Time, as requested by Parent in writing no later than five (5) Business Days prior to the Closing Date.
(e) Notwithstanding anything in this Agreement to the contrary, each Dissenting Stockholder (the shares of Common Stock held by each Dissenting Common Stockholder and the shares of Preferred Stock held by each Dissenting Preferred Stockholders, collectively, the “Dissenting Shares”) shall not have the right to receive any payment in accordance with Section 2.6(c) with respect to such Dissenting Stockholder’s respective Dissenting Shares, but instead and in lieu thereof shall have the right to receive payment from the Surviving Corporation with respect to its Dissenting Shares in accordance with the DGCL, unless and until such Dissenting Stockholder shall have effectively withdrawn or lost its rights to appraisal under the DGCL. If any such formerly Dissenting Stockholder shall have effectively withdrawn or lost such right, such Stockholder shall have the right to receive such Equityholder’s consideration as set forth in Section 2.5(a) or Section 2.5(c), as the case may be. The Company will give Parent prompt notice of any demands received by the Company for appraisal rights, and Parent will have the right to participate in (at its own expense) all negotiations and proceedings with respect to such demands. The Company will not, except with the prior written consent of Parent (not to be unreasonably withheld, conditioned or delayed), make any payment with respect to, or settle or offer to settle, any such demands.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Fat Brands, Inc)
Closing Payments and Deliveries. (a) At least four the Closing, Parent shall pay, on behalf of the Company, to the accounts designated in any Payoff Letters (4delivered in accordance with Section 6.18), by wire transfer of immediately available funds, an amount equal to that portion of the Company Debt owing to the payee in accordance with the applicable Payoff Letter.
(b) Business Days At the Closing, Parent shall pay to Payment Agent for Payment Agent to hold in an account (the “Payment Account”) nominated in a payment agent agreement to be executed at the Closing by Parent, Payment Agent and the Representative in form and substance customary for transactions similar to those contemplated herein and reasonably acceptable to Parent and the Representative (the “Payment Agent Agreement”), for further payment to each Securityholder who shall have delivered to the Company or one Payment Agent, a completed letter of transmittal in form and substance customary for transactions similar to those contemplated herein and reasonably acceptable to Parent and the Representative (1the “Letter of Transmittal”), together with (i) Business Dayany information required by applicable “know your customer” and anti-money laundering rules and regulations, including the PATRIOT Act, reasonably requested by Payment Agent and (ii) any other customary information, forms or certificates (including Tax certificates) reasonably requested by Payment Agent and required to make the applicable payment, the Closing Date Cash Merger Consideration (in the case of Blocker Securityholders, as adjusted) with respect to each Equity Security covered by such Letter of Transmittal in accordance with Section 3.2 and Section 3.3, as applicable, which amount shall be payable by wire transfer of immediately available funds on the Closing Date to the account designated in such Securityholder’s Letter of Transmittal.
(c) At the Closing, Parent shall pay, or cause to be paid, by wire transfer of immediately available funds, the portion of the Estimated Company Transaction Expenses Amount (other than the Change of Control Payments which, pursuant to their terms, are payable following the Closing) and Blocker Debt Amount (if any) to the applicable recipients thereof as set forth on the Estimated Closing Statement, so long as, in the case of clause the Estimated Company Transaction Expenses Amount, the applicable payee has delivered an invoice in accordance with Section 6.8.
(iid) below) prior At the Closing, Parent shall deliver, or cause to be delivered, to the Closing DateEscrow Agent, by wire transfer of immediately available funds, the Company shall:
(i) deliver Escrow Amount, for the Escrow Agent to Parent a statement hold in an account (the “Closing Date StatementEscrow Account”) setting forth and disburse solely in reasonable detail (w) accordance with the Company’s good faith estimate terms of (1) an escrow agreement to be executed at the Closing Cash by Parent, the Escrow Agent and the Representative in form and substance customary for transactions similar to those contemplated herein and reasonably acceptable to Parent and the Representative (the “Estimated Closing CashEscrow Agreement”).
(e) At the Closing, Parent shall pay, or cause to be paid, to the Escrow Agent by wire transfer of immediately available funds, the Escrow Agent Fee to the account designated by the Escrow Agent.
(f) At the Closing, Parent shall deposit, or cause to be deposited, by wire transfer of immediately available funds to an account designated in writing by the Representative at least two (2) the Closing Net Working Capital (the “Estimated Closing Net Working Capital”), (3) the Closing Indebtedness (the “Estimated Closing Indebtedness”) and (4) the Transaction Expenses (the “Estimated Transaction Expenses”), (x) the Aggregate Preferred Stock Closing Accrued Value and Aggregate Preferred Option Closing Accrued Value, (y) the Aggregate Option Exercise Price and (z) the Company’s determination of the Aggregate Estimated Closing Merger Consideration based on the foregoing clauses (together with reasonably detailed supporting calculations, in each case, determined in accordance with this Agreement); provided, that the Company shall consider in good faith any comments provided by Parent in writing with respect to the Closing Date Statement, and if the Company accepts any such written comments, it shall deliver to Parent an updated version of the Closing Date Statement, which updated version shall replace the prior version for all purposes hereunder except, for purposes of determination of the Closing Date pursuant to Section 2.1, such updated version shall be deemed to have been delivered on the date on which the prior version of the Closing Date Statement was delivered and; and provided, further, that the Company shall, and shall cause the Company Group to, use commercially reasonable efforts to make its financial records, accounting personnel and advisors available to Parent, its accountants and other representatives at reasonable times during the review by Parent of the Closing Date Statement;
(ii) deliver to Parent the Payoff Letter (provided that a substantially final draft of the Payoff Letter but without the amounts filled in shall be delivered to Parent three (3) Business Days prior to the Closing Date);
(iii) deliver to Parent a certificate, duly completed and executed pursuant to Sections 1.897-2(h) and 1.1445-2(c) of the U.S. Treasury Regulations, issued by the Company certifying that an interest in the Company is not a United States real property interest within the meaning of Section 897 of the Code; and
(iv) notify Parent in writing of, to the extent then known, the respective amounts payable pursuant Representative Holdback Amount with the Representative. The Representative Holdback Amount will be used to Section 2.6(c)(i) through Section 2.6(c)(viii) pay costs, fees and bank accounts to which each of such amounts shall be paid.
(b) At expenses incurred by or prior to the Closing, Parent shall deposit with (i) the Paying Agent, (A) for the benefit of the Stockholders (other than Dissenting Common Stockholders) Securityholders on or after the portion Closing Date and shall be paid or distributed at the direction of the Aggregate Estimated Closing Merger Consideration (less any amounts payable to Dissenting Common Stockholders) payable to Representative as provided in the Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to (x) the Closing Merger Consideration Per Share, multiplied by (y) the total number of issued and outstanding shares of Common Stock at the time of the Closing other than any shares of Common Stock to be canceled pursuant to Section 2.5(b) (less any amounts payable to Dissenting Common Stockholders), and (B) for the benefit of the Preferred Stockholders (other than Dissenting Preferred Stockholders), the Aggregate Preferred Stock Closing Accrued Value (less any amounts payable to Dissenting Preferred Stockholders) payable to the Preferred Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to the sum of the Closing Preferred Stock Accrued Values for each issued and outstanding share of Preferred Stock at the time of the Closing other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d) (less any amounts payable to Dissenting Preferred Stockholders), pursuant to this Agreement (the amount so deposited with the Paying Agent, the “Exchange Fund”) and (ii) the Company or the Company’s designated Subsidiary, (A) the portion of the Aggregate Estimated Closing Merger Consideration payable to the Optionholders (in their capacities as such) pursuant to this Agreement and (B) the Aggregate Preferred Option Closing Accrued Value payable to the Preferred Optionholders (in their capacities as such) pursuant to this Agreement. Notwithstanding anything to the contrary herein, the parties acknowledge and agree, the Equityholder Representative agrees on behalf of the Equityholders, and each Equityholder shall acknowledge and agree in such Equityholder’s Letter of Transmittal, that Parent shall be entitled to rely on the Company’s calculation of the respective portions of the Aggregate Estimated Closing Merger Consideration payable to the Stockholders, the Preferred Stockholders, the Optionholders and the Preferred Optionholders (in their respective capacities as such) as a true, complete and accurate calculation of the amounts to which each such Equityholder is entitled pursuant to the Company Certificate of Incorporation as in effect as of immediately prior to the Effective Time, in connection with the transactions contemplated by this Agreement, Transmittal and in no event shall Parent or any of its Affiliates (including, following the Closing, the Surviving Corporation and its Subsidiaries) have any liability to any Equityholder or to any other Person for the calculation of any of the foregoingaccordance with Section 10.15.
(cg) At the Closing:
, each of the Blockers and Company Securityholders (iother than the Blockers) shall deliver to Parent shall pay an amount equal the certifications required to the Credit Agreement Payoff Amount be delivered pursuant to a customary payoff letter delivered to Parent prior to the Closing Date pursuant to Section 2.6(a)(ii) above (the “Payoff Letter”);
(ii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Escrow Agent an amount equal to the Adjustment Escrow Amount, which amount shall be held by the Escrow Agent in a separate account (the “Adjustment Escrow Account”) pursuant to an escrow agreement in a form reasonably acceptable to the Equityholder Representative and Parent (the “Escrow Agreement”), by and among Parent, the Equityholder Representative and the Escrow Agent;
(iii) Parent shall pay or cause to be paid to the account designated by the Company to Parent prior to the Closing Date of each Person to whom Transaction Expenses described in clauses (a) and (cb), respectively, of Section 6.8.
(h) Any remaining cash unclaimed by holders of the definition thereof are owed an amount equal to the portion Equity Securities as of the Transaction Expenses owed a date which is immediately prior to such Person (other than Transaction Expenses that are payable time as such amounts would otherwise escheat to or become property of any Company Group Employee, which shall be delivered to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries in accordance with the terms of the applicable arrangements to such Person);
(iv) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions provided by the Equityholder RepresentativeGovernmental Authority shall, to the account extent permitted by applicable Law, become the property of each Stockholder (excluding holders of Dissenting Shares) with respect to each share of Common Stock outstanding immediately prior to the Effective Time (other than any shares of Common Stock to be canceled pursuant to Section 2.5(b)) for which a duly completed Parent free and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Merger Consideration Per Share for each such share of Common Stock;
(v) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions and calculations provided by the Equityholder Representative to the account of each Preferred Stockholder (excluding holders of Dissenting Shares) with respect to each share of Preferred Stock outstanding immediately prior to the Effective Time (other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d)) held by such Preferred Stockholder and for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Preferred Stock Accrued Value for each such share of Preferred Stock;
(vi) with respect to each Optionholder, Parent shall pay or cause to be paid to each such Optionholder in respect of each share of Common Stock underlying each of such Optionholder’s Options (other than any Underwater Options), for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Option Consideration Per Share with respect to each such share of Common Stock underlying each such Option held by such Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Optionholder;
(vii) with respect to each Preferred Optionholder, Parent shall pay or cause to be paid to each such Preferred Optionholder in respect of each share of Preferred Stock underlying each of such Preferred Optionholder’s Preferred Options, an amount equal to the Closing Preferred Option Accrued Value with respect to each such share of Preferred Stock underlying each such Preferred Option held by such Preferred Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Preferred Optionholder; and
(viii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Equityholder Representative, the Equityholder Representative Expense Amount.
(d) At or prior to the Closing, the Company will deliver or cause to be delivered to Parent:
(i) resignation letters (which resignation letters will not constitute a termination of employment) or other evidence of removal providing for the resignation or removal of the directors and officers of the Company Group from such positions as directors or officers of members of the Company Group effective as of the Effective Time, as requested by Parent in writing no later than five (5) Business Days prior to the Closing Date.
(e) Notwithstanding anything in this Agreement to the contrary, each Dissenting Stockholder (the shares of Common Stock held by each Dissenting Common Stockholder and the shares of Preferred Stock held by each Dissenting Preferred Stockholders, collectively, the “Dissenting Shares”) shall not have the right to receive any payment in accordance with Section 2.6(c) with respect to such Dissenting Stockholder’s respective Dissenting Shares, but instead and in lieu thereof shall have the right to receive payment from the Surviving Corporation with respect to its Dissenting Shares in accordance with the DGCL, unless and until such Dissenting Stockholder shall have effectively withdrawn or lost its rights to appraisal under the DGCL. If any such formerly Dissenting Stockholder shall have effectively withdrawn or lost such right, such Stockholder shall have the right to receive such Equityholder’s consideration as set forth in Section 2.5(a) or Section 2.5(c), as the case may be. The Company will give Parent prompt notice clear of any demands received by the Company for appraisal rights, and Parent will have the right to participate in (at its own expense) all negotiations and proceedings with respect to such demands. The Company will not, except with the prior written consent claims or interest of Parent (not to be unreasonably withheld, conditioned or delayed), make any payment with respect to, or settle or offer to settle, any such demandsPerson previously entitled thereto.
Appears in 1 contract
Samples: Merger Agreement (Brunswick Corp)
Closing Payments and Deliveries. (a) At least four three (43) Business Days (or one (1) Business Day, in the case of clause (ii) below) prior to the Closing Date, the Company shall:
(i) deliver to Parent a statement (the “Closing Date Statement”) setting forth in reasonable detail (w) the Company’s good faith estimate of (1) the Closing Cash (the “Estimated Closing Cash”), (2) the Closing Net Working Capital (the “Estimated Closing Net Working Capital”), (3) the Closing Indebtedness (the “Estimated Closing Indebtedness”) and ), (4) the Transaction Expenses (the “Estimated Transaction Expenses”), (x) the Aggregate Preferred Stock Closing Accrued Value and Aggregate Preferred Option Closing Accrued Value, (y) the Aggregate Option Exercise Price and (z5) the Company’s determination of the Aggregate Estimated Closing Merger Cash Consideration based on the foregoing clauses (together with reasonably detailed supporting calculations, in each case, determined in accordance with this Agreement); provided, that the Company shall consider in good faith any comments provided by Parent in writing with respect to the Closing Date Statement, and if the Company accepts any such written comments, it shall deliver to Parent an updated version of the Closing Date Statement, which updated version shall replace the prior version for all purposes hereunder except, for purposes of determination of the Closing Date pursuant to Section 2.1, such updated version shall be deemed to have been delivered on the date on which the prior version of the Closing Date Statement was delivered and; and provided, further, that the Company shall, and shall cause the Company Group to, use commercially reasonable efforts to make its financial records, accounting personnel and advisors available to Parent, its accountants and other representatives at reasonable times during the review by Parent of the Closing Date Statement;
(ii) deliver to Parent the Payoff Letter (provided that a substantially final draft of the Payoff Letter but without the amounts filled in shall be delivered to Parent three (3) Business Days prior to the Closing Date);
(iii) deliver to Parent a certificate, duly completed and executed pursuant to Sections 1.897-2(h) and 1.1445-2(c) of the U.S. Treasury Regulations, issued by the Company certifying that an interest in the Company is not a United States real property interest within the meaning of Section 897 of the Codeforegoing; and
(ivii) notify Parent in writing of, to the extent then known, the respective amounts payable pursuant to Section 2.6(c)(i2.6(c)(i) through Section 2.6(c)(viii2.6(c)(ix) itemized by payee and bank accounts to which each of such amounts shall be paid. Any payments required to be made by Parent or the Surviving Corporation pursuant to this ARTICLE II shall be made in cash by wire transfer of immediately available funds unless otherwise expressly designated by the payee thereof.
(b) At or prior Prior to the ClosingClosing (and in the case of Section 2.6(b)(ii), following the consummation of the Reorganization Transactions):
(i) Parent shall deposit with (i) the Paying Agent, (A) for the benefit of the Stockholders (other than Dissenting Common Stockholders) and the portion holders of In-the-Cash Options, the Aggregate Estimated Closing Merger Cash Consideration (less any amounts payable to Dissenting Common Stockholders) payable to the Stockholders (in their capacities as such), which, for and the avoidance holders of doubt, shall be an amount in cash equal to (x) the Closing Merger Consideration Per Share, multiplied by (y) the total number of issued and outstanding shares of Common Stock at the time of the Closing other than any shares of Common Stock to be canceled pursuant to Section 2.5(b) (less any amounts payable to Dissenting Common Stockholders), and (B) for the benefit of the Preferred Stockholders (other than Dissenting Preferred Stockholders), the Aggregate Preferred Stock Closing Accrued Value (less any amounts payable to Dissenting Preferred Stockholders) payable to the Preferred Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to the sum of the Closing Preferred Stock Accrued Values for each issued and outstanding share of Preferred Stock at the time of the Closing other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d) (less any amounts payable to Dissenting Preferred Stockholders), In-the-Cash Options pursuant to this Agreement (the amount so deposited with the Paying Agentdeposited, the “Exchange Fund”) and ); and
(ii) the Company or shall deposit with the Paying Agent, for the benefit of the Stockholders (other than Dissenting Stockholders) and the holders of In-the-Cash Options and In-the-Stock Options, all of the shares of Topco held by the Company’s designated Subsidiary, (A) the portion of the Aggregate Estimated Closing Merger Consideration payable to the Optionholders (in their capacities as such) pursuant to this Agreement and (B) the Aggregate Preferred Option Closing Accrued Value payable to the Preferred Optionholders (in their capacities as such) pursuant to this Agreement. Notwithstanding anything to the contrary herein, the parties acknowledge and agree, the Equityholder Representative agrees on behalf of the Equityholders, and each Equityholder shall acknowledge and agree in such Equityholder’s Letter of Transmittal, that Parent shall be entitled to rely on the Company’s calculation of the respective portions of the Aggregate Estimated Closing Merger Consideration payable to the Stockholders, the Preferred Stockholders, the Optionholders and the Preferred Optionholders (in their respective capacities as such) as a true, complete and accurate calculation of the amounts to which each such Equityholder is entitled pursuant to the Company Certificate of Incorporation as in effect as of immediately prior to the Effective Time, in connection with the transactions contemplated by this Agreement, and in no event shall Parent or any of its Affiliates (including, following the Closing, the Surviving Corporation and its Subsidiaries) have any liability to any Equityholder or to any other Person for the calculation of any of the foregoing.
(c) At the Closing:
(i) Parent shall pay or cause to be paid an amount equal to the Credit Agreement Payoff Amount pursuant to a customary payoff letter delivered amount of Funded Indebtedness, as set forth in pay-off letter(s) provided to Parent at least one (1) Business Day prior to the Closing Date pursuant Date, to Section 2.6(a)(ii) above (the “Payoff Letter”account set forth in such pay-off letter(s);
(ii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Escrow Agent an amount equal to the Adjustment Escrow Amount, which amount shall be held by the Escrow Agent in a separate account (the “Adjustment Escrow Account”) ), and the Indemnity Escrow Amount, which amount shall be held by the Escrow Agent in a separate account (the “Indemnity Escrow Account”), in each case, pursuant to an escrow agreement in a form reasonably acceptable to the Equityholder Representative and Parent (the “Escrow Agreement”), to be entered into by and among Parent, the Equityholder Representative Representative, and the Escrow Agent, in form and substance reasonably acceptable to each of Parent and the Equityholder Representative;
(iii) Parent shall pay or cause to be paid to the account designated by the Company to Parent prior to the Closing Date of each Person to whom Transaction Expenses described in clauses (a) and (c) of the definition thereof are owed owed, an amount equal to the portion of the Transaction Expenses owed to such Person (other than Transaction Expenses that are payable to any Company Group Employee, which shall be delivered to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries Subsidiary in accordance with the terms of the applicable arrangements to such Personarrangements);
(iv) Parent and the Equityholder Representative shall direct take such action as is necessary or appropriate to cause the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions provided by the Equityholder Representative, pay to the account of each Stockholder (excluding holders of Dissenting SharesStockholders) with respect to each share of Common Stock outstanding immediately prior to the Effective Time (other than any shares of Common Stock to be canceled pursuant to Section 2.5(b)) for which a duly completed and executed Letter of Transmittal has been properly delivered to the Paying Agent at least three (3) Business Days prior to the Closing Date, an amount equal to the Closing Merger Cash Consideration Per Share for each such share of Common Stock, it being agreed and understood that the amount of the Stockholder Promissory Note shall be deducted from the cash proceeds payable hereunder to the Equityholder party thereto;
(v) Parent and the Equityholder Representative shall direct take such action as is necessary or appropriate to cause the Paying Agent to paypay to each holder of In-the-Cash Options, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions and calculations provided by the Equityholder Representative to the account respect of each Preferred Stockholder (excluding holders of Dissenting Shares) with respect to each share of Preferred Class B Common Stock outstanding underlying such In-the-Cash Options immediately prior to the Effective Time (other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d)) held by such Preferred Stockholder and for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Preferred Stock Accrued Value for each such share of Preferred Stock;
Paying Agent at least three (vi3) with respect to each Optionholder, Parent shall pay or cause to be paid to each such Optionholder in respect of each share of Common Stock underlying each of such Optionholder’s Options (other than any Underwater Options), for which a duly completed and executed Letter of Transmittal has been properly delivered Business Days prior to the Closing Date, an amount equal to the Closing Option Consideration Per Share with respect to each such share of Common Stock underlying each such Option held by such Optionholder immediately prior to the Effective TimeShare, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or one of its applicable Subsidiaries and distribution at the next administratively practicable payroll date to each such Optionholder;
(vi) the Equityholder Representative shall take such action as is necessary or appropriate to cause the Paying Agent to deliver to each Stockholder (excluding Dissenting Stockholders) in respect of each share of Common Stock outstanding immediately prior to the Effective Time and for which a duly completed and executed Letter of Transmittal has been properly delivered to the Paying Agent at least three (3) Business Days prior to the Closing Date, such Stockholder’s Stock Consideration Per Share;
(vii) with respect the Equityholder Representative shall take such action as is necessary or appropriate to cause the Paying Agent to deliver to each Preferred Optionholder, Parent shall pay or cause to be paid to each such Preferred Optionholder in respect of each share of Preferred Class B Common Stock underlying each of such Preferred Optionholder’s Preferred Options, an amount equal In-the-Cash Options and for which a duly completed and executed Letter of Transmittal has been properly delivered to the Paying Agent at least three (3) Business Days prior to the Closing Preferred Option Accrued Value with respect Date, such Optionholder’s Stock Consideration Per Option;
(viii) the Equityholder Representative shall take such action as is necessary or appropriate to cause the Paying Agent to deliver to each such Optionholder in respect of each share of Preferred Class B Common Stock underlying each of such Preferred Option held by such Preferred Optionholder immediately Optionholder’s In-the-Stock Options and for which a duly completed and executed Letter of Transmittal has been properly delivered to the Paying Agent at least three (3) Business Days prior to the Effective TimeClosing Date, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Preferred Optionholder’s Stock Consideration Per Option; and
(viiiix) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Equityholder Representative, the Equityholder Representative Expense Amount.
(d) At or prior to the Closing, the Company will deliver deliver, or cause to be delivered delivered, to Parent:
(i) resignation letters (which resignation letters will not constitute a termination agreement, in the form attached hereto as Exhibit C, terminating the AEA Management Agreement;
(ii) resignation letters, dated as of employment) or other evidence of removal providing for the resignation or removal Closing Date, of the directors and officers of the Company Group from such positions set forth on Schedule 2.6(d)(ii) and as directors or officers of members of the Company Group effective as of the Effective Time, as otherwise may be reasonably requested by Parent in writing no later than five (5) Business Days prior to the Closing Date;
(iii) a certificate, duly completed and executed pursuant to Sections 1.897-2(h) and 1.1445-2(c) of the U.S. Treasury Regulations, issued by the Company certifying that an interest in the Company is not a United States real property interest within the meaning of Section 897 of the Code, along with written authorization for Parent to deliver such certificate to the IRS on behalf of the Company upon the Closing;
(iv) a copy of the resolutions or written consent of the Board of Directors of each of the Company and Topco, certified by its Secretary or Assistant Secretary as having been duly and validly adopted and as being in full force and effect, authorizing execution and delivery of this Agreement and performance by it of the Contemplated Transactions;
(v) a certificate of good standing, dated not more than ten (10) days prior to the Closing Date, with respect to the Company, issued by the Secretary of State of the State of Delaware;
(vi) a certificate, dated as of the Closing Date, in form and substance reasonably satisfactory to Parent, of the Secretary or Assistant Secretary of the Company certifying as to the Stockholder Approval;
(vii) the Escrow Agreement, duly executed by the Equityholder Representative and the Escrow Agent;
(viii) the Paying Agent Agreement, duly executed by the Equityholder Representative and the Paying Agent;
(ix) the Reverse TSA, duly executed by Topco;
(x) documentation evidencing the termination of the Company 401(k) Plan, effective no later than the day immediately prior to the Closing Date, in form and substance reasonably satisfactory to Parent; and
(xi) the certificates required to be delivered pursuant to Section 7.3(c) and Section 7.3(f).
(e) At or prior to the Closing, Parent will deliver, or cause to be delivered, to the Equityholder Representative:
(i) the Escrow Agreement, duly executed by Parent;
(ii) the Paying Agent Agreement, duly executed by Parent;
(iii) the Reverse TSA, duly executed by Parent; and
(iv) the certificate required to be delivered pursuant to Section 7.2(c).
(f) Notwithstanding anything in this Agreement to the contrary, each Dissenting Stockholder (the shares of Common Stock held by each Dissenting Common Stockholder and the shares of Preferred Stock held by each Dissenting Preferred such Stockholders, collectively, the “Dissenting Shares”) shall not have the right to receive any payment consideration in accordance with Section 2.6(c2.6(c) with respect to such Dissenting Stockholder’s respective the Dissenting Shares, but instead and in lieu thereof shall have the right to receive payment from the Surviving Corporation with respect to its Dissenting Shares in accordance with the DGCL, unless and until such Dissenting Stockholder shall have effectively withdrawn or lost its rights to appraisal under the DGCL. If any such formerly Dissenting Stockholder shall have effectively withdrawn or lost such right, such Stockholder shall have the right to receive such EquityholderStockholder’s consideration as set forth in Section 2.5(a) or Section 2.5(c2.5(a), as the case may be. The Company will shall give Parent prompt notice of any written demands for appraisal of any Common Stock, attempted withdrawals of such demands, and any other instrument served pursuant to the DGCL and received by the Company for appraisal rightsrelating to stockholders’ rights of appraisal, and Parent will shall have the right to participate in (at its own expense) all negotiations and proceedings with respect to such demandsdemands for appraisal under the DGCL. The Neither the Company will notnor the Surviving Corporation shall, except with the prior written consent of Parent (such consent not to be unreasonably withheld, conditioned or delayed), voluntarily make any payment with respect to, or settle or offer to settle, any such demandsdemand for payment.
(g) The Parties agree (and each Letter of Transmittal shall provide that) the Stock Consideration Per Share and the Stock Consideration Per Option shall be determined by Topco prior to the Closing and none of the Equityholders shall have any claim with respect to such determination.
Appears in 1 contract
Closing Payments and Deliveries. Subject to the terms set forth in this Agreement, at the Closing:
6 (a) At least four Buyers shall deliver or cause to be delivered to Sellers’ Representative an amount in cash equal to (4i) Business Days (or one (1) Business Day, in the case of clause Estimated CDM Purchase Price plus (ii) below) prior to the Closing Date, the Company shall:
Estimated CDE Purchase Price minus (i) deliver to Parent a statement (the “Closing Date Statement”) setting forth in reasonable detail (wiii) the Company’s good faith estimate Sellers Note Amount minus (iv) without duplication of (1) the Closing Cash (the “Estimated Closing Cash”), (2) the Closing Net Working Capital (the “Estimated Closing Net Working Capital”), (3) the any CDM Closing Indebtedness (used in the “Estimated Closing Indebtedness”) and (4) the Transaction Expenses (the “Estimated Transaction Expenses”), (x) the Aggregate Preferred Stock Closing Accrued Value and Aggregate Preferred Option Closing Accrued Value, (y) the Aggregate Option Exercise Price and (z) the Company’s determination calculation of the Aggregate Estimated CDM Purchase Price or any CDE Closing Merger Consideration based on Indebtedness used in the foregoing clauses (together with reasonably detailed supporting calculations, in each case, determined in accordance with this Agreement); provided, that the Company shall consider in good faith any comments provided by Parent in writing with respect to the Closing Date Statement, and if the Company accepts any such written comments, it shall deliver to Parent an updated version calculation of the Estimated CDE Purchase Price, any other Indebtedness paid off at Closing Date Statement, which updated version shall replace the prior version for all purposes hereunder except, for purposes of determination of the Closing Date pursuant to Section 2.12.02(c), such updated version shall be deemed by wire transfer of immediately available funds to have been delivered on the date on which the prior version of the Closing Date Statement was delivered and; and provided, further, that the Company shall, and shall cause the Company Group to, use commercially reasonable efforts to make its financial records, accounting personnel and advisors available to Parent, its accountants and other representatives accounts designated in writing by Sellers’ Representative at reasonable times during the review by Parent of the Closing Date Statement;
least two (ii) deliver to Parent the Payoff Letter (provided that a substantially final draft of the Payoff Letter but without the amounts filled in shall be delivered to Parent three (32) Business Days prior to the Closing Date);
Closing; (iiib) Buyers shall deliver to Parent Sellers’ Representative a certificate, duly completed and executed pursuant to Sections 1.897-2(h) and 1.1445-2(c) of the U.S. Treasury Regulations, secured promissory note issued by the Company certifying that an interest Buyers to Sellers’ Representative as agent for Sellers in the Company is not a United States real property interest within principal amount equal to the meaning Sellers Note Amount in the form of Section 897 Exhibit G attached hereto (the “Sellers Note”); and (c) Buyers shall deliver or cause to be delivered, by wire transfer of immediately available funds to the Code; and
(iv) notify Parent account designated in writing ofby Sellers, (i) to the extent then known, intended beneficiaries of funded Indebtedness (as identified in the respective amounts payable Payoff Letters delivered pursuant to Section 2.6(c)(i6.02(d)(vii) through Section 2.6(c)(viiior as otherwise identified in writing) and bank accounts any further funded or secured indebtedness to which each of such amounts shall be paid.
(b) At or prior to the Closing, Parent shall deposit repaid in connection with (i) the Paying Agent, (A) for the benefit of the Stockholders (other than Dissenting Common Stockholders) the portion of the Aggregate Estimated Closing Merger Consideration (less any amounts payable to Dissenting Common Stockholders) payable to the Stockholders (in their capacities as such), whichexcluding, for the avoidance of doubt, shall all Indebtedness owed to Sellers, which will be an amount in cash equal to (x) the Closing Merger Consideration Per Share, multiplied by (y) the total number of issued and outstanding shares of Common Stock at the time separately paid off as part of the Pre-Closing other than any shares of Common Stock to be canceled pursuant to Section 2.5(b) (less any amounts payable to Dissenting Common StockholdersRestructuring), and (B) for the benefit of the Preferred Stockholders (other than Dissenting Preferred Stockholders), the Aggregate Preferred Stock Closing Accrued Value (less any amounts payable to Dissenting Preferred Stockholders) payable to the Preferred Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to the sum of the Closing Preferred Stock Accrued Values for each issued and outstanding share of Preferred Stock at the time of the Closing other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d) (less any amounts payable to Dissenting Preferred Stockholders), pursuant to this Agreement (the amount so deposited with the Paying Agent, the “Exchange Fund”) and (ii) the Company or the Company’s designated Subsidiary, (A) the portion of the Aggregate Estimated Closing Merger Consideration payable to the Optionholders (Transaction Expenses set forth in their capacities as such) pursuant to this Agreement and (B) the Aggregate Preferred Option Closing Accrued Value payable to the Preferred Optionholders (in their capacities as such) pursuant to this Agreement. Notwithstanding anything to the contrary herein, the parties acknowledge and agree, the Equityholder Representative agrees on behalf of the Equityholders, and each Equityholder shall acknowledge and agree in such Equityholder’s Letter of Transmittal, that Parent shall be entitled to rely on the Company’s calculation of the respective portions of the Aggregate Estimated Closing Merger Consideration payable to the Stockholders, the Preferred Stockholders, the Optionholders and the Preferred Optionholders (in their respective capacities as such) as a true, complete and accurate calculation of the amounts to which each such Equityholder is entitled pursuant to the Company Certificate of Incorporation as in effect as of immediately prior to the Effective Time, in connection invoices with the transactions contemplated by this Agreement, and in no event shall Parent or any of its Affiliates (including, following the Closing, the Surviving Corporation and its Subsidiaries) have any liability to any Equityholder or to any other Person for the calculation of any of the foregoing.
(c) At the Closing:
(i) Parent shall pay an amount equal to the Credit Agreement Payoff Amount pursuant to a customary payoff letter respect thereto delivered to Parent prior to the Closing Date pursuant to Section 2.6(a)(ii) above Buyers, at least two (the “Payoff Letter”);
(ii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Escrow Agent an amount equal to the Adjustment Escrow Amount, which amount shall be held by the Escrow Agent in a separate account (the “Adjustment Escrow Account”) pursuant to an escrow agreement in a form reasonably acceptable to the Equityholder Representative and Parent (the “Escrow Agreement”), by and among Parent, the Equityholder Representative and the Escrow Agent;
(iii) Parent shall pay or cause to be paid to the account designated by the Company to Parent prior to the Closing Date of each Person to whom Transaction Expenses described in clauses (a) and (c) of the definition thereof are owed an amount equal to the portion of the Transaction Expenses owed to such Person (other than Transaction Expenses that are payable to any Company Group Employee, which shall be delivered to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries in accordance with the terms of the applicable arrangements to such Person);
(iv) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions provided by the Equityholder Representative, to the account of each Stockholder (excluding holders of Dissenting Shares) with respect to each share of Common Stock outstanding immediately prior to the Effective Time (other than any shares of Common Stock to be canceled pursuant to Section 2.5(b)) for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Merger Consideration Per Share for each such share of Common Stock;
(v) Parent and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions and calculations provided by the Equityholder Representative to the account of each Preferred Stockholder (excluding holders of Dissenting Shares) with respect to each share of Preferred Stock outstanding immediately prior to the Effective Time (other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d)) held by such Preferred Stockholder and for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Preferred Stock Accrued Value for each such share of Preferred Stock;
(vi) with respect to each Optionholder, Parent shall pay or cause to be paid to each such Optionholder in respect of each share of Common Stock underlying each of such Optionholder’s Options (other than any Underwater Options), for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Option Consideration Per Share with respect to each such share of Common Stock underlying each such Option held by such Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Optionholder;
(vii) with respect to each Preferred Optionholder, Parent shall pay or cause to be paid to each such Preferred Optionholder in respect of each share of Preferred Stock underlying each of such Preferred Optionholder’s Preferred Options, an amount equal to the Closing Preferred Option Accrued Value with respect to each such share of Preferred Stock underlying each such Preferred Option held by such Preferred Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such Preferred Optionholder; and
(viii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Equityholder Representative, the Equityholder Representative Expense Amount.
(d) At or prior to the Closing, the Company will deliver or cause to be delivered to Parent:
(i) resignation letters (which resignation letters will not constitute a termination of employment) or other evidence of removal providing for the resignation or removal of the directors and officers of the Company Group from such positions as directors or officers of members of the Company Group effective as of the Effective Time, as requested by Parent in writing no later than five (52) Business Days prior to Closing, and (iii) any other liabilities included in the computation of Closing Date.
(e) Notwithstanding anything Indebtedness, in each case, which by their terms or pursuant to this Agreement to the contrary, each Dissenting Stockholder (the shares of Common Stock held by each Dissenting Common Stockholder and the shares of Preferred Stock held by each Dissenting Preferred Stockholders, collectively, the “Dissenting Shares”) shall not have the right to receive any payment in accordance with Section 2.6(c) with respect to such Dissenting Stockholder’s respective Dissenting Shares, but instead and in lieu thereof shall have the right to receive payment from the Surviving Corporation with respect to its Dissenting Shares in accordance with the DGCL, unless and until such Dissenting Stockholder shall have effectively withdrawn or lost its rights to appraisal under the DGCL. If any such formerly Dissenting Stockholder shall have effectively withdrawn or lost such right, such Stockholder shall have the right to receive such Equityholder’s consideration as set forth in Section 2.5(a) or Section 2.5(c), as the case may be. The Company will give Parent prompt notice of any demands received by the Company for appraisal rights, and Parent will have the right to participate in (at its own expense) all negotiations and proceedings with respect to such demands. The Company will not, except with the prior written consent of Parent (not are required to be unreasonably withheld, conditioned or delayed), make any payment with respect to, or settle or offer to settle, any such demandspaid at the Closing.
Appears in 1 contract
Closing Payments and Deliveries. (a) At least four (4) Business Days (each Closing, Sellers will deliver or one (1) Business Day, in cause to be delivered to Buyer the case of clause (ii) below) prior to the Closing Date, the Company shallfollowing:
(i) deliver to Parent a statement duly executed Xxxx of Sale substantially in the form of Exhibit E (the “Closing Date StatementXxxx of Sale”) setting forth in reasonable detail (w) the Company’s good faith estimate of (1) the Closing Cash (the “Estimated Closing Cash”), (2) the Closing Net Working Capital (the “Estimated Closing Net Working Capital”), (3) the Closing Indebtedness (the “Estimated Closing Indebtedness”) and (4) the Transaction Expenses (the “Estimated Transaction Expenses”), (x) the Aggregate Preferred Stock Closing Accrued Value and Aggregate Preferred Option Closing Accrued Value, (y) the Aggregate Option Exercise Price and (z) the Company’s determination for each of the Aggregate Estimated Closing Merger Consideration based on Stores and the foregoing clauses (together with reasonably detailed supporting calculations, in Transferred Assets at each case, determined in accordance with this Agreement); provided, that such Store location being acquired at the Company shall consider in good faith any comments provided by Parent in writing with respect to the Closing Date Statement, and if the Company accepts any such written comments, it shall deliver to Parent an updated version of the Closing Date Statement, which updated version shall replace the prior version for all purposes hereunder except, for purposes of determination of the Closing Date pursuant to Section 2.1, such updated version shall be deemed to have been delivered on the date on which the prior version of the Closing Date Statement was delivered and; and provided, further, that the Company shall, and shall cause the Company Group to, use commercially reasonable efforts to make its financial records, accounting personnel and advisors available to Parent, its accountants and other representatives at reasonable times during the review by Parent of the Closing Date StatementApplicable Closing;
(ii) deliver to Parent a duly executed Assignment and Assumption of Leases substantially in the Payoff Letter form of Exhibit F (provided that a substantially final draft of the Payoff Letter but without “Lease Assignment and Assumption Agreement”) for the amounts filled in shall be delivered to Parent three (3) Business Days prior to Assumed Leases being acquired at the Closing Date)Applicable Closing;
(iii) deliver a duly executed certificate from an officer of each Seller to Parent a certificate, duly completed and executed pursuant to Sections 1.897-2(hthe effect that each of the conditions specified in Section 7.2(a) and 1.1445-2(cSection 7.2(c) of the U.S. Treasury Regulations, issued by the Company certifying that an interest in the Company is not a United States real property interest within the meaning of Section 897 of the Code; and
(iv) notify Parent in writing of, to the extent then known, the respective amounts payable pursuant to Section 2.6(c)(i) through Section 2.6(c)(viii) and bank accounts to which each of such amounts shall be paid.
(b) At or prior to the Closing, Parent shall deposit with (i) the Paying Agent, (A) for the benefit of the Stockholders (other than Dissenting Common Stockholders) the portion of the Aggregate Estimated Closing Merger Consideration (less any amounts payable to Dissenting Common Stockholders) payable to the Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to (x) the Closing Merger Consideration Per Share, multiplied by (y) the total number of issued and outstanding shares of Common Stock at the time of the Closing other than any shares of Common Stock to be canceled pursuant to Section 2.5(b) (less any amounts payable to Dissenting Common Stockholders), and (B) for the benefit of the Preferred Stockholders (other than Dissenting Preferred Stockholders), the Aggregate Preferred Stock Closing Accrued Value (less any amounts payable to Dissenting Preferred Stockholders) payable to the Preferred Stockholders (in their capacities as such), which, for the avoidance of doubt, shall be an amount in cash equal to the sum of the Closing Preferred Stock Accrued Values for each issued and outstanding share of Preferred Stock at the time of the Closing other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d) (less any amounts payable to Dissenting Preferred Stockholders), pursuant to this Agreement (the amount so deposited with the Paying Agent, the “Exchange Fund”) and (ii) the Company or the Company’s designated Subsidiary, (A) the portion of the Aggregate Estimated Closing Merger Consideration payable to the Optionholders (in their capacities as such) pursuant to this Agreement and (B) the Aggregate Preferred Option Closing Accrued Value payable to the Preferred Optionholders (in their capacities as such) pursuant to this Agreement. Notwithstanding anything to the contrary herein, the parties acknowledge and agree, the Equityholder Representative agrees on behalf of the Equityholders, and each Equityholder shall acknowledge and agree in such Equityholder’s Letter of Transmittal, that Parent shall be entitled to rely on the Company’s calculation of the respective portions of the Aggregate Estimated Closing Merger Consideration payable to the Stockholders, the Preferred Stockholders, the Optionholders and the Preferred Optionholders (in their respective capacities as such) as a true, complete and accurate calculation of the amounts to which each such Equityholder is entitled pursuant to the Company Certificate of Incorporation as in effect as of immediately prior to the Effective Time, in connection with the transactions contemplated by this Agreement, and in no event shall Parent or any of its Affiliates (including, following the Closing, the Surviving Corporation and its Subsidiaries) have any liability to any Equityholder or to any other Person for the calculation of any of the foregoing.
(c) At the Closing:
(i) Parent shall pay an amount equal to the Credit Agreement Payoff Amount pursuant to a customary payoff letter delivered to Parent prior to the Closing Date pursuant to Section 2.6(a)(ii) above (the “Payoff Letter”);
(ii) Parent shall pay or cause to be paid to an account designated prior to the Closing Date by the Escrow Agent an amount equal to the Adjustment Escrow Amount, which amount shall be held by the Escrow Agent in a separate account (the “Adjustment Escrow Account”) pursuant to an escrow agreement in a form reasonably acceptable to the Equityholder Representative and Parent (the “Escrow Agreement”), by and among Parent, the Equityholder Representative and the Escrow Agent;
(iii) Parent shall pay or cause to be paid to the account designated by the Company to Parent prior to the Closing Date of each Person to whom Transaction Expenses described in clauses (a) and (c) of the definition thereof are owed an amount equal to the portion of the Transaction Expenses owed to such Person (other than Transaction Expenses that are payable to any Company Group Employee, which shall be delivered to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries in accordance with the terms of the applicable arrangements to such Person)satisfied;
(iv) Parent a duly executed consent to assignment from the landlord and the Equityholder Representative shall direct the Paying Agent to pay, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions provided by the Equityholder Representative, to the account of each Stockholder (excluding holders of Dissenting Shares) any other third party with respect to each share of Common Stock outstanding immediately prior to the Effective Time (other than any shares of Common Stock to be canceled pursuant to Section 2.5(b)) Assumed Lease for which a duly completed and executed Letter such consent is required as identified on Section 3.5(b)(vi) of Transmittal has been properly delivered prior to the Closing Date, an amount equal to the Closing Merger Consideration Per Share for each such share of Common StockDisclosure Schedule;
(v) Parent and the Equityholder Representative shall direct the Paying Agent to paya fully-executed Estoppel Certificate from each Estoppel Party, following the Effective Time and in accordance with the Paying Agent Agreement, pursuant to payment instructions and calculations provided by the Equityholder Representative to the account of each Preferred Stockholder dated not more than thirty (excluding holders of Dissenting Shares30) with respect to each share of Preferred Stock outstanding immediately days prior to the Effective Time (other than any shares of Preferred Stock to be canceled pursuant to Section 2.5(d)) held by such Preferred Stockholder and for which a duly completed and executed Letter of Transmittal has been properly delivered prior to the Closing Applicable closing Date, an amount equal to the Closing Preferred Stock Accrued Value for each such share of Preferred Stock;
(vi) with respect to each Optionholder, Parent shall pay or cause to be paid to each such Optionholder in respect evidence of each share consent of Common Stock underlying each of such Optionholder’s Options (other than any Underwater Options), for which a duly completed and executed Letter of Transmittal has been properly delivered prior the U.S. Environmental Protection Agency to the Closing Date, an amount equal transfer of those Furnishings and Equipment subject to the Closing Option Consideration Per Share with respect to each such share of Common Stock underlying each such Option held by such Optionholder immediately prior to the Effective Time, which such payment shall be effected by way of payment to the Surviving Corporation or one of its Subsidiaries for payroll or other applicable payment processing by the Surviving Corporation or its applicable Subsidiaries and distribution at the next administratively practicable payroll date to such OptionholderEPA Consent Decree;
(vii) with respect to each Preferred Optionholderparcel of Owned Real Property transferred at such Closing, Parent shall pay or cause a general warranty deed in form and substance reasonably satisfactory to be paid to Buyer (each such Preferred Optionholder a “Deed”) and duly executed and notarized by Sellers;
(viii) any and all documentation in respect Sellers’ possession reasonably requested by Buyer and any and all documentation reasonably and customarily required by a nationally recognized title company issuing title insurance for the applicable Owned Real Property and the Leased Real Property, including any and all owner’s affidavits, affidavits of each share of Preferred Stock underlying each of such Preferred Optionholder’s Preferred Optionsnon-foreign status, an amount equal to the Closing Preferred Option Accrued Value GAP affidavits, survey certifications with respect to existing surveys, tax affidavits, certificates of good standing and due authorization and articles of incorporation, and any other documentation reasonably and customarily required by the title company to remove the standard exceptions and other exceptions excluding Permitted Liens from each title policy (whether or not such share title insurance policies are purchased);
(ix) notice letters to all tenants and subtenants of Preferred Stock underlying the applicable Owned Real Property and Leased Real Property, as applicable, confirming the sale under this Agreement, together with evidence of the termination of all subleases constituting Excluded Assets hereunder;
(x) the paper lease file for each Leased Real Property in Sellers’ possession (or its equivalent for each Owned Real Property) along with Seller’s certification that such Preferred Option held by file is a true, correct and complete file for such Preferred Optionholder immediately prior location;
(xi) an assignment of Sellers’ right, title and interest, if any, in any warranties related to the Effective Time, which such payment shall be effected by way of payment applicable Leased Real Property or Owned Real Property to the Surviving Corporation extent such warranties are transferable, together with true and complete copies of such warranties;
(1) all tax clearance certificates and other certificates and documents necessary to establish Sellers’ compliance with the requirements and provisions of any Tax clearance, bulk sales, bulk transfer or one similar Laws of its Subsidiaries the states of North Carolina, South Carolina and Georgia in connection with the transactions contemplated by this Agreement (all showing that all applicable taxes have been paid or that none are due and owing), and (2) such other evidence as Buyer may reasonably request to evidence Sellers’ compliance with the Tax laws of each state in which the Transferred Assets are located and each other jurisdiction in which Seller files any Tax Return, or to determine the amount of withholding required to avoid successor liability in accordance with such states’ applicable tax clearance procedures;
(xiii) a duly executed Specified Leases Letter Agreement in the form of Exhibit G (the “Specified Leases Letter Agreement”) for payroll or other applicable payment processing by each of the Surviving Corporation or its applicable Subsidiaries and distribution Stores identified on Exhibit G-1 being acquired at the next administratively practicable payroll date Applicable Closing;
(xiv) a duly executed Specified Leases Estoppel Letter in the form of Exhibit H (the “Specified Leases Estoppel Letter”) for each of the Stores identified on Exhibit G-1 being acquired at the Applicable Closing;
(xv) a duly executed and recorded Notice of Lease substantially in the form of Exhibit I (the “Notice of Lease”) for the applicable Leased Real Property being acquired at the Applicable Closing to such Preferred Optionholderthe extent, with respect to the applicable Leased Real Property, if (1) a Notice of Lease is not previously of record with regard to the Leased Real Property or (2) the recording of a Notice of Lease is reasonably and customarily required by a nationally recognized title company when issuing title insurance; and
(viiixvi) Parent shall pay such other customary instruments of transfer, instruments of assumption, filings or cause documents, in form and substance reasonably satisfactory to be paid to an account designated prior Buyer as Buyer may reasonably request. At the Initial Closing, in addition to the Closing Date by the Equityholder Representativeforegoing deliverables, the Equityholder Representative Expense Amount.
(d) At or prior to the Closing, the Company Sellers will deliver or cause to be delivered to ParentBuyer (A) an executed certificate of non-foreign status from each Seller in compliance with Treasury Regulations Section 1.1445-2 and (B) the Escrow Agreement, duly executed by Sellers.
(b) At each Closing, Buyer will deliver or cause to be delivered to Sellers the following:
(i) resignation letters the applicable Closing Cash Payment, by wire transfer of immediately available funds, to an account or accounts as directed by Sellers;
(which resignation letters will not constitute ii) the applicable Xxxx of Sale duly executed by Buyer;
(iii) the applicable Lease Assignment and Assumption Agreement duly executed by Buyer;
(iv) a termination duly executed certificate from an officer of employment) or other evidence of removal providing for Buyer to the resignation or removal effect that each of the directors conditions specified in Section 7.3(a) and officers Section 7.3(b) are satisfied;
(v) a Specified Leases Letter Agreement duly executed by Koninklijke Ahold Delhaize N.V. (f/k/a Koninklijke Ahold N.V.) and Ahold U.S.A., Inc. for each of the Company Group from Stores identified on Exhibit G-1 being acquired at the Applicable Closing; and
(vi) such positions other customary instruments of transfer, instruments of assumption, filings or documents, in form and substance reasonably satisfactory to Sellers as directors or officers of members of the Company Group effective as of the Effective Time, as requested by Parent in writing no later than five (5) Business Days prior to the Closing DateSellers may reasonably request.
(ec) Notwithstanding anything At the Initial Closing, in this Agreement addition to the contraryforegoing deliverables, each Dissenting Stockholder (the shares of Common Stock held by each Dissenting Common Stockholder and the shares of Preferred Stock held by each Dissenting Preferred Stockholders, collectively, the “Dissenting Shares”) shall not have the right to receive any payment in accordance with Section 2.6(c) with respect to such Dissenting Stockholder’s respective Dissenting Shares, but instead and in lieu thereof shall have the right to receive payment from the Surviving Corporation with respect to its Dissenting Shares in accordance with the DGCL, unless and until such Dissenting Stockholder shall have effectively withdrawn Sellers will deliver or lost its rights to appraisal under the DGCL. If any such formerly Dissenting Stockholder shall have effectively withdrawn or lost such right, such Stockholder shall have the right to receive such Equityholder’s consideration as set forth in Section 2.5(a) or Section 2.5(c), as the case may be. The Company will give Parent prompt notice of any demands received by the Company for appraisal rights, and Parent will have the right to participate in (at its own expense) all negotiations and proceedings with respect to such demands. The Company will not, except with the prior written consent of Parent (not cause to be unreasonably withhelddelivered to Buyer the Escrow Agreement, conditioned or delayed), make any payment with respect to, or settle or offer to settle, any such demandsduly executed by Buyer.
Appears in 1 contract
Samples: Asset Purchase Agreement (Southeastern Grocers, Inc.)
