Effect of Accounting Principles Clause Samples
The Effect of Accounting Principles clause defines how financial statements and calculations within an agreement are to be prepared and interpreted, specifying the set of accounting standards—such as Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS)—that must be followed. This clause ensures that all parties use a consistent framework for recognizing revenue, expenses, assets, and liabilities, which is particularly important when determining financial covenants, performance metrics, or payment obligations. By establishing a clear accounting basis, the clause prevents disputes arising from differing interpretations of financial data and promotes transparency and comparability in financial reporting.
Effect of Accounting Principles. Notwithstanding anything set forth in this Section 4 to the contrary, in the event that it is determined by the Company (in consultation with its auditors) that the provisions of this Section 4 would result in any of the Options being classified as a liability as contemplated by FASB Statement No. 123R, Share-Based Payment, including any amendments and interpretations thereto, then the following terms shall apply in lieu of the corresponding provisions in Section 4(b) and Section 4(c) providing for the purchase by the Company of exercisable Options: With respect to any exercisable Options, upon the occurrence of the applicable event giving rise to the Section 4 Call Event, the Management Stockholder Entities may be required to by the Company to elect, in accordance with the terms of the relevant Stock Option Agreement, to receive from the Company, on one occasion, in exchange for all of the exercisable Options then held by the applicable Management Stockholder Entities, if any, a number of shares of Stock equal to the quotient of (x) the product of (A) the excess, if any, of the Fair Market Value over the Option Exercise Price and (B) the number of shares then acquirable on exercise, divided by (y) the Fair Market Value, which Options shall be terminated in exchange for such payment of shares of Stock (such shares of Stock, the “Net Settled Stock”). (In the event the foregoing Option Excess Price is zero or a negative number, all outstanding exercisable Options shall be automatically terminated without any payment in respect thereof.) Upon the occurrence of such net settlement of all exercisable Options, the Call Period shall be deemed to be the period that is 30 days following the date that is six months after the receipt by the applicable Management Stockholder Entities of the Net Settled Stock, during which time the Company may, on delivery of Call Notice, purchase all or any portion of the Net Settled Stock held by the applicable Management Stockholder Entities, at a per share price equal to the applicable Repurchase Price for Option Stock identified in Section 4(b) or Section 4(c), as applicable.
Effect of Accounting Principles. Notwithstanding anything set forth in Section 4 or 5 to the contrary, in the event that it is determined by the Board, after consultation with the Chief Financial Officer of the Company, that any of the provisions of either of Section 4 or 5 would result in any of the Options being classified as a liability as contemplated by Financial Accounting Standards Board Accounting Standard Codification (ASC) Section 718, Compensation — Stock Compensation (FASB ASC 718), including any amendments and interpretations thereto, then the Company shall be required to advise the RPM Stockholder Entities of this determination (x) in order to allow the RPM Stockholder Entities to exercise their rights under Section 4 and (y) in order for the Company to exercise its rights under Section 5 (but only to the extent that the Company notifies the RPM Stockholder Entities of its intent to exercise its rights under Section 5), and then in any such case the following terms shall apply:
Effect of Accounting Principles. Notwithstanding anything set forth in Section 4 or 5 to the contrary, in the event that it is determined by the Board, after consultation with the Chief Financial Officer of the Company, that any of the provisions of either of Section 4 or 5 would result in any of the Options being classified as a liability as contemplated by Financial Accounting Standards Board Accounting Standard Codification (ASC) Section 718, Compensation — Stock Compensation (FASB ASC 718), including any amendments and interpretations thereto, then the Company shall be required to advise the Employee Stockholder Entities of this determination (x) in order to allow the Employee Stockholder Entities to exercise their rights under Section 4 and (y) in order for the Company to exercise its rights under Section 5 (but only to the extent that the Company notifies the Employee Stockholder Entities of its intent to exercise its rights under Section 5), and then in any such case the following terms shall apply:
Effect of Accounting Principles. Notwithstanding anything set forth in Section 5 to the contrary, in the event that it is determined by the Board that any of the provisions of Section 5 would result in any of the Restricted Stock being classified as a liability as contemplated by FASB Statement No. 123, Share-Based Payment, including any amendments and interpretations thereto, then any shares of Restricted Stock that are to be purchased by the Company pursuant to Section 5 may only be so purchased if and when such shares have been held by the Stockholder for at least six months.
Effect of Accounting Principles. Notwithstanding anything set forth in Section 6 or 7 to the contrary, in the event that it is determined by the Board that any of the provisions of either of Section 6 or 7 would result in any of the Options being classified as a liability as contemplated by FASB Statement No. 123R, Share-Based Payment, including any amendments and interpretations thereto, then the following terms shall apply: (i) Any shares of Stock that are to be purchased by the Company pursuant to Section 6 or 7, as applicable, may only be so purchased if and when such shares have