Common use of Dilution Mechanism Clause in Contracts

Dilution Mechanism. If a Defaulting Shareholder fails to provide the required funding in the amount and manner and within the specified period set forth in a Contribution Notice or as required pursuant to Section 7.5(a) and the Non-Defaulting Shareholder either: (i) elects to fund the Defaulted Amount (rather than advance a Shareholder Loan) in accordance with Section 8.2(a)(i); or (ii) elects not to fund the Defaulted Amount; then the Proportionate Interest of each Shareholder will be recalculated immediately after the Dilution Day in accordance with Schedule C. The Directors shall cause or permit the Company to issue Shares of the Company for nominal consideration to the Non-Defaulting Shareholder in order to reflect a dilution of the Proportionate Interest of the Defaulting Shareholder in accordance with Schedule C.

Appears in 3 contracts

Samples: Shareholders Agreement (Emerald Health Therapeutics Inc.), Shareholders Agreement (Village Farms International, Inc.), Shareholder Agreement

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Dilution Mechanism. If a Defaulting Shareholder fails to provide the required funding in the amount and manner and within the specified period set forth in a Contribution Notice or as required pursuant to Section 7.5(a) and the Non-Defaulting Shareholder either: (i) elects to fund the Defaulted Amount (rather than advance a Shareholder Loan) in accordance with Section 8.2(a)(i); or (ii) elects not to fund the Defaulted Amount; then the Proportionate Interest of each Shareholder will be recalculated immediately after the Dilution Day in accordance with Schedule C. 0. The Directors shall cause or permit the Company to issue Shares of the Company for nominal consideration to the Non-Defaulting Shareholder in order to reflect a dilution of the Proportionate Interest of the Defaulting Shareholder in accordance with Schedule C.0.

Appears in 1 contract

Samples: Shareholders Agreement (Village Farms International, Inc.)

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