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Common use of Escrow Clause in Contracts

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 3 contracts

Samples: Merger Agreement (Marchex Inc), Merger Agreement (Marchex Inc), Merger Agreement (Marchex Inc)

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Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees and Buyer agree that the their right to indemnification pursuant to this Article XII XI shall constitute Parent’s and Buyer’s sole and exclusive remedy and recourse against the Shareholders Company and the Sole Member for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations or as otherwise provided in Section 6.11, the maximum aggregate liability of any Shareholder individually the Company and the Sole Member collectively shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders Company and the Sole Member collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration Purchase Price (and for less any amount previously recovered under this Article XII from the Employee Shareholders also Escrow Deposit). To the value extent that all or any portion of the Equity Consideration or Restricted Equity Consideration) Consideration is sold, disposed of or otherwise transferred by the Sole Member or any affiliate in an arms-length transaction, then with respect to and in lieu of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shares of Parent Common Stock so sold, Parent shall be limited entitled to such Shareholder’s Pro Rata Portion of the recover against any and all cash or other proceeds so obtained. Any Losses up payable pursuant to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the this Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to 11.4 from the Escrow Deposit shall be equal paid from the Cash Escrow and the Stock Escrow in the same proportion as such Cash Escrow and Stock Escrow bears to the percentage total Escrow Deposit. Notwithstanding anything to the contrary contained herein, neither the Company nor the Sole Member shall have any liability for indemnification pursuant to this Article XI for Indemnifiable Matters arising from breaches of any representations and warranties until the Merger Consideration to aggregate Losses are in excess of $25,000, at which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, point the Restricted Equity Consideration Company and the Sole Member shall be valued (irrespective liable for the full amount of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting all Losses including such unvested sharesamount.

Appears in 2 contracts

Samples: Asset Purchase Agreement (Marchex Inc), Asset Purchase Agreement (Marchex Inc)

Escrow. As security for Cardo’s indemnification obligations hereunder, Parent shall deposit with the Escrow Agent ten percent (10%) of the shares of Parent Common Stock issued in connection with the Merger pursuant to Article III to each Historical Cardo Member (the “Cardo Escrowed Securities”) pursuant to the terms of the Escrow Agreement and this Article IX. The Cardo Escrowed Securities shall be released in accordance with the terms of the Escrow Deposit Agreement on the date that is one (1) year after the Closing Date (such period, the “Escrow Period”), except with respect to a number of such Cardo Escrowed Securities as reasonably determined by the board of directors of Parent to be necessary to satisfy any unresolved claim made pursuant to this Article IX in writing prior to such release date, which securities shall be held pursuant to the terms of the Escrow Agreement until such claim is fully and finally resolved. Parent shall be entitled to recover the Damages for which Cardo is obligated to provide indemnification hereunder against the Cardo Escrowed Securities on a pro rata basis based on the number of such securities issued to each holder thereof and held in such escrow, and the aggregate number of Cardo Escrowed Securities subject to such recovery shall be determined by dividing the amount of such indemnifiable Damages, as fully and finally determined to be due by the Escrow Agent mutual agreement of the board of directors of Parent and the Members’ Representatives or by a court of competent jurisdiction, as applicable, by the average closing price per share of Parent Common Stock on the OTCBB or Eligible Market, as applicable, for a the ten (10)-day period ending on the Escrow Release Dateday prior to such determination. Delivery of Cardo Escrowed Securities from the escrow account to the Historical Cardo Members shall be made pro rata based on the number of shares of Parent Common Stock deposited in such escrow account in respect of each Historical Cardo Member. Any provisions of this Agreement to the contrary notwithstanding, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims Parent Indemnified Parties’ sole remedy for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit claims hereunder shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse recover against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing DateCardo Escrowed Securities; provided, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000)however, (bi) for Section 3.12 Indemnifiable Matters arising during the period beginning on foregoing shall not apply in the day after the twelve (12) month anniversary case of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000)a Parent Indemnified Party seeking specific performance or injunctive or other equitable relief, and (eii) for Section 3.12 Indemnifiable Matters arising during no Parent Indemnified Party shall be deemed to have waived any rights, claims, causes of action or remedies if and to the period beginning extent (A) such rights, claims, causes of action or remedies may not be waived under applicable Laws, or (B) fraud is proven on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” part of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesParent Indemnified Party by an indemnifying party hereto.

Appears in 2 contracts

Samples: Merger Agreement, Merger Agreement (Clicknsettle Com Inc)

Escrow. (a) At Closing, Radyne, the Principal Shareholders, the Shareholders’ Representative and Alliance Bank of Arizona (the “Escrow Agent”) shall enter into an escrow agreement in substantially the form attached hereto as Exhibit A (the “Escrow Agreement”). The escrow agent will hold $2,000,000 (the “Escrow Amount”) in escrow (the “Escrow Fund”) as security to cover potential losses or other claims for which Radyne is entitled to indemnification or recovery pursuant to Article 8. Subject to any claims made by Radyne, the Escrow Amount will be released to the AeroAstro Shareholders within ten (10) days after the second anniversary of the Closing. (b) The parties hereto hereby acknowledge and agree that the Escrow Amount is intended to be treated as an installment obligation for purposes of Section 453 of the Code and, unless required by applicable law, no party shall take any action or filing position inconsistent with such characterization. The parties hereto further agree that, subject to any future Treasury Regulations or other changes in the law, pursuant to Proposed Treasury Regulation Section 1.468B-8, for tax reporting purposes, all items of income, deduction and credit relating to the Escrow Amount or any portion thereof in any tax year shall be reported as allocated to Radyne with respect to all periods on or prior to the date that the distribution of the Escrow Amount (or portion thereof) is determined, and with respect to all periods thereafter to Radyne and the AeroAstro Shareholders in accordance with their respective interests in the distribution in accordance with Proposed Treasury Regulation Section 1.468B-8. The Escrow Deposit Agreement shall be held by provide for quarterly distributions from the Escrow Agent for a period ending Fund to Radyne of amounts sufficient to pay any taxes due on any income earned on the Escrow Release Date, except Fund. Any income earned on the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior Fund, to the Escrow Release Date. The Escrow Deposit extent that such income exceeds the quarterly tax distributions, shall be held added to and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion become part of the Escrow Deposit and the maximum aggregate liability Fund. Any portion of the Escrow Amount paid to the AeroAstro Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited included as a payment of the purchase consideration for tax purposes (to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Considerationextent not treated as imputed interest). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), . (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of In this Agreement, the term Pro Rata PortionPer Share Escrow Amountof a Shareholder as to any Losses or as to shall be the Escrow Deposit shall be equal to Amount divided by the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesFully Diluted Shares.

Appears in 2 contracts

Samples: Merger Agreement (Radyne Corp), Merger Agreement (Radyne Corp)

Escrow. The Escrowed Shares, when initially issued, shall be issued to the Escrow Deposit Agent as nominee of the LMI Stockholders, such shares to be deposited in an escrow account. The Escrowed Shares shall be allocated against the number of shares of Ebiz Common Stock to which each LMI Stockholder is entitled on a pro rata basis in accordance with the relative Applicable Stock Percentage of each LMI Stockholder. The Escrowed Shares shall be held by the Escrow Agent for a period ending on the Escrow Release Datein escrow, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit and shall be held and disbursed transferred or released by the Escrow Agent only as follows. If no Notice of Claim is submitted by the Ebiz Designated Representative to the LMI Designated Representative within the applicable time period provided in Section 10.4(a), then the Escrow Agent shall promptly transfer all of the Escrowed Shares to the LMI Stockholders on a pro rata basis in accordance with an the relative Applicable Stock Percentage of each LMI Stockholder. If a Notice of Claim is submitted by the Ebiz Designated Representative to the LMI Designated Representative within the applicable time period provided in Section 10.4(a), then the Escrow AgreementAgent shall hold the Escrowed Shares until the first to occur of the issuance of a Final Decision or the waiver and release by Ebiz of the Indemnification Claims to which the Notice of Claim relates. If the Closing occurs, Parent agrees that the right Final Decision results in Ebiz being entitled to indemnification no payment pursuant to this Article XII 10 or if Ebiz waives and releases its Indemnification Claims, then the Escrow Agent shall constitute Parent’s sole and exclusive remedy and recourse against promptly transfer all of the Shareholders for Losses attributable Escrowed Shares to any Indemnifiable Mattersthe LMI Stockholders on a pro rata basis in accordance with the relative Applicable Stock Percentage of each LMI Stockholder. Except If, however, pursuant to the Final Decision it is determined that Ebiz is entitled pursuant to this Article 10 to receive payment with respect to its Indemnification Claims, then the Excluded Obligations Escrow Agent shall transfer to Ebiz on the maximum Due Date such number of Escrowed Shares as have an aggregate liability Ebiz Share Value equal to the amount of any Shareholder individually such payment and shall be limited to such Shareholder’s Pro Rata Portion transfer all of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited remaining Escrowed Shares to the Cash Consideration (and for LMI Stockholders on a pro rata basis in accordance with the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability relative Applicable Stock Percentage of each LMI Stockholder. Any LMI Stockholder may, but shall not be limited required, to such Stockholder’s Pro Rata Portion of Five Million Dollars redeem any Escrowed Shares allocable to him that are required to be transferred to Ebiz pursuant to this subsection ($5,000,000), (bf) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as by paying to the Escrow Deposit Agent, prior to the transfer thereof to Ebiz, the Ebiz Share Value of such Escrowed Shares. Any Escrowed Shares that are so redeemed shall be equal transferred to the percentage of redeeming LMI Stockholder and the Merger Consideration cash paid to which redeem such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration Escrowed Shares shall be valued (irrespective paid, in lieu of vesting) based on the Closing Market Pricesuch shares, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEbiz.

Appears in 2 contracts

Samples: Merger Agreement (Herman Stephen C), Merger Agreement (Ebiz Enterprises Inc)

Escrow. The Escrow Deposit shall be held by On or prior to the Closing, the Equityholder Representative, the Buyer and the Escrow Agent for a period ending on shall enter into the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after Promptly following the twelve (12) month anniversary of the Closing Date (the “Survival Date”), the Buyer and continuing the Equityholder Representative shall deliver a joint written notice to the Escrow Agent to deliver (a)(i) the portion of each former Stockholder’s Fully Diluted Percentage of the sum of the remaining amount of the Indemnity Escrow Fund minus any amounts that would be necessary to satisfy any then pending and unsatisfied or unresolved claim for indemnification pursuant to Section 8.2 if such claim(s) were resolved in full in favor of the Buyer Indemnified Persons (which amounts will continue to be held in the Indemnity Escrow Fund until the eighteen related claims have been finally resolved) (18such sum, the “Distributable Amount”), attributable to Shares (as opposed to In-the-Money Options or RSUs) month anniversary previously held by such former Stockholder, subject to Section 2.8, to such former Stockholder as soon as practicable and (ii) the portion of each former holder’s Fully Diluted Percentage of the Closing Distributable Amount attributable to In-the-Money Options or RSUs (as opposed to Shares) previously held by such former holder to the Surviving Corporation for delivery to such former holder of In-the-Money Options and RSUs through the Surviving Corporation’s payroll system; provided that if no such notice is delivered to the Escrow Agent within five (5) Business Days after the Survival Date, the maximum liability of each Stockholder Escrow Agent shall be limited to automatically and without further action by either the Buyer or the Equityholder Representative release the Distributable Amount in accordance with the preceding sentence. Promptly following the time that any such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date pending and continuing until the twenty-four (24) month anniversary of the Closing Dateunsatisfied or unresolved claims have been finally resolved, the maximum liability of each Stockholder Buyer and the Equityholder Representative shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of deliver a Shareholder as to any Losses or as joint written notice to the Escrow Deposit shall be equal Agent to deliver (x) the percentage portion of each former Stockholder’s Fully Diluted Percentage of the Merger Consideration revised Distributable Amount attributable to which Shares (as opposed to In-the-Money Options or RSUs) previously held by such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XIIformer Stockholder, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant subject to Section 7.8 2.8, to such former Stockholder as soon as practicable and (y) the Employee Shareholders’ liability with respect thereto shall be limited portion of each former holder’s Fully Diluted Percentage of the revised Distributable Amount attributable to forfeiting such unvested shares.In-the-Money Options or RSUs (as opposed to Shares) previously held by

Appears in 2 contracts

Samples: Merger Agreement (Zayo Group LLC), Merger Agreement (Zayo Group LLC)

Escrow. The (a) On the Closing Date, the Acquiror shall deposit the Escrow Deposit shall be held by Amount with the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an the terms of this Section 2.19, Article VII hereof and the Indemnity Escrow Agreement. If the Closing occurs, Parent agrees that the right Agreement in order to indemnification satisfy claims pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations VII hereof. (other than the Section 3.12 Indemnifiable Mattersb) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of On the Closing Date, the maximum liability Acquiror shall deposit the Working Capital Escrow Amount with the Escrow Agent to be held and disbursed by the Escrow Agent in accordance with the terms of each Stockholder shall be limited this Section 2.19, Section 2.12(b) and the Working Capital Escrow Agreement in order to such Stockholdersettle payment of the Adjustment Amount pursuant to Section 2.12(b). (c) Each Securityholder’s Pro Rata Portion portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on Escrow Amount and the day after Working Capital Escrow Amount at the twelve (12) month anniversary time of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage Securityholder’s Pro-Rata Portion at the time of the Merger Consideration to which such Shareholder is entitled as Closing and shall be set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on in the Closing Market PricePayment Certificate. If following the Closing further distributions of consideration are made to the Securityholders under this Agreement which would have the effect of changing any Securityholder’s Pro-Rata Portion, Acquiror shall withhold an appropriate portion of a distribution going to a Securityholder whose Securityholder’s Pro-Rata Portion increased with such distribution and shall deposit such amount as additional Escrow Amount and simultaneously shall authorize the Escrow Agent to shares not yet vested pursuant release an appropriate portion of the existing Escrow Amount to Section 7.8 those Securityholders whose Securityholder’s Pro-Rata Portion decreased with such distribution. Acquiror and the Employee Shareholders’ liability with respect thereto Securityholder Representative shall be limited work together in good faith to forfeiting such unvested sharesmake and agree upon the required calculations to effectuate the foregoing.

Appears in 2 contracts

Samples: Merger Agreement (Mellanox Technologies, Ltd.), Merger Agreement (Ezchip Semiconductor LTD)

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees Parent, First Acquisition Corp. and Second Acquisition Corp. agree that the Parent’s, First Acquisition Corp.’s and Second Acquisition Corp.’s right to indemnification pursuant to this Article XII shall constitute Parent’s, First Acquisition Corp.’s and Second Acquisition Corp.’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations Obligations, the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion (as defined below) of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively any Shareholder for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion (as defined below) of the Losses up to the aggregate amount of the Cash Merger Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to less any amount previously recovered under this Article XII from such StockholderShareholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary portion of the Closing Date and continuing until the eighteen (18Escrow Deposit); provided, however, that no Shareholder shall have any liability for indemnification pursuant to Section 12.1(b) month anniversary on account of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000)any other Shareholder. For the purposes of this Agreement, a “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.312.4. For purposes of Article XIINotwithstanding anything to the contrary contained herein, the Restricted Equity Consideration Shareholders shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested have no liability for indemnification pursuant to Section 7.8 this Article XII until the Employee Shareholders’ liability with respect thereto aggregate Losses are in excess of $100,000, at which point the Shareholders shall only be limited to forfeiting liable for the amount of Losses in excess of such unvested sharesamount.

Appears in 2 contracts

Samples: Merger Agreement (Marchex Inc), Merger Agreement (Marchex Inc)

Escrow. The Escrow Deposit shall be held by On the Escrow Agent for a period ending on the Escrow Release Closing Date, except Purchaser shall deposit Two Hundred Fifty Thousand Dollars ($250,000) (the “Escrowed Cash”) and REG shall deposit Ninety-Seven Thousand Five Hundred Sixty-One (97,561) shares of the common stock of REG, as adjusted for any post-Effective Date dividend, stock split, recapitalization or reorganization by REG by delivery of stock certificates in the name of the Company (the “Escrowed Stock” and together with the Escrowed Cash, the “Escrow Deposit may Amount”) into an escrow account (the “Escrow Fund”), to be withheld after the Escrow Release Date for so long as is maintained by an escrow agent reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior acceptable to the parties (the “Escrow Release DateAgent”) in accordance with the terms of an Escrow Agreement in the form attached hereto as Exhibit B (the “Escrow Agreement”). The Escrow Deposit Fund shall be held used for the purpose specified in Article VII herein. The Escrow Fund (less any amounts for indemnifiable Losses to the extent set forth in Article VII and disbursed by the Escrow Agent Agreement) shall be disbursed to the Company in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion terms of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning Agreement on the Closing Date and continuing until the twelve (12) month one year anniversary of the Closing Date, . Purchaser and the maximum liability of each Stockholder Company shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary bear an equal portion of the Closing Date fees and continuing until the eighteen (18) month anniversary expenses of the Escrow Agent, with the portion borne by the Company to be deducted from the Escrow Fund. Bunge and BIG shall agree prior to Closing Date, as between themselves the maximum liability percentages of each Stockholder shall Escrowed Cash and Escrowed Stock to be limited received by Bunge and BIG upon distribution by the Company to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary Members of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing DateEscrow Fund; provided, the maximum liability of each Stockholder shall be limited to such Stockholderthat a Member’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration Escrow Fund shall be valued (irrespective reduced by the amount of vesting) based on the Closing Market Price, and as to shares not yet vested any indemnifiable Loss made pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited terms of the Escrow Agreement and this Agreement applicable to forfeiting such unvested sharesMember.

Appears in 2 contracts

Samples: Asset Purchase Agreement (Blackhawk Biofuels, LLC), Asset Purchase Agreement (Blackhawk Biofuels, LLC)

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees and Buyer agree that the right to indemnification pursuant to this Article XII XI shall constitute Parent’s and Buyer’s sole and exclusive remedy and recourse against the Shareholders Company and Stockholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations Obligations, Section 2.11 Indemnifiable Matters or as otherwise provided in Section 6.11, the maximum aggregate liability of the Company and the Stockholders collectively shall be limited to the Escrow Deposit and of any Shareholder Stockholder individually shall be limited to such ShareholderStockholder’s Pro Rata Portion (as defined below) of the Escrow Deposit and the maximum aggregate liability of the Shareholders Company and the Stockholders collectively for the Excluded Obligations (other than the Section 3.12 2.11 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) Purchase Price and of any Shareholder Stockholder individually for the Excluded Obligations (other than the Section 3.12 2.11 Indemnifiable Matters) shall be limited to such ShareholderStockholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration Purchase Price which such Shareholder Stockholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration)entitled. The maximum aggregate liability of the Stockholders for the Section 3.12 2.11 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 2.11 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve one (121) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month year anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars 6,500,000, ($2,000,000), and (eb) for Section 3.12 2.11 Indemnifiable Matters arising during the period beginning on the day after the thirty one (301) month year anniversary of the Closing Date and continuing until the thirty six two (362) month year anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars $4,550,000, (c) for Section 2.11 Indemnifiable Matters arising during the period beginning on the day after the two (2) year anniversary of the Closing Date and continuing until the three (3) year anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $1,000,000)2,600,000, and (iv) for Section 2.11 Indemnifiable Matters arising during the period beginning on the day after the three (3) year anniversary of the Closing Date and continuing until the four (4) year anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $1,300,000. For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder Stockholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration Purchase Price to which such Shareholder Stockholder is entitled as set forth on Schedule 2.31.5. For Any Losses payable pursuant to this Section 11.4 from the Escrow Deposit shall be paid from the Cash Escrow and the Stock Escrow as set forth in the Escrow Agreement. Notwithstanding anything to the contrary above, all Losses with respect to any Section 2.11 Indemnifiable Matters shall be included for purposes of Article XII, determining whether the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ maximum liability with respect thereto shall be limited to forfeiting such unvested shareslimits set forth above have been reached.

Appears in 2 contracts

Samples: Asset Purchase Agreement (Marchex Inc), Asset Purchase Agreement (Marchex Inc)

Escrow. As security for the indemnification obligations of the Company Stockholders set forth in Section 8.2 of this Agreement, at the Closing, WuXi and Holdco shall place in escrow (the “Indemnification Escrow”) with an escrow agent mutually acceptable to the Company and Holdco (the “Escrow Agent”), a certificate representing that number of shares of common stock, par value $0.02 per share, of WuXi calculated by dividing $14,000,000.00 by the average of the closing price per share of the American Depository Shares of WuXi as reported on The New York Stock Exchange over the thirty-day period ending on the third business day before the Closing Date and multiplying the result by eight (the “Escrowed Shares”). The Escrowed Shares shall be delivered by WuXi and Holdco to the Escrow Deposit Agent at the Closing, shall be held by the Escrow Agent for a period ending on pursuant to the terms of the Escrow Release DateAgreement, except substantially in the form set forth in Appendix B (the “Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit Agreement”) and shall be held and disbursed delivered by the Escrow Agent in accordance with an the terms and provisions of the Escrow Agreement. The $14,000,000 value of the Escrowed Shares shall be deducted from the Adjusted Aggregate Merger Consideration and withheld from each payment otherwise deliverable to a Company Stockholder in respect of its, his or her shares of Capital Stock. WuXi and Holdco may substitute cash in exchange for delivery of Escrowed Shares as further described in paragraph 2(c) of the Escrow Agreement. If WuXi and Holdco deliver Escrowed Shares, the Closing occursresale of such Escrowed Shares by the Company Stockholders shall be registered on an effective Form F-3, Parent agrees F-4 or other equivalent registration statement under the Securities Act of 1933 (the “Registration Statement”) permitting the public resale of such Escrowed Shares by the Company Stockholders upon the distribution of such Escrowed Shares pursuant to the Escrow Agreement. WuXi shall cause the Registration Statement to remain continuously effective for a period that will terminate upon the earlier of: (i) the date on which all Escrowed Shares held by the Company Stockholders and covered under the Registration Statement have been sold by such Company Stockholders or (ii) the date on which all such Escrowed Shares held by the Company Stockholders and covered under the Registration Statement may be sold by such Company Stockholders pursuant to Rule 144(k) without volume limitations. If WuXi fails to comply with this provision and the Escrowed Shares are not registered pursuant to the Registration Statement on or before the date of distribution of any such Escrowed Shares pursuant to the Escrow Agreement, WuXi and Holdco agree that the right “WuXi Option to indemnification Escrow Cash” will be deemed to have been selected pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion paragraph 2(c) of the Escrow Deposit Agreement and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as distributions pursuant to the Escrow Deposit Agreement shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, made in cash and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrowed Shares.

Appears in 1 contract

Samples: Merger Agreement (WuXi PharmaTech (Cayman) Inc.)

Escrow. The Escrow Deposit shall be held by Contemporaneously with the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes execution of this Agreement, “Pro Rata Portion” the Borrower shall executed an escrow agreement with the Agent as escrow holder (the "Escrow Agreement") in the form of a Shareholder as Exhibit G to any Losses or as this Agreement. Contemporaneously with the execution of this Agreement, the Borrower shall execute and deliver to the Escrow Deposit Holder a certificate for 2,700,000 shares of Common Stock as a portion of the number of Conversion Shares (based upon a conversion price of $0.375 per share) underlying the principal amount of the Note evidencing the initial Loan and the number of Warrant Shares for which the Warrants shall be equal exercisable upon funding the initial Loan. Prior to each additional Loan, the Borrower shall execute and deliver to the percentage Escrow Holder a certificate for 200% of the Merger Consideration number of additional Conversion Shares (based upon a conversion price of $0.375 per share) underlying the principal amount of the Note evidencing that Loan and 200% the number of additional Warrant Shares for which the Warrants shall be exercisable upon funding that Loan, until all of the Conversion Shares and Warrant Shares have been delivered to which the Escrow Holder.. All certificates for Conversion Shares and Warrant Shares delivered to the Escrow Holder shall be registered in the name of Thomson Kernaghan & Co. Limited. Until such Shareholder time as the registration statement covering the Conversion Shares and the Warrant shares is entitled as set forth on Schedule 2.3. For purposes of Article XIIeffective, the Restricted Equity Consideration certificates shall bear a legend indicating that they have been issued in a transaction that is exempt from the registration requirements of the Securities Act, and may not be transferred except pursuant to registration under the Securities Act or an exemption from such registration. Except for such legend, the Common Stock underlying the Lenders' Warrant and the Agent's Warrant shall be valued (irrespective free and clear of vesting) based on any legends, liens, claims, stop orders or other restrictions. Not later than the Closing Market Pricethird Business Day following the effective date of the Registration Statement, the Borrower shall cause the Common Stock underlying the Lenders' Warrant and as the Agent's Warrant to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesregistered in Agent's street name, in DTC form, free and clear of any legends, liens, claims, stop orders or other restrictions.

Appears in 1 contract

Samples: Loan Agreement (Surgical Safety Products Inc)

Escrow. Pursuant to the Escrow Agreement by and among Parent, Holdco, the Company, the Member Representative and Continental Stock Transfer & Trust Company (the “Escrow Agent”), in the form set forth in Exhibit 1.2(d)(i) (the “Escrow Agreement”), as the sole remedy for (i) the indemnification obligations set forth in Section 5.3, (ii) the Working Capital Shortfall, if any, pursuant to Section 1.3, and (iii) the Inventory Amount Shortfall, if any, pursuant to Section 1.5, Two Million Five Hundred Thousand (2,500,000) shares of Holdco Common Stock (the “Escrowed Indemnification Stock”) will be withheld from the Closing Stock Consideration, which shall be allocated among the Contribution Consideration Recipients in accordance with their respective Stock Contribution Consideration Percentages and deposited at Closing to the account specified in the Escrow Agreement. The Escrow Deposit Agreement shall be held by provide that, (i) on the thirtieth (30th) day after the date Holdco has filed with the Securities and Exchange Commission (the “SEC”) its Annual Report on Form 10-K for the year ending December 31, 2009 (the “First Escrow Release Date”), the Escrow Agent for a period ending shall release One Million (1,000,000) shares of the Escrowed Indemnification Stock, less that portion thereof applied in satisfaction of, or reserved with respect to, (A) indemnification obligations of the Contribution Consideration Recipients to the Parent Indemnified Parties in connection with claims made pursuant to Section 5.3 of this Agreement, (B) obligations of the Contribution Consideration Recipients in connection with any Working Capital Shortfall pursuant to Section 1.3, and (C) obligations of the Members in connection with any Inventory Amount Shortfall pursuant to Section 1.5 (collectively, clauses (A), (B), and (C) “Escrow Claims”), and (ii) on the thirtieth (30th) day after the date Holdco has filed with the SEC its Annual Report on Form 10-K for the year ending December 31, 2010 (the “Final Escrow Release Date”), the Escrow Agent shall release all of the shares then comprising the Escrowed Indemnification Stock remaining in escrow, less that portion thereof applied in satisfaction of, or reserved with respect to, Escrow Claims; provided, however, that with respect to any Escrow Claim made with respect to clause (C) herein, the Parties agree that the sole remedy for such Escrow Claim shall be the return of the Member Inventory Stock in accordance with Section 1.5 and further that no such Escrow Claim as it relates to clause (C) herein shall be made, if ever, prior to the date that all of the Inventory Assets (as hereafter defined) are sold; provided, further, that with respect to any Escrow Claim that remains unresolved at the time of the First Escrow Release Date or the Final Escrow Release Date, except as applicable, and notice of which was properly and timely delivered pursuant to this Section 1.2(d) and Section 5.3, a portion of the Escrow Deposit may be withheld after the Escrow Release Date for so long as is Escrowed Indemnification Stock reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the such Escrow Release Date. The Claim shall remain in escrow until such Escrow Deposit Claim shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification have been disposed pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.35.3. For purposes of Article XIIthis Section 1.2(d) and Section 5.3, and with respect to any Escrow Claims (and any satisfaction thereof), the Restricted Equity Consideration Escrowed Indemnification Stock shall be deemed to be valued at Eleven Dollars (irrespective of vesting$11.00) based per share. Any shares comprising the Escrowed Indemnification Stock due to be released on the Closing Market Price, and as First Escrow Release Date or Final Escrow Release Date that continue to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.held

Appears in 1 contract

Samples: Agreement and Plan of Reorganization (Alternative Asset Management Acquisition Corp.)

Escrow. The Escrow Deposit shall be held by Notwithstanding the provisions of Section 11.5 and subject to adjustment pursuant to Section 19.1(a) of this Agreement, Parent will deposit with the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior number of shares of Parent Common Stock equal to the quotient of (a) Seventeen Million Three Hundred Fifty Thousand Dollars ($17,350,000) divided by (b) the Average Pre-Closing Price of Parent Common Stock (the "Escrow Release Date. The Escrow Deposit shall Shares") to be held and disbursed by the Escrow Agent in accordance with an the Escrow Agreement. If For purposes of this Agreement and any Collateral Documents, the Closing occurs, term Escrow Shares shall include the shares referred to in the immediately preceding sentence and any additional shares of Parent agrees that Common Stock to be deposited with the right to indemnification Escrow Agent pursuant to Section 19.1(a) of this Article XII shall constitute Parent’s sole Agreement, if any. Xxxxx and exclusive remedy each Target Shareholder will be deemed, without any action on the part of Xxxxx or such Target Shareholder, to have received and recourse against deposited with the Escrow Agent pursuant to the Escrow Agreement a number of Escrow Shares representing Xxxxx'x or such Target Shareholder's proportionate interest in the Escrow Shares (the proportionate interest of Xxxxx and each of the Target Shareholders for Losses attributable in the Escrow Shares being hereinafter referred to as such Person's "Escrow Percentage"). All shares of Parent Common Stock to be received by Xxxxx and the Target Shareholders in connection with the Xxxxx Interest Purchase and the Mergers, as the case may be, other than the Escrow Shares will be distributed to Xxxxx and the Target Shareholders pursuant to the relevant Sections of Articles I through X and Section 11.5 of this Agreement. Xxxxx'x and each Target Shareholder's Escrow Percentage will be determined based on (i) the number of shares of Parent Common Stock issuable hereunder to Xxxxx or such Target Shareholder, as the case may be, divided by (ii) the aggregate number of shares of Parent Common Stock issuable hereunder to Xxxxx and all of the Target Shareholders in the aggregate. The Escrow Shares will be represented by a certificate registered in the name of the nominee of the Escrow Agent (with Xxxxx and each Target Shareholder being the beneficial owner of Xxxxx'x or such Target Shareholder's Escrow Percentage). To the extent that any Indemnifiable Matters. Except dividend or distribution, or other transaction, with respect to the Excluded Obligations the maximum aggregate Escrow Shares results in a liability for Tax, such Tax liability will be that of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit Xxxxx and the maximum aggregate liability of the Target Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited in proportion to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Xxxxx'x or each Target Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000's Escrow Percentage), and (e) for Section 3.12 Indemnifiable Matters arising during not of Parent or Xxxxx Acquisition or of any Surviving Corporation. Any and all voting rights with respect to the period beginning on Escrow Shares will be exercisable by Xxxxx or the day after Target Shareholders, as the thirty (30) month anniversary case may be, or their authorized agent as of the Closing Date Effective Time. Parent, the Company, the Merger Subs, Xxxxx Acquisition, the Target Companies, the Target Shareholders and continuing until Xxxxx hereby agree and acknowledge that the thirty six (36) month anniversary Escrow Shares will be treated as transferred to and owned by the Target Shareholders and Xxxxx as of the Closing Date, the maximum liability of each Stockholder shall Effective Time and at all times thereafter for all Tax purposes. The Escrow Shares will be limited used to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes satisfy indemnity claims made by Parent pursuant to Section 18.2(d) and Section 20.2 of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Merger Agreement (E Trade Group Inc)

Escrow. As the sole remedy for the indemnification obligations set forth in Article VIII of this Agreement, an aggregate number of shares of Ascend Common Stock to be received by the holders of Kitara Media Membership Units and shares of NYPG Common Stock, allocated pro rata amongst such holders, representing ten percent (10%) of the shares of Ascend Common Stock to be received by the holders of Kitara Media Membership Units and shares of NYPG Common Stock as a result of the Mergers pursuant to this Agreement, shall be deposited into escrow (the “Escrow Shares), in accordance with the terms and conditions of the escrow agreement to be entered into at the Closing between Ascend, the Committee (defined below), the Representatives (defined below) and Continental Stock Transfer & Trust Company, as escrow agent (“Escrow Agent”), in form and substance mutually and reasonably agreed to by Ascend, Kitara Media and NYPG and providing for the terms contemplated by Article VIII hereof (the “Escrow Agreement”). The Escrow Deposit Agreement shall be held by provide that, on the 5th business day after Ascend is required to file with the SEC its Annual Report on Form 10-K for the fiscal year ending December 31, 2013 (the “Escrow Release Date”), the Escrow Agent shall release the Escrow Shares to the Signing Holders in the same proportions as originally deposited into escrow, less, for a period ending each of the Kitara Signing Holder and the NYPG Signing Holders, the net of (i) that portion of such Signing Holders’ proportion of the Escrow Shares applied in satisfaction of or reserved with respect to indemnification claims made pursuant to Section 8.1(a) of this Agreement attributable to Kitara Media, in the case of the Kitara Signing Holder’s proportion, and to NYPG, in the case of the NYPG Signing Holders’ proportion, and (ii) that portion of the Escrow Shares applied in satisfaction of or reserved with respect to indemnification claims made pursuant to Section 8.2(a). Any Escrow Shares due to be released on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary that continue to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually unresolved Ascend Escrow Claim shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited delivered to the Cash Consideration (and for Signing Holders in the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited same proportions as originally deposited into escrow, promptly upon such resolution, subject to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Datereduction, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000)if any, (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, herein for the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability indemnification obligation associated with respect thereto shall be limited to forfeiting such unvested sharesresolved Ascend Escrow Claim.

Appears in 1 contract

Samples: Merger Agreement (Ascend Acquisition Corp.)

Escrow. The As the sole remedy for the indemnification obligations set forth in Article VII of this Agreement and Article VII of the APA, an aggregate of ten percent (10%) of the GGAC Ordinary Shares to be issued to the Sellers hereunder and thereunder (the “Escrow Deposit Shares”) shall be held by deposited in escrow, which shall be allocated among the Sellers in the same proportion as the number of GGAC Ordinary Shares being issued to them hereunder and thereunder, provided that in the event a Seller’s pro rata portion of the Escrow Shares results in a fractional number of GGAC Ordinary Shares, any fraction that is less than one half will be rounded down to the next whole number and any fraction that is one half or more will be rounded up to the next whole number, all in accordance with the terms and conditions of an escrow agreement to be entered into at the Closing between GGAC, the Representative and Continental Stock Transfer & Trust Company (“Continental”), as escrow agent (“Escrow Agent”), substantially in the form of Exhibit C hereto (the “Escrow Agreement”). On the date (the “Escrow Termination Date”) that is five business days after the day upon which GGAC is required to file its annual report pursuant to the Exchange Act (as hereinafter defined) for its 2015 fiscal year, the Escrow Agent for a period ending on shall release all of the Escrow Release DateShares, except the less that number of Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy Shares applied in satisfaction of, or reserved with respect to, indemnification claims for indemnification which are the subject to a Claims Notice delivered made prior to such date, to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent Sellers in accordance with an each Seller’s pro rata share of the Purchase Consideration; provided that in no event shall the Escrow AgreementTermination Date be later than April 15, 2016. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except Any Escrow Shares held with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually unresolved claim for indemnification and not applied as indemnification with respect to such claim upon its resolution shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited delivered to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to Sellers promptly upon such Shareholderresolution in accordance with each Seller’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his pro rata share of the Restricted Equity Purchase Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Share Purchase Agreement (Garnero Group Acquisition Co)

Escrow. The (a) At the Closing, Parent shall on behalf of the Principal Securityholders, deposit the Cash Escrow Deposit shall be held by Amount and shares of Parent Common Stock (the "Escrowed Shares") representing the Stock Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent Amount in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations Section 2.2(b)(iii) (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled Escrow Amount and Escrowed Shares, the "Escrowed Property") with the Escrow Agent to be held in an escrow account (the "Escrow Account") pursuant to and for an Employee Shareholder in accordance with this Agreement and the value of his share Escrow Agreement to be executed as of the Restricted Equity Consideration)Closing Date. Any payment the Principal Securityholders are obligated to make to any Parent Indemnified Parties pursuant to this Article IX (other than Sections 9.2(a)(ii) and 9.6) or Article X (at Parent's option) shall be paid (i) if the payment is to be made in cash, by reducing the amount of the cash in the Escrow Account in an amount equal to such payment and releasing such cash to Parent or (ii) if the payment is to be made in Escrowed Shares, by reducing the number of Escrowed Shares in the Escrow Account in an amount equal to (x) the amount of such payment divided by (y) the average closing price of Parent Common Stock on the Nasdaq (as reported by The Wall Street Journal, Eastern Edition, or, if not reported thereby, any other authoritative source) for the ten (10) trading days ending with the second trading day immediately preceding the date such Escrowed Shares are released and returning and releasing such Escrowed Shares to Parent. The maximum aggregate liability first $5,000,000 of Escrowed Property required to be paid by the Principal Securityholders shall be paid out of the Stockholders for Escrowed Shares. The next $5,000,000 of Escrowed Property required to paid the Section 3.12 Indemnifiable Matters by Principal Securityholders shall be limited out of the Cash Escrow Amount. Any remaining amounts of Escrowed Property required to be paid by the Principal Securityholders shall be paid out of the remaining Escrowed Property. (b) To the extent that there is an insufficient amount of remaining Escrowed Property to pay any remaining sums due pursuant to this Article IX (other than Sections 9.2(a) (ii) and 9.6) or Article X, then the Principal Securityholders shall be required to pay all of such additional sums due and owing to the Parent Indemnified Parties by wire transfer of immediately available funds within thirty (30) days after the date of notice any sums then due and owing is given to the Stockholder Representative (with a copy to the Escrow Agent) by the applicable Parent Indemnified Party. Any indemnification owed by a Principal Securityholder pursuant to Section 9.2(a)(ii) shall be paid by such Principal Securityholder to the Parent Indemnified Parties by wire transfer of immediately available funds within ten (10) Business Days after the date of notice any sums then due and owing is given to such Principal Securityholder (with a copy to the Stockholder Representative) by the applicable Parent Indemnified Party. (c) On December 31, 2006, the Escrow Agent shall release one-third of the Escrowed Shares (based upon the number of Escrowed Shares originally deposited with Escrow Agent or the proceeds thereof pursuant to Section 9.5(d)) less the number of such Escrowed Shares as follows: may be necessary to satisfy in full all unpaid Escrow Claims and less all Escrowed Shares previously disbursed to Parent; on June 30, 2007, the Escrow Agent shall release two-thirds of the Escrowed Shares (a) for based upon the number of Escrowed Shares originally deposited with Escrow Agent or the proceeds thereof pursuant to Section 3.12 Indemnifiable Matters arising during 9.5(d)), less the period beginning number of such Escrowed Shares as may be necessary to satisfy in full all unpaid Escrow Claims and less the aggregate of all Escrowed Shares previously disbursed to Parent or released; and on the Closing Date and continuing until the twelve (12) month second anniversary of the Closing Date, the maximum liability Escrow Agent shall release the remaining Escrowed Property and earnings thereon (in each case, to the extent not utilized to pay Parent for any indemnification claim), except that the Escrow Agent shall retain an amount of each Stockholder Escrowed Property equal to the amount of claims for indemnification under this Article IX or Article X. The Escrowed Property retained for unresolved claims for indemnification shall be limited released by the Escrow Agent (to the extent not utilized to pay Parent for any such Stockholder’s Pro Rata Portion claims resolved in favor of Five Million Dollars ($5,000,000)Parent) upon their resolution in accordance with this Article IX, (b) for Section 3.12 Indemnifiable Matters arising during 2.5 or Article X. For the period beginning on avoidance of doubt, the day release of the Escrow Property to the Principal Securityholders after the twelve (12) month second anniversary of the Closing Date and continuing until the eighteen (18) month anniversary pursuant to this Section 9.5 shall not prejudice any of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary rights of the Closing Date and continuing until Parent Indemnified Parties to seek indemnification from the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), Principal Securityholders under this Agreement. (d) for Section 3.12 Indemnifiable Matters arising during If and to the period beginning on extent permitted under the day after Registration Rights Agreement, the twenty-four (24) month anniversary Principal Securityholders may, at their option, instruct the Escrow Agent to sell all or any portion of the Closing Date Escrowed Shares on their behalf and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit Agent shall be equal to sell such Escrowed Shares and deposit the percentage of proceeds from any such sales in the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrow Account.

Appears in 1 contract

Samples: Merger Agreement (Gentiva Health Services Inc)

Escrow. The On the Closing Date, Purchaser will deposit in escrow with the Escrow Deposit Agent, on behalf of and in the name of the Stockholders, certificates representing fifteen (15%) percent of the number of whole shares of Purchaser Common Stock, comprised of 15% of the Unvested Shares and 15% of the unrestricted shares of Purchaser Common Stock, that such Stockholders have the right to receive pursuant to the provisions of Section 1.8 (the "Escrow Shares"). Two-thirds of the Escrow Shares so deposited shall be retained by the Escrow Agent, pursuant to the Escrow Agreement, to secure the Stockholders' indemnification and certain other obligations to Purchaser, for a period of 1 year after the Closing Date and shall be available to Purchaser to satisfy claims in accordance with Section 9; provided, however that if an indemnification claim is pending at the expiration of such 1 year period, the Escrow Agent shall retain a number of Escrow Shares required to satisfy such claim(s) until resolution of such claim(s). The remaining one-third of the Escrow Shares so deposited shall be retained by the Escrow Agent, pursuant to the Escrow Agreement, to secure the Stockholders' indemnification obligations pursuant to Section 9.2(a)(vi) for a total of four (4) years after the Closing Date and shall be available to Purchaser in accordance with Section 9; provided, however that if an indemnification claim is pending at the expiration of such 4 year period, the Escrow Agent shall retain a number of Escrow Shares required to satisfy such claim(s) until resolution of such claim(s). Where a Stockholder includes in its deposit of Escrow Shares, Unvested Shares together with other shares of Purchaser Common Stock that are not restricted, the shares deposited that are not restricted shall be used to satisfy claims made pursuant to Section 9, if any, before Unvested Shares are so used. Escrow Shares that are Unvested Shares shall vest on the same vesting schedule as Unvested Shares held outside of escrow. At such time as any Stockholder is entitled to a release of Escrow Shares from escrow any such release by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion terms of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Exchange Agreement (Nortel Networks Corp)

Escrow. (i) At Closing, the Buyer will (in accordance with Section 2.1(d)(ii)(B)) deliver to the Escrow Agent the Escrow Amount to be held in escrow pursuant to the Escrow Agreement and to be disbursed in accordance with the terms of this Agreement and the Escrow Agreement. The Escrow Deposit Account, together with any interest and earnings thereon, shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed released by the Escrow Agent to the Surviving Corporation, the Paying Agent or the Buyer, as applicable, in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion terms of the Escrow Deposit and the maximum aggregate liability Agreement. (ii) Any portion of the Shareholders collectively Escrow Fund disbursed pursuant to the Escrow Agreement for the Excluded Obligations (other than benefit of the Section 3.12 Indemnifiable Matters) Company Equityholders or parties to Transaction Incentive Compensation Agreements set forth on Schedule 10, shall be limited disbursed in accordance with this Section 2.1(e)(ii). A portion of such disbursed amount equal to the Cash Consideration (and for amount due under the Employee Shareholders also Transaction Incentive Compensation Agreements set forth on Schedule 10 on account of payments from the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited Escrow Fund, as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning set forth on the Closing Date and continuing until the twelve Allocation Schedule (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited subject to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as reduction pursuant to the Escrow Deposit Agreement), shall be equal paid by the Escrow Agent to the percentage Surviving Corporation pursuant to the terms of the Merger Consideration Escrow Agreement for payment to which such Shareholder is entitled as the parties to the Transaction Incentive Compensation Agreements set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration 10 (which amount shall be valued paid by the Surviving Corporation to such holder, subject to any applicable withholding as provided in Section 2.7). A portion of such disbursed amount equal to the Escrow Pro Rata Share (irrespective after taking into account amounts due under the Transaction Incentive Compensation Agreements set forth on Schedule 10 on account of vestingpayments from the Escrow Fund) based on the Closing Market Pricethat is represented by each share of Company Stock, and as to shares not yet vested other than Series B Preferred Stock, converted pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto 2.1(c) shall be limited paid by the Escrow Agent to forfeiting the Paying Agent pursuant to the terms of the Escrow Agreement for payment to the holder thereof. A portion of such unvested sharesdisbursed amount equal to the Escrow Pro Rata Share that is represented by each Company Option (after taking into account amounts due under the Transaction Incentive Compensation Agreements set forth set forth on Schedule 10 on account of payments from the Escrow Fund) shall be paid by the Escrow Agent to the Surviving Corporation pursuant to the terms of the Escrow Agreement for payment to the holder thereof (which amount shall be paid by the Surviving Corporation to such holder, subject to any applicable withholding as provided in Section 2.7).

Appears in 1 contract

Samples: Merger Agreement (Demandware Inc)

Escrow. (a) The Escrow Deposit shall Amount will be held, invested and distributed in accordance with the terms of the Escrow Agreement and this Agreement. Pursuant to and subject to the restrictions set forth in the Escrow Agreement, the Sellers’ Representative will have sole authority to direct the investment of the Escrow Amount to any investments with a level of risk appropriate for bank escrow accounts. The Escrow Amount will be held by the Escrow Agent as partial security for the obligations of the Seller Parties under this Agreement, including, without limitation, any obligations pursuant to Section 1.11 (Closing Net Working Capital), Section 5.10 (Accounts Receivable) and Section 7.1 (Seller Parties’ Agreement to Indemnify). (b) On the date that is nine months following the Closing Date (or the next Business Day thereafter if such date is not a period ending Business Day), an amount equal to (A) 50% of the Escrow Amount minus (B) the sum of (i) the aggregate amount of any asserted but unresolved claims made on the Escrow Amount by the Buyer Entities (or a Buyer Indemnified Party) hereunder, and (ii) the aggregate amount paid from the Escrow Amount on or before such date in satisfaction of any claims by the Buyer Entities (or a Buyer Indemnified Party) hereunder, shall be paid to an account or accounts designated in writing by the Sellers’ Representative on behalf of the Seller Parties. On the date that is 18 months following the Closing Date (or the next Business Day thereafter if such date is not a Business Day) (the “Second Escrow Release Date”), the remainder of the Escrow Amount then held by the Escrow Agent pursuant to the Escrow Agreement, less the aggregate amount of any asserted but unresolved claims made on the Escrow Amount by the Buyer Entities (or a Buyer Indemnified Party) hereunder, if greater than zero, (the “Remaining Escrow Amount”) will be paid to an account or accounts designated in writing by the Sellers’ Representative on behalf of the Seller Parties; provided, however, if as of the Second Escrow Release Date, except a remediation plan has not been approved in writing by all applicable Governmental Authorities with jurisdiction over environmental contamination at the Houston Facility, an amount equal to the Remaining Escrow Amount less $1,000,000, if greater than zero, will be paid to an account or accounts designated by the Sellers’ Representative for the benefit of the Seller Parties. If, pursuant to the preceding sentence, any portion of the Escrow Deposit may be withheld after Amount remains in escrow following the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Second Escrow Release Date. The , the remainder of the Escrow Deposit shall be Amount then held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occursAgent, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to less the aggregate amount of any asserted but unresolved claims made on the Cash Consideration which such Shareholder is entitled Escrow Amount by the Buyer Entities (and or a Buyer Indemnified Party) hereunder, if greater than zero, shall be paid to an account or accounts designated by the Sellers’ Representative, for an Employee Shareholder the value of his share benefit of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” Seller Parties following written approval of a Shareholder as to any Losses or as to remediation plan by all applicable Governmental Authorities with jurisdiction over environmental contamination at the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesHouston Facility.

Appears in 1 contract

Samples: Purchase Agreement (Enpro Industries, Inc)

Escrow. The Escrow Deposit shall be held by Parent will deposit 1,500,000 shares of the Merger Consideration Shares with the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an the Escrow Agreement. If Each holder of a Company Stock Certificate and Gary Xxxxxxxxx (xxch an "Escrow Stockholder") will be deemed, without any act of such Escrow Stockholder, to have received and deposited with the Closing occurs, Parent agrees that the right to indemnification Escrow Agent pursuant to this Article XII shall constitute Parent’s sole the Escrow Agreement a number of Merger Consideration Shares representing such Escrow Stockholder's proportionate interest in the Escrow Shares ("Escrow Percentage"). Each Escrow Stockholder's Escrow Percentage will be determined based on (a) the number of Merger Consideration Shares issuable hereunder with respect to all Company Stock Certificates held by such Escrow Stockholder (together, in the case of Gary Xxxxxxxxx, xxth the Stevxxxxx Xxxpensation Shares) divided by (b) the sum of (i) the aggregate number of Merger Consideration Shares issuable hereunder with respect to all Company Stock Certificates held by all Escrow Stockholders and exclusive remedy and recourse against (ii) the Shareholders for Losses attributable to Stevxxxxx Xxxpensation Shares. The Escrow Shares will be represented by a certificate registered in the name of the nominee of the Escrow Agent (with each Escrow Stockholder being the beneficial owner of such Escrow Stockholder's Escrow Percentage). To the extent that any Indemnifiable Matters. Except dividend or distribution, or other transaction, with respect to the Excluded Obligations the maximum aggregate Escrow Shares results in a liability of any Shareholder individually shall for Tax, such Tax liability will be limited to such Shareholder’s Pro Rata Portion that of the Escrow Deposit and Stockholders (in proportion to each Escrow Stockholder's proportionate interest in the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000Escrow Shares), and (e) for Section 3.12 Indemnifiable Matters arising during not of Parent or the period beginning on the day after the thirty (30) month anniversary of the Closing Date Company. Any and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as all voting rights with respect to the Escrow Deposit shall Shares will be equal to exercisable by the percentage Escrow Stockholders or their authorized agent as of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3Effective Time. For purposes of Article XIIParent, the Restricted Equity Consideration shall Company and the Escrow Stockholders hereby agree and acknowledge that the Escrow Shares will be valued (irrespective treated as transferred to and owned by the Escrow Stockholders as of vesting) based on the Closing Market Price, Effective Time and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesat all times thereafter for all Tax purposes.

Appears in 1 contract

Samples: Merger Agreement (Quokka Sports Inc)

Escrow. The (a) Acquiror will withhold $3,600,000 of the Total Consideration (the “Base Escrow Deposit shall Amount”) that would otherwise be delivered to the Company Securityholders pursuant to this Agreement and will deliver such Base Escrow Amount to the Escrow Agent to be held by the Escrow Agent as security for a period ending on the indemnification obligations under Article 8 and pursuant to the provisions of the Escrow Release DateAgreement in substantially the form attached hereto as Exhibit D (the “Escrow Agreement”) that is being entered into as of the Effective Time by Acquiror, except the Escrow Deposit may be withheld after Agent, the Company and the Stockholders’ Agent. (b) In addition to the Base Escrow Release Date for so long Amount, Acquiror will withhold an additional amount of the Total Consideration as is reasonably necessary to satisfy claims for indemnification which are set forth under the subject to a Claims Notice delivered prior caption “Total Supplemental Escrow Amount” on Schedule 1.10(b) hereof (the “Supplemental Escrow Amount”) and will deliver such Supplemental Escrow Amount to the Escrow Release Date. The Escrow Deposit shall Agent to be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If as additional security for the Closing occurs, Parent agrees that the right to indemnification obligations under Article 8 and pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except provisions of the Escrow Agreement with respect to Damages resulting from any breach of Sections 2.3, 2.32, 2.34 and 3.1, and any Dissenting Share Payments pursuant to Section 1.9. Notwithstanding the Excluded Obligations foregoing, in the maximum aggregate liability of event that any Shareholder individually shall be limited Company Stockholder listed on Schedule 1.10(b) delivers its Stockholder Acknowledgement and Waiver prior to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, then the maximum liability of each Stockholder Supplemental Escrow Amount shall be limited reduced by an amount equal to the value set forth opposite such Company Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (bname on Schedule 1.10(b) for Section 3.12 Indemnifiable Matters arising during under the period beginning on caption “Supplemental Escrow Amount,” and the day after portion so reduced shall be included in the twelve (12) month anniversary portion of the Closing Date and continuing until Total Consideration to be paid in accordance with Section 1.11. The aggregate Base Escrow Amount plus the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder Supplemental Escrow Amount shall be limited referred to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), as the “Escrow Amount.” (c) for Section 3.12 Indemnifiable Matters arising during The Escrow Amount held in escrow to secure the period beginning on the day after the eighteen (18) month anniversary indemnification obligations of the Closing Date and continuing until Company Securityholders under the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder Escrow Agreement shall be limited referred to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during as the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesFund.

Appears in 1 contract

Samples: Merger Agreement (Efj Inc)

Escrow. The Escrow Deposit shall be held by At the Closing, Buyer, Seller and the Escrow Agent for a period ending on will enter into the Escrow Release DateAgreement, except pursuant to which Buyer will deliver the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior Amount to the Escrow Release DateAgent, to be held in escrow (“Escrow”) as provided in this Agreement and the Escrow Agreement. The Escrow Deposit shall Amount will be held and disbursed by the Escrow Agent used, in accordance with an the terms of this Agreement and the Escrow Agreement, to pay indemnity obligations of Seller in accordance with Article IX and Pre-Closing Deductions in accordance with Section 3.7. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect Subject to the Excluded Obligations the maximum aggregate liability terms of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of this Agreement and the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning Agreement, on the Closing Date and continuing until the twelve (12) 18 month anniversary of the Closing Date, the maximum liability Escrow Amount (plus all earnings on such Escrow Amount, less the aggregate amounts released from Escrow through such date in respect of each Stockholder shall be limited to such StockholderSeller’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for indemnification obligations under Article IX and Pre-Closing Deductions under Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date3.7, the maximum liability amount of each Stockholder shall any such indemnification Claims or Pre-Closing Deductions resolved but remaining unpaid as of such date and any amounts with respect to other indemnification Claims against Seller under Article IX or Pre-Closing Deductions in accordance with Section 3.7 then pending) will be limited released to Seller. The amounts of any such Stockholder’s Pro Rata Portion indemnification obligations of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during Seller or Pre-Closing Deductions resolved but remaining unpaid will be released in accordance with the period beginning on terms of this Agreement and the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000)Escrow Agreement, and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on amounts of any such other indemnification Claims against Seller or any Pre-Closing Deductions then pending will be released to Seller or Buyer in accordance with the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes terms of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to Agreement and the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesAgreement.

Appears in 1 contract

Samples: Asset Purchase Agreement (Scott's Liquid Gold - Inc.)

Escrow. The At the Closing, Buyer will deposit or cause to be deposited the Escrow Deposit shall Amounts by wire transfer of immediately available funds with Wilmington Trust (the “Escrow Agent”), with such funds to be held by the Escrow Agent for in two (2) segregated, non-interest bearing accounts. The Adjustment Escrow Amount will be held in a period ending on separate account (the “Adjustment Escrow Account”) to secure the obligations of Seller under Section 2.3. The Indemnity Escrow Amount shall be held in a separate account (the “Indemnity Escrow Account”) to secure the indemnification obligations of Seller under ARTICLE VIII. The Escrow Amounts, as adjusted pursuant to the terms hereof, shall only be released by the Escrow Release Date, except Agent pursuant to joint written instructions executed by Buyer and Seller pursuant to this Agreement and the Escrow Deposit may Agreement or by a final, non-appealable order of a court of competent jurisdiction. The Adjustment Escrow Amount shall be withheld distributed in accordance with Section 2.3(g). On the date that is eighteen (18) months after the Closing Date (the “Indemnity Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior Termination Date”), Buyer and Seller shall execute and deliver joint written instructions to the Escrow Release DateAgent instructing the Escrow Agent to disburse to an account or accounts designated by Seller, an amount equal to (a) all amounts then remaining in the Indemnity Escrow Account, minus (b) the aggregate amount of any claims for indemnifiable Losses properly and timely made by Buyer pursuant to ARTICLE VIII prior to such date that have yet to be paid, are in dispute or as to which any Third-Party Claims are pending (in each case, “Pending Claims”). The applicable amount of any Pending Claims as of the Indemnity Escrow Deposit Termination Date shall continue to be held and disbursed by the Escrow Agent in the Indemnity Escrow Account until such time as each such Pending Claim is resolved, at which time the amount of such Pending Claim shall be disbursed to Seller and/or Buyer from the Indemnity Escrow Account in accordance with an the resolution of such Pending Claim. Within five (5) days after the resolution of each Pending Claim, Buyer and Seller shall deliver joint written instructions to the Escrow Agreement. If Agent to disburse the Closing occurs, Parent agrees that amount remaining in the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except Indemnity Escrow Account with respect to such Pending Claim in accordance with the Excluded Obligations the maximum aggregate liability resolutions of such Pending Claim. The parties hereto agree that any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion fees of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) Agent shall be limited to the Cash Consideration (borne equally by Buyer and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration)Seller. The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning Such fees that are payable by Seller on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during deducted from the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested amount payable by Buyer pursuant to Section 7.8 3.2. As between Buyer and Seller, in the Employee Shareholders’ liability with respect thereto event of any discrepancy between this Section 2.4 and the Escrow Agreement, this Section 2.4 shall be limited to forfeiting such unvested sharescontrol.

Appears in 1 contract

Samples: Equity Purchase Agreement (Nano Dimension Ltd.)

Escrow. The Escrow Deposit shall be held by (a) As security for the indemnification obligations set forth herein, promptly following the Effective Time, Parent will deliver to an escrow agent (the "ESCROW AGENT"), from the shares of Parent Common Stock otherwise deliverable pursuant to Sections 2.2, an amount equal to 50% of such shares (the "ESCROW FUND"). Such delivery and payment to the Escrow Agent for a period ending on shall be under an Escrow Agreement (the "ESCROW AGREEMENT") in substantially the form attached as EXHIBIT C between Parent, the Escrow Release Date, except Agent and the Escrow Deposit may be withheld after person representing and acting on behalf of the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are Shareholders (the subject to a Claims Notice delivered "SHAREHOLDER REPRESENTATIVE") dated on or prior to the Escrow Release Closing Date. The Escrow Deposit , and shall be held and disbursed made on behalf of each Shareholder pro rata in proportion to the total number of shares of Parent Common Stock to be received by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification such Shareholder pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against Sections 2.2. (b) On the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month first annual anniversary of the Closing Date, the maximum liability Escrow Agent will deliver 60% of each Stockholder shall be limited the Escrow Fund and any proceeds thereon to the Shareholder Representative on behalf of the Shareholders to an address or account in the United States designated by the Shareholder Representative to the Escrow Agent in writing at least ten business days prior to such Stockholder’s Pro Rata Portion date. The Escrow Agent may withhold from such delivery the equivalent of Five Million Dollars any amounts then in dispute relating to indemnification obligations arising under this Agreement or any other Transactional Agreement. ($5,000,000), (bc) for Section 3.12 Indemnifiable Matters arising during On the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month second annual anniversary of the Closing Date, the maximum liability Escrow Agent will deliver all shares of each Stockholder Parent Common Stock and proceeds thereof remaining in the Escrow Fund to the Shareholder Representative on behalf of the Shareholders to an address or account in the United States designated by the Shareholder Representative to the Escrow Agent in writing at least ten business days prior to such date. The Escrow Agent may withhold from such delivery the equivalent of any amounts then in dispute relating to indemnification obligations arising under this Agreement or any other Transactional Agreement; PROVIDED, that the withheld amount, to the extent not applied in satisfaction of indemnification obligations, shall be limited paid to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning Shareholder Representative on the day after the eighteen (18) month anniversary behalf of the Closing Date and continuing until the twenty-four (24) month anniversary Shareholders as described above promptly upon resolution of such dispute. Upon receipt of the Closing Dateremaining amount of the Escrow Fund, the maximum liability Shareholder Representative shall distribute the applicable amount of each Stockholder shall be limited Parent Common Stock and proceeds thereof to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), the Shareholders in accordance with their percentage contribution to the Escrow Fund. (d) for Subject to Section 3.12 Indemnifiable Matters arising during 12.2, nothing in this Section 2.7 shall be construed as limiting the period beginning on the day after the twenty-four (24) month anniversary liability of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as Shareholders to the property in the Escrow Deposit Fund, nor shall such property be equal to the percentage of the Merger Consideration to which such Shareholder is entitled considered as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesliquidated damages for any breach under this Agreement or any other Transactional Agreement.

Appears in 1 contract

Samples: Merger Agreement (National Information Consortium)

Escrow. Within ten (10) business days of Preliminary Approval, Burlington shall deposit the entire Settlement Amount into a special interest-bearing “Qualified Settlement Fund” (as defined in Section 1.468B-1(a) of the U.S. Treasury Regulations) account (the “Escrow Account”) established by the Settlement Administrator at Bank of America. The Escrow Deposit Settlement Amount shall be held by in the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the Account and subject to the terms and conditions of an escrow agreement and instructions, a Claims Notice delivered prior copy of which is attached as Exhibit H to this Settlement Agreement (the Escrow Release DateAgreement and Instructions”). The Escrow Deposit Burlington and the named Plaintiffs shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that have the right to indemnification pursuant to this Article XII shall constitute Parent’s sole audit amounts paid from the Escrow Account. The cost of settlement notice and exclusive remedy and recourse against the Shareholders for Losses attributable to claims administration (including any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion expenses of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable MattersSettlement Administrator) shall be limited paid from the Escrow Account following Preliminary Approval as needed. Class representative’s incentive awards, Class Counsel’s attorneys’ fees (as approved by the First Judicial District Court), reimbursement of Class Counsel of all actual expenses of the Action (as approved by the First Judicial District Court), any other litigation costs of Plaintiffs and all applicable taxes (including without limitation to New Mexico gross receipts taxes), if any, shall be paid from the Cash Consideration (and Escrow Account after Final Approval. The balance of the Net Settlement Amount shall be disbursed to Class Members as provided in the Court-approved Plan of Allocation after Final Approval. In no event, however, shall any money be disbursed to Class Members or paid out for class representatives’ incentive awards, Class Counsel’s attorneys’ fees, reimbursement of Class Counsel of actual expenses, reimbursement of other litigation costs of Plaintiffs, applicable taxes, if any, until the time for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited Parties to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested exercise their termination rights pursuant to Section 7.8 5.4 has passed without the Employee Shareholders’ liability Parties exercising such rights. Following Burlington’s deposit of the Settlement Amount into the Escrow Account in full, Burlington and the Section 29 entities shall have no liability, under any circumstances, to the Plaintiffs, Class Members, Class Counsel, or any other person in connection with respect thereto shall be limited to forfeiting the administration or distribution of such unvested sharesSettlement Amount.

Appears in 1 contract

Samples: Settlement Agreement

Escrow. The Of the Merger Consideration, (a) an amount equal to $8,000,000 (the “Escrow Deposit Amount”) and (b) an amount equal to the Securityholders’ Agent Fund, shall be held deposited by Parent at the Escrow Agent for a period ending on the Escrow Release DateClosing, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior by wire transfer of immediately available funds, into escrow pursuant to the Escrow Release Date. The Escrow Deposit shall be held terms of the escrow agreement by and disbursed by among Parent, the Securityholders’ Agent and the Escrow Agent in accordance with an the form attached hereto as Exhibit K (the “Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively ”) for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning commencing on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the ending twenty-four (24) month anniversary months thereafter (the “Escrow Period”) for the purpose of, with respect to the Escrow Amount, satisfying indemnification claims pursuant to Section 8 hereof and post-Closing adjustments to the Merger Consideration pursuant to Section 1.11 hereof. Each Effective Time Holder shall contribute to fifty percent (50%) of the Closing DateEscrow Amount and one hundred percent (100%) of the Securityholders’ Agent Fund, the maximum liability of each Stockholder shall be limited in proportion to such StockholderEffective Time Holder’s Pro Rata Portion Share of Three Million Dollars the Merger Consideration, and the Management Participants shall contribute to fifty percent ($3,000,00050%) of the Escrow Amount (pursuant to the terms of the Transaction Bonus Plan), (d) for Section 3.12 Indemnifiable Matters arising during each in proportion to such Management Participant’s Pro Rata Share of the period beginning Transaction Bonus Plan Amount, all in the amounts set forth on the day Payout Spreadsheet (such amounts, as to each Effective Time Holder, and the Management Participant in the aggregate, are sometimes referred to herein as the “Escrow Contribution” or the “Securityholders’ Agent Fund Contribution”, respectively). Upon the date ending twelve (12) months after the twenty-four (24) month anniversary of the Closing Date and continuing until (the thirty “Initial Escrow Release Date”), an amount equal to $2,000,000 minus the sum of (30A) month anniversary any portion of the Closing DateEscrow Amount previously released to the Indemnitees plus (B) the amount of all unresolved claims under Section 1.11 or Section 8, if any, shall be distributed to the Securityholders’ Agent, on behalf of each Effective Time Holder, and to Parent, on behalf of the Management Participants to be paid in accordance with the terms of the Transaction Bonus Plan, all based on their respective Escrow Contributions and in accordance with the terms of the Escrow Agreement. Upon the expiration of the Escrow Period (or on such later date as is specified in the Escrow Agreement), the maximum liability difference between (A) the then remaining balance of the Escrow Amount (the “Remaining Escrow Amount”) minus (B) the amount of all unresolved claims under Section 1.11 or Section 8, if any, shall be distributed to the Securityholders’ Agent, on behalf of each Stockholder Effective Time Holder, and to Parent, on behalf of the Management Participants to be paid in accordance with the terms of the Transaction Bonus Plan, all based on their respective Escrow Contributions and in accordance with the terms of the Escrow Agreement. Thereafter, after the resolution of all unresolved claims under Section 1.11 or Section 8, if any, the Remaining Escrow Amount shall be limited distributed to the Securityholders’ Agent, on behalf of each Effective Time Holder, and to Parent, on behalf of the Management Participants to be paid in accordance with the terms of the Transaction Bonus Plan, all based on their respective Escrow Contributions and in accordance with the terms of the Escrow Agreement. Parent shall use reasonable efforts to cause the portion of the Escrow Amount attributable to amounts that are compensatory in exchange for services rendered to the Company (the “Compensation Portion”), subject to any applicable withholding Tax, to be structured in a manner so that under applicable Tax law, such Stockholder’s Pro Rata amount is not subject to income Tax until distribution is made in accordance with the applicable terms of the Escrow Agreement. Parent and the Company shall cause such structure to be reflected in the terms of the Escrow Agreement. In addition, any amount to be paid from the Escrow Amount attributable to the Compensation Portion of $Two Million Dollars ($2,000,000), the Escrow Amount shall be administered and (e) for interpreted in accordance with Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary 409A of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesCode.

Appears in 1 contract

Samples: Merger Agreement (Netscout Systems Inc)

Escrow. (a) At the Closing, the Purchaser will deposit into an escrow account (the “Escrow Account”) established for such purpose with The Bank of New York Mellon (the “Escrow Deposit shall be held Agent”) pursuant to an escrow agreement by and among the Purchaser, the Company, the Stockholder Representative and the Escrow Agent for a period ending Agent, in substantially the form attached hereto as Exhibit I (the “Escrow Agreement”), $22,500,000 of the Merger Consideration (less, if applicable, the Initial Shortfall Amount), consisting of ratable portions (based on the allocation of the Merger Consideration between the Cash Merger Consideration and the Shares Merger Consideration set forth herein) of the Cash Merger Consideration (the “Cash Escrow Release DateDeposit”), except by wire transfer of immediately available funds into the Escrow Deposit may be withheld after Account, and the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are Shares Merger Consideration, valued at the subject to a Claims Notice delivered prior Purchaser Stock Price (the “Escrowed Shares”), by delivery of the stock certificates representing such shares, along with stock powers executed in blank, to the Escrow Release DateAgent. The Cash Escrow Deposit shall Deposit, together with any interest and other income earned thereon (collectively, the “Escrowed Funds”), along with the Escrowed Shares (collectively, the “Escrowed Merger Consideration”), will be held and disbursed by in the Escrow Agent Account to act as the exclusive source of payment of: (i) any Downward Post-Closing NWC Adjustment pursuant to Section 2.11(b); and (ii) the indemnification obligations (including Indemnified Taxes) of the Company Stockholders under Article VIII; provided that the indemnification obligations under Sections 8.2(a)(iv) and (v) may also be funded as provided in accordance with an Section 2.12. In addition, the Purchaser will be entitled to draw on $7,500,000 of the Escrowed Merger Consideration to fund certain post-closing employment-related obligations of the Company and of the Company Subsidiaries on the terms provided in the Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), . (b) for Section 3.12 Indemnifiable Matters arising during Escrowed Shares and Escrowed Funds shall be released ratably from the period beginning on Escrow Account. For all purposes under the day after Escrow Account, the twelve Escrowed Shares shall be valued at the Purchaser Stock Value. Notwithstanding anything to the contrary herein, no fraction of an Escrowed Share shall be released from the Escrow Account and all releases of Escrowed Shares shall be rounded to the nearest whole Escrowed Share. (c) On the 12) -month anniversary of the Closing Date (the “Initial Escrow Period Expiration Date”), an amount of Escrowed Merger Consideration equal in aggregate value to $7,500,000 (less, if applicable, the Initial Shortfall Amount) minus the sum of (i) the aggregate amount of unsatisfied or disputed claims for Losses specified in Indemnity Claim Notices delivered by the Purchaser to the Stockholder Representative on or prior to the Initial Escrow Period Expiration Date; and continuing until (ii) the eighteen (18) month anniversary aggregate amount of all satisfied claims for Losses paid to Purchaser Indemnified Parties on or prior to the Closing Initial Escrow Period Expiration Date, the maximum liability of each Stockholder shall be limited released by the Escrow Agent from the Escrow Account to such Stockholder’s Pro Rata Portion of Four Million Dollars the Paying Agent ($4,000,000for further distribution by the Paying Agent to the Company Stockholders pursuant to Section 2.10(b)(iii), (c) for Section 3.12 Indemnifiable Matters arising during ). On the period beginning on the day after the eighteen (18) 30-month anniversary of the Closing Date (the “Second Escrow Period Expiration Date”), an amount of Escrowed Merger Consideration equal to $15,000,000 (less, if applicable, the Initial Shortfall Amount) minus the amount of the Escrowed Merger Consideration previously released to the Paying Agent minus the aggregate amount of unsatisfied or disputed claims for Losses specified in Indemnity Claim Notices delivered to the Stockholder Representative between the Initial Escrow Period Expiration Date and continuing the Second Escrow Period Expiration Date (such aggregate amount of unsatisfied or disputed claims for Losses, the “Pending Claims Amount”), shall be released by the Escrow Agent from the Escrow Account to the Paying Agent (for further distribution by the Paying Agent to the Company Stockholders pursuant to Section 2.10(b)(iii)). The Escrow Agent shall continue to hold the Pending Claims Amount corresponding to each claim for Losses until the twenty-four (24) month anniversary final resolution of such claim, at which point, as and when such claim is resolved, the Escrow Agent shall release Escrowed Merger Consideration equal in value to the appropriate portion of the Closing DatePending Claims Amount to the Paying Agent (for further distribution by the Paying Agent to the Company Stockholders pursuant to Section 2.10(b)(iii)) and/or to the Purchaser, as the case may be, depending upon resolution of such claim. In addition, the maximum liability Purchaser will be entitled to draw up to $7,500,000 of each Stockholder shall the Escrowed Merger Consideration to fund certain post-Closing employment-related obligations of the Company and of the Company Subsidiaries on the terms provided in the Escrow Agreement. Any Escrowed Merger Consideration remaining in the Escrow Account after the later of (i) resolution of the last to be limited to resolved of such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (dclaim(s) for Section 3.12 Indemnifiable Matters arising during Losses and (ii) the period beginning on the day after the twenty-four fifth (245th) month anniversary of the Closing Date and continuing until shall be released by the thirty Escrow Agent from the Escrow Account to the Paying Agent (30for further distribution by the Paying Agent to the Company Stockholders pursuant to Section 2.10(b)(iii)). (d) month anniversary of the Closing DateThe Purchaser, the maximum liability of Company and the Stockholder Representative each Stockholder shall be limited agree to such Stockholder’s Pro Rata Portion of $Two Million Dollars promptly take commercially reasonable actions ($2,000,000), including executing and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as delivering joint written instructions to the Escrow Deposit shall be equal Agent) requested by the other to the percentage effect releases of the Escrowed Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XIIfrom the Escrow Account, in each case in accordance with this Agreement and the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrow Agreement.

Appears in 1 contract

Samples: Merger Agreement (Earthlink Inc)

Escrow. At the First Effective Time, Parent, Escrow Agent and the Stockholder Representatives shall have entered into an Escrow Agreement in substantially the form attached hereto as Exhibit E (the “Escrow Agreement”). The Escrow Deposit Amount will be withheld from (a) the Total Closing Consideration otherwise deliverable to Company Stockholders eligible to receive shares of Parent Common Stock pursuant to Section 2.1(a)(iii) above and deposited by Parent and (b) the cash amounts payable to Nonaccredited Holders pursuant to the Cancellation Agreements as set forth in Section 2.1(a)(iv), and shall be held by the Escrow Agent in escrow for a period ending on the payment of Damages to which any Parent Indemnified Person may be entitled under Article IX of this Agreement. At the First Effective Time, the Company Stockholders (other than Company Stockholders holding shares of Company Capital Stock which constitute Dissenting Shares) and the Nonaccredited Holders will be deemed to have received and deposited with the Escrow Release DateAgent the Parent Common Stock or cash, except as applicable, representing the Escrow Deposit may be withheld after Amount, without any action by the Company Stockholders or Nonaccredited Holders, in accordance with each such Person’s Escrow Release Date for so long as is reasonably necessary Pro Rata Share. Subject to satisfy any claims for indemnification which are made by the subject to a Claims Notice delivered prior Parent, the Escrow Amount shall be released (y) as shares of Parent Common Stock to the Company Stockholders and (z) as cash payments to the Nonaccredited Holders, in each case on the Expiration Date based on such Person’s Escrow Release DatePro Rata Share. The Approval by the Company Stockholders of this Agreement shall constitute approval of the Escrow Deposit shall be held Agreement and disbursed by all arrangements relating thereto, including without limitation the placement of the Escrow Amount with the Escrow Agent in accordance with an Escrow Agreement. If and the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion appointment of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled Stockholders’ Representatives as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to in Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares9.10 below.

Appears in 1 contract

Samples: Acquisition Agreement (Cell Therapeutics Inc)

Escrow. The (i) At the Closing, Buyer shall deliver or caused to be delivered, (A) by wire transfer of immediately available funds, the PPP Escrow Deposit shall Amount to Newtek Small Business Finance LLC (the “PPP Lender”), to be held deposited in an escrow account established pursuant to the terms and conditions of an escrow agreement substantially in the same form attached as Exhibit D (the “PPP Escrow Agreement”) and (B) by wire transfer of immediately available funds, the Working Capital Escrow Agent for Amount to Citi Bank, National Association (the “Escrow Agent”), in each case to be deposited in an escrow account established pursuant to the terms and conditions of an escrow agreement substantially in the same form attached as Exhibit E (the “Escrow Agreement”). Buyer, on one hand, and the Sellers (as a period ending Sellers Transaction Expense), on the Escrow Release Dateother hand, except shall each be responsible for one half (1/2) of the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held fees and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion expenses of the Escrow Deposit Agent. At the Closing, Buyer shall (i) retain the Indemnification Holdback Amount, which shall constitute a source of recovery for Damages owed to any Buyer Indemnified Party pursuant to Section 12 and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the any set off pursuant to Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration2.4(g)(i) and (ii) deliver or cause to be delivered, by wire transfer of any Shareholder individually for immediate available funds, the Excluded Obligations Sellers’ Representative Expense Amount to an account designated by the Sellers’ Representative. (other than ii) Promptly following the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled sixteen (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (1216) month anniversary of the Closing Date, Buyer shall deliver the maximum liability remaining shares of the Indemnification Holdback Amount that are not then validly claimed by Buyer in accordance with Section 12 of this Agreement to be owed to a Buyer Indemnified Party (with the value assigned to each Stockholder shall be limited Sangoma Common Share equal to such Stockholder’s Pro Rata Portion the per share closing price of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning a Sangoma Common Share on the day after TSX-V (or such other stock exchange on which the twelve Sangoma Common Shares are then listed and posted for trading) on the sixteen (1216) month anniversary of the Closing Date and continuing until Date) to Star2Star Holdings and, in the eighteen case of the Optionholder, the Company for delivery to the Optionholder in accordance with Section ‎2.2; provided that, promptly following the resolution of any claim for indemnification that is pending as of the sixteen (1816) month anniversary of the Closing Date, Buyer shall deliver the maximum liability applicable portion of each Stockholder the Indemnification Holdback Amount to Star2Star Holdings and, in the case of the Optionholder, the Company for delivery to the Optionholder in accordance with Section ‎2.2. Star2Star Holdings shall be limited entitled to such Stockholder’s Pro Rata Portion receive that number of Four Million Dollars ($4,000,000)all or the remaining, (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary as applicable, shares of the Closing Date and continuing until Indemnification Holdback Amount equal to: (A) the twenty-four (24) month anniversary product of the Closing Datenumber of the remaining shares of the Indemnification Holdback Amount, the maximum liability of each Stockholder multiplied by (B) its Deferred Consideration Percentage. The Optionholder shall be limited entitled to such Stockholder’s Pro Rata Portion receive that number of Three Million Dollars ($3,000,000)all or the remaining, (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary as applicable, shares of the Closing Date and continuing until Indemnification Holdback Amount equal to: (C) the thirty (30) month anniversary product of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary number of the Closing Date and continuing until the thirty six (36) month anniversary remaining shares of the Closing DateIndemnification Holdback Amount, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars multiplied by ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger D) its Deferred Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesPercentage.

Appears in 1 contract

Samples: Stock Purchase Agreement (Sangoma Technologies Corp)

Escrow. As the sole and exclusive remedy for the indemnity obligations set forth in Article VII, at the Effective Time, Parent will cause to be delivered to, and directly deposited with JPMorgan Chase Bank or such other escrow agent that is mutually agreeable to the parties (the "ESCROW AGENT"), for the account and future potential benefit of the Company's stockholders, a stock certificate representing ten percent (10%) of the shares of Parent Common Stock to be issued at Closing otherwise issuable to such holders pursuant to Section 1.6, which certificate shall be registered in the name of the Escrow Agent f/b/o the Former Holders of Capital Stock of XLNT Veterinary Care, Inc. In the event any additional shares of Parent Common Stock are issued in accordance with the requirements of Section 1.6(e), a stock certificate representing ten percent (10%) of the shares of Parent Common Stock to be so issued shall be delivered to and directly deposited with the Escrow Agent, which certificate shall be registered in the name of the Escrow Agent f/b/o the Former Holder of Capital Stock of XLNT Veterinary Care, Inc. All such shares of Parent Common Stock so delivered to the Escrow Agent, together with all subsequent dividends or distributions of cash, other shares of Parent Common Stock or property received in respect of such shares while deposited with the Escrow Agent shall be referred to as "ESCROW SHARES" and such account containing the Escrow Shares shall be referred to as the "ESCROW FUND." A pro rata number of the Escrow Shares (determined on the basis of the respective pro rata ownership interest of each holder of Company Common Stock immediately prior to the Effective Time, subject to adjustments by the Escrow Agent to eliminate fractional shares) shall be subtracted from the number of shares of Parent Common Stock each holder of Company Common Stock (including Company Common Stock issued upon conversion of Company Preferred Stock) at the Effective Time is entitled to receive pursuant to the Merger. The Escrow Deposit Shares shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior pursuant to the Escrow Release Date. The Escrow Deposit shall be held terms and disbursed by the Escrow Agent in accordance with conditions of an Escrow Agreement. If , the Closing occursform of which shall be reasonably acceptable to Parent and the Company (the "ESCROW AGREEMENT") among the Escrow Agent, Parent agrees that and the right to indemnification Stockholders' Representatives (as hereinafter defined) or the successors thereto pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion terms of the Escrow Deposit and Agreement. Subject to the maximum aggregate liability provisions of Article VII, the Escrow Shares shall be promptly delivered to the applicable Company stockholders upon expiration of the Shareholders collectively for the Excluded Obligations Survival Period (other than the as defined in Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration7.4(a). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Echo Healthcare Acquisition Corp.)

Escrow. In connection with the Closing, Parent, the Representative and JPMorganChase Bank, N.A. or another Person mutually satisfactory to Parent and the Company (the “Escrow Agent”) shall have executed and delivered an escrow agreement, in substantially the form attached hereto as Exhibit G (the “Escrow Agreement”), pursuant to which the Escrow Agent shall hold an escrow fund in an amount equal to the Escrow Consideration, together with interest (the “Escrow Fund”), until the Escrow Termination Date for the purposes of securing the payment of any Working Capital Deficit pursuant to Section 2.17 and any indemnification obligations of the Company Holders pursuant to Article X. Parent and the Representative shall provide a joint written instruction to the Escrow Agent of the date of the Escrow Termination Date under Section 2.2(b)(1) of the Escrow Agreement. The Parties will treat any escrow payment as taxable to a Company Holder only upon the release of the funds to such Company Holder and not earlier. Upon the termination of the Escrow Deposit shall Fund in accordance with the Escrow Agreement, the Escrow Consideration (less any Working Capital Deficit paid from the Escrow Fund pursuant to Section 2.17 and any indemnification obligations of the Company Holders paid from the Escrow Fund pursuant to Article X or continue to be held by the Escrow Agent for a period ending on pursuant to the terms of the Escrow Release DateAgreement) shall be distributed to the Company Holders in accordance with Sections 2.10, except 2.13 and 2.14 and the Escrow Deposit may be withheld after Agreement, and Parent and the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to Representative shall provide a Claims Notice delivered prior joint written instruction to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by Agent under Section 2.2(e) of the Escrow Agent in accordance with an Escrow Agreement. If The adoption of this Agreement and the Closing occursapproval of the transactions contemplated hereby, Parent agrees that including the right to indemnification pursuant to this Article XII Merger, by the stockholders of the Company shall constitute Parent’s sole approval of the Escrow Agreement and exclusive remedy and recourse against all arrangements related thereto, including the Shareholders for Losses attributable to any Indemnifiable Mattersdepositing of the Escrow Consideration into the Escrow Fund. Except Any interest accruing with respect to the Excluded Obligations Escrow Fund shall accrue to the maximum aggregate liability benefit of the Company Holders. The right of any Shareholder individually shall be limited Company Holder to such Shareholder’s Pro Rata Portion receive its portion of the Escrow Deposit and the maximum aggregate liability Fund, if any, (i) is an integral part of the Shareholders collectively consideration provided for in this Agreement, (ii) does not give the Excluded Obligations Company Holders dividend rights, voting rights, liquidation rights, preemptive rights or other rights of holders of capital stock of the Company, (iii) shall not be evidenced by a certificate or other instrument, (iv) shall not be assignable or otherwise transferable by such Company Holder, except by will, upon death or by operation of Law, and (v) does not represent any right other than the right to receive the consideration set forth in this Section 2.16. Any attempted transfer of the right to any portion of the Escrow Consideration by any holder thereof (other than as specifically permitted by the Section 3.12 Indemnifiable Mattersimmediately preceding sentence) shall be limited to the Cash Consideration (null and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesvoid.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Myriad Genetics Inc)

Escrow. (a) Tellabs and Occam shall enter into an escrow agreement substantially in the form of Exhibit G with the applicable escrow agent within ninety (90) days following the Effective Date. Tellabs shall bear the expense of such third party escrow arrangement. (b) The Escrow Deposit Materials for each BLC Product shall initially be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent escrow agent in accordance with an the terms of the escrow agreement following the first shipment of the generally available release of each such BLC Product by Tellabs. Thereafter, Occam will make, in accordance with the terms of the Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except an annual deposit of updated Escrow Materials with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion BLC Products then being manufactured by Tellabs. In addition, if a Release Condition occurs, Occam will provide Tellabs with then-current versions of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively Materials for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), BLC Product. (c) for Section 3.12 Indemnifiable Matters arising during The Escrow Materials will be released by the period beginning on escrow agent to Tellabs in accordance with the day after the eighteen (18) month anniversary terms of the Closing Date and continuing until escrow agreement if the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), Release Condition occurs. (d) for Section 3.12 Indemnifiable Matters arising during Subject to the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes terms of this AgreementAgreement and the escrow agreement, “Pro Rata Portion” of Occam hereby grants to Tellabs a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled non-exclusive, royalty-free, non-assignable (except as set forth on Schedule 2.3in Section 16.3), non-transferable, non-sublicenseable license to receive all Escrow Materials released to Tellabs in accordance with Section 2.9(c) and the terms of the Escrow Agreement and to use such Escrow Materials during the term of this Agreement solely to correct the design defects that are the subject of the Release Condition. For purposes of Article XIIOnce Tellabs corrects the design defects, this license will expire and Tellabs must promptly destroy the Restricted Equity Consideration shall be valued (irrespective of vesting) based on Escrow Materials. Tellabs must not use the Closing Market Price, and Escrow Materials for any other purpose. Tellabs must protect the Escrow Materials as Occam’s Confidential Information in accordance with Section 14. Occam must not disclose the Escrow Materials to shares not yet vested a third party. *** Confidential treatment requested pursuant to Section 7.8 a request for confidential treatment filed with the Employee Shareholders’ liability Securities and Exchange Commission. Omitted portions have been filed separately with respect thereto shall be limited to forfeiting such unvested sharesthe Commission.

Appears in 1 contract

Samples: Manufacturing License Agreement (Occam Networks Inc/De)

Escrow. The At the Effective Time, Acquirer shall withhold from the shares of Acquirer Common Stock to be issued to the Company Stockholders in the Merger upon conversion of their Company Stock pursuant to Section 2.2.2, each Company Stockholder's Pro Rata Share of that aggregate number of shares of Acquirer Common Stock having an aggregate value (based on the Acquirer Average Price Per Share) equal to 11.25% of the Total Consideration (such withheld shares of Acquirer Common Stock, the "Escrow Deposit Shares"). If a Company Stockholder holds Unvested Company Shares, then the shares of Acquirer Common Stock to be issued upon conversion hereunder of shares of Company Stock held by such Company Stockholder which are not Unvested Company Shares ("Vested Company Shares") shall be held withheld and placed in escrow first and, thereafter, the Unvested Company Shares shall be withheld and placed in escrow (with the understanding that any Unvested Company Shares so placed in escrow shall vest prior to any such Unvested Company Shares not placed in escrow) to the extent necessary to satisfy such Company Stockholders' escrow obligations as set forth in the first sentence of this Section 2.6. The payment of any Escrow Shares in satisfaction of any indemnification obligations under Article 11 shall be made, with respect to each Company Stockholder, first with Vested Company Shares and then, if such shares are insufficient to satisfy such indemnification obligation and only to the extent of such insufficiency, shall such payment be made with Unvested Company Shares. Any shares of Acquirer Common Stock or other equity securities issued or distributed by Acquirer (including shares issued upon a stock split, stock dividend, recapitalization or other similar event) in respect of Escrow Shares shall also be withheld in the Escrow Agent for a period ending Fund. Cash dividends on the Escrow Release Date, except the Escrow Deposit may Fund shall not be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior added to the Escrow Release Date. The Escrow Deposit Fund but shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect distributed to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion record holders of the Escrow Deposit and Fund. Acquirer shall hold the maximum aggregate liability of the Shareholders collectively Escrow Shares as security for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and Company Stockholders' indemnification obligations for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Damages under Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares11.

Appears in 1 contract

Samples: Merger Agreement (Netscreen Technologies Inc)

Escrow. The (a) In order to secure and to establish a procedure for the satisfaction of claims by Buyer and its related Indemnified Parties for indemnification pursuant to Article VII, as well as to establish an expense fund for the Stockholder Representative, concurrently with the execution and delivery of the Escrow Deposit shall be held by Agreement and pursuant to applicable provisions thereof, the Escrow Agent for a period ending on will establish three separate escrow accounts (the “Indemnity Escrow Release DateAccount,” the “Stockholder Claim Escrow Account” and the “SR Expense Account,” respectively, except and, collectively, the Escrow Deposit may be withheld after Accounts”) and, as of the Effective Time, the Indemnity Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior Account will hold an amount equal to the Indemnity Escrow Release DateAmount, the Stockholder Claim Escrow Account will hold an amount equal to the Stockholder Claim Escrow Amount, and the SR Expense Account will hold an amount equal to $200,000 (the “SR Expense Amount”), free of any Lien, encumbrance, or other claim of any creditor of any of the parties. The funds in the Indemnity Escrow Deposit shall Account and the SR Expense Account will be held and disbursed by the Escrow Agent released in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to terms of this Article XII shall constitute Parent’s sole Agreement and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively Agreement for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the a period beginning on the Closing Date and continuing until ending on the twelve first anniversary thereof (12) month anniversary of the Closing “Release Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) and the funds in the Stockholder Claim Escrow Account will be held and released in accordance with the terms of this Agreement and the Stockholder Claim Escrow Agreement for Section 3.12 Indemnifiable Matters arising during the a period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until ending on the eighteen date four (184) month anniversary of months thereafter (the Closing “Stockholder Claim Release Date”), each subject to extension as provided in Section 2.10(f) with respect to claims that remain subject to dispute on such date. On or prior to the maximum liability of each Closing, Buyer shall deposit, or cause to be deposited, with the Escrow Agent to be held (i) in the Indemnity Escrow Account an amount in cash equal to the Indemnity Escrow Amount, (ii) in the Stockholder Claim Escrow Account an amount in cash equal to the Stockholder Claim Escrow Amount and (iii) in the SR Expense Account an amount in cash equal to the SR Expense Amount. (b) The Indemnity Escrow Amount shall be limited deemed to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000)comprise a deposit, (c) for Section 3.12 Indemnifiable Matters arising during into a fund maintained in the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as Indemnity Escrow Account pursuant to the Escrow Deposit shall be equal to Agreement (the percentage “Indemnity Escrow Fund”), all on behalf of certain Stockholders receiving a portion of the Merger Consideration hereunder and the Bonus Plan Participants (each such Person initially allocated a portion of the Indemnity Escrow Fund pursuant to which such Shareholder is entitled this Section 2.10(a), an “Escrow Participant”), subject to Article VII, in respective initial amounts as set forth on Schedule 2.3. For purposes of Article XIIthe Certified Capitalization Table, the Restricted Equity Consideration which initial amounts shall be valued (irrespective of vestingi) based allocated between certain Stockholders in the aggregate, on the Closing Market Priceone hand, and the Bonus Plan Participants in the aggregate, on the other hand, in the same ratio as the Merger Consideration Amount bears to the Participant Payment Amount, (ii) allocated among the Bonus Plan Participants in proportion to their respective Bonus Plan Payment Amounts and (iii) allocated among certain Stockholders as follows: first, to the holders of the shares not yet vested of Company Series D Preferred Stock in proportion to their respective numbers of such shares, until the aggregate amount so allocated equals the excess of the Merger Consideration allocated with respect to the shares of Company Series D Preferred Stock over the portion of the SR Expense Fund initially allocated with respect to the shares of Company Series D Preferred Stock, and the remainder, if any, to the holders of Company Series E Preferred Stock in proportion to their respective numbers of such shares. The percentage of the Indemnity Escrow Fund so initially allocated to an Escrow Participant shall be referred to herein as such Escrow Participant’s “Escrow Percentage.” Any payment made from the Indemnity Escrow Fund to Indemnified Parties shall reduce the respective deemed deposits of the Escrow Participants in the Indemnity Escrow Fund in proportion to their respective Escrow Percentages. (c) The Stockholder Claim Escrow Amount shall be deemed to comprise a deposit, into a fund maintained in the Stockholder Claim Escrow Account pursuant to the Stockholder Claim Escrow Agreement (the “Stockholder Claim Escrow Fund”), all on behalf of the Stockholders that are Escrow Participants (each such Person initially allocated a portion of the Stockholder Claim Escrow Fund pursuant to this Section 7.8 2.10(c), a “Stockholder Claim Escrow Participant”), subject to Article VII, in respective initial amounts as set forth on the Employee Shareholders’ liability with respect thereto Certified Capitalization Table, which initial amounts shall be limited allocated to forfeiting the holders of the shares of Company Series D Preferred Stock in proportion to their respective numbers of such unvested shares. The percentage of the Stockholder Claim Escrow Fund so initially allocated to a Stockholder Claim Escrow Participant shall be referred to herein as such Stockholder Claim Escrow Participant “Stockholder Claim Escrow Percentage.” Any payment made from the Stockholder Claim Escrow Fund to Indemnified Parties shall reduce the respective deemed deposits of the Stockholder Claim Escrow Participants in the Stockholder Claim Escrow Fund in proportion to their respective Stockholder Claim Escrow Percentages.

Appears in 1 contract

Samples: Merger Agreement (Upland Software, Inc.)

Escrow. The (a) Pursuant to Section 2.2.3 and the Escrow Deposit Agreement, at the Closing, Federal shall be held by deliver to the Escrow Agent for a period ending on the Escrow Release DatePayment, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an shall set up the separate Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification Accounts pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion terms of the Escrow Deposit Agreement to secure the Stockholders’ and the maximum aggregate liability of Shadow Stockholders’ indemnification obligations under this Section 6.2. Within ten (10) Business Days following the Shareholders collectively for the Excluded Obligations first (other than the Section 3.12 Indemnifiable Matters1st) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month year anniversary of the Closing Date and continuing until (the eighteen (18) month anniversary “Initial Escrow Distribution Date”), the Escrow Agent shall, pursuant to the terms of the Closing DateEscrow Agreement, deliver (i) to the maximum liability Non-ESOP Stockholders’ Representative an amount out of each Stockholder Xxxxxxx X. Xxxx’x Escrow Account equal to his share (based upon his Equity Holder Pro Rata Percentage) of the Initial Escrow Distribution (as hereinafter defined), if any, (ii) to the Non-ESOP Stockholders’ Representative an amount out of the Trust’s Escrow Account equal to its share (based upon its Equity Holder Pro Rata Percentage) of the Initial Escrow Distribution, if any; (iii) to the Non-ESOP Stockholders’ Representative an amount out of the Shadow Stockholders’ Escrow Account equal to their share (based upon their Equity Holder Pro Rata Percentage) of the Initial Escrow Distribution, if any, less the applicable Tax withholdings with respect thereto, which withholdings shall be limited paid to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) Federal for Section 3.12 Indemnifiable Matters arising during payment to the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000)appropriate Tax authorities, and (eiv) for Section 3.12 Indemnifiable Matters arising during to the period beginning on the day after the thirty (30) month anniversary ESOP Shareholder’s Representative an amount out of the Closing Date and continuing until the thirty six ESOP’s Escrow Account equal to its share (36based upon its Equity Holder Pro Rata Percentage) month anniversary of the Closing DateInitial Escrow Distribution, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000)if any. For the purposes of this Agreement, the term Pro Rata PortionInitial Escrow Distributionof a Shareholder as to any Losses or as to shall mean the Escrow Deposit shall be Payment (including any undistributed earnings received thereon) less the sum of: (i) Six Million Two Hundred Fifty Thousand Dollars ($6,250,000), (ii) any disbursements previously made from the Escrow Accounts to Parent or the Escrow Agent, and (iii) an amount equal to the percentage total of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesall then pending indemnity claims by Parent Indemnitees.

Appears in 1 contract

Samples: Stock Purchase Agreement (Caci International Inc /De/)

Escrow. (a) On the Closing Date, Parent and the Shareholder Representative will execute and deliver an Escrow Agreement substantially similar to Exhibit C attached hereto, by and among Parent, the Shareholder Representative and the Escrow Agent (the “Escrow Agreement”), and Parent will deliver to the Escrow Agent, as agent, the Escrow Amount. The True-Up Reserve Amount shall be used to pay any Final Downward Adjustment, with the balance of any amount not so used being paid as set forth in Section 3.4. The Indemnification Amount shall be applied to satisfy any indemnity claims of Parent, the Surviving Corporation and their respective Indemnified Parties (if any) under Article IX and to pay the remaining portion of any Final Downward Adjustment if the True-Up Reserve Amount is not sufficient for such payment. The Shareholder Fund Amount shall be available to reimburse the Shareholder Representative for out-of-pocket costs and expenses incurred in the performance of his duties hereunder (including, without limitation, costs incurred in connection with filing of Tax returns or audit costs of filed Tax returns) and to pay attorneys and accountants employed by the Shareholder Representative necessary to discharge the duties as Shareholder Representative and to defend any indemnification claim, but shall not be used to satisfy any indemnification obligations under Article IX or to pay any Final Downward Adjustment. The Escrow Deposit shall Amount will be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in available funds in accordance with an the terms and conditions of the Escrow Agreement and will be disbursed as provided in the Escrow Agreement. If Any funds released from the Closing occurs, Parent agrees that the right Indemnification Amount because such amounts are no longer subject to indemnification pursuant claims shall first be paid to this Article XII shall constitute Parent’s sole the Shareholder Representative to reimburse the Shareholder Representative for any previously unreimbursed costs and exclusive remedy expenses, and recourse against then if determined by the Shareholder Representative, transferred to the Shareholder Fund Amount to provide for any reasonably anticipated costs and expenses, with the balance of any unused Shareholder Fund Amount being deposited with the Disbursing Agent for payment to the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro based on their Pro-Rata Portion of when the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to Representative determines such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), funds are not needed. (b) for Section 3.12 Indemnifiable Matters arising during Nothing in this Agreement is intended, and nothing in this Agreement shall be interpreted as, imposing upon the period beginning on Parent, Newco or the day after the twelve (12) month anniversary Surviving Corporation any liability, economic obligation, or guarantee in favor of the Closing Date and continuing until the eighteen (18) month anniversary Shareholder Representative or any party to this Agreement or any third party, including without limitation any obligation of the Closing DateParent, the maximum liability of each Stockholder shall be limited Newco or Surviving Corporation to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as contribute monies to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesFund Amount.

Appears in 1 contract

Samples: Merger Agreement (New Ulm Telecom Inc)

Escrow. The Escrow Deposit shall be held by To provide for an escrow account or accounts to secure and to serve as a fund in respect of the indemnification obligations of the Sellers and Owners under this Agreement, Buyer, the Sellers’ Representatives and the Escrow Agent for a period ending on at Closing shall enter into an Escrow Agreement substantially in the form of Exhibit B (the “Escrow Agreement”). At Closing, the Buyer shall deposit the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by Shares with the Escrow Agent to be held in an account or accounts (the “Escrow Account”) pursuant to the terms of the Escrow Agreement. All Rebranding Escrow Shares remaining in the Escrow Account after the Rebranding Cost Reimbursement shall be distributed to the Owners in accordance with an the Escrow Agreement. If Agreement on the Closing occurs, Parent agrees that third Business Day after the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable MattersRebranding Cost Reimbursement. Except with respect to Special Escrow Shares retained to fund Buyer Indemnified Persons’ indemnity claims made in accordance with Article 7 on or before the Excluded Obligations twenty-seventh (27th) month anniversary following the maximum aggregate liability of any Shareholder individually Closing Date (the “Escrow Period”), all Special Escrow Shares then remaining in the Escrow Account shall be limited distributed to such Shareholder’s Pro Rata Portion the Owners in accordance with the Escrow Agreement on the third Business Day after the earlier of (a) the final resolution, by settlement, litigation or otherwise, of the dispute between International Vapor and Xxxxx Xxxxxxxxx regarding the Xxxxxxxxx Agreement (the “Xxxxxxxxx Resolution”) and (b) the expiration of the Escrow Deposit and Period; provided that, the maximum aggregate liability portion of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to Special Escrow Shares deposited in the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested Account pursuant to Section 7.8 1.7.7 shall be distributed to the Employee Shareholders’ liability Owners in accordance with the proportions set forth in Section 1.7.7. Except with respect thereto to General Escrow Shares retained to fund Buyer Indemnified Persons’ indemnity claims made in accordance with Article 7 prior to the expiration of the Escrow Period, all General Escrow Shares in the Escrow Account shall be limited distributed to forfeiting the Owners in accordance with the Escrow Agreement on the third Business Day after the expiration of the Escrow Period. With respect to any pending claim, promptly following resolution of such unvested sharespending claim, the Special Escrow Shares or the General Escrow Shares, as applicable and if any, retained to fund such pending claim which have not been paid, which are not payable to any Buyer Indemnified Person pursuant to Article 7 in connection with such resolution, and which are not required to remain in the Escrow Account to satisfy other pending claims, shall be distributed to the Owners.

Appears in 1 contract

Samples: Asset Purchase Agreement (Vapor Corp.)

Escrow. (a) At the Effective Time, Parent will withhold from the cash and shares of Parent Common Stock to be issued to Company Stockholders in the Merger upon conversion of their Company Common Stock pursuant to Section 3.1(a) above, each Company Stockholder’s pro rata share of (i) $2,762,500 (such withheld cash consideration, the “One Year Escrow Cash”) and (ii) six hundred and twenty-five thousand (625,000) shares of Parent Common Stock to be paid in the Merger (such withheld shares of Parent Common Stock, the “One Year Escrow Shares”). The One Year Escrow Deposit Cash, One Year Escrow Shares and any New Shares (as defined below) are collectively referred to herein as the “One Year Escrow Fund.” Any shares of Parent Common Stock or other equity securities issued or distributed by Parent (including shares issued upon a stock split, stock dividend, recapitalization or other similar event) in respect of One Year Escrow Shares that have not been released (any such additional shares, the “New Shares”) shall be added to the One Year Escrow Fund and become a part thereof. New Shares issued in respect of shares of Parent Common Stock which have been released from the One Year Escrow Fund shall not be added to the One Year Escrow Fund but shall be distributed to the recordholders thereof. Escrow Agent will hold the certificates representing such One Year Escrow Shares as security for the Company Stockholders’ indemnification obligations under Section 9 hereof. The One Year Escrow Funds will be represented by a certificate or certificates issued in the names of each Company Stockholder in proportion to each Company Stockholder’s pro rata share and will be held by the Escrow Agent for a period ending on the Escrow Release DateParent, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held terms and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occursconditions of Section 9 hereof, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month first anniversary of the Closing Date and continuing until (the eighteen “One Year Escrow Release Date”) subject to any such One Year Escrow Funds being withheld pursuant to Section 9. (18b) month anniversary At the Effective Time, Parent will also withhold from the shares of Parent Common Stock to be issued to Principal Stockholders in the Merger upon conversion of their Company Common Stock pursuant to Section 3.1(a) above each Principal Stockholder’s pro rata share of that number of shares of Parent Common Stock equal to 5% of the aggregate value of the Merger Consideration (with the Stock Merger Consideration portion valued using the closing sale price of one share of Parent Common Stock on the Closing Date) (such withheld shares of Parent Common Stock, the maximum liability “Three Year Escrow Shares”). The Three Year Escrow Shares and any IP New Shares (as defined below) are collectively referred to herein as the “Three Year Escrow Fund.” Any shares of Parent Common Stock or other equity securities issued or distributed by Parent (including shares issued upon a stock split, stock dividend, recapitalization or other similar event) in respect of Three Year Escrow Shares that have not been released (any such additional shares, the “IP New Shares”) shall be added to the Three Year Escrow Fund and become a part thereof. IP New Shares issued in respect of shares of Parent Common Stock which have been released from the Three Year Escrow Fund shall not be added to the Three Year Escrow Fund but shall be distributed to the recordholders thereof. Escrow Agent will hold the certificates representing such Three Year Escrow Shares as security for the Principal Stockholders’ indemnification obligations under Section 9.3(b)(i) hereof solely for that purpose described in the last sentence of such section. The Three Year Escrow Fund will be represented by a certificate or certificates issued in the names of each Principal Stockholder shall be limited in proportion to such each Principal Stockholder’s Pro Rata Portion pro rata share and will be held by Parent, subject to the terms and conditions of Four Million Dollars ($4,000,000)Section 9 hereof, (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on until the day after the eighteen (18) month third anniversary of the Closing Date and continuing until (the twenty-four “Three Year Escrow Release Date”) subject to any such Three Year Escrow Funds being withheld pursuant to Section 9. (24c) month anniversary of the Closing Date, the maximum liability of each Each Company Stockholder shall be limited shown as the record owner on Parent’s books and records of such number of shares of the One Year Escrow Fund and the Three Year Escrow Fund as is equal to such Company Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date pro rata share and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as have voting rights with respect to the Escrow Deposit shall be equal shares of Parent Common Stock held (and on any voting securities added to the percentage One Year Escrow Fund and the Three Year Escrow Fund in respect of such shares of Parent Common Stock) in the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, One Year Escrow Fund and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesThree Year Escrow Fund.

Appears in 1 contract

Samples: Merger Agreement (Pervasive Software Inc)

Escrow. 22.1 The Escrow Deposit ERO Purchaser and the DSAG Purchaser agree that after the date of this Agreement they shall be held by endeavour in good faith to agree the terms of the Escrow Agent for a period ending on Agreement as soon as reasonably practicable. 22.2 In the event that any amount is payable from the 1st Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior Account to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by DSAG Purchaser’s Counsel’s Account pursuant to the DSAG Purchase Agreement following the Determination of the DSAG PPA, the DSAG Purchaser undertakes to instruct the 1st Escrow Agent (in accordance with an the terms of such escrow) to transfer such sum directly to the 2nd Escrow Account. For the avoidance of doubt, payments in favour of the DSAG Purchaser for the A380 Issue shall not be transferred into the 2nd Escrow Account. 22.3 The DSAG Purchaser undertakes not to give any instruction to the 1st Escrow Agent except in accordance with the terms of the DSAG Purchase Agreement and this Agreement. 22.4 In the event that, at the time that the DSAG Purchase Price Adjustment Amount is Determined, the A380 Issue has not been Determined, any payments otherwise due to the ERO Purchaser and the DSAG Purchaser shall be reduced if necessary to ensure that, the amount standing to the credit of the 2nd Escrow Account plus any amounts standing to the credit of the First Escrow Account at the date of such payment from the 2nd Escrow Account in respect of such DSAG PPA shall not be less than £12.5 million. No payment from the 2nd Escrow Account to the ERO Purchaser of £8.5 million or less shall be reduced at all. Any amounts so retained in the 2nd Escrow Account shall be available to satisfy the A380 Issue if Determined in favour of the DSAG Purchaser to the extent that the First Escrow Account is insufficient to satisfy such A380 Issue so Determined. 22.5 If any payments due to the ERO Purchaser have been reduced pursuant to Clause 22.4 the ERO Purchaser and the DSAG Purchaser will instruct the 2nd Escrow Agent to make such payment(s) (the “Preliminary Payments” and each a “Preliminary Payment”) to either of them from the available monies as are required, in accordance with the Guiding Principles, provided always that if the ERO Purchaser is entitled to a payment from such 2nd Escrow Account in excess of £8.5 million as a result, it shall receive the first £8.5 million of any such payment and thereafter receive such additional amounts as are available subject to Clause 22.4 only to the extent the D&M Negative Amount (expressed as a positive) is less than £4 million. If the Closing occurs, Parent agrees that A380 Issue is then subsequently Determined: (a) in favour of the right DSAG Purchaser each of the ERO Purchaser and the DSAG Purchaser shall: (i) instruct the 2nd Escrow Agent to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to pay any Indemnifiable Matters. Except with respect amount standing to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion credit of the 2nd Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited Account to the Cash Consideration DSAG Purchaser (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which A380 Issue or such Shareholder is entitled lower settlement amount); and (and for an Employee Shareholder ii) make such payments to each as are required (if any) to ensure that the value of his share of the Restricted Equity Consideration). The maximum ERO Purchaser has received, in aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Datewith its Preliminary Payment, the maximum liability sum of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars £12.5 million less the D&M Negative Amount ($5,000,000), (bexpressed as a positive figure) provided always that for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreementcalculation such D&M Negative Amount (expressed as a positive figure) shall never exceed £4 million. (b) in favour of the DSAG Vendors, “Pro Rata Portion” each of a Shareholder as ERO Purchaser and the DSAG Purchaser shall instruct the Second Escrow Agent to any Losses or as make such payments to either of them from the monies standing to the credit of the 2nd Escrow Deposit shall be equal Account in accordance with the Guiding Principles which when aggregated with its Preliminary Payment, and payment pursuant to Clause 21, will place such party in the position as they would have been if the calculation had been made in accordance with the Guiding Principles as if the A380 Claim had been Determined in favour of the DSAG Vendors prior to the percentage Determination of the Merger Consideration DSAG Purchase Price Adjustment. 22.6 If the A380 Issue is Determined prior to which the Determination of the DSAG PPA then: (a) if it is Determined in favour of the DSAG Purchaser, within 5 Business Days of the Determination of the DSAG PPA, the ERO Purchaser and the DSAG Purchaser agree to instruct the 2nd Escrow Agent (following receipt of the relevant amount into the 2nd Escrow Account) to make such Shareholder is entitled payment(s) to either of them from the monies standing to the credit of the 2nd Escrow Account as set forth on Schedule 2.3. For are required in accordance with the Guiding Principles from such 2nd Escrow Account but provided always that any payment to the ERO Purchaser does not exceed £12.5 million less the D&M Negative Amount (expressed as a positive figure) of the DSAG Purchaser and provided further that for the purposes of Article XIIthis calculation such D&M Negative Amount (expressed as a positive figure) shall never exceed £4 million; (b) if it is Determined in favour of the DSAG Vendors, within 5 Business Days of the Determination of the DSAG PPA, the Restricted Equity Consideration shall be valued ERO Purchaser and the DSAG Purchaser agree to instruct the 2nd Escrow Agent (irrespective following receipt of vestingthe relevant amount into the 2nd Escrow Account) based on to make such payments as are required in accordance with the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting Guiding Principles from such unvested shares2nd Escrow Account.

Appears in 1 contract

Samples: Separation Agreement (Standard Aero Holdings Inc.)

Escrow. The At the Closing, the Buyer shall deposit, or cause to be deposited, with the Indemnity Escrow Deposit Agent an amount in cash equal to five point two percent (5.2%) of the Headline Purchase Price (such amount plus all accrued interest thereon shall be referred to as the “Escrow Amount”), which Escrow Amount shall be held in escrow by the Indemnity Escrow Agent as a source of funds for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary paying any amount owed by Seller to satisfy claims for indemnification which are the subject Buyer pursuant to a Claims Notice delivered prior to the Escrow Release Datethis Agreement. The Escrow Deposit Amount shall be held administered and disbursed by the Indemnity Escrow Agent as provided for in accordance with an this Agreement and in the Indemnity Escrow Agreement. If the Closing occurs, Parent agrees that the right The Escrow Amount shall be available to indemnification reimburse Buyer and/or other Buyer Indemnified Parties for any Purchase Price adjustment payable to Buyer pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for I or any indemnifiable Losses attributable payable to any Indemnifiable Matters. Except Buyer Indemnified Party in accordance with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit Article IX through and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after including the twelve (12) month anniversary of the Closing Date and continuing until (the eighteen (18) month anniversary “Escrow Termination Date”). Any portion of the Closing Date, Escrow Amount remaining on the maximum liability Escrow Termination Date (other than amounts necessary to cover any pending claims) shall promptly be disbursed for the account of each Stockholder Seller to Agent in immediately available funds by wire transfer to an account designated by Agent in writing to Buyer. The Indemnity Escrow Agent’s escrow fees and charges shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date paid one-half by Seller and continuing until the twentyone-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shareshalf by Buyer.

Appears in 1 contract

Samples: Asset Purchase Agreement

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of On the Closing Date, the maximum liability Escrow Amount in the form of each Stockholder the Escrow Shares shall be limited delivered to the Escrow Agent to be held pursuant to the Escrow Agreement to satisfy claims related to Losses suffered by Buyer Indemnities. After the Survival Date, other than to the extent that there are pending claims for any Losses suffered by Buyer Indemnities, the Escrow Amount then remaining in the Escrow Account shall be released from the Escrow Account (if there are pending claims for Losses suffered by Buyer Indemnities then only such Stockholder’s Pro Rata Portion portion of Five Million Dollars ($5,000,000the Escrow Amount in excess of such pending claims for Losses shall be released from the Escrow Account), . (b) To the extent the Escrow Funds are held in Parent Common Stock at the time any payment is due for Losses suffered by Buyer Indemnities, the amount of shares of Parent Common Stock subject to release from the Escrow Fund to cover any Losses suffered by Buyer Indemnities shall be satisfied by releasing a number of Escrow Shares to Buyer determined by dividing the amount of such Losses by the Closing Date Closing Price. (c) In accordance with the terms of the Escrow Agreement, at such time as Seller has satisfied the six (6)-month holding period requirement of Rule 144 with respect to the Escrow Shares: subject to the obligations of Seller set forth in this Section 3.12 Indemnifiable Matters arising during 9.04(c), the period beginning on Escrow Shares shall be transferable by Seller pursuant to Rule 144, provided that (i) to the day after extent such Escrow Shares are held in the twelve Escrow Account and still subject to being used to satisfy indemnification claims of the Buyer Indemnitees in accordance with the Escrow Agreement, Seller shall not sell any Escrow Shares (12x) month anniversary without the consent of the Buyer, which consent shall not be unreasonably withheld, or (y) if the Parent Common Stock Sale Price to be received for such Escrow Shares in connection with such sale is less than the Closing Date Stock Price; (ii) Seller shall use its best efforts to arrange for such Escrow Shares to be sold through a registered broker-dealer reasonably acceptable to Parent, and Parent shall use its best efforts to assist and support Seller in connection with such sales (including without limitation providing to Seller all reasonably requested documentation and opinions with respect to such open market transactions); and (iii) the Escrow Shares shall not be released from the Escrow Account in connection with such transactions unless (x) all net proceeds received in respect of such Escrow Shares equal to the Closing Date Stock Price are concurrently deposited with the Escrow Agent into the Escrow Account, and (y) net proceeds in excess of the Closing Date and continuing until the eighteen Stock Price (18if any) month anniversary received in respect of the Closing Date, the maximum liability of each Stockholder shall be limited such Escrow Shares is promptly delivered to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesBuyer.

Appears in 1 contract

Samples: Stock Purchase Agreement (Heckmann Corp)

Escrow. The (a) Prior to or at the Closing, the Seller and the Purchaser shall enter into an Indemnity Escrow Deposit shall be held by Agreement with the Escrow Agent substantially in the form of Exhibit 2.08 (the "Indemnity Escrow Agreement") hereto. In accordance with the terms of the Indemnity Escrow Agreement, the Purchaser shall deposit the Indemnity Escrow Amount in two separate accounts. Shares of Purchaser Common Stock, with a value of $3,500,000 calculated by dividing $3,500,000 by the Share Value Amount, shall be deposited in an account which shall be used solely (except in the event that Seller does not pay Purchaser the requisite amounts, if any, under Section 2.07(c)(i)) as security for a period ending on the Escrow Release Date, except the Escrow Deposit all other indemnification payments that may be withheld after due pursuant to Section 8.02 (the "Operating Escrow Release Date for so long Account"). Shares of Purchaser Common Stock, with a value of $500,000 calculated by dividing $500,000 by the Share Value Amount, shall be deposited in a separate account which shall be used solely (except in the event that Seller does not pay Purchaser the requisite amounts, if any, under Section 2.07(c)(i)) as is reasonably necessary to satisfy claims security for indemnification which are payments that may be due pursuant to Section 8.02 as a result of a breach of Section 3.12 (the subject to a Claims Notice delivered prior to the "Environmental Escrow Release Date. The Escrow Deposit Account"). (b) Both of such accounts shall be held managed and disbursed paid out by the Escrow Agent in accordance with an the terms of the Indemnity Escrow Agreement. If All remaining funds in the Closing occurs, Parent agrees that Operating Escrow Account shall be distributed by the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect Escrow Agent to the Excluded Obligations Seller on October 1, 2004, unless one or more claims for indemnification for which the maximum aggregate liability of any Shareholder individually Operating Escrow Account is security shall have been made prior to such date, in which event funds in the Operating Escrow Account shall be limited to such Shareholder’s Pro Rata Portion held in accordance with the provisions of the Indemnity Escrow Deposit and Agreement. All remaining funds in the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) Environmental Escrow Account shall be limited distributed by the Escrow Agent to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning Seller on the Closing Date and continuing until the twelve (12) month third anniversary of the Closing DateClosing, unless one or more claims for indemnification for which the maximum liability of each Stockholder Environmental Escrow Account is security shall have been made prior to such date, in which event funds in the Environmental Escrow Account shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during held in accordance with the period beginning on the day after the twelve (12) month anniversary provisions of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), Indemnity Escrow Agreement. (c) The Operating Escrow Account shall be decreased, by distributions to the Seller in accordance with the Indemnity Escrow Agreement, by 66 cents for each dollar received by the Purchaser in respect of the AT&T March 2004 Receivable, up to a maximum aggregate decrease of $1,500,000. From and after the time that the Purchaser has collected an aggregate of $1,500,000 under the AT&T March 2004 Receivable, no further reductions in the Operating Escrow Account on account of this Section 3.12 Indemnifiable Matters arising during 2.08(c) and the period beginning AT&T March 2004 Receivable shall be taken. The Purchaser acknowledges and agrees that in order to effectuate the provisions of this Section 2.08(c), it will promptly notify the Seller and the Escrow Agent upon receipt of any collections on account of the AT&T March 2004 Receivable. Seller shall have the right from time to time to inquire from AT&T as to the status of the payments on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), AT&T March 2004 Receivable. (d) for Section 3.12 Indemnifiable Matters arising during In addition, prior to or at the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing DateClosing, the maximum liability of each Stockholder Seller and the Purchaser shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during enter into the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this AT&T Escrow Agreement, “Pro Rata Portion” in accordance with the provisions of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares5.24 hereof.

Appears in 1 contract

Samples: Asset Purchase Agreement (Dycom Industries Inc)

Escrow. The (a) At the Effective Time, Buyer shall pay an amount equal to $12,750,000.00 (the “Indemnity Escrow Deposit shall be held by Amount”) to SunTrust Bank (the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary Agent”) to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed delivered by the Escrow Agent in accordance with the terms and provisions of a certain escrow agreement that shall be executed and delivered by Buyer, the Holder Representative and the Escrow Agent at the Closing substantially in the form attached hereto as Exhibit C (the “Escrow Agreement”). The Indemnity Escrow Amount shall be placed in a single escrow account (the “Indemnity Escrow Account”) separate from the Adjustment Escrow Account and the Holder Representative Expense Account. The Indemnity Escrow Amount shall be established as security for any indemnification obligations for Buyer Losses pursuant to Article VIII hereof, and for any negative Post- 3063972 5 Closing Adjustment that exceeds the Adjustment Escrow Amount, as set forth in Section 2.8.2(b) hereof. (b) At the Effective Time, Buyer shall pay an amount equal to $500,000.00 (the “Adjustment Escrow Amount”) to the Escrow Agent to be held and delivered by the Escrow Agent in accordance with the terms and provisions of the Escrow Agreement. If The Adjustment Escrow Amount shall be placed in a single escrow account (the “Adjustment Escrow Account”) separate from the Indemnity Escrow Account and the Holder Representative Expense Account. The Adjustment Escrow Amount shall be established as security for any negative Post-Closing occursAdjustment, Parent agrees that as set forth in Section 2.8.2(b) hereof. (c) At the right Effective Time, Buyer shall pay an amount equal to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against $1,000,000.00 (the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect “Holder Representative Expense Amount”) to the Excluded Obligations Escrow Agent to be held and delivered by the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion Escrow Agent in accordance with the terms and provisions of the Escrow Deposit Agreement. The Holder Representative Expense Amount shall be placed in a single escrow account (the “Holder Representative Expense Account”) separate from the Indemnity Escrow Account and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) Adjustment Escrow Account. The Holder Representative Expense Amount shall be limited established to the Cash Consideration (pay Holder Representative expenses and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (certain other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled obligations as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesherein.

Appears in 1 contract

Samples: Merger Agreement (Costar Group Inc)

Escrow. (i) At Closing, the Buyer will (in accordance with Section 2.1(d)(ii)(B)) deliver to the Escrow Agent the Escrow Amount to be held in escrow pursuant to the Escrow Agreement and to be disbursed in accordance with the terms of this Agreement and the Escrow Agreement. The Escrow Deposit Account, together with any interest and earnings thereon, shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed released by the Escrow Agent to the Surviving Corporation, the Exchange Agent or the Buyer, as applicable, in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion terms of the Escrow Deposit Agreement. (ii) Any portion of the Escrow Fund disbursed pursuant to the Escrow Agreement for the benefit of the Company Equityholders shall be disbursed in accordance with this Section 2.1(e)(ii) and the maximum aggregate liability Allocation Schedule. A portion of such disbursed amount equal to the Shareholders collectively for the Excluded Obligations (other than the applicable Per Share Escrow Distribution that is payable in respect of each share of Company Stock converted pursuant to Section 3.12 Indemnifiable Matters2.1(c) shall be limited paid by the Escrow Agent to the Cash Consideration (and for Exchange Agent pursuant to the Employee Shareholders also the value terms of the Restricted Equity Consideration) and Escrow Agreement for payment to the holder thereof. A portion of any Shareholder individually for such disbursed amount equal to the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) applicable Per Share Escrow Distribution that is payable in respect of each Company Option shall be limited paid by the Escrow Agent to the Buyer or the Surviving Corporation pursuant to the terms of the Escrow Agreement for payment to the holder thereof through the Buyer’s or the Surviving Corporation’s payroll (which amount shall be paid by the Buyer or the Surviving Corporation to such Shareholderholder on the first payroll payment date after the Buyer’s Pro Rata Portion or the Surviving Corporation’s receipt of such amount; provided that if the Losses up Buyer or Surviving Corporation received such amount fewer than five (5) Business Days prior to such payroll payment date, the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning paid on the Closing Date next payroll payment date, and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of in each Stockholder case shall be limited subject to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for any applicable withholding as provided in Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,0002.10). For the purposes avoidance of doubt, the Buyer shall (in accordance with the Allocation Schedule) cause (A) the Surviving Corporation to use any funds distributed to the Surviving Corporation pursuant to this Section 2.1(e)(ii) and (B) the Exchange Agent to use any funds distributed to the Exchange Agent pursuant to this Section 2.1(e)(ii) to make the payments provided for in this Section 2.1(e)(ii), and such funds shall not be used for any other purpose except as provided in this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Merger Agreement (Sucampo Pharmaceuticals, Inc.)

Escrow. The As soon as practicable after the Effective Time, the Escrow Deposit shall be held delivered by Parent to the Escrow Agent Agent, to be held for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice duly delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If Agreement in the form attached hereto as Exhibit C. Except with respect to claims based on the Indefinite Excluded Obligations, which are not limited in amount, if the Closing occurs, Parent agrees and Acquisition Corp. agree that the Parent’s right to indemnification pursuant to this Article XII shall constitute Parent’s and Acquisition Corp.’s sole and exclusive remedy and recourse against the Shareholders Stockholders and Management Option Holders for Losses attributable to any Indemnifiable Mattersinaccuracy or breach of any representation or warranty, or any breach or nonfulfillment of any failure to perform the covenants, agreements or undertakings, of the Company, the Company’s Subsidiary or the Stockholders which is contained in this Agreement or the Letters of Transmittal or any Schedule or certificate delivered pursuant hereto or thereto. Except with respect to the Indefinite Excluded Obligations and the Limited in Time Excluded Obligations, the maximum aggregate liability of any Shareholder individually Stockholder or Management Option Holder shall be limited to such Shareholder’s Pro Rata Portion (as defined below) with respect to each such Stockholder or Management Holder of the Escrow Deposit and the maximum aggregate Deposit; provided, however, that no Stockholder shall have any liability of the Shareholders collectively for the Excluded Obligations (other than the indemnification pursuant to Section 3.12 Indemnifiable Matters12.1(b) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and on account of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, a “Pro Rata Portion” of a Shareholder Stockholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Initial Merger Consideration to which such Shareholder Stockholder is entitled and a “Pro Rata Portion” of a Management Option Holder as set forth on Schedule 2.3to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Management Options to which such Management Option Holder is entitled. For purposes of Article XIIWith respect to the Limited in Time Excluded Obligations, the Restricted Equity Consideration shall be valued (irrespective maximum liability of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto any Stockholder shall be limited to forfeiting the aggregate amount of Initial Merger Consideration, Cash Earnout Consideration, and Management Retention Consideration (if applicable) received or receivable by such unvested sharesStockholder and the maximum liability of any Management Option Holder shall be limited to the aggregate number of Management Options received or receivable by such Management Option Holder.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Marchex Inc)

Escrow. The (a) At the First Effective Time, Parent, Escrow Deposit Agent and the Representative shall have entered into an Escrow Agreement in substantially the form attached hereto as Exhibit C (the “Escrow Agreement”). An amount of cash and Parent Common Stock (valued at the Average Parent Stock Price) equal to $5,000,000 (the “Escrow Amount”) will be withheld from the Total Stockholder Consideration otherwise deliverable to Company Stockholders, and shall be held by the Escrow Agent in escrow for the payment of Damages to which any Parent Indemnified Person may be entitled under Article IX of this Agreement. At the First Effective Time, the Parent shall set aside in escrow with respect to each Company Stockholder (other than Company Stockholders holding shares of Company Capital Stock which constitute Dissenting Shares) an amount of cash and/or a period ending on number of shares of Parent Common Stock equal to such Company Stockholder’s Pro Rata Share of the Escrow Release DateAmount, except without any action by the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary Company Stockholders. Subject to satisfy any claims for indemnification which are made by the subject to a Claims Notice delivered prior Parent, the Escrow Amount shall be released at 11:59 p.m. California time on the date that is eighteen (18) months after the Closing Date (the “Escrow Expiration Date”) to the Company Stockholder based on such Person’s Pro Rata Share. (b) In addition to and separate from the Escrow Release Date. The Amount, an amount equal to $1,000,000 in cash (the “Patent Escrow Deposit Amount”) shall be held and disbursed by set aside from the Escrow Agent in accordance with an Escrow Agreement. If cash portion of the Closing occurs, Parent agrees that Total Stockholder Consideration for payment of any Damages related to the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse patent claims filed against the Shareholders for Losses attributable to any Indemnifiable MattersCompany by Teles AG Informationstechnologien (the “Patent Claim”). Except At the First Effective Time, the Parent shall set aside in escrow with respect to the Excluded Obligations the maximum aggregate liability each Company Stockholder (other than Company Stockholders holding shares of any Shareholder individually shall be limited Company Capital Stock which constitute Dissenting Shares) an amount of cash equal to such ShareholderCompany Stockholder’s Pro Rata Portion Share of the Patent Escrow Deposit and Amount, without any action by the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited Company Stockholders. Any Damages related to the Cash Consideration (and for Patent Claim that are incurred by the Employee Shareholders also Company or any Parent Indemnified Person commencing upon the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Agreement Date and continuing until the twelve Patent Escrow Expiration Date (12as defined in Section 9.2 below) month anniversary shall first be indemnified out of the Closing Patent Escrow Amount. For the avoidance of doubt, such indemnification of the Company from the Patent Escrow Account for Damages related to the Patent Claim that are incurred by the Company shall be mandatory, may not be waived by the Company and shall pertain irrespective of any patent-related disclosures related to Company’s representations and warranties contained herein. Upon the Patent Escrow Expiration Date, any remaining Patent Escrow Amount after payment of all Damages related to the maximum liability of each Stockholder Patent Claim shall be limited released to the Company Stockholders based on such StockholderPerson’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), Share. (c) for Section 3.12 Indemnifiable Matters arising during Approval by the period beginning on the day after the eighteen (18) month anniversary Company Stockholders of this Agreement shall constitute approval of the Closing Date Escrow Agreement and continuing until all arrangements relating thereto, including without limitation the twenty-four (24) month anniversary placement of the Closing Date, Escrow Amount and the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during Patent Escrow Amount with the period beginning on Escrow Agent and the day after the twenty-four (24) month anniversary appointment of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled Representative as set forth on Schedule 2.3. For purposes of in Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesIX below.

Appears in 1 contract

Samples: Merger Agreement (Network Equipment Technologies Inc)

Escrow. The In order to at least partially satisfy, and to establish a procedure for the satisfaction of, amounts owed to Parent pursuant to Section 2.7 and claims by the Parent Indemnitees for indemnification pursuant to Article VIII hereof, Parent, the Stockholder Representative and Xxxxx Fargo Bank, National Association (the “Escrow Deposit Agent”) shall be held by enter into the Escrow Agreement on the Closing Date, pursuant to which Parent shall deposit with the Escrow Agent for a period ending (i) cash in the amount of Four Million Five Hundred Thousand Dollars ($4,500,000) (the “Cash Escrow Amount”) and (ii) an aggregate of 695,580 shares of Parent Stock (the “Stock Escrow Amount”) within ten (10) business days after the Closing. Parent shall be deemed to have contributed the proportion of the Escrow Amount with respect to each Equityholder set forth on the Escrow Release Date, except Closing Consideration Schedule and the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary consideration payable to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification each Equityholder pursuant to this Article XII II shall constitute Parent’s sole and exclusive remedy and recourse against be reduced by such amount. As used in this Agreement, the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability term “Escrow Amount” means, as of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion moment in time, the amount of the Escrow Deposit cash and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) Parent Stock then in the Escrow Account. Pursuant to the terms and of any Shareholder individually for subject to the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion conditions of the Losses up to Escrow Agreement, the aggregate amount of Escrow Agent shall establish an escrow account into which the Cash Consideration which such Shareholder is entitled Escrow Agent shall deposit the Escrow Amount (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration“Escrow Account”). The maximum aggregate liability timing and methodology for the release of the Stockholders for the Section 3.12 Indemnifiable Matters Escrow Amount shall be limited governed by the terms and subject to the conditions set forth in this Agreement and the Escrow Agreement; provided, however, that each of Parent and the Stockholder Representative agrees that it will act in good faith and cooperate with one another to execute and deliver such joint written instructions, including with respect to any distributions of the Escrow Amount, to the Escrow Agent as follows: (a) for Section 3.12 Indemnifiable Matters arising during are required to implement the period beginning on intent of this Agreement and the Closing Date and continuing until Escrow Agreement. After the twelve (12) eighteen month anniversary of the Closing Date, the maximum liability Escrow Agent shall deliver to the Stockholders and Parent or the Second Surviving Corporation, on behalf of the Company Optionholders, the remaining Escrow Amount minus the Pending Claims Amount in accordance with the Escrow Agreement. In the event of a distribution of any amounts from the Escrow Account to the Equityholders, each Stockholder Equityholder shall be limited entitled to receive a portion of such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be distribution equal to the percentage of the Merger Consideration to which such Shareholder is entitled as proportion set forth with respect to such Equityholder on Schedule 2.3the Closing Consideration Certificate. For purposes of Article XIIsatisfying any claims for indemnification under this Agreement, all shares of Parent Stock in the Restricted Equity Consideration Escrow Account shall be valued (deemed to have a value equal to the Parent Stock Value, as adjusted for any stock splits, dividends, combinations or the like, irrespective of vesting) based on the Closing Market Priceactual value of such shares at the time the claim is satisfied out of the Escrow Account. Notwithstanding anything to the contrary herein, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto no fraction of a share of Parent Stock shall be limited released from the Escrow Account and all releases of shares of Parent Stock shall be rounded to forfeiting such unvested sharesthe nearest whole share.

Appears in 1 contract

Samples: Merger Agreement (Teladoc, Inc.)

Escrow. (a) At the Closing, Buyer will deposit into one or more escrow accounts (collectively, the “Escrow Account”) established for such purpose with the Escrow Agent pursuant to an escrow agreement by and among Buyer, Sellers, the Company, and the Escrow Agent, in substantially the form attached hereto as Exhibit F (the “Escrow Agreement”), (i) $400,000 in cash by wire transfer to an account designated by the Escrow Agent (the “R&W Retention Escrow Amount”), to be held by the Escrow Agent to serve as a source of payment of Sellers’ retention obligations under the R&W Policy pursuant to Article VIII, (ii) $5,000,000 in cash by wire transfer to an account designated by the Escrow Agent (the “Indemnification Escrow Amount”), to be held by the Escrow Agent to serve as a source of payment of the indemnification obligations of Sellers under Article VIII as described in Section 8.3, and (iii) $500,000 in cash by wire transfer to an account designated by the Escrow Agent (the “Working Capital Escrow Amount”), to be held by the Escrow Agent as the first source of payment for any Closing Payment Decrease pursuant to Section 2.5(f). The R&W Retention Escrow Deposit Amount, the Indemnification Escrow Amount, and the Working Capital Escrow Amount will be released as follows: (i) The R&W Retention Escrow Amount shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior pursuant to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion terms of the Escrow Deposit Agreement and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable MattersA) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) -month anniversary of the Closing Date, the maximum liability remaining amount of each Stockholder the R&W Escrow Fund minus (1) $200,000 and (2) any pending claims made in compliance with this Agreement, shall be limited released to such Stockholder’s Pro Rata Portion of Five Million Dollars Sellers, and ($5,000,000), (bB) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month three-year anniversary of the Closing Date, the maximum liability remaining amount of each Stockholder the R&W Retention Escrow Fund shall be limited released to such Stockholder’s Pro Rata Portion Sellers, subject to reserves for any pending claims made in compliance with this Agreement. (ii) The Indemnification Escrow Amount shall be held by the Escrow Agent pursuant to the terms of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning Escrow Agreement and on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twentythree-four (24) month year anniversary of the Closing Date, the maximum liability remaining amount of each Stockholder the Indemnification Escrow Fund shall be limited released to such Stockholder’s Pro Rata Portion of Three Million Dollars Sellers, subject to reserves for any pending claims made in compliance with this Agreement. ($3,000,000), (diii) for Section 3.12 Indemnifiable Matters arising during The Working Capital Escrow Amount shall be held by the period beginning on Escrow Agent pursuant to the day after the twenty-four (24) month anniversary terms of the Closing Date Escrow Agreement and continuing until released upon the thirty (30) month anniversary final determination of Final Net Working Capital and any related adjustments to the Closing Date, Payment pursuant to Section 2.5. In the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of event that the Closing Date Payment Decrease exceeds the Working Capital Escrow Amount, Buyer shall recover any remaining amounts directly from Sellers. (b) The Sellers’ Representative and continuing until the thirty six Buyer each agree to promptly take commercially reasonable actions (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as including executing and delivering joint written instructions to the Escrow Deposit shall be equal Agent) requested by the other to the percentage effect releases of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XIIWorking Capital Escrow Amount, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market PriceR&W Retention Escrow Amount, and as to shares not yet vested pursuant to Section 7.8 Indemnification Escrow Amount from the Employee Shareholders’ liability Escrow Account, in each case in accordance with respect thereto shall be limited to forfeiting such unvested sharesthis Agreement and the Escrow Agreement.

Appears in 1 contract

Samples: Stock Purchase Agreement (Universal Corp /Va/)

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve Within five (125) month anniversary of Business Days following the Closing Date, the maximum liability Buyer shall deliver, or shall cause to be delivered, directly to an escrow agent reasonably acceptable to the Shareholders' Representative (the "Escrow Agent"), a portion of each Stockholder the Merger Consideration in an amount equal to $299,500 in cash (collectively with all interest and earnings thereon, the "Escrow Amount"). Each Company Shareholder shall be limited deemed to have contributed to the Escrow Amount pro rata in an amount equal to the product of (x) $299,500 and (y) the Pro Rata Multiplier for such Company Shareholder ("Escrow Pro Rata Share"), pursuant to the terms set forth herein and in an escrow agreement to be entered into by and among the Shareholders' Representative, the Buyer and the Escrow Agent, in a form reasonably acceptable to the Shareholders' Representative (the "Escrow Agreement"). The Buyer shall pay the Escrow Fee to the Escrow Agent pursuant to the terms of the Escrow Agreement. Each Company Shareholder's Escrow Pro Rata Share shall be deducted from the Merger Consideration payable to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), Company Shareholder at the Effective Time under Section 4.3. (b) The Escrow Amount shall be available from time to time prior to distribution as provided in Section 4.5(c) to satisfy any indemnification obligations of the Company Shareholders pursuant to Section 8 for Section 3.12 Indemnifiable Matters arising during Losses (each, an "Indemnity Payment") on or prior to the period beginning on last day of the day after the twelve (12) month one year anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Datesuch day, the maximum liability of each Stockholder "Final Release Date"). Any Indemnity Payments from the Escrow Amount shall be limited to such Stockholder’s satisfied by reducing each Company Shareholder's Escrow Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during Share deposited with the period beginning Escrow Agent on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder a pro rata basis. Any Specified Indemnity Payments shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars satisfied ($3,000,000)i) first, (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to from the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.Amount on

Appears in 1 contract

Samples: Merger Agreement (LOCAL.COM)

Escrow. The An amount equal to $15,500,000 (the “Escrow Deposit Amount”) shall be deposited by Parent with U.S. Bank National Association, as escrow agent selected by Parent (the “Escrow Agent”), to be held by in escrow (the “Escrow Fund”) in an account (the “Escrow Account”) pursuant to the terms of the Escrow Agent for a period ending on Agreement (the Escrow Release DateAgreement”) among Parent, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held Stockholders’ Representative and disbursed by the Escrow Agent in accordance with an substantially the form attached hereto as Exhibit C. Distributions of any amounts from the Escrow Account shall be governed by the terms and conditions of the Escrow Agreement. If the Closing occurs, Parent agrees that the right Specific reference is made to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion (i) Section 5 of the Escrow Deposit and Agreement, which shall govern the maximum aggregate liability disbursement of funds from the Escrow Account to Parent for satisfaction of indemnification claims under Article IX hereof, (ii) Sections 6(a)-(b) of the Shareholders collectively for Escrow Agreement, which shall govern the Excluded Obligations (other than disbursement of funds from the Section 3.12 Indemnifiable Matters) shall be limited Escrow Account to the Cash Consideration (holders of Company Capital Stock and for Qualified Warrants following the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) 15-month anniversary of the Closing Date and continuing until (iii) Sections 6(c)-(d) of the eighteen (18) month Escrow Agreement which shall govern the disbursement of funds from the Escrow Account to the holders of Company Capital Stock and Qualified Warrants following the three-year anniversary of the Closing Date, . The portion of the maximum liability Escrow Amount contributed on behalf of each Stockholder holder of Company Capital Stock or Qualified Warrants shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary same proportion of the Closing Date and continuing until Escrow Amount equal to the twenty-four (24) month anniversary aggregate amount of cash such holder would otherwise be entitled to receive under Section 2.2 hereof by virtue of such holder’s ownership of Company Capital Stock or Qualified Warrants to the Closing Date, the maximum liability of each Stockholder shall be limited to total Merger Consideration received by all such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000)holders. For the purposes avoidance of this Agreementdoubt, “Pro Rata Portion” of a Shareholder as to any Losses or as Qualified Options and Rolling Options (and the respective Parent Rollover Options) shall not be subject to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesFund.

Appears in 1 contract

Samples: Merger Agreement (Adc Telecommunications Inc)

Escrow. (i) At Closing, the Buyer will (in accordance with Section 2.1(d)(ii)(B)) deliver to the Escrow Agent the Purchase Price Adjustment Escrow Amount to be held in escrow in the Purchase Price Adjustment Escrow Account pursuant to the Escrow Agreement and to be disbursed in accordance with the terms of this Agreement and the Escrow Agreement. The Purchase Price Adjustment Escrow Deposit Account, together with any interest and earnings thereon, shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed released by the Escrow Agent to the Surviving Corporation, the Paying Agent or the Buyer, as applicable, in accordance with an the terms of this Agreement and the Escrow Agreement. If The amounts held in the Closing occursPurchase Price Adjustment Escrow Account shall be used solely to compensate Buyer for the purchase price adjustment as contemplated in Section 2.6, Parent agrees that and any amount in excess of such adjustment shall be distributed to the right Company Equityholders as provided in Section 2.6. (ii) At Closing, the Buyer will (in accordance with Section 2.1(d)(ii)(B)) deliver to indemnification the Escrow Agent the Indemnity Escrow Amount to be held in escrow in the Indemnity Escrow Account pursuant to the Escrow Agreement and to be disbursed in accordance with the terms of this Article XII Agreement and the Escrow Agreement. The Indemnity Escrow Account, together with any interest and earnings thereon, shall constitute Parent’s sole be held by the Escrow Agent and exclusive remedy released by the Escrow Agent to the Surviving Corporation, the Paying Agent or the Buyer, as applicable, in accordance with the terms of this Agreement and recourse against the Shareholders Escrow Agreement. (iii) Any portion of the Indemnity Escrow Fund disbursed pursuant to the Escrow Agreement for Losses attributable the benefit of the Company Equityholders shall be disbursed in accordance with this Section 2.1(e)(iii). A portion of such disbursed amount equal to the Pro Rata Share that is represented by each share of Company Stock converted pursuant to Section 2.1(c) shall be paid by the Escrow Agent to the Paying Agent pursuant to the terms of the Escrow Agreement for payment to the holder thereof (and the Buyer shall direct the Paying Agent to promptly pay such amounts to such holders in accordance with their Pro Rata Portions, subject to the requirements of Section 2.2). A portion of such disbursed amount equal to the Pro Rata Share that is represented by each In-The-Money Vested Company Option and Other Company Vested Equity Award shall be paid by the Escrow Agent to the Surviving Corporation for payment to the holder thereof (and the Buyer shall cause the Surviving Corporation to promptly pay such amounts to such holders in accordance with their Pro Rata Portions, subject to any Indemnifiable Mattersapplicable withholding as provided in Section 2.8). Except If any portion of the Indemnity Escrow Amount is previously distributed to a Buyer Indemnified Party with respect to a claim pursuant to Section 8.2 (such amount, the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit “Distributed Amount” and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration Company Equityholder with respect to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XIIclaim under Section 8.2 was made, the Restricted Equity Consideration “Breaching Equityholder”), then the Buyer and the Company Equityholder Representative shall instruct the Paying Agent to reduce any subsequent distribution payable to the Breaching Equityholder by the Distributed Amount, and the Distributed Amount shall be valued (irrespective of vesting) based on paid to the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesother Company Equityholders proportionately.

Appears in 1 contract

Samples: Merger Agreement (Progress Software Corp /Ma)

Escrow. The Escrow Deposit In order to secure ABCC’s obligations in accordance with this Agreement, the ABCC shareholders set forth on Schedule 1.2 hereof, who shall be issued Eight Hundred Fifty Million (850,000,000) Shares of ABCC Common Stock to retire and satisfy certain obligations of ABCC (the “ABCC Escrowees”), shall deliver the number of Exchange Shares set forth on Schedule 1.2, duly endorsed in blank for transfer, to Exxx X. Xxxxxxx, Trustee, as “Escrow Agent,” who shall hold the Escrow Shares pursuant to the provisions of this Section 1.2 , as follows (a) Fifty Million (50,000,000) shares shall be delivered to the Escrow Agent to secure the ABCC Escrowees’ obligations related to the Financing Condition (the “Financing Shares”). If the ABCC Escrowees fail to satisfy the Financing Condition within seventy-five (75) days of the Closing Date, upon notice from ABCC’s board of directors, the Escrow Agent shall be authorized to retire and return to treasury the Financing Shares, on a pro rata basis. If the Financing Condition is satisfied within seventy-five (75) days of the Closing Date, the Company shall release all the Financing Shares to the ABCC Escrowees . (b) In order to indemnify WTV pursuant to Section 4.7 below, at the Closing, a number of shares of ABCC Common Stock, representing ten percent (10%) of ABCC Common Stock held by the ABCC Escrowees (the “Escrow Agent for a period ending on Shares”), shall be delivered to the Escrow Release DateAgent. Until the first anniversary following the Closing (the “Measuring Period”), except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy no claims are asserted against ABCC, NCSI or WTV for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed liabilities incurred by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on ABCC and/or NCSI before the Closing Date (the “Escrow Liabilities”) and continuing until that offering proceeds in the twelve Minimum Amount have been funded to ABCC under the Financing (12) month the Financing Condition”), any remaining Escrow Shares will be released to the ABCC Escrowees promptly upon the anniversary of the Closing Date, provided that no Escrow Liabilities are asserted against ABCC during the maximum Measuring Period (a “Liability Notice”). (c) Promptly (and in any event within 5 days after the receipt of a service of any citation or summons) after becoming aware of any claim or the commencement of any suit, action or proceeding made or brought by any Person not a party hereto, in respect of which indemnity may be sought under this Agreement, ABCC shall give notice thereof to the ABCC Escrowees. (d) If ABCC receives a Liability Notice during the Measuring Period, and any Loss is incurred to ABCC and/or WTV as a result of defending, litigating, negotiating and/or settling the Escrow Liability, upon delivery of a written order, judgment, settlement agreement or a separate written agreement between ABCC and the ABCC Escrowees indicating the amount of the liability of each Stockholder paid by ABCC and/or WTV, including attorneys’ fees (the “Liability Amount”), the Escrow Agent shall be limited authorized to retire and return to treasury a number of the Escrow Shares equal to the product of the Liability Amount divided by the closing bid price of ABCC Common Stock on ABCC’s primary trading exchange (or fair market value if no such Stockholder’s Pro Rata Portion exchange exists). As used in this Section 1.2: (a) “Loss” shall mean any and all costs and expenses, including reasonable attorneys’ fees, court costs, reasonable accountants’ fees, and damages and losses, net of Five Million Dollars ($5,000,000)any insurance proceeds actually received by the party suffering the Loss with respect thereto, incurred following the commencement of a proceeding, to its final determination and the exhaustion of any and all appeals; (b) for Section 3.12 Indemnifiable Matters arising during the period beginning “Escrow Liability” shall mean all Claims against NCSI or ABCC, and all liabilities, obligations or indebtedness of any nature whatsoever of NCSI, whenever accruing, and of ABCC, accruing on the day after the twelve (12) month anniversary of or before the Closing Date (whether primary, secondary, direct, indirect, liquidated, unliquidated or contingent, matured or unmatured), including, but not limited to (i) any breach by ABCC of any of its representations or warranties set forth in Article III herein, (ii) any breach by ABCC of any of the representations or warranties set forth in the subscription agreement delivered to investors in connection with the Financing that has its basis in the operations of ABCC prior to the Closing, (iii) any litigation threatened, pending or for which a basis exists, that has resulted or may result in the entry of judgment in damages or otherwise against ABCC or NCSI; (iv) any and continuing until the eighteen all outstanding debts owed by ABCC or NCSI; (18v) month anniversary any and all internal or employee related disputes, arbitrations or administrative proceedings threatened, pending or otherwise outstanding, (vi) any and all liens, foreclosures, settlements, or other threatened, pending or otherwise outstanding financial, legal or similar obligations of ABCC or NCSI, (vii) any and all Taxes for which ABCC or any of its direct or indirect assets may be liable or subject, for any taxable period (or portion thereof) ending on or before the Closing Date, including, without limitation, any and all Taxes resulting from or attributable to ABCC’s ownership or operation of the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000)NCSI assets, (cviii) any and all Taxes for Section 3.12 Indemnifiable Matters arising during the which ABCC or its assets may be liable or subject as a consequence of Buyer’s acquisition, formation, capitalization and ownership of NCSI, whether related to a taxable period beginning (or portion thereof) ending on the day or after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, and (ix) all fees and expenses incurred in connection with effecting the maximum liability adjustments contemplated by this Section 1.6, as such ABCC Liabilities are determined by ABCC’s independent auditors, on a quarterly basis; and (c) “WTV Liabilities” shall mean all Claims against WTV or any of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion its Subsidiaries, and all liabilities, obligations or indebtedness of Three Million Dollars ($3,000,000)any nature whatsoever of WTV or any of its subsidiaries, (d) for Section 3.12 Indemnifiable Matters arising during the period beginning whenever accruing on the day after the twenty-four (24) month anniversary of or before the Closing Date (whether primary, secondary, direct, indirect, liquidated, unliquidated or contingent, matured or unmatured), including, but not limited to (i) any breach by WTV of any of its representations or warranties set forth in Article II herein, (ii) any litigation threatened, pending or for which a basis exists, that has resulted or may result in the entry of judgment in damages or otherwise against WTV; (iii) any and continuing until the thirty all outstanding debts owed by WTV; (30iv) month anniversary any and all internal or employee related disputes, arbitrations or administrative proceedings threatened, pending or otherwise outstanding, (v) any and all liens, foreclosures, settlements, or other threatened, pending or otherwise outstanding financial, legal or similar obligations of WTV, (vi) any and all Taxes for which WTV or any of its direct or indirect assets may be liable or subject, for any taxable period (or portion thereof) ending on or before the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (evii) for all fees and expenses incurred in connection with effecting the adjustments contemplated by this Section 3.12 Indemnifiable Matters arising during the period beginning 1.6, as such ABCC Liabilities are determined by ABCC’s independent auditors, on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesquarterly basis.

Appears in 1 contract

Samples: Share Exchange Agreement (Accelerated Building Concepts CORP)

Escrow. (a) Concurrently with the execution and delivery of this Agreement, the Securityholder Representative and Parent shall enter into the Escrow Agreement with the Escrow Agent. Immediately following its receipt of the Purchase Price, the repayment of the outstanding Closing Date Indebtedness and the payment of the Acquisition Expenses outstanding as of the Closing Date, the Securityholder Representative Fee and the Company Common Securityholder Representative Fee, in each case, pursuant to Section 2.13(a), the Escrow Agent shall deposit the Escrow Amount in the Escrow Account, to be held by the Escrow Agent for the purpose of securing the obligations of the Company Securityholders set forth in Article VIII and Section 2.16 (the “Escrow Account”). The Escrow Deposit Escrowed Proceeds shall be held by the Escrow Agent for a period ending on pursuant to the terms of the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release DateAgreement. The Escrow Deposit Escrowed Proceeds shall be held and disbursed by solely for the Escrow Agent purposes and in accordance with an the terms of this Agreement and the Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. . (b) Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of as otherwise provided in the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning Agreement, on the Closing Date and continuing until date that is the twelve (12) month 12‑month anniversary of the Closing Date, the maximum liability General Escrow Indemnification Amount Proceeds, minus the aggregate amount of each Stockholder Damages claimed by the Parent Indemnified Parties pursuant to Section 8.1(a) (and not fully resolved prior to such date), shall be limited released to such Stockholder’s Pro Rata Portion the Escrow Agent for disbursement to the Company Securityholders in accordance with the terms of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during this Agreement and the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), Escrow Agreement. (c) for The Litigation Escrow Indemnification Amount Proceeds shall be released in accordance with the terms and conditions set forth on Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (182.14(c) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), Company Disclosure Letter. (d) The parties hereto agree that, for Section 3.12 Indemnifiable Matters arising during Tax reporting purposes, Parent shall be deemed to be the period beginning on the day after the twenty-four (24) month anniversary owner of the Closing Date Escrowed Proceeds, as reduced from time to time by the amounts distributed from the Escrow Account in accordance with this Agreement and continuing the Escrow Agreement, and that all interest on or other taxable income, if any, earned from the investment of the Escrowed Proceeds pursuant to this Agreement shall be treated for Tax purposes as earned by Parent until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of Escrowed Proceeds are distributed in accordance with this Agreement, “Pro Rata Portion” of a Shareholder as . Any and all distributions from the Escrow Account to any Losses or as the Company Stockholders pursuant to the Escrow Deposit Agreement shall be equal to characterized for federal, state and local income tax purposes, as consideration payable in exchange for the percentage of the Merger Consideration to which Company Stock held by such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested Company Stockholders eligible for installment sale treatment pursuant to Section 7.8 453 of the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesCode (other than any amounts treated as interest under Section 483 of the Code).

Appears in 1 contract

Samples: Merger Agreement (Dun & Bradstreet Corp/Nw)

Escrow. The Escrow Deposit At the Effective Time, Acquiror shall be held by withhold the Escrow Agent for a period ending on Shares from the Escrow Release Date, except shares of Acquiror Common Stock issuable to the Escrow Deposit may be withheld after Bonus Plan Participants and issuable pursuant to Section 2.2(b) to the Escrow Release Date for so long Company Shareholders as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered of immediately prior to the Escrow Release Date. The Escrow Deposit shall be held Effective Time (other than holders of solely shares of Company Capital Stock which constitute and disbursed by remain Dissenting Shares) (“Effective Time Holders”), on a pro rata basis (based upon the Escrow Agent in accordance with an Escrow Agreement. If sum of (i) the Closing occurs, Parent agrees that the right number of shares of Acquiror Common Stock each such Effective Time Holder is entitled to indemnification receive pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except Section 2.2(b) (if applicable) with respect to the Excluded Obligations the maximum aggregate liability its shares of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations Company Capital Stock (other than Dissenting Shares) and (ii) the Section 3.12 Indemnifiable Mattersnumber of shares each such Effective Time Holder is entitled to receive as a Bonus Plan Participant (if applicable) shall be limited relative to the Cash Consideration sum of (and for the Employee Shareholders also the value i) number of the Restricted Equity Considerationshares of Acquiror Common Stock that all such Effective Time Holders are entitled to receive pursuant to Section 2.2(b) and with respect to their shares of any Shareholder individually for the Excluded Obligations Company Capital Stock (other than Dissenting Shares), and Company Warrants and (ii) the Section 3.12 Indemnifiable Mattersnumber of shares all such Effective Time Holders are entitled to receive as Bonus Plan Participants) (“Pro Rata Share”). Prior to the Closing, Acquiror, the Representative and U.S. Bank National Association (the “Escrow Agent”) shall be limited to such Shareholder’s Pro Rata Portion of enter into an escrow agreement substantially in the Losses up to form attached hereto as Exhibit D (the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration“Escrow Agreement”). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of Within five business days after the Closing Date, Acquiror shall cause the maximum liability Escrow Shares to be deposited with the Escrow Agent. The payment of each Stockholder any Escrow Shares in satisfaction of any indemnification obligations under ARTICLE 12 shall be limited made, with respect to each Effective Time Holder, first with Escrow Shares that are not then unvested and then, if such shares are insufficient to satisfy such indemnification obligation and only to the extent of such insufficiency, shall such payment be made with Unvested Shares. Acquiror shall hold the Escrow Shares as security for the Effective Time Holders’ indemnification obligations for Damages under ARTICLE 12. Notwithstanding the foregoing, that for the ease of administration, those Bonus Plan Escrow Shares allocable to the Bonus Plan Participants (other than those Bonus Plan Escrow Shares allocable to Mx. Xxxxxx Xxxxxx) will be distributed to such Stockholder’s Pro Rata Portion of Five Million Dollars Bonus Plan Participants ($5,000,000), (bother than Mx. Xxxxxx Xxxxxx) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Bonus Plan Consideration Delivery Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Covad Communications Group Inc)

Escrow. The Escrow Deposit At the Effective Time, Acquirer shall withhold from the shares of Acquirer Common Stock to be held by issued, and the Escrow Agent for a period ending cash consideration to be paid, to the Company Stockholders in the Merger upon conversion of their Company Stock pursuant to Section 2.2.2, each Company Stockholder’s Pro Rata Share of that number of shares of Acquirer Common Stock and that portion of the cash consideration (the withholding of such Acquirer Common Stock and cash being pro rata to the respective proportions that each of the Share Consideration and the Cash Consideration bear to the Closing Consideration) having an aggregate value (based on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except Acquirer Average Price Per Share with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited share portion thereof) equal to such Shareholder’s Pro Rata Portion 10.0% of the Closing Consideration (such withheld shares of Acquirer Common Stock, the “Escrow Deposit Shares” and such withheld cash consideration, the “Escrow Cash”) to secure the performance of the indemnification obligations of the Company Stockholders pursuant to Article 11. If a Company Stockholder holds Unvested Company Shares, then the proportion of shares of Acquirer Common Stock issued upon conversion hereunder of shares of Company Stock held by such Company Stockholder that are not Unvested Company Shares (“Vested Company Shares”), and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount proportion of the Cash Consideration which payable with respect to such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters Vested Shares, that shall be limited as follows: withheld from such Company Stockholder and placed in escrow shall be the proportion that (a) the aggregate number of shares of Acquirer Common Stock which such Company Stockholder would otherwise be entitled to receive for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited its Vested Company Shares bears to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during all shares of Acquirer Common Stock which such Company Stockholder is entitled to receive at the period beginning on Effective Time. Similarly, the day after proportion of shares of Acquirer Common Stock to be issued, and the twelve (12) month anniversary proportion of the Closing Date and continuing until the eighteen (18) month anniversary Cash Consideration payable, to such Company Stockholder upon conversion hereunder of the Closing DateUnvested Company Shares, the maximum liability of each Stockholder that shall be limited withheld from such Company Stockholder and placed in escrow shall be the proportion that (a) the aggregate number of shares of Acquirer Common Stock which such Company Stockholder would otherwise be entitled to receive for its Unvested Company Shares bears to (b) all shares of Acquirer Common Stock which such Company Stockholder is entitled to receive at the Effective Time. With respect to each Company Stockholder that holds Unvested Company Shares, such holders’ payment of any Escrow Shares and Escrow Cash in satisfaction of any indemnification obligations under Article 11 shall be made ratably among the Company Stockholder’s Pro Rata Portion Escrow Shares and Escrow Cash that were issued upon conversion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during Vested Company Shares and the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Company Stockholder’s Pro Rata Portion Escrow Shares and Escrow Cash that were issued upon conversion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date Unvested Company Shares and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each that such Company Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as contributed to the Escrow Deposit Fund. Any shares of Acquirer Common Stock or other equity securities issued or distributed by Acquirer (including shares issued upon a stock split, stock dividend, recapitalization or other similar event) in respect of Escrow Shares shall also be withheld in the Escrow Fund. Cash dividends on the Escrow Shares shall not be added to the escrow fund but shall be equal distributed to the percentage record holders of the Merger Consideration Escrow Shares. Acquirer shall hold the Escrow Fund as security for the Company Stockholders’ indemnification obligations for Damages under Article 11. Unless and until the Escrow Shares contributed by a Company Stockholder to which the Escrow Fund shall have been released in accordance with Article 11 hereof to compensate Acquirer Indemnified Parties for Damages, each Company Stockholder shall continue to be entitled to all rights to vote such Shareholder is entitled as set forth on Schedule 2.3Escrow Shares in accordance with Delaware Law. For purposes of Article XIIfederal income tax purposes, the Restricted Equity Consideration Escrow Cash shall be valued (irrespective treated as the property of vesting) based on Acquirer until released to the Closing Market Price, and as to shares not yet vested Company Stockholders pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesArticle 11.

Appears in 1 contract

Samples: Merger Agreement (Netscreen Technologies Inc)

Escrow. (a) On the Closing Date, $375,000.00 and 14,717 shares of Parent Common Stock from the Closing Shares (the "Escrowed Property") shall be delivered to the escrow agent listed on Exhibit A (the "Escrow Agent") to be --------- held in escrow in accordance with the terms of an escrow agreement to be entered into between the parties (the "Escrow Agreement") on or prior to the Closing Date. The Escrowed Property will be held in escrow by the Escrow Deposit Agent as security for any indemnification obligation of the Shareholders to the Merger Subsidiary, the Surviving Corporation and Parent pursuant to the terms of Section 6.02(b). The Escrowed Property shall consist of cash and the following shares of Parent Common Stock from the Shareholders and shall be allocable to such Shareholders as shown on Exhibit 4.02(a) hereof. (b) Any Loss by the Merger Subsidiary, the Surviving Corporation or Parent pursuant to Section 6.02(b) shall be satisfied first by the reduction of the Escrowed Property at its market value on the date that the Loss is paid or satisfied until the termination of the Escrow Agreement and thereafter by the Shareholders. The market value of the Escrowed Property shall not constitute a limit on the liability of the Shareholders to the Merger Subsidiary, the Surviving Corporation and Parent hereunder, it being understood and agreed that the Shareholders shall remain liable to satisfy the amount of any Loss which exceeds the then market value of the Escrowed Property, subject in any case to the Cap. The Escrowed Property shall be held by the Escrow Agent for a period ending pursuant to the terms of the Escrow Agreement which shall be agreed upon and entered into by the Escrow Agent, the Shareholders and the Merger Subsidiary on or before the Closing Date. Among other things, the Escrow Agreement will provide that on the Escrow Release Datefirst anniversary hereof, except the Escrow Deposit may be withheld after Agent shall deliver to the Shareholders or their designees such amount of the Escrowed Property then remaining, if any, as has not previously been applied pursuant to the terms of said Escrow Release Date for so long as Agreement, unless an indemnification claim by the Merger Subsidiary, the Surviving Corporation or the Parent against the Shareholders is reasonably necessary then pending. The Shareholders shall have the right at their option, to satisfy claims their respective indemnification obligations with respect to any Loss that has been Finally Determined as provided for indemnification which are in Section 6.02 by paying cash instead of having the subject to a Claims Notice Escrowed Property applied in satisfaction of such Loss. (c) On the Closing Date $430,000 from the Cash Consideration shall be delivered prior to the Escrow Release DateAgent as security for the Shareholders indemnification obligations pursuant to Section 4.02(c) and (d) hereof. The This Escrow Deposit Amount shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII the terms of the Short Term Escrow Agreement of even date. This Escrow Amount shall constitute Parent’s sole and exclusive remedy and recourse against be allocated to the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Mattersas shown on Exhibit 4.02(a) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shareshereof.

Appears in 1 contract

Samples: Merger Agreement (Interliant Inc)

Escrow. The 3.1 Contemporaneously with the execution of this Escrow Deposit Agreement, the Company shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior issue and deliver to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by Holder, to the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees extent that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole Company has authorized shares available, a certificate for the Conversion Shares and exclusive remedy Warrant Shares underlying the Initial Debentures and recourse against the Shareholders for Losses attributable Warrants. Prior to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability additional sale of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing DateDebentures, the maximum liability of each Stockholder Company shall be limited have obtained its shareholders' consent to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000)authorize, and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as have delivered to the Escrow Deposit Holder, all of the Conversion Shares and Warrant Shares required by the Agreement. Prior to each additional sale of Debentures, the Company shall, if necessary, issue and deliver to the Escrow Holder a certificate for such additional Conversion Shares as may be necessary to ensure that the appropriate number of Conversion Shares underlying the Debentures have been issued and delivered to the Escrow Holder. 3.2 All certificates for Conversion Shares and Warrant Shares delivered to the Escrow Holder shall be equal to registered in the percentage name of Thomson Kernaghan and Co. Ltd.. Until such time as the registration statement covering the Conversion Shares and the Warrant shares is effective, the certificates shall bear a legend indicating that they have been issued in a transaction that is exempt from the registration requirements of the Merger Consideration Securities Act, and may not be transferred except pursuant to which registration under the Securities Act or an exemption from such Shareholder is entitled as set forth on Schedule 2.3registration. For purposes of Article XIIExcept for such legend, the Restricted Equity Consideration Common Stock underlying the Purchasers' Warrants and the Agent's Warrant shall be valued (irrespective free and clear of vesting) based on any legends, liens, claims, stop orders or other restrictions. 3.3 Not later than the Closing Market Pricethird Business Day following the effective date of the Registration Statement, the Company shall cause the Common Stock underlying the Purchasers' Warrants and as the Agent's Warrant to shares not yet vested pursuant to Section 7.8 be registered in Agent's street name, in DTC form, free and clear of any legends, liens, claims, stop orders or other restrictions. 3.4 All Conversion Shares and Warrant Shares deposited by the Employee Shareholders’ liability with respect thereto Company after the effective date of the Registration Statement shall be limited to forfeiting such unvested sharesregistered in the street name of Thomson Kernaghan and Co. Ltd., in DTC form, free and clear of any legends, liens, claims, stop orders or other restrictions.

Appears in 1 contract

Samples: Warrant Agreement (United States Antimony Corp)

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Escrow. The Escrow Deposit (a) At the Closing: (x) Parent shall be held by deposit with the Escrow Agent for a period ending (i) the Adjustment Escrow Amount on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion behalf of the Company Indemnitors for the purpose of partially securing the obligations of the Company Indemnitors to Parent regarding a Post-Closing Deficit Amount under Section 2.9, (ii) the Indemnity Escrow Deposit Shares and the maximum aggregate liability Indemnity Escrow Cash on behalf of the Shareholders collectively Company Indemnitors for the Excluded Obligations (other than purpose of partially securing the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value obligations of the Restricted Equity Consideration) Company Indemnitors under Section 2.9 and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising Article VIII during the period beginning on through the Closing Date and continuing until the twelve fifteen (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (1215) month anniversary of the Closing Date (it being agreed that with respect to any holder of Unvested Company Shares, the amounts deposited on such Person’s behalf will be cash and continuing until shares of Parent Common Stock, as applicable, that are not subject to any further vesting requirements and then only if and to the eighteen extent there is a shortfall, Vesting Consideration will be deposited on such Person’s behalf); and (18y) month anniversary the Company shall deposit with the Escrow Agent on behalf of the Closing DateCompany Indemnitors the Other Indemnity Escrow Amount into the Other Indemnity Escrow Fund for the purpose of partially securing certain obligations of the Company Indemnitors under Section 2.11(g) and Article VIII. The Adjustment Escrow Fund shall become payable to the Company Indemnitors, if at all, in accordance with each Company Indemnitor’s respective Pro Rata Share, subject to the terms and conditions of this Agreement (including Section 2.9). The Indemnity Escrow Shares and the Indemnity Escrow Cash shall become issuable or payable, as applicable, to the Company Indemnitors, if at all, in accordance with each Company Indemnitor’s respective Pro Rata Share in the same proportion as cash and shares (if any) otherwise payable to such Company Indemnitor (and, with respect to the Key Employees, excluding the shares subject to revesting pursuant to the Joinder Agreements)), subject to the terms and conditions of this Agreement (including Section 2.9 and Article VIII). The Other Indemnity Escrow Cash shall become issuable or payable, as applicable, to the Company Indemnitors, if at all, in accordance with each Company Indemnitor’s respective Pro Rata Share in cash, subject to the terms and conditions of this Agreement (including Article VIII). The parties hereto agree that, for Tax purposes only, Parent shall be treated as the owner of the Adjustment Escrow Fund, Indemnity Escrow Cash and Other Indemnity Escrow Cash and all interest on or other taxable income, if any, earned from the investment of the Adjustment Escrow Fund, Indemnity Escrow Cash and Other Indemnity Escrow Cash pursuant to the Escrow Agreement shall be treated for Tax purposes as earned by Parent. Within ten (10) days after the final distribution of the Escrow Cash to the Company Indemnitors, Parent shall be entitled to a distribution equal to twenty eight percent (28%) of the excess of (x) all interest and earnings from the investment and reinvestment of the Escrow Cash prior to the final distribution of the Escrow Cash, over (y) the deduction available to Parent on distribution of the Escrow Cash under Section 483 of the Code (and any comparable provision of state or local Tax law), as applicable; provided that such rate shall be adjusted to reflect any subsequent change in the combined effective U.S. federal and state income tax rate applicable to corporate income of Parent. The parties hereto agree that, for federal and applicable state income tax purposes, the maximum liability of each Stockholder Company Indemnitors shall be limited treated as the owner of the Indemnity Escrow Shares. (b) The approval and adoption of this Agreement and approval of the Merger by the Company Indemnitors, and the delivery of the Joinder Agreements, Option Surrender Agreements, RSU Surrender Agreements and Warrant Cancellation Agreements by the Company Indemnitors, constitutes approval by such Company Indemnitors, as specific terms of the Merger, and the irrevocable agreement of such Company Indemnitors to such Stockholderbe bound by and comply with, this Agreement and all of the arrangements and provisions of this Agreement relating to the matters set forth in this Section 2.4, including Parent’s Pro Rata Portion deposit of Four Million Dollars ($4,000,000)the Adjustment Escrow Fund, the Indemnity Escrow Shares, the Indemnity Escrow Cash and the Other Indemnity Escrow Cash with the Escrow Agent. (c) for For purposes of determining the number of Indemnity Escrow Shares required to satisfy any Post-Closing Deficit Amount under Section 3.12 Indemnifiable Matters arising during 2.9(d), to satisfy any Losses under Article VIII or to calculate the period beginning on the day after the eighteen Retained Escrow Amount (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Dateif any), the maximum liability of each Stockholder Indemnity Escrow Share shall be deemed to have a value equal to the Parent Stock Price (and the parties hereto acknowledge that the Parent Stock Price only reflects an agreed-upon amount as to the value of a share of Parent Common Stock for the limited purpose of this sentence and is not intended to such Stockholder’s Pro Rata Portion be, nor is it, deemed to constitute the fair market value of Three Million Dollars ($3,000,000a share of Parent Common Stock at any given time), . (d) for Section 3.12 Indemnifiable Matters arising during While any Indemnity Escrow Shares are held in escrow, each Company Indemnitor shall have the period beginning on ability to exercise all rights with respect to the day after the twenty-four (24) month anniversary Company Indemnitor’s allocable portion of the Closing Date and continuing until Indemnity Escrow Shares, including voting rights, except (i) the thirty (30) month anniversary right of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000)possession thereof, and (eii) for Section 3.12 Indemnifiable Matters arising during the period beginning right to pledge, encumber, sell, assign or transfer such Indemnity Escrow Shares or any interest therein except as contemplated herein and in the Joinder Agreements. The Stockholder Representative (on the day after the thirty (30) month anniversary behalf of the Closing Date and continuing until Company Indemnitors) shall direct the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or Escrow Agent in writing as to the exercise of any such voting rights, and the Escrow Deposit Agent shall comply, to the extent it is able to do so, with any such directions of the Stockholder Representative. In the absence of such directions, the Escrow Agent shall not vote any of the shares comprising the Indemnity Escrow Shares. The Parties agree that, for tax reporting purposes, the Company Indemnitors shall be equal treated as having received the Indemnity Escrow Shares and voluntarily set them aside in the escrow account at the time of Closing and the Indemnity Escrow Shares shall be treated as issued and outstanding by Parent. In furtherance of the foregoing, the Company Indemnitors shall, be entitled to vote the Indemnity Shares and to receive any dividends in respect of the Indemnity Escrow Shares, and no tax reporting shall be required in respect of the release of all or a portion of the Indemnity Escrow Shares to the percentage Company Indemnitors. All dividends paid to holders of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes capital stock of Article XII, Parent in respect of the Restricted Equity Consideration Indemnity Escrow Shares shall not be deposited in the Escrow Account but instead shall be valued (irrespective of vesting) delivered to the Paying Agent for prompt distribution to the appropriate Company Indemnitors based on the Closing Market Price, Company Indemnitor’s allocable portion of the Indemnity Escrow Shares. The Company Indemnitors shall be responsible for paying taxes on all taxable dividends earned on the Indemnity Escrow Shares and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability for filing all necessary tax returns with respect thereto shall be limited to forfeiting such unvested sharesincome.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Accolade, Inc.)

Escrow. The Escrow Deposit Notwithstanding anything to the contrary in this Agreement, if the sum of the cash, the RAME Common Stock (valued at the RAME Stock Price) and the RAME Warrants (valued at the RAME Warrant Price) delivered to the Senior Subordinated Note Holders at the Recapitalization Closing pursuant to this Agreement and the Merger Agreement is less than the Outstanding Senior Subordinated Note Indebtedness (such difference, the “Senior Subordinated Note Holder Shortfall Amount”), then each Person that was a Senior Subordinated Note Holder as of the Recapitalization Closing shall be held by entitled to its Pro Rata Share of all distributions, if any, from the Escrow Agent for Fund and the Representative Fund until such Persons have received an aggregate amount of distributions equal to the Senior Subordinated Note Holder Shortfall Amount. Notwithstanding anything to the contrary in this Agreement, if the sum of the RAME Common Stock (valued at the RAME Stock Price) and the RAME Warrants (valued at the RAME Warrant Price) delivered to the Preferred Stockholders at the Recapitalization Closing pursuant to this Agreement and the Merger Agreement is less than the sum of the Preferred Stock Accrued Dividend Payoff Amount (such difference, the “Preferred Stock Accrued Dividend Shortfall Amount”), then, after the Senior Subordinated Note Holder Shortfall Amount has been satisfied in full, each Person that was a period ending on Preferred Stockholder as of the Recapitalization Closing shall be entitled to its Pro Rata Share of all distributions, if any, from the Escrow Release DateFund and the Representative Fund until such Persons have received an aggregate amount of distributions equal to the Preferred Stock Accrued Dividend Shortfall Amount. Notwithstanding anything to the contrary in this Agreement, except if the Escrow Deposit may be withheld sum of the cash, the RAME Common Stock (valued at the RAME Stock Price) and the RAME Warrants (valued at the RAME Warrant Price) delivered to the Preferred Stockholders in connection with the Merger pursuant to the Merger Agreement is less than the Outstanding Preferred Stock Face Amount (such difference, the “Preferred Stock Face Shortfall Amount”), then, after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are Senior Subordinated Note Holder Shortfall Amount and the subject to Preferred Stock Accrued Dividend Shortfall Amount have been satisfied in full, each Person that was a Claims Notice delivered Preferred Stockholder immediately prior to the Escrow Release Date. The Escrow Deposit Effective Time of the Merger shall be held and disbursed by entitled to all distributions, if any, from the Escrow Agent Fund and the Representative Fund, pro rata based on the number of shares of Preferred Stock held by such Persons immediately prior to the Effective Time of the Merger, until such Persons have received an aggregate amount of distributions equal to the Preferred Stock Face Shortfall Amount. All distributions, if any, from the Escrow Fund and the Representative Fund after the satisfaction in full of the Senior Subordinated Note Holder Shortfall Amount, the Preferred Stock Accrued Dividend Shortfall Amount and the Preferred Stock Face Shortfall Amount, shall be made to the Persons that were the holders of Common Stock immediately prior to the Effective Time of the Merger (including holders of Common Stock deemed to be outstanding immediately prior to the Effective Time of the Merger pursuant to Section 1.5(g)(iii) of the Merger Agreement), pro rata based on the number of shares of Common Stock held by such Persons immediately prior to the Effective Time of the Merger. For the avoidance of doubt, any amounts delivered to the Representative or the Representative Fund pursuant to Section 6.7(d) of the Merger Agreement (relating to forfeited retention bonuses) shall be distributed in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares2.12.

Appears in 1 contract

Samples: Merger Agreement (Ram Energy Resources Inc)

Escrow. The (a) CustomWare Escrow Deposit Shares shall be held by placed with the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until ending on the twelve (12) -month anniversary of the Closing Date, to be disbursed solely upon the maximum liability joint signatures of each Stockholder Visigenic and the Shareholder, all as set forth below. In the event Visigenic issues any Additional Escrow Shares (as defined below), such shares will be issued in the name of the Escrow Agent in the same manner as the CustomWare Escrow Shares delivered at Closing. Disbursements from the escrow shall be limited made for the payment of amounts, if any, to such Stockholder’s Pro Rata Portion satisfy the indemnification rights of Five Million Dollars ($5,000,000), Visigenic and CustomWare pursuant to Section 11 hereof. (b) Except for tax-free dividends paid in stock declared with respect to the CustomWare Escrow Shares pursuant to Section 3.12 Indemnifiable Matters arising 305(a) of the Code ("Additional Escrow Shares"), which shall be treated pursuant to Section 11.6 hereof, any cash dividends, dividends payable in securities or other distributions of any kind made in respect of the CustomWare Escrow Shares will be delivered to the Shareholder. The Shareholder will have voting rights with respect to the CustomWare Escrow Shares deposited in the Escrow Fund so long as such CustomWare Escrow Shares are held in escrow, and Visigenic will take all reasonable steps necessary to allow the exercise of such rights. While the CustomWare Escrow Shares remain in the Escrow Agent's possession pursuant to this Agreement, the Shareholder will retain and will be able to exercise all other incidents of ownership of said CustomWare Escrow Shares which are not inconsistent with the terms and conditions of this Agreement. (c) The CustomWare Escrow Shares shall be disbursed during the period beginning term hereof, at any time or from time to time, Visigenic may give the Shareholder a Notice of Claim. Such Notice of Claim must be for a specified amount. (i) The Shareholder may give Visigenic a written notice ("Notice of Objection") (A) attaching a copy of such Notice of Claim, (B) stating that, in the good faith opinion of the Shareholder, the claim described in such Notice of Claim is invalid (either in whole or in specified party) under the terms of Section 11 hereof, (C) giving the reasons for the alleged invalidity, and (D) stating that, based on such alleged invalidity, the Shareholder objects to the payment of any portion of the CustomWare Escrow Shares to the requesting party on account thereof. In the event that a Notice of Objection alleges that a Notice of Claim is only partially invalid, the Shareholder, within thirty (30) days of the receipt of such Notice of Claim, agrees to pay over to Visigenic that portion of the amounts specified in such Notice of Claim as to which no objection is made. The Shareholder is not required to agree to make any payments to Visigenic in respect of a Notice of Claim that has been objected to in a Notice of Objection given to the Shareholder as aforesaid except (X) as provided in the immediately preceding sentence, or (Y) in accordance with an order of any arbitration panel initiated by any of the parties hereto pursuant to paragraph (ii) below. (ii) Visigenic and the Shareholder agree to submit to final and binding arbitration any and all disputes the Shareholder has specified in a Notice of Objection or Visigenic has specified in a Notice of Claim to which the Shareholder has not responded within thirty (30) days of receipt of such Notice of Claim. Any such dispute subject to arbitration in accordance with the AAA Rules as provided in Section 11 hereof. (d) The escrow shall be terminated on the day after the twelve (12) -month anniversary of the Closing Date and continuing until (the eighteen (18) "Termination Date"); provided, however, that the escrow may -------- ------- continue beyond such 12-month anniversary anniversary, if either of the Closing parties has asserted indemnification claims, and any such claims remain unsatisfied. (e) Within five (5) business days after the Termination Date (the "Release Date"), the Escrow Agent shall release from escrow to the Shareholder, the CustomWare Escrow Shares plus all Additional Escrow Shares less the number of CustomWare Escrow Shares with a value (as determined pursuant to Section 11.2) equal to the amount of any unsatisfied indemnification claims. Any CustomWare Escrow Shares held as a result of the foregoing shall be released to the Shareholder promptly upon resolution of each indemnification claim. (f) On the Release Date, the maximum liability Escrow Agent will deliver to the Shareholder the requisite number of each Stockholder shall CustomWare Escrow Shares to be limited to released on such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during date as identified by Visigenic and the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall Agent in writing, in the form of stock certificate(s) issued in the name of the Shareholder. Certificates representing CustomWare Escrow Shares so issued that are subject to resale restrictions under applicable securities laws will bear a legend to that effect. Cash will be paid in lieu of fractions of CustomWare Escrow Shares in an amount equal to the percentage product determined by multiplying such fraction by the closing average sale price of Visigenic Common Stock as quoted on the NNM as reported in The Wall Street Journal for the ten (10) trading days prior to the date immediately prior to the Termination Date (such average price being hereafter referred to as the "Release Price"). Within five (5) business days after written request from the Shareholder or the Escrow Agent, Visigenic will deposit with the Escrow Agent sufficient funds to pay such cash amounts for fractional shares. (g) No CustomWare Escrow Shares or any beneficial interest therein may be pledged, sold, assigned or transferred, including by operation of law, by the Shareholder or be taken or reached by any legal or equitable process in satisfaction of any debt or other liability of the Merger Consideration Shareholder, prior to which the delivery to the Shareholder of the CustomWare Escrow Shares by the Escrow Agent. (h) The Escrow Agent is hereby granted the power to effect any transfer of CustomWare Escrow Shares contemplated by this Agreement. Visigenic will cooperate with the Escrow Agent in promptly issuing stock certificates to effect such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharestransfers.

Appears in 1 contract

Samples: Agreement and Plan of Reorganization (Visigenic Software Inc)

Escrow. The (a) Within seventy-five (75) days following Closing or signing of this agreement, Buyer shall deposit the Cash Earnout Amount and either the Seller Earnout Shares or the Alternative Cash Earnout Amount, as applicable (the “Seller Escrow Deposit shall be held Amounts”) with U.S. Bank, N.A. (or other institution selected by the Buyer with the reasonable consent of the Seller) as escrow agent (the “Escrow Agent for a period ending on the Escrow Release DateAgent”), except the Escrow Deposit may such deposit to be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed governed by the Escrow Agent in accordance with an terms of the Escrow Agreement. If In addition to pursuing indemnification obligations directly from Seller, the Closing occurs, Parent agrees that Seller Escrow Amounts shall be available to compensate the right to indemnification Buyer Indemnitees pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Mattersindemnification obligations of the Seller set forth in Section 9.3(h). Except with respect to Section 9.3(h), the Excluded Obligations Seller Escrow Amounts shall not be available to compensate the maximum aggregate liability Buyer Indemnitees for any other indemnification obligations of any Shareholder individually the Seller, rather, Buyer shall be limited pursue indemnification from Seller directly with respect to such Shareholder’s Pro Rata Portion indemnification obligations. Pursuant to the terms of the Escrow Deposit and Agreement, the maximum aggregate liability Seller Escrow Amounts shall be released by the Escrow Agent to Seller fourteen months after the Closing.1 (b) Within seven (7) days following Closing, Seller shall deposit 52,913 Series A Units (the “Escrow Units”) with the Escrow Agent, such deposit to be governed by the terms of the Shareholders collectively for Escrow Agreement. The Escrow Units shall not be available to compensate the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited Seller Indemnitees pursuant to the Cash Consideration (and for the Employee Shareholders also the value indemnification obligations of the Restricted Equity ConsiderationBuyer set forth below, rather, Seller shall pursue any indemnification from Buyer directly. Notwithstanding the foregoing, (i) if Buyer fails to deliver the Cash Earnout Amount and of any Shareholder individually for either the Excluded Obligations Seller Earnout Shares or the Alternative Cash Earnout Amount within seventy-five (other than the Section 3.12 Indemnifiable Matters75) shall be limited to such Shareholder’s Pro Rata Portion calendar days of the Losses up Closing, Seller may elect at its sole discretion, in lieu of some or all of such Cash Earnout Amount and either Seller Earnout Shares or Alternative Cash Earnout Amount, to the aggregate amount receive a pro rata release of the Escrow Units back to Seller, or (ii) in the event that either the Seller Earnout Shares are not freely tradable or the Alternative Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning Earnout Amount has not been delivered on the Closing Date and continuing until the twelve (12) month one year anniversary of the Closing DateClosing, Seller may elect at its sole discretion to surrender some or all of the Seller Earnout Shares back to Buyer in exchange for the pro rata release of the Escrow Units back to Seller. Pursuant to the terms of the Escrow Agreement, in the event that neither of (i) or (ii) above has occurred, the maximum liability Escrow Units will be eligible for release by the Escrow Agent twelve months after the Closing. Buyer covenants and agrees that in the event that any of each Stockholder (i) or (ii) above has occurred, it will immediately execute and deliver such documents and take such actions as are reasonably necessary to effect the assignment or return of the Escrow Units to Seller and will promptly reimburse Seller for any additional Taxes that Seller incurs as a result of such event. Further, Buyer and Seller agree that to the extent that Buyer no longer has a majority ownership interest in the Company, they shall be limited execute and deliver any and all documents necessary to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning vote their membership interests so that Buyer will designate one representatives on the day after Managing Board (as defined in the twelve (12Company Agreement) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning Seller will designate two representatives on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.Managing Board

Appears in 1 contract

Samples: Limited Liability Company Interest Purchase Agreement (En Pointe Technologies Inc)

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during At the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing DateEffective Time, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage portion of the Merger Consideration in an amount equal to which 10% of the Base Consideration (consisting, more specifically, of 10% of the shares of WFBI Common Stock that comprise the Base Consideration (the “Escrow Shares”), together with any cash in lieu of fractional shares of WFBI Common Stock to be paid with respect to such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested Escrow Shares pursuant to Section 7.8 2.2(e), and 10% of the Employee Shareholders’ liability cash that comprises the Base Consideration (the “Escrow Cash”), and together with the Escrow Shares, the “Indemnity Escrow Amount”, and together with interest and earnings thereon, the “Escrow Fund”) shall be deposited into escrow with Computershare Trust Company, N.A. (the “Escrow Agent”) pursuant to an escrow agreement in substantially the form attached hereto as Exhibit E (the “Escrow Agreement”), as security for the indemnification obligations of the holders of FP Holding Common Stock (other than holders of Dissenting Shares or Excluded Shares), FP Warrants and FP Director Options (each, an “FP Indemnity Securityholder”) and to make the payments contemplated by Section 6.12. A pro rata portion (the “Pro Rata Share”) of the Indemnity Escrow Amount shall be allocated to each FP Indemnity Securityholder, with such allocation comprising either (i) a pro rata portion of the Escrow Cash or (ii) a pro rata portion of the Escrow Shares (together with any cash in lieu of fractional shares of WFBI Common Stock to be paid with respect thereto to such Escrow Shares pursuant to Section 2.2(e)), as would be payable to each FP Indemnity Securityholder pursuant to Section 2.2 of this Agreement. The portion of the Indemnity Escrow Amount attributable to each FP Indemnity Securityholder shall be limited withheld from the portion of the Merger Consideration payable to forfeiting the FP Indemnity Securityholders at the Effective Time pursuant to Sections 2.2 and 2.3. (b) In the event that there is a distribution of a portion of the Indemnity Escrow Amount to WFBI pursuant to Section 6.12, then the amount of such unvested sharesdistribution shall be allocated in the form of Escrow Cash and Escrow Shares (together with any cash in lieu of fractional shares of WFBI Common Stock to be paid with respect to such Escrow Shares pursuant to Section 2.2(e)) in the same proportion as the Escrow Cash and Escrow Shares were deposited with respect to each FP Indemnity Securityholder, in order to proportionately reduce the Pro Rata Share allocated to each FP Indemnity Securityholder.

Appears in 1 contract

Samples: Merger Agreement (WashingtonFirst Bankshares, Inc.)

Escrow. The (a) At the Closing, (i) Buyer will deposit (A) into the Working Capital Escrow Deposit shall be held by Account with the Escrow Agent for a period ending on the sum of Two Million Five Hundred Thousand Dollars ($2,500,000) (the “Working Capital Escrow Release Date, except Amount”) and (B) into the Indemnity Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by Account with the Escrow Agent the sum of Seven Hundred Fifty-Five Thousand Dollars ($755,000) (the “Indemnity Escrow Amount,” and together with the Working Capital Escrow Amount, the “Escrow Amount”), in accordance with an Escrow Agreement. If each case, as a holdback of a portion of the Closing occursPurchase Price, Parent agrees that as the right to indemnification same may be adjusted pursuant to this Article XII shall constitute Parent’s sole Section 2.07, by wire transfer of immediately available funds, and exclusive remedy (ii) Buyer, Shareholder Representative, and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for Agent will enter into an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited escrow agreement, dated as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, substantially in the maximum liability form attached hereto as Exhibit C (the “Escrow Agreement”). The Working Capital Escrow Amount will be maintained as security for the payment by Sellers of each Stockholder any Post-Closing Adjustment and the Indemnity Escrow Amount will be maintained as security for the payment by Sellers of certain claims for Losses by Buyer and its successors and permitted assigns against Sellers as more particularly described in Article VII. All investments of the Escrow Amount shall be limited selected by Shareholder Representative in accordance with the terms of the Escrow Agreement. Releases from the Escrow Account will be made to Buyer or Sellers, as applicable, in strict accordance with the terms and conditions set forth in the Escrow Agreement, which shall impose substantial restrictions on Sellers’ access to the Escrow Amount for Buyer’s benefit; provided that any releases from the Escrow Account to the Option Holders in respect of their Options shall be disbursed to the Company for distribution to such StockholderOption Holders through the Company’s Pro Rata Portion payroll. The fees and expenses of Five Million Dollars ($5,000,000)the Escrow Agent will be paid equally by Shareholder Representative, (b) for Section 3.12 Indemnifiable Matters arising during with such fees and expenses constituting Reimbursement Expenses, and Buyer. For purposes of determining the period beginning on reduction in the day after the twelve (12) month anniversary amount of the Closing Date and continuing until the eighteen (18) month anniversary Payment Amount payable to each Seller pursuant to Section 2.05(a)(ii)(A), Buyer will be deemed to have contributed on behalf of each Seller, his, her or its pro rata portion of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars Escrow Amount ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, Exhibit B) into the Restricted Equity Consideration shall Escrow Account to be valued (irrespective of vesting) based on governed under the Closing Market Price, terms set forth in this Agreement and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrow Agreement.

Appears in 1 contract

Samples: Share Purchase Agreement (Callaway Golf Co)

Escrow. (a) On the Closing Date, Parent shall deliver to the Escrow Agent, as a contribution to the Escrow Fund, cash in an amount equal to $2,100,000 (the “Escrow Amount”), which shall serve as security for the Participating Securityholders’ indemnification obligations pursuant to Section 8. Subject to the terms of the Holdback Agreements, the Pro Rata Fraction of the Escrow Amount shall be withheld from the Merger Consideration Amount otherwise payable to each of the Participating Securityholders. The Escrow Deposit Fund shall be held by the Escrow Agent for a period ending on in accordance with the terms of this Agreement and the terms of the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release DateAgreement. The Escrow Deposit Fund shall be held as a trust fund and shall not be subject to any lien, attachment, trustee process or any other judicial process of any creditor of any Person, and shall be held and disbursed by solely for the Escrow Agent purposes and in accordance with an the terms of the Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect Subject to the Excluded Obligations Holdback Agreements, any amounts held in the maximum aggregate liability of any Shareholder individually Escrow Fund that are not subject to then outstanding indemnification claims shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited released to the Cash Consideration Participating Securityholders within three (and for 3) business days following the Employee Shareholders also date that is the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month second anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), . (b) for Section 3.12 Indemnifiable Matters arising during Subject to the period beginning on Holdback Agreements, each distribution of cash made from the day after Escrow Fund to the twelve (12) month anniversary Participating Securityholders shall be made in proportion to the respective Pro Rata Fractions of the Closing Date and continuing until Participating Securityholders at the eighteen (18) month anniversary time of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), distribution. (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary Any income, gains, losses and expenses of the Closing Date Escrow Fund shall be included by Parent as taxable income or loss of Parent, and continuing until the twenty-four (24) month anniversary any income and gains of the Closing Date, the maximum liability of each Stockholder Escrow Fund shall be limited available to such Stockholder’s Pro Rata Portion Parent as part of Three Million Dollars ($3,000,000)the Escrow Fund, and if not paid to Parent in connection with an indemnification claim in accordance with Section 8 shall ultimately be distributable to the Participating Securityholders in accordance with this Agreement and the Escrow Agreement. (d) for Section 3.12 Indemnifiable Matters arising during The approval of this Agreement by the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000)Company Stockholders, and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” acceptance of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage portion of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes Amount by the Participating Securityholders, shall constitute approval of Article XIIthe Escrow Agreement and of all of the arrangements relating thereto, including the Restricted Equity Consideration shall be valued (irrespective placement of vesting) based on the Closing Market Price, Escrow Amount in the Escrow Fund in accordance with the terms hereof and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesthereof.

Appears in 1 contract

Samples: Merger Agreement (Millennial Media Inc.)

Escrow. (a) The Betalactamics Cleanup Escrow Deposit shall be held exist solely for the purpose of securing Sellers’ obligations under Section 5.5 of this Agreement. Upon the earlier of completion of the sanitary cleanup by Buyer or nine (9) months from the date of Closing, Buyer and Sellers shall instruct the Escrow Agent for a period ending on to remit the Escrow Release Date, except difference (if any) to Sellers between the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (Betalactamics Cleanup Escrow and for an Employee Shareholder the value of his share of expenses actually and reasonably incurred by Buyer in conducting the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), sanitary clean-up activities. (b) for Section 3.12 Indemnifiable Matters arising during The Escrow Shares shall provide security of Sellers’ payment to Buyer of all amounts due as a result of (i) the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes indemnification obligations in ARTICLE 6 of this Agreement, “Pro Rata Portion” of a Shareholder as to (ii) any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested purchase price adjustments pursuant to Section 7.8 2.3 of this Agreement, including without limitation monies due to Buyer due to a Working Capital Deficiency that are not satisfied from the Employee Shareholders’ liability with respect thereto Working Capital Holdback, (iii) betalactamic clean-up expenses that exceed the Betalactamics Cleanup Escrow amount, and (iv) any other claims or costs or expenses arising under this Agreement which are the responsibility of Sellers. (c) The Escrow Shares shall be limited available to forfeiting satisfy indemnification claims pursuant to Article 6 of this Agreement for a period of seven (7) years, provided that: (i) Within ten days following the second anniversary of the Closing, Buyer shall instruct Escrow Agent to distribute to Sellers Two Hundred Thousand United States Dollars ($200,000) of OPKO Common Stock (less the sum of (i) the amount of any claims paid or pending under the Escrow Fund as of such unvested shares.date, plus (ii) Xxx Xxxxxxx Xxxxxxxx Xxxxxx Xxxxxx Dollars ($100,000), in the event the registration of the Exatka trademarks referenced in Section 4.25 shall not have been obtained by such date). The amount retained relating to the Exakta marks shall be released to Sellers if such registration is obtained prior to the 36th month after the Closing date. The number of shares of OPKO Common Stock to be released to Sellers shall be calculated in accordance with Section 6.4(d). (ii) Within ten days following the fourth anniversary of the Closing, Buyer shall instruct Escrow Agent to distribute to Sellers Two Hundred Thousand United States Dollars ($200,000) of OPKO Common Stock (less the amount of any claims paid or pending under the Escrow as of such date), and it being understood that the amounts remaining in the Escrow shall be available solely to satisfy indemnification claims as a result of Seller’s breach of the representations and warranties contained in Sections 4.20 and any other tax obligation or liability arising from operation of the Company’s business prior to closing. The number of shares of OPKO Common Stock to be released to Sellers shall be calculated in accordance with Section 6.4(d). (iii) Within ten days following the seventh anniversary of the Closing, Buyer shall instruct Escrow Agent to distribute to Sellers the remaining Escrow Shares (less the amount of any claims pending under the Escrow as of such date), ARTICLE 3

Appears in 1 contract

Samples: Purchase Agreement

Escrow. The 2.3.1 At or prior to the Closing, Avalon, the Sen Lang Representative and VStock Transfer, LLC (or such other escrow agent mutually acceptable to Avalon and the Sen Lang Representative), as escrow agent (the “Escrow Deposit Agent”), shall be held by enter into an escrow agreement, effective as of the Closing, substantially in the form attached hereto as Exhibit D (the “Escrow Agreement”), pursuant to which Avalon shall issue to the Escrow Agent a number of shares of Avalon Common Stock equal to ten percent (10.00%) of the Common Exchange Shares (the “Escrow Amount”) (together with any equity securities paid as dividends or distributions with respect to such shares or into which such shares are exchanged or converted, the “Escrow Shares”) to be held, along with any other dividends, distributions or other income on the Escrow Shares (together with the Escrow Shares, the “Escrow Property”), in a segregated escrow account (the “Escrow Account”) and disbursed therefrom in accordance with the terms of ARTICLE VIII hereof and the Escrow Agreement. The Escrow Property shall be allocated among and transferred to the Sen Lang Shareholders pro rata based on their respective Pro Rata Share. The Escrow Property shall not serve as the sole source of payment for the obligations of the Sen Lang Shareholders pursuant to ARTICLE VIII. Unless otherwise required by law, all distributions made from the Escrow Account shall be treated by the Parties as an adjustment to the number of shares of Common Exchange Shares received by the Sen Lang Shareholders pursuant to this ARTICLE II. 2.3.2 The Escrow Property shall be released from escrow on the date which is twelve (12) months after the Closing Date (the “Escrow Release Date”); provided, however, with respect to any indemnification claims made in accordance with ARTICLE VIII hereof on or prior to the Escrow Release Date that remain unresolved at the time of the Escrow Release Date (“Pending Claims”), all or a period ending portion of the Escrow Property reasonably necessary to satisfy such Pending Claims (as determined based on the amount of the indemnification claim included in the Claim Notice provided by Avalon under ARTICLE VIII and the Avalon Per Share Price) shall remain in the Escrow Account until such time as such Pending Claim shall have been finally resolved and paid pursuant to the provisions of ARTICLE VIII. After the Escrow Release Date, except any Escrow Property remaining in the Escrow Deposit may be withheld after the Escrow Release Date for so long as Account that is reasonably necessary to satisfy claims for indemnification which are the not subject to a Claims Notice delivered prior Pending Claims, if any, and not subject to the Escrow Release Date. The Escrow Deposit resolved but unpaid claims in favor of an Indemnified Party, shall be held and disbursed transferred by the Escrow Agent to the Sen Lang Shareholders that have previously delivered the Transmittal Documents in accordance with an Section 2.2.2.2, with each such Sen Lang Shareholder receiving its Pro Rata Share of such Escrow AgreementProperty. If Promptly after the Closing occursfinal resolution of all Pending Claims and payment of all indemnification obligations in connection therewith, Parent agrees that the right to indemnification pursuant to this Article XII Escrow Agent shall constitute Parent’s sole and exclusive remedy and recourse against transfer any remaining Escrow Property remaining in the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect Escrow Account to the Excluded Obligations Sen Lang Shareholders that have previously delivered the maximum aggregate liability of any Transmittal Documents in accordance with Section 2.2.2.2, with each such Sen Lang Shareholder individually shall be limited to such Shareholder’s receiving its Pro Rata Portion Share of the such Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesProperty.

Appears in 1 contract

Samples: Share Purchase Agreement (Avalon GloboCare Corp.)

Escrow. The Escrow Deposit At the Effective Time, Acquirer will withhold from the shares of Acquirer Common Stock issuable, and from the cash payable, to each Company Stockholder in the Merger upon the conversion of such Company Stockholder's Company Series 3 Preferred Stock pursuant to Section 2.2(b), such Company Stockholder's Pro Rata Share of ten percent (10%) of the Total Consideration, provided that such withholding of shares of Acquirer Common Stock and cash shall be held by effected in a manner such that the total amount of cash so withheld from all Company Stockholders shall not exceed the Escrow Agent for a period ending on Cash Amount, with Acquirer Common Stock constituting the remainder of such withheld Total Consideration (such cash withheld, the "Escrow Release DateCash" and such shares of Acquirer Common Stock withheld, except the "Escrow Deposit may Shares"); and provided further that (a) the number of shares of Acquirer Common Stock so withheld from each Company Stockholder shall be rounded down to the nearest whole share and the amount of cash so withheld after from each Company Stockholder shall be rounded up to the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the nearest whole cent, and (b) subject to the foregoing, the proportion of shares of Acquirer Common Stock and cash so withheld from a Claims Notice delivered prior to Company Stockholder shall be the same for each Company Stockholder. Any cash dividends, shares of Acquirer Common Stock or other equity securities or other rights issued or distributed by Acquirer (including shares issued upon a stock split, stock dividend or similar event) in respect of Escrow Release DateShares (the "New Escrow Shares") will also be withheld. The Escrow Deposit shall be held and disbursed by Cash, the Escrow Agent in accordance with an Shares and any New Escrow Agreement. Shares are collectively referred to herein as the "Escrow Fund." If a Company Stockholder holds both (a) vested shares of Company Series 3 Preferred Stock and (b) Unvested Company Shares, then to the Closing occursextent possible, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability such Company Stockholder, upon conversion of any Shareholder individually shall be limited to shares of Company Series 3 Preferred Stock held by such Shareholder’s Pro Rata Portion Company Stockholder into shares of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing DateAcquirer Common Stock, the maximum liability shares of each Stockholder shall Acquirer Common Stock which are not Unvested Acquirer Shares will be limited withheld and placed in escrow prior to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to withholding any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesUnvested Acquirer Shares in escrow.

Appears in 1 contract

Samples: Merger Agreement (Concur Technologies Inc)

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on On the Closing Date and continuing until pursuant to the twelve (12) month anniversary Escrow ------ Agreement, the Purchaser, on behalf of the Closing DateCompany Stockholders, will deposit in an escrow account (the "ESCROW ACCOUNT") a number of shares of the Purchaser -------------- Common Stock equal to twenty percent (20%) of the number of shares of the Total Merger Shares (such shares, the maximum liability "ESCROW SHARES"), rounded up to the nearest ------------- whole share. The Escrow Shares will be withheld from the Company Stockholders on a pro-rata basis in proportion to the total amount of each Stockholder shall the Total Merger Shares that would otherwise be limited paid to the Company Stockholders pursuant to Section 3.1. The Escrow Shares will be held for the Company Stockholders' respective accounts in accordance with the terms of the Escrow Agreement. Upon a Company Stockholder's surrender to the Company of the certificate or certificates representing such Company Stockholder's shares of Company Common Stock, the Purchaser will deliver to such Stockholder’s Pro Rata Portion Company Stockholder pursuant to Section 3.2(a) the number of Five Million Dollars ($5,000,000shares of Purchaser Common Stock to which such Company Stockholder is entitled under Section 3.2(a), less the number of Escrow Shares to be held in ---- the Escrow Account for such Company Stockholder's account as specified in the Escrow Agreement. The Escrow Shares will be held in the Escrow Account and released to the Company Stockholders or to the Purchaser in accordance with Section 9.8 and the Escrow Agreement. Until the Escrow Shares are released from the Escrow Account in accordance with Section 9.8, (a) the Escrow Shares may not be transferred, sold, assigned, or pledged and (b) for certificates evidencing the Escrow Shares will bear a legend indicating that they are subject to restrictions on transfer pursuant to this Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,0003.4(a). For Until the purposes of this Escrow Shares held in the Escrow Account for the Company Stockholders are released in accordance with Section 9.8 and the Escrow Agreement, “Pro Rata Portion” of a Shareholder as such Company Stockholders will be entitled to any Losses or as to vote all such Escrow Shares held in the Escrow Deposit shall be equal Account in such Company Stockholder's name and to the percentage receive all dividends and distributions in respect of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrow Shares.

Appears in 1 contract

Samples: Merger Agreement (Concurrent Computer Corp/De)

Escrow. The Escrow Deposit Shares shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed retained by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and Agreement until the maximum aggregate liability earlier to occur of (the Shareholders collectively for “Escrow Termination Date”) (x) the Excluded Obligations date that is eighteen (other than the Section 3.12 Indemnifiable Matters18) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on months after the Closing Date and continuing until (y) the twelve (12) month anniversary date on which the number of Escrow Shares held by the Escrow Agent is reduced to zero because of disbursements therefrom in accordance with this Section 1.7 and the Escrow Agreement. After the Closing, subject to the provisions of this Section 1.7 and Article VIII, Purchaser shall be entitled to seek disbursements of all or portions of the Closing Escrow Shares in order to satisfy any amounts due to Purchaser pursuant to Section 1.5(b) and under claims for a breach of the Company’s, SSI’s, SSPL’s, or Stockholders’ representations, warranties or covenants hereunder, based on each Escrow Share being valued at the Purchaser Per Share Price (rounded down to the nearest whole Escrow Share). The Escrow Shares shall only be released by the Escrow Agent pursuant to the terms of this Agreement and the Escrow Agreement. On the Escrow Termination Date, the maximum liability Stockholders’ Representative and Purchaser shall execute and deliver joint written instructions to the Escrow Agent instructing the Escrow Agent to disburse to the Stockholders’ Representative any Escrow Shares remaining with the Escrow Agent, except to the extent of each Stockholder the amount of any claims for indemnifiable Losses made by any Indemnified Party under Article VIII prior to the Escrow Termination Date that have yet to be paid, are in dispute or as to which Third-Party Claims are pending, which shares shall continue to be held by the Escrow Agent after the Escrow Termination Date until such time as such disputed claims and/or Third-Party Claims are resolved, at which time the Escrow Shares remaining with the Escrow Agent shall be limited disbursed to the Stockholders’ Representative (who shall distribute such shares pro rata to the Stockholders in amounts set forth opposite each Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during name on Schedules A and B under the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, heading “Pro Rata Portion” Interest”) or Purchaser in accordance with the resolution of a Shareholder as to any Losses or as to such disputed claims in accordance with the terms of this Agreement and the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesAgreement.

Appears in 1 contract

Samples: Share Exchange Agreement (Trans-India Acquisition Corp)

Escrow. The Cash Escrow Deposit shall be held delivered by Parent to the Escrow Agent at Closing by wire and the Stock Escrow shall be delivered by the Parent as soon as practicable after the Closing and in any event within two (2) business days after the Closing, which such Cash Escrow and Stock Escrow is to be held for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date pursuant to the terms of the Escrow Agreement. Any indemnification claim for any Losses under this Article XII shall be paid first from the Escrow Deposit. Notwithstanding the foregoing, provided no claim for indemnification has been made hereunder the Escrow Release Date for the Cash Escrow portion of the Escrow Deposit shall be the nine (9) month anniversary of the Closing Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an the Escrow Agreement. If Except with respect to claims based on the Excluded Obligations, if the Closing occurs, Parent agrees and Acquisition Corp. agree that the Parent’s right to indemnification pursuant to this Article XII shall constitute Parent’s and Acquisition Corp.’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Mattersinaccuracy or breach of any representation or warranty, or any breach or nonfulfillment of any failure to perform the covenants, agreements or undertakings, of the Company, the Principal Shareholders or the Shareholders which is contained in this Agreement or the Letters of Transmittal or any Schedule or certificate delivered pursuant hereto or thereto. Except with respect to the Excluded Obligations Obligations, the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion (as defined below) of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively any Shareholder for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion (as defined below) of the Losses up to the aggregate amount of the Initial Merger Consideration and Cash Earnout Consideration to which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to less any amount previously recovered under this Article XII from such StockholderShareholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary portion of the Closing Date and continuing until the eighteen (18Escrow Deposit); provided, however, that no Shareholder shall have any liability for indemnification pursuant to Section 12.1(b) month anniversary on account of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000)any other Shareholder. For the purposes of this Agreement, a “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesentitled.

Appears in 1 contract

Samples: Merger Agreement (Marchex Inc)

Escrow. The (a) To secure the indemnification obligations of the Company under this Agreement, the Initial Indemnification Escrow Deposit Amount, the Initial Reconciliation Escrow Amount and the Litigation Fees Escrow Amount (if applicable), and, to fund the activities of the Selling Parties’ Representative, the Selling Parties Representative Escrow Amount (which shall be held under the control of the Selling Parties’ Representative pursuant to Section 1.6(b)), will all be deposited into an escrow account (the “Escrow Account”), each with a separate sub-account segregated from the others and governed by the terms of an Escrow Agreement in the form attached hereto as Exhibit 8.10 (the “Escrow Agreement”). (b) Any disbursements from the Escrow Account to the Disbursing Agent for a period ending further payment to the Selling Parties pursuant to the terms of the Escrow Agreement, Section 1.5(e), Section 1.13, and Article 10 whether in the form of cash or Buyer Stock is “Escrow Consideration.” (c) [**] (d) Any disbursements of the Selling Parties’ Representative Escrow Account to the Selling Parties’ Representative to fund the activities of Selling Parties’ Representative will be made pursuant to Section 1.6(b) and Article 10. (e) Any disbursements from the Escrow Account in respect of an indemnification payment to Buyer or Buyer’s Other Indemnified Persons in the form of Buyer Stock shall be made valuing the stock at the average closing sale price per share of Buyer Stock that is publically traded on the New York Stock Exchange for the five (5) consecutive trading days ending with the trading day two days preceding the date of the release of the Buyer Stock from the Escrow Release DateAccount. (f) Until such time as the Buyer Stock is delivered to the Selling Parties (or returned to or repurchased by Buyer), the Selling Parties shall be deemed to be the beneficial owner of their Pro-Rata Percentage of the Buyer Stock that is held pursuant to the Escrow Agreement and shall possess, through the Selling Parties’ Representative, all rights with respect to such shares, except the Escrow Deposit may be withheld after right of possession thereof. In particular, the Escrow Release Date for so long respective Selling Parties, through the Selling Parties’ Representative as their agent and attorney-in-fact, shall have the right to exercise any voting rights with respect to their allocable portion of the Buyer Stock that is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior held pursuant to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occursIn addition, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except dividends (other than non-taxable stock dividends) made with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder Buyer Stock that is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as held pursuant to the Escrow Deposit Agreement shall be equal promptly paid to the percentage Disbursing Agent for payment to the Selling Parties in accordance with their allocable portion of the Merger Consideration Buyer Stock. The Selling Parties’ Representative shall not have any obligation to which exercise any rights with respect to such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested escrowed Buyer Stock held pursuant to Section 7.8 the Employee ShareholdersEscrow Agreement unless directed to do so under the letter agreement, dated on or around the date hereof, by and among the Selling Partiesliability with respect thereto shall be limited to forfeiting such unvested sharesRepresentative and certain of the Selling Parties.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Imation Corp)

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during Purchaser and Seller shall enter into an escrow agreement in the period beginning on form agreed to by the Closing Date and continuing until parties (the twelve (12) month anniversary “Escrow Agreement”), dated as of the Closing Date, pursuant to which US Bank, National Association, as escrow agent (the maximum liability “Escrow Agent”) shall agree to hold the Indemnification Escrow Amount and the Accounts Receivable Escrow Amount for the benefit of each Stockholder shall be limited Purchaser and Seller, in accordance with the terms and conditions of this Agreement and the Escrow Agreement. Purchaser and Seller agree that the Indemnification Escrow Amount and Accounts Receivable Escrow Amount: (i) are being delivered and held for purposes of satisfying, on a non-exclusive basis, Seller’s obligations under Article 7 and Section 2.7, respectively; and (ii) are part of the consideration paid to Seller, and the obligation to release such Stockholder’s Pro Rata Portion amounts to Seller is subject to the terms and conditions of Five Million Dollars ($5,000,000), this Agreement and the Escrow Agreement. (b) for Section 3.12 Indemnifiable Matters arising during The Indemnification Escrow Amount (together with the period beginning on earnings thereon, the day after “Indemnification Escrow Fund”) and the twelve Accounts Receivable Escrow Amount (12together with the earnings thereon, the “Accounts Receivable Escrow Fund”) month anniversary shall be held in separate accounts and disbursed in accordance with the terms and conditions of the Closing Date Escrow Agreement. (c) Any amounts as to which any member of the Purchaser Group is entitled to payment under Article 7 shall be paid to such member of the Purchaser Group first from the Indemnity Escrow Funds, to the extent that the then remaining Indemnity Escrow Funds are sufficient to pay such amounts and, thereafter by Seller. To the extent any payments are to be made to any member of the Purchaser Group pursuant to Article 7 from the Indemnity Escrow Funds, Purchaser and continuing until Seller shall jointly instruct the Escrow Agent to disburse such amount to such member of the Purchaser Group by wire transfer of same day funds. (d) The Indemnity Escrow Funds remaining under the Escrow Agreement minus: (i) amounts distributed to Purchaser Group to satisfy indemnity claims pursuant to Article 7; and (ii) the amount of any then outstanding and unresolved indemnification claims reasonably made by any member of the Purchaser Group prior to the date which is eighteen (18) month anniversary months after the Closing Date that, if successful, would be payable to such member of the Closing DatePurchaser Group (such remaining amount, the maximum liability of each Stockholder “Remaining Indemnity Escrow Funds”), shall be limited to such Stockholder’s Pro Rata Portion released by the Escrow Agent by wire transfer of Four Million Dollars same day funds within five ($4,000,000), (c5) for Section 3.12 Indemnifiable Matters arising during Business Days of the period beginning on the day after the date which is eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of months after the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and . (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder The Accounts Receivable Escrow Fund shall be limited disbursed to such Stockholder’s Pro Rata Portion Purchaser or Seller in accordance with the provisions of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to Section 2.7 and the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesAgreement.

Appears in 1 contract

Samples: Equity Purchase Agreement (Crown Crafts Inc)

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld No later than two Business Days after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, Parent, on behalf of the maximum liability Surviving Corporation, will transfer to, and deposit with, the Escrow Agent an amount equal to the Escrow Amount plus the Reserve Amount. Such Escrow Amount shall become part of the Escrow Fund established pursuant to Article 7 and such Reserve Amount shall become part of the Reserve Fund established pursuant to Article 7. The portion of the Escrow Amount and the portion of the Reserve Amount withheld with respect to each Stockholder shall Escrow Holder will be limited in proportion to the amount of the Base Cash Amount payable to such StockholderEscrow Holder pursuant to Section 1.8(a) and/or Section 1.11(a) compared to the amount of the Base Cash Amount payable to all Escrow Holders. Such amount and such Escrow Holder’s Pro Rata Portion allocated percentage of Five Million Dollars the Escrow Fund and the Reserve Fund ($5,000,000)such percentage, (ban Escrow Holder’s “Recovery Percentage”) for Section 3.12 Indemnifiable Matters arising during the period beginning will be set forth on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000)Consideration Spreadsheet. For the purposes sake of this Agreementclarity, “Pro Rata Portion” the amount actually deposited into the Reserve Fund in respect of a Shareholder as each Escrow Holder shall be determined without regard to withholding Taxes applicable to such amounts, and any such withholding Taxes applicable to amounts deposited into the Reserve Fund shall reduce other amounts payable to such Escrow Holder. Thus, for example, if $100 would be deposited into the Reserve Fund on behalf of an Escrow Holder (prior to any Losses or as withholding Tax) and Taxes in the amount of $25 are required to the Escrow Deposit be withheld with respect to such $100 deposit, $100 shall be equal deposited into the Reserve Fund with respect to such Escrow Holder and other payments to such Escrow Holder in connection with the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration Closing (determined after all required Tax withholding) shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting reduced by such unvested shares$25.

Appears in 1 contract

Samples: Merger Agreement (Cadence Design Systems Inc)

Escrow. At or prior to the Closing, the Purchaser, the OSN Representative, FADL, the Seller Representative and the Escrow Agent shall enter into an Escrow Agreement, effective as of the Closing, substantially in the form attached as Exhibit A hereto (the “Escrow Agreement”), pursuant to which (i) the Purchaser shall cause to be delivered to the Escrow Agent from the Exchange Shares otherwise deliverable at Closing an aggregate of 28,095,454 Seller Escrow Shares (including (A) 24,372,900 Earn-Out Escrow Shares to be held in the Earn-Out Escrow Account and (B) 3,722,554 Seller Indemnification Escrow Shares to be held in the Indemnification Escrow Account and (ii) FADL shall cause to be delivered to the Escrow Agent the FADL Indemnification Escrow Shares to be held in the Indemnification Escrow Account, in each case along with any earnings thereon (excluding Accrued Dividends) and in accordance with the terms and conditions of this Agreement and the Escrow Agreement. The portion of the Exchange Shares that shall be withheld at the Closing for deposit in the Earn-Out Escrow Deposit Account shall be allocated among the Sellers pro rata based on each Seller’s Pro Rata Share. The portion of the Exchange Shares that shall be withheld at the Closing for deposit in the Indemnification Escrow Account shall be allocated among the Sellers holding Class B Purchaser Shares based on each such Seller’s pro rata share of the Class B Purchaser Shares. Each Seller shall have the right to vote its portion of such Escrow Shares (based on its Pro Rata Share, subject to adjustment for any Escrow Shares that are forfeited or earned in a manner other than pro rata among all Sellers based on their Pro Rata Share) during the time held in the Escrow Accounts as Escrow Shares. FADL shall have the right to vote the FADL Indemnification Escrow Shares during the time held in the Indemnification Escrow Account as Escrow Shares. The Parties agree that while any Escrow Shares are held in an Escrow Account, any dividends or distributions made or otherwise payable on or in respect of such Escrow Shares shall not be paid to the Escrow Account and shall instead be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long Purchaser as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent Accrued Dividends in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole terms and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes conditions of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Share Exchange Agreement (Ossen Innovation Co. Ltd.)

Escrow. (a) Prior to or simultaneously with the Closing, the Company and Parent shall enter into an escrow agreement (the "Escrow Agreement") with an ---------------- escrow agent selected by Parent and reasonably acceptable to the Company (the "Escrow Agent") substantially in the form of Exhibit A hereto. Prior to or ------------ --------- simultaneously with the Closing, each Shareholder shall execute and deliver to Parent a Shareholder Investment Representations and Joinder Agreement under which such Shareholder shall, among other things, agree to be bound by the terms of the Escrow Agreement and authorize and appoint a Shareholders' Representative to act on his, her or its behalf in connection with the Escrow Agreement. Pursuant to the terms of the Escrow Agreement, at the Closing, Parent will deposit in escrow with the Escrow Agent shares of Parent Common Stock having an aggregate value (calculated at the Parent Share Value) equal to fifteen percent (15%) of the Merger Consideration (the "Escrow Shares") on a pro rata basis in ------------- accordance with each Shareholder's percentage ownership of Company Common Stock. The shares of Parent Common Stock deposited with the Escrow Agent pursuant to this Section 2.04 are collectively referred to as the "Escrow ------ Fund". The Escrow Deposit Fund shall be available for the purpose of securing the ---- indemnification obligations of the Shareholders set forth in Article VIII as well as for any adjustment of the Merger Consideration pursuant to Section 2.05 below, with any such claim or adjustment to be handled on a pro rata basis. In the event any claim is made by Parent against the Escrow Fund, the Escrow Shares shall be valued at the Parent Share Value. The Escrow Fund shall be held by the Escrow Agent under the Escrow Agreement for a period ending on the Escrow Release Datelater of (i) twelve (12) months following the Closing Date or (ii) March 30, except 2003; provided, however, that if an indemnification claim is pending on such -------- ------- date, then the portion of the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the Fund subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit said claim shall be held and disbursed by the Escrow Agent until final resolution of such claim. (b) The Shareholders' Representative (as defined below) shall have a right to receive reimbursement from the Escrow Fund for any claims or expenses incurred by the Shareholders' Representative with respect to or on behalf of the Shareholders in accordance connection with an Escrow Agreement. If his duties as the Closing occursShareholders' Representative, Parent agrees provided, however, that the Shareholders' Representative's -------- ------- right to indemnification pursuant receive reimbursement from the Escrow Fund shall be subject to the conditions and restrictions set forth in this Article XII subsection (b) of this Section 2.04. The Shareholders' Representative's right to receive reimbursement from the Escrow Fund shall constitute be at all times subordinate and subject to Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except 's rights with respect to the Excluded Obligations Escrow Fund as provided in this Section 2.04 and in the maximum aggregate liability of any Shareholder individually Escrow Agreement. The Shareholders' Representative shall only be limited entitled to such Shareholder’s Pro Rata Portion receive reimbursement from that portion of the Escrow Deposit and the maximum aggregate liability Fund that is not used or being used to satisfy or secure any indemnification obligations of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of set forth in Article VIII or any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage adjustment of the Merger Consideration Consideration. The Shareholders' Representative shall not be entitled to which receive any reimbursement from the Escrow Fund until the later of (i) the termination date of the Escrow Fund as defined under the Escrow Agreement and (ii) if an indemnification claim is pending on such Shareholder is entitled termination date, then, as set forth on Schedule 2.3. For purposes to that portion of Article XIIthe Escrow Fund subject to said claim, the Restricted Equity Consideration shall be valued (irrespective date of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesfinal resolution of said claim.

Appears in 1 contract

Samples: Merger Agreement (Newport Corp)

Escrow. The a. At the Effective Time, a portion of the Merger Consideration in an amount equal to 10% of the Base Consideration (consisting, more specifically, of 10% of the shares of WFBI Common Stock that comprise the Base Consideration (the “Escrow Deposit Shares”), together with any cash in lieu of fractional shares of WFBI Common Stock to be paid with respect to such Escrow Shares pursuant to Section 6.b.v of this Plan of Merger and 10% of the cash that comprises the Base Consideration (the “Escrow Cash”), and together with the Escrow Shares, the “Indemnity Escrow Amount”, and together with interest and earnings thereon, the “Escrow Fund”) shall be held deposited into escrow with Computershare Trust Company, N.A. (the “Escrow Agent”) pursuant to an escrow agreement in substantially the form attached as Exhibit E to the Merger Agreement (the “Escrow Agreement”), as security for the indemnification obligations of the holders of FP Holding Common Stock (other than holders of Dissenting Shares or Excluded Shares), FP Warrants and FP Director Options (each, an “FP Indemnity Securityholder”) set forth in Section 6.12 of the Merger Agreement and to make the payments contemplated by Section 6.12 of the Merger Agreement. A pro rata portion (the “Pro Rata Share”) of the Indemnity Escrow Amount shall be allocated to each FP Indemnity Securityholder, with such allocation comprising either (i) a pro rata portion of the Escrow Cash or (ii) a pro rata portion of the Escrow Shares (together with any cash in lieu of fractional shares of WFBI Common Stock to be paid with respect to such Escrow Shares pursuant to Section 6.b.v of this Plan of Merger), as would be payable to each FP Indemnity Securityholder pursuant to Section 2.2 of the Merger Agreement. The portion of the Indemnity Escrow Amount attributable to each FP Indemnity Securityholder shall be withheld from the portion of the Merger Consideration payable to the FP Indemnity Securityholders at the Effective Time pursuant to Sections 6.b and 6.c of this Plan of Merger. b. In the event that there is a distribution of a portion of the Escrow Fund to WFBI pursuant to Section 6.12 of the Merger Agreement, then the amount of such distribution shall be allocated in the form of Escrow Cash and Escrow Shares (together with any cash in lieu of fractional shares of WFBI Common Stock to be paid with respect to such Escrow Shares pursuant to Section 6.b.v of this Plan of Merger) in the same proportion as the Escrow Cash and Escrow Shares were deposited with respect to each FP Indemnity Securityholder, in order to proportionately reduce the Pro Rata Share allocated to each FP Indemnity Securityholder. c. Each claim for WFBI Losses that is to be satisfied from the Escrow Fund pursuant to Article VI of the Merger Agreement shall be satisfied by delivery to WFBI, on behalf of the applicable FP Indemnity Securityholder, of Escrow Shares or Escrow Cash, as applicable, in an amount equal to the WFBI Losses. The amount of Escrow Shares and Escrow Cash to be used to satisfy each such claim shall be determined by reference to each FP Indemnity Securityholder’s Pro Rata Share of the amount to be so delivered, to be calculated as follows: as to each FP Indemnity Securityholder, out of such FP Indemnity Securityholder’s Escrow Cash or Escrow Shares, as applicable, in the same proportion as the Escrow Cash and Escrow Shares deposited with respect to such FP Indemnity Securityholder pursuant to this Section 8 of this Plan of Merger. d. Except as specifically authorized in Section 6.12 of the Merger Agreement, no claims may be made or recovery from the Escrow Fund sought following the end of the WFBI Indemnification Period. e. Promptly, and in any event within three business days, following the end of the WFBI Indemnification Period, the remaining portion of the Escrow Fund, less any amount of actual or reasonably estimated WFBI Losses in respect of any resolved claims that have yet to be satisfied or any unresolved and pending claims specified in any WFBI Claim) (“Unresolved Claims”) delivered to the FP Representative in accordance with Section 6.12(h) of the Merger Agreement on or prior to the end of the WFBI Indemnification Period, shall be distributed to the FP Indemnity Securityholders in accordance with Section 8.g of this Plan of Merger and the terms of the Escrow Agreement. f. In the event that there exist Unresolved Claims as of the expiration of the WFBI Indemnification Period, as soon as each such Unresolved Claim has been resolved, the Escrow Agent shall promptly, and in any event within three business days following the resolution or satisfaction of such Unresolved Claim, deliver in accordance with Section 8.g of this Plan of Merger and the terms of the Escrow Agreement, the portion of the Escrow Fund that was retained for purposes of satisfying such Unresolved Claim that was not needed to satisfy such Unresolved Claim. g. Delivery of the Escrow Fund or any portion thereof to the FP Indemnity Securityholders pursuant to this Section 8 of the Plan of Merger and Section 6.12 of the Merger Agreement shall be made by the Escrow Agent for based on each FP Indemnity Securityholder’s Pro Rata Share of the Indemnity Escrow Amount to be so delivered, with such allocation comprising either (i) a period ending on pro rata portion of the Escrow Release Date, except Cash or (ii) a pro rata portion of the Escrow Deposit may Shares (together with any cash in lieu of fractional shares of WFBI Common Stock to be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except paid with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested Shares pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall 6.b.v of this Plan of Merger), as would be limited payable to forfeiting such unvested shareseach FP Indemnity Securityholder pursuant to Section 6.b of this Plan of Merger.

Appears in 1 contract

Samples: Merger Agreement (WashingtonFirst Bankshares, Inc.)

Escrow. (a) The Betalactamics Cleanup Escrow Deposit shall be held exist solely for the purpose of securing Sellers’ obligations under Section 5.5 of this Agreement. Upon the earlier of completion of the sanitary cleanup by Buyer or nine (9) months from the date of Closing, Buyer and Sellers shall instruct the Escrow Agent for a period ending on to remit the Escrow Release Date, except difference (if any) to Sellers between the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (Betalactamics Cleanup Escrow and for an Employee Shareholder the value of his share of expenses actually and reasonably incurred by Buyer in conducting the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), sanitary clean-up activities. (b) for Section 3.12 Indemnifiable Matters arising during The Escrow Shares shall provide security of Sellers’ payment to Buyer of all amounts due as a result of (i) the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes indemnification obligations in ARTICLE 6 of this Agreement, “Pro Rata Portion” of a Shareholder as to (ii) any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested purchase price adjustments pursuant to Section 7.8 2.3 of this Agreement, including without limitation monies due to Buyer due to a Working Capital Deficiency that are not satisfied from the Employee Shareholders’ liability with respect thereto Working Capital Holdback, (iii) betalactamic clean-up expenses that exceed the Betalactamics Cleanup Escrow amount, and (iv) any other claims or costs or expenses arising under this Agreement which are the responsibility of Sellers. (c) The Escrow Shares shall be limited available to forfeiting satisfy indemnification claims pursuant to Article 6 of this Agreement for a period of seven (7) years, provided that: (i) Within ten days following the second anniversary of the Closing, Buyer shall instruct Escrow Agent to distribute to Sellers Two Hundred Thousand United States Dollars ($200,000) of OPKO Common Stock (less the sum of (i) the amount of any claims paid or pending under the Escrow Fund as of such unvested sharesdate, plus (ii) Xxx Xxxxxxx Xxxxxxxx Xxxxxx Xxxxxx Dollars ($100,000), in the event the registration of the Exatka trademarks referenced in Section 4.25 shall not have been obtained by such date). The amount retained relating to the Exakta marks shall be released to Sellers if such registration is obtained prior to the 36th month after the Closing date. The number of shares of OPKO Common Stock to be released to Sellers shall be calculated in accordance with Section 6.4(d). (ii) Within ten days following the fourth anniversary of the Closing, Buyer shall instruct Escrow Agent to distribute to Sellers Two Hundred Thousand United States Dollars ($200,000) of OPKO Common Stock (less the amount of any claims paid or pending under the Escrow as of such date), and it being understood that the amounts remaining in the Escrow shall be available solely to satisfy indemnification claims as a result of Seller’s breach of the representations and warranties contained in Sections 4.20 and any other tax obligation or liability arising from operation of the Company’s business prior to closing. The number of shares of OPKO Common Stock to be released to Sellers shall be calculated in accordance with Section 6.4(d). (iii) Within ten days following the seventh anniversary of the Closing, Buyer shall instruct Escrow Agent to distribute to Sellers the remaining Escrow Shares (less the amount of any claims pending under the Escrow as of such date),

Appears in 1 contract

Samples: Purchase Agreement (Opko Health, Inc.)

Escrow. The (a) To secure the indemnification obligations of the Company under this Agreement, the Initial Indemnification Escrow Deposit Amount, the Initial Reconciliation Escrow Amount and the Litigation Fees Escrow Amount (if applicable), and, to fund the activities of the Selling Parties’ Representative, the Selling Parties Representative Escrow Amount (which shall be held under the control of the Selling Parties’ Representative pursuant to Section 1.6(b)), will all be deposited into an escrow account (the “Escrow Account”), each with a separate sub-account segregated from the others and governed by the terms of an Escrow Agreement in the form attached hereto as Exhibit 8.10 (the “Escrow Agreement”). (b) Any disbursements from the Escrow Account to the Disbursing Agent for a period ending further payment to the Selling Parties pursuant to the terms of the Escrow Agreement, Section 1.5(e), Section 1.13, and Article 10 whether in the form of cash or Buyer Stock is “Escrow Consideration.” (c) [**] (d) Any disbursements of the Selling Parties’ Representative Escrow Account to the Selling Parties’ Representative to fund the activities of Selling Parties’ Representative will be made pursuant to Section 1.6(b) and Article 10. (e) Any disbursements from the Escrow Account in respect of an indemnification payment to Buyer or Buyer’s Other Indemnified Persons in the form of Buyer Stock shall be made valuing the stock at the average closing sale price per share of Buyer Stock that is publically traded on the New York Stock Exchange for the five (5) consecutive trading days ending with the trading day two days preceding the date of the release of the Buyer Stock from the Escrow Release DateAccount. (f) Until such time as the Buyer Stock is delivered to the Selling Parties (or returned to or repurchased by Buyer), the Selling Parties shall be deemed to be the beneficial owner of their Pro-Rata Percentage of the Buyer Stock that is held pursuant to the Escrow Agreement and shall possess, through the Selling Parties’ Representative, all rights with respect to such shares, except the Escrow Deposit may be withheld after right of possession thereof. In particular, the Escrow Release Date for so long respective Selling Parties, through the Selling Parties’ Representative as their agent and attorney-in-fact, shall have the right to exercise any voting rights with respect to their allocable portion of the Buyer Stock that is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior held pursuant to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occursIn addition, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except dividends (other than non-taxable stock dividends) made with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder Buyer Stock that is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as held pursuant to the Escrow Deposit Agreement ** Denotes confidential information that has been omitted from the exhibit and filed separately, accompanied by a confidential treatment request, with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934. shall be equal promptly paid to the percentage Disbursing Agent for payment to the Selling Parties in accordance with their allocable portion of the Merger Consideration Buyer Stock. The Selling Parties’ Representative shall not have any obligation to which exercise any rights with respect to such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested escrowed Buyer Stock held pursuant to Section 7.8 the Employee ShareholdersEscrow Agreement unless directed to do so under the letter agreement, dated on or around the date hereof, by and among the Selling Partiesliability with respect thereto shall be limited to forfeiting such unvested sharesRepresentative and certain of the Selling Parties.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Imation Corp)

Escrow. (a) The Purchaser shall deposit into escrow, with the Escrow Agent named in the Escrow Agreement, $800,000 of the Initial Purchase Price paid in connection with the Acquisition and an additional $300,000 to be paid by the Escrow Agent to the Stockholders in connection with any Additional Payment (the "Additional Payment Escrow Deposit" and together with the $800,000, the "Escrow Deposit"). In the event an Additional Payment is required to be made by the Purchaser as a result of the performance by AA of the AA Procedures, such Additional Payment shall be paid by the Escrow Agent from the Additional Payment Escrow Deposit to the Principal Stockholders. In the event that the amount of the Additional Payment exceeds $300,000, the Purchaser shall be liable to the Principal Stockholders for the amount of such excess. Upon the payment by the Escrow Agent to the Principal Stockholders of an Additional Payment, the balance of the Additional Payment Escrow Deposit, if any, shall be paid by the Escrow Agent to the Purchaser and an amount equal to $500,000 shall be paid from the Escrow Deposit to the Principal Stockholders. In the event a Shortfall Payment is required to be made by the Principal Stockholders as a result of the performance by AA of the AA Procedures, such Shortfall Payment shall be paid by the Escrow Agent from the Escrow Deposit to the Purchaser; provided, however, any payment made by the Escrow Agent to the Purchaser in connection with a Shortfall Payment shall not exceed $500,000. In the event that the Shortfall Payment exceeds $500,000, the Principal Stockholders shall be jointly and severally liable to the Purchaser for the amount of such excess. Upon the payment by the Escrow Agent of any Shortfall Payment, the difference, if any, between $500,000 and the amount of such payment shall be paid to the Stockholders and the Additional Payment Escrow Deposit shall be held paid to the Purchaser. After the payment by the Escrow Agent for a period ending on of any Additional Payment or Shortfall Payment, the Escrow Release Date, except total amount remaining in the Escrow Deposit may be withheld after shall equal $300,000 plus the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability amount of any Shareholder individually shall be limited to Retained Liabilities as described in Section 10.6(b) below. Until such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to time as the aggregate amount of the Cash Consideration Purchaser Indemnity Claims which such Shareholder is entitled (and for an Employee Shareholder the value of his share have been definitively resolved to be payable in favor of the Restricted Equity Consideration). The maximum aggregate liability Purchaser shall equal or exceed the amount of the Stockholders for the Section 3.12 Indemnifiable Matters Escrow Deposit, all Purchaser Indemnity Claims shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary satisfied first out of the Closing DateEscrow Deposit, as further provided under the maximum liability terms of each Stockholder shall be limited to the Escrow Agreement. At such Stockholder’s Pro Rata Portion time as the aggregate amount of Five Million Dollars ($5,000,000), Purchaser Indemnity Claims (b) for In the event that there are liabilities of SCS that constitute Retained Liabilities (as described in Section 3.12 Indemnifiable Matters arising during 8.2), the period beginning Purchaser shall deposit in the Escrow Deposit an amount equal to the Retained Liabilities. Such amount shall be determined based on the day after the twelve (12) month anniversary recorded liabilities of SCS as shown on its books and records as of the Closing Date and continuing until the eighteen (18) month anniversary plus all unrecorded liabilities known to Snydxx xx of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesdate.

Appears in 1 contract

Samples: Stock Purchase Agreement (Snyder Communications Inc)

Escrow. On the Closing Date, one third of the shares of HomeSeekers common stock that the Shareholders are entitled to receive pursuant to Section 2.1(b) of this Agreement shall instead be delivered on behalf of the Shareholders to an escrow agent mutually agreed upon by the parties (the "Escrow Agent"). The Escrow Deposit escrow shall be subject to the following terms and conditions: (a) All fees and expenses of the escrow agent shall be borne equally by the parties. (b) Additional shares received by the Shareholders with respect to shares held by in escrow, as a result of stock dividends and stock splits shall be delivered to the Escrow Agent for a period ending on and shall be subject to the terms of this Agreement; (c) The Escrow Release Agent shall hold the shares deposited until the two year anniversary of the Closing Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by whereupon the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right shall release to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability each of the Shareholders collectively for that Shareholder's pro rata portion of shares remaining in the Excluded Obligations (other than fund after payment to the Section 3.12 Indemnifiable Matters) Indemnified Parties of all of its indemnity claims, approved as provided in this Agreement, except that in the event a claim that may result in indemnification under this Agreement remains undetermined as of the two year anniversary of the Closing Date, an adequate number of shares and cash, if any, shall be limited retained in escrow to the Cash Consideration (and provide for the Employee Shareholders also the value of the Restricted Equity Consideration) and payment of any Shareholder individually for such claim. Notwithstanding the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning above, on the Closing Date and continuing until the twelve (12) month one year anniversary of the Closing Date, the maximum liability Escrow Agent shall retain that number of each Stockholder shall be limited shares and amount of cash, if any, having a value equal to such Stockholder’s Pro Rata Portion the sum of Five Million Dollars (a) $5,000,000), 333,000 plus (b) the estimated amount of any claim for Section 3.12 Indemnifiable Matters arising during indemnification pending as of the period beginning on the day after the twelve (12) month one year anniversary of the Closing Date and continuing until as determined utilizing the eighteen (18) month Average Closing Sale Price Method as of the one year anniversary of the Closing Date, and Escrow Agent shall release the maximum liability balance of the shares in escrow to each Stockholder shall of the Shareholders in an amount equal to that Shareholder's pro rata portion of the shares to be limited to such Stockholder’s Pro Rata Portion released. For example, if the Closing Sale Price for a share of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning HomeSeekers common stock on the day after the eighteen (18) month first anniversary of the Closing Date date is $33.30, and continuing until if the twenty-four (24) month anniversary of the Closing Dateunsatisfied indemnity claims are for $99,900, the maximum liability of each Stockholder Escrow Agent shall be limited retain in escrow 10,000 shares plus 3,000 shares to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), satisfy the indemnity claim. (d) for Section 3.12 Indemnifiable Matters arising during In the period beginning on the day after the twenty-four (24) month anniversary event of any claim by any of the Closing Date Indemnified Parties for indemnification, the Indemnified Party shall give written notice to the Shareholders, and continuing until the thirty (30) month anniversary parties shall attempt to reach agreement in respect to that claim. If the parties fail to reach agreement within 30 days after notice of a claim has been given, the issue shall be submitted to arbitration in accordance with the rules and requirements of the Closing Date, CPR Center for Dispute Resolution. The decision of the maximum liability of each Stockholder arbitrator shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000)final and binding on all parties, and appropriate instructions in conformity with that decision shall immediately be given by the arbitrator to the Escrow Agent, who is authorized and directed to rely on such instructions. (e) for Provided that the Shareholders verify that they have already sold all of the shares of HomeSeekers Common Stock described in Section 3.12 Indemnifiable Matters arising during 2.1(b) of this Agreement that are not held in escrow pursuant to this Article X, then through written instructions signed by all of the period beginning Shareholders, the Shareholders may instruct the Escrow Agent to sell shares of HomeSeekers Common Stock described in Section 2.1(b) of this Agreement on the day after open market before the thirty (30) month anniversary of the Closing First Keep-well Date and continuing until the thirty six (36) month anniversary of the Closing Dateor, if applicable, the maximum liability Second Keep-well Date. In such event, the Escrow Agent shall retain in escrow all proceeds of each Stockholder shall such sales together with any shares of HomeSeekers Common Stock required to be limited delivered to the Shareholders on account of such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes sales pursuant to Section 2.1(c) of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Merger Agreement (Homeseekers Com Inc)

Escrow. At the Effective Time, Parent will deposit in escrow, on a pro rata basis, certificates representing forty percent (40%) of the Merger Shares, together with stock powers duly endorsed in blank (collectively, the "Escrow Shares "). The Escrow Deposit Shares shall be held as security for the indemnification obligations under Article XI pursuant to the provisions of an Indemnity and Escrow Agreement (the "Escrow Agreement") in the form of Exhibit C attached hereto. On the date which is 180 days after the Closing Date, if there are any Escrow Shares representing over 33.33% of the Merger Shares remaining in the Escrow Fund (less any Escrow Shares being held subject to an Indemnity Claim delivered by Parent in accordance with the terms of the Escrow Agreement on or prior to 180 days after the Closing Date), such excess amount shall be distributed by the Escrow Agent for a period ending on to the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior Shareholders pursuant to the Escrow Release DateAgreement. The With respect to those Shareholders who hold Option Shares that will be converted into Merger Shares that are part vested and part unvested, the unvested Merger Shares held by each such Shareholder will be used for Escrow Deposit shall Shares and, if at the Effective Time, less than forty percent (40%) of a Shareholder's Merger Shares are unvested, all of the unvested Merger Shares of such Shareholder will be held used for Escrow Shares and disbursed by that percentage of the vested Merger Shares of such Shareholder necessary to bring such Shareholder's Escrow Shares to the forty percent (40%) level will be delivered to the Escrow Agent in accordance with an Escrow Agreementby Parent. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with With respect to those Shareholders who are executing Employment and Non-Competition Agreements or Consulting and Non-Competition Agreements and who hold shares of Company Common Stock that will be converted into Merger Shares that are partially subject to forfeiture, the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited Merger Shares subject to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which forfeiture held by each such Shareholder is entitled will be used for Escrow Shares and, if at the Effective Time, less than forty percent (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a40%) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as Shareholder's Merger Shares are subject to any Losses or as forfeiture, all of such Merger Shares that are subject to the forfeiture will be used for Escrow Deposit shall be equal to the Shares and that percentage of the Merger Consideration to which Shares of such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, that are not subject to forfeiture necessary to bring such Shareholder's Escrow Shares to the Restricted Equity Consideration shall forty percent (40%) level will be valued (irrespective of vesting) based on delivered to the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrow Agent by Parent.

Appears in 1 contract

Samples: Merger Agreement (Lycos Inc)

Escrow. (a) The Escrowed Shares deposited in accordance with Section 3.4(e) with the Escrow Deposit Agent shall be held by in an escrow account (the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary Account”) pursuant to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an this Agreement and the Escrow Agreement. If . (b) Any indemnification payment the Closing occurs, Securityholders are obligated to make to any Parent agrees that the right to indemnification Indemnified Parties pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually X in Escrowed Shares shall be limited made by returning and releasing to Parent from the Escrow Account the number of Escrowed Shares equal to (i) the amount of such Shareholder’s Pro Rata Portion indemnification payment, divided by (ii) the applicable Release Date Per Share Value of the Escrow Deposit and Escrowed Shares. (c) On the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month first anniversary of the Closing Date, the maximum liability Escrow Agent shall, in accordance with the terms of each Stockholder shall be limited the Escrow Agreement, release to such Stockholder’s Pro Rata Portion the Securityholders any and all of Five Million Dollars the Escrowed Shares remaining in the Escrow Account in excess of the sum of (i) that number of Escrowed Shares equal to $5,000,000), plus (bii) for Section 3.12 Indemnifiable Matters arising during the period beginning number of Escrowed Shares as may be necessary to satisfy in full any then unpaid indemnification claims made by Parent in good faith, in each case determined based upon the Release Date Per Share Value on the day after the twelve (12) month first anniversary of the Closing Date and continuing until Date. On the eighteen (18) month anniversary of the Closing Date, the maximum liability Escrow Agent shall release to the Securityholders the remaining Escrowed Shares, less the number of each Stockholder such Escrowed Shares as may be necessary to satisfy in full any then unpaid indemnification claims made by Parent in good faith, valued at the Release Date Per Share Value on the 18-month anniversary of the Closing Date. The Escrowed Shares retained for unresolved claims for indemnification shall be limited released by the Escrow Agent (to the extent not utilized to pay Parent for any such Stockholder’s Pro Rata Portion claims resolved in favor of Four Million Dollars ($4,000,000), (cParent Indemnified Parties) for Section 3.12 Indemnifiable Matters arising during upon their resolution in accordance with this Article X or Article XI. Release of the period beginning on Escrowed Shares to the day Securityholders after the eighteen (18) -month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary pursuant to this Section 10.6 shall not prejudice any of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary rights of the Closing Date and continuing until Parent Indemnified Parties to seek indemnification from the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of Securityholders under this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Merger Agreement (Gentiva Health Services Inc)

Escrow. At the Effective Time, Parent will deposit in escrow, on a pro rata basis, certificates representing forty percent (40%) of the Merger Shares, together with stock powers duly endorsed in blank (collectively, the "Escrow Shares "). The Escrow Deposit Shares shall be held as security for the indemnification obligations under Article XI pursuant to the provisions of an Indemnity and Escrow Agreement (the "Escrow Agreement ") in the form of Exhibit C attached hereto. On the date which is 180 days after the Closing Date, if there are any Escrow Shares representing over 33.33% of the Merger Shares remaining in the Escrow Fund (less any Escrow Shares being held subject to an Indemnity Claim delivered by Parent in accordance with the terms of the Escrow Agreement on or prior to 180 days after the Closing Date), such excess amount shall be distributed by the Escrow Agent for a period ending on to the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior Shareholders pursuant to the Escrow Release DateAgreement. The With respect to those Shareholders who hold Option Shares that will be converted into Merger Shares that are part vested and part unvested, the unvested Merger Shares held by each such Shareholder will be used for Escrow Deposit shall Shares and, if at the Effective Time, less than forty percent (40%) of a Shareholder's Merger Shares are unvested, all of the unvested Merger Shares of such Shareholder will be held used for Escrow Shares and disbursed by that percentage of the vested Merger Shares of such Shareholder necessary to bring such Shareholder's Escrow Shares to the forty percent (40%) level will be delivered to the Escrow Agent in accordance with an Escrow Agreementby Parent. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with With respect to those Shareholders who are executing Employment and Non-Competition Agreements or Consulting and Non-Competition Agreements and who hold shares of Company Common Stock that will be converted into Merger Shares that are partially subject to forfeiture, the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited Merger Shares subject to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which forfeiture held by each such Shareholder is entitled will be used for Escrow Shares and, if at the Effective Time, less than forty percent (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a40%) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as Shareholder's Merger Shares are subject to any Losses or as forfeiture, all of such Merger Shares that are subject to the forfeiture will be used for Escrow Deposit shall be equal to the Shares and that percentage of the Merger Consideration to which Shares of such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, that are not subject to forfeiture necessary to bring such Shareholder's Escrow Shares to the Restricted Equity Consideration shall forty percent (40%) level will be valued (irrespective of vesting) based on delivered to the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrow Agent by Parent.

Appears in 1 contract

Samples: Merger Agreement (Lycos Inc)

Escrow. The Escrow Deposit (a) Twenty percent of all securities otherwise issuable in respect of EyeSys Common Stock, Preferred Stock and the EyeSys Notes pursuant to Sections 2.2(b) (collectively, the "ESCROW SHARES") shall be deducted from the Merger Shares on a pro rata basis among the holders of EyeSys Common Stock, Preferred Stock and the EyeSys Notes and placed in an escrow for a one (1)-year period as the source of payment for the indemnification obligations of EyeSys, pursuant to Article 7 of this Agreement and the Escrow Agreement. (b) In addition to the shares described in Section 2.3(a) above, there shall be deposited into the Escrow that number of shares of Premier Common Stock (the "ESCROWED DISSENTING SHARES") equal to the number of shares that would be issuable to any EyeSys stockholders who have perfected their Appraisal Rights at the Closing Date in accordance with Delaware law. To the extent that the Principal Shareholder sells shares of Premier Common Stock under Section 5.22, the Escrowed Dissenting Shares so deposited in the Escrow shall be immediately released to the Principal Shareholder, in an amount equal to the amounts of Premier Common Stock sold by it, and shall be subject to the Lock-Up Agreement executed by the Principal Shareholder. At such time as the claims of dissenting shareholders have been paid, all of the Escrowed Dissenting Shares that have not been released to the Principal Shareholder shall be returned to Premier. The Interests in Eyesys held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit Principal Shareholder shall be held and disbursed by deemed converted, upon consummation of the Escrow Agent in accordance with an Escrow Agreement. If the Closing occursMerger, Parent agrees that into the right to indemnification pursuant receive that number of the Escrowed Dissenting Shares required to be delivered under this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against Section 2.3(b). (c) Upon the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion distribution out of the Escrow Deposit and of any remaining securities to the maximum aggregate liability holders of Interests in EyeSys, such securities shall be distributed to such holders in such amounts as would provide such holders with that amount of the Shareholders collectively for the Excluded Obligations (other than the Merger Securities that they would have received under Section 3.12 Indemnifiable Matters2.2(b) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to had the aggregate amount of Merger Securities originally issued been only the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value total amount of his share Merger Securities outstanding after any reimbursement to Premier of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall Merger Securities required to be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of made under this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares.

Appears in 1 contract

Samples: Merger Agreement (Premier Laser Systems Inc)

Escrow. The At Closing, Purchaser shall deposit 1,250,000 shares of Axtive Common Stock of the Stock Consideration (the “Escrow Deposit Shares”), together with an executed stock power, into an escrow account (the “Escrow Account”) maintained by the Escrow Agent pursuant to the terms of an Escrow Agreement containing customary terms and terms consistent with this Section 3.3 and otherwise in a form to be mutually agreed upon by Purchaser and Seller or Shareholder (the “Escrow Agreement”). Subject to the following provisions of this Section 3.3 regarding disbursements, the Escrow Shares shall be held by the Escrow Agent for a period ending on of one year from the Closing Date pursuant to the terms of the Escrow Release Date, except the Escrow Deposit may Agreement and shall be withheld after the Escrow Release Date for so long as is reasonably necessary generally available to satisfy any claims for indemnification which are made by Purchaser or Axtive pursuant to ARTICLE VII: (a) on the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If date that is 180 days after the Closing occursDate, Parent agrees that the right an amount equal to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion one-half of the Escrow Deposit Shares less the number of Escrow Shares equal to the sum of (i) the total number of Escrow Shares disbursed from the Escrow Account during such 180-day period to satisfy indemnification claims made by Purchaser or Axtive pursuant to ARTICLE VII and (ii) the maximum aggregate liability number of Escrow Shares equal to the total dollar amount subject to pending indemnification claims made by Purchaser or Axtive pursuant to ARTICLE VII as of the Shareholders collectively for end of such 180-day period, and not covered by any Escrow Amount, divided by the Excluded Obligations Axtive Share Value; and (other than the Section 3.12 Indemnifiable Mattersb) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month first anniversary of the Closing Date, the maximum liability remaining balance in the Escrow Account less the number of each Stockholder Escrow Shares with a value equal to the total dollar amount subject to pending indemnification claims made by Purchaser or Axtive pursuant to ARTICLE VII as of such date, which shall remain on deposit in the Escrow Account until finally resolved pursuant to ARTICLE VII, at which time any remaining balance shall be limited disbursed to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000)Seller. For the purposes purpose of satisfying any claims for indemnification made by Purchaser or Axtive pursuant to ARTICLE VII, the number of Escrow Shares shall be determined based upon the Axtive Share Value (and rounded to the nearest whole share). Notwithstanding anything to the contrary in this Agreement, “Pro Rata Portion” in the event of a Shareholder as to any Losses or as to conflict between the terms of this Agreement and the terms of the Escrow Deposit Agreement, the terms of the Escrow Agreement shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharescontrolling for all purposes.

Appears in 1 contract

Samples: Asset Purchase Agreement (Axtive Corp)

Escrow. The As security for the obligations of Sellers under this Article VII, and to provide a source of reimbursement and indemnification to the Buyer Parties, on the Closing Date, Buyers shall deliver to Xxxxx Fargo Bank, National Association, a national banking association, as agent to Buyers and Sellers (the “Escrow Deposit shall be held Agent”), in immediately available funds, to the account(s) designated by the Escrow Agent for a period ending on (the Escrow Release DateAccount”), except an amount or amounts in cash equal in the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior aggregate to the Escrow Release DateAmount, in accordance with the terms of this Agreement and the Escrow Agreement, which will be executed at the Closing, by and among Parent, the Representative and the Escrow Agent substantially in the form attached hereto as Exhibit F (the “Escrow Agreement”). The Escrow Deposit Any payment Sellers are obligated to make to any of the Buyer Parties pursuant to this Article VII shall be held and disbursed paid first, to the extent there are sufficient funds in the Escrow Account, by release of funds to the Buyer Parties from the Escrow Account by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion terms of the Escrow Deposit Agreement and shall accordingly reduce the Escrow Amount and, second, to the extent the Escrow Amount is insufficient to pay any remaining sums due, then Sellers shall be required, on a joint and several basis, to pay all of such additional sums due and owing to the Buyer Parties by wire transfer of immediately available funds within five Business Days after a “final determination” of a Loss and the maximum aggregate Sellers’ liability of therefor. On the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) eighteen month anniversary of the Closing Date, the maximum liability Escrow Agent shall release the Escrow Amount to Sellers, except that the Escrow Agent shall retain an amount (up to the lesser of each Stockholder shall be limited (x) the Escrow Amount and (y) the total amount then held by the Escrow Agent) equal to such Stockholder’s Pro Rata Portion the aggregate of Five Million Dollars ($5,000,000), (b) the Claim Amounts in respect of any claims for Section 3.12 Indemnifiable Matters arising during indemnification under this Article VII asserted prior to the period beginning on the day after the twelve (12) eighteen month anniversary of the Closing Date and continuing until the eighteen but not yet resolved (18) month anniversary “Unresolved Claims”). The portion of the Closing Date, the maximum liability of each Stockholder Escrow Amount retained for Unresolved Claims shall be limited released by the Escrow Agent (to the extent not utilized to pay the Buyer Parties for any such Stockholder’s Pro Rata Portion claims resolved in favor of Four Million Dollars ($4,000,000), (cthe Buyer Parties) for Section 3.12 Indemnifiable Matters arising during upon their resolution in accordance with this Agreement and the period beginning Escrow Agreement. All fees and expenses owed to the Escrow Agent in connection with the Escrow Agreement shall be paid on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3by Buyers. For purposes of Article XIIthis Section 7.7, a “final determination” shall exist when (i) Parent and the Restricted Equity Consideration Representative have reached an agreement in writing, (ii) a court of competent jurisdiction shall be valued have entered a final and non-appealable order or judgment, or (irrespective of vestingiii) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability an arbitration or like panel shall have rendered a final non-appealable determination with respect thereto shall be limited to forfeiting such unvested sharesdisputes the parties have agreed to submit thereto.

Appears in 1 contract

Samples: Purchase Agreement (Fossil Inc)

Escrow. The (a) Prior to or simultaneously with the Effective Time, the Sellers’ Agent and Parent shall enter into an escrow agreement with Xxxxx Fargo Bank National Association (the “Escrow Deposit Agent”) substantially in the form of Exhibit G hereto (the “Escrow Agreement”). At the Effective Time, Parent shall withhold from the Merger Consideration and deposit with the Escrow Agent the Cash Escrow Holdback Amount and a certificate representing the Parent Stock Escrow Holdback Amount (together the “Escrow Fund”), to be held in an account (the “Escrow Account”) governed by the terms and conditions of the Escrow Agreement and managed by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release DateAgent. The Escrow Deposit Account shall be available for withdrawal by Parent of the amount required by any adjustment to the Merger Consideration set forth in Section 2.07, any claim for Damages of an Indemnified Party pursuant to Section 12.02, and any claim for Losses of a Parent Indemnitee pursuant to Section 9.06. Parent shall cause to be distributed to each Seller such Seller’s Pro Rata Share of (i) the Parent Stock Escrow Holdback Amount and (ii) the Cash Escrow Holdback Amount less the Final Cash Escrow Holdback Amount as promptly as practicable, but in no event more than two Business Days, after the determination of Final Working Capital and the making of any adjustment to the Merger Consideration pursuant to Section 2.07. The Escrow Account shall terminate and Parent shall cause to be distributed to each Seller such Seller’s Pro Rata Share of the Final Cash Escrow Holdback Amount remaining, if any, in the Escrow Account promptly after April 16, 2007. (b) At the Effective Time, Parent shall withhold from the Merger Consideration each Seller’s Tax Escrow Share of the Tax Escrow Fund and deposit it with the Escrow Agent to be held in an account (the “Tax Escrow Account”) governed by the terms and disbursed conditions of the Escrow Agreement and managed by the Escrow Agent in accordance with an Agent. The Tax Escrow Agreement. If Account shall only be available for withdrawal by Parent of the Closing occurs, amount required by any claim for Losses of a Parent agrees that the right to indemnification Indemnitee pursuant to this Article XII Section 9.06(h) . The Tax Escrow Account shall constitute terminate and Parent shall cause to be distributed to each Seller such Seller’s Tax Escrow Share of the Tax Escrow Fund remaining, if any, in the Tax Escrow Account as promptly as practicable, but in no event more than ten Business Days, after the earliest of (i) the receipt of a private letter ruling from the Internal Revenue Service pursuant to Section 1362(f) of the Code, reasonably acceptable to Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except , waiving termination of S corporation status with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion failure of the Escrow Deposit and the maximum aggregate liability Chen Minors Trust to be treated as a qualified subchapter S trust, as defined in Section 1361(d)(3) of the Shareholders collectively for the Excluded Obligations (other than the Code, that has made a valid election pursuant to Section 3.12 Indemnifiable Matters1361(d)(2) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) Code (a “QSST”), and of any Shareholder individually providing inadvertent termination relief retroactively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration all years for which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000)terminating event was effective, (bii) for a Final Determination with respect to all Taxes described in Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,0009.06(h), and (eiii) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary expiration of the Closing Date and continuing until the thirty six (36) month anniversary full period of the Closing Date, the maximum liability applicable statute of each Stockholder shall be limited limitations with respect to such Stockholder’s Pro Rata Portion of One Million Dollars all Taxes described in Section 9.06(h) ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as giving effect to any Losses waiver, mitigation, or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesextension thereof).

Appears in 1 contract

Samples: Merger Agreement (Ultra Clean Holdings Inc)

Escrow. The Escrow Deposit shall be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of On the Closing Date, Purchaser shall deposit, by wire transfer of immediately available funds, the maximum liability Adjustment Escrow Amount into the Adjustment Escrow Account and the Indemnity Escrow Amount into the Indemnity Escrow Account, in each case to be held and administered in accordance with the terms of each Stockholder this Agreement and the Escrow Agreement. Such escrow amounts shall be limited withheld pro rata (based on each Securityholder’s Percentage Interest) from the amount which would be otherwise payable to such Stockholder’s Pro Rata Portion each Securityholder at the Effective Time. Upon the effectiveness of Five Million Dollars ($5,000,000the Merger, these provisions will be deemed to be binding on each of the Securityholders. Except as provided in Section 3.4(c), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder Adjustment Escrow Account shall be limited the sole source of any payments that may become due to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested Purchaser pursuant to Section 7.8 3.4 and the Employee Shareholders’ liability with respect thereto Indemnity Escrow Account shall be limited the sole source of any payments that may become due to forfeiting such unvested sharesPurchaser pursuant to any indemnification claims pursuant to and in accordance with Section 9.2. Following payment of all amounts payable from the Adjustment Escrow Account pursuant to Section 3.4, any remaining balance of the Adjustment Escrow Account will be released and distributed to the Securityholders (based on each Securityholder’s Percentage Interest) in accordance with the terms of the Escrow Agreement. Following the Release Date, any remaining balance of the Indemnity Escrow Account will be released and distributed to the Securityholders (based on each Securityholder’s Percentage Interest) in accordance with the terms of the Escrow Agreement.

Appears in 1 contract

Samples: Merger Agreement (Avista Corp)

Escrow. The Escrow Deposit (a) At the Closing, Parent shall be held by deposit with the Escrow Agent for a period ending (i) the Adjustment Escrow Cash on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion behalf of the Escrow Deposit and Company Indemnitors for the maximum aggregate liability purpose of partially securing the obligations of the Shareholders collectively Company Indemnitors to Parent regarding a Post-Closing Deficit Amount under Section 2.9 and (ii) the Indemnity Escrow Cash on behalf of the Company Indemnitors for the Excluded Obligations (other than purpose of partially securing the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value obligations of the Restricted Equity Consideration) Company Indemnitors under Section 2.9 and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising Article VIII during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until through the eighteen (18) month anniversary of the Closing Date. The Adjustment Escrow Cash shall become issuable or payable, as applicable, to the maximum liability Company Indemnitors, if at all, in accordance with each Company Indemnitor’s respective Pro Rata Share, subject to the terms and conditions of this Agreement (including Section 2.9). The Indemnity Escrow Cash shall become payable to the Company Indemnitors, if at all, in accordance with each Stockholder Company Indemnitor’s respective Pro Rata Share, subject to the terms and conditions of this Agreement (including Section 2.9 and Article VIII). The parties hereto agree that, for Tax purposes only, Parent shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during treated as the period beginning on the day after the eighteen (18) month anniversary owner of the Closing Date Escrow Cash and continuing until all interest on or other taxable income, if any, earned from the twenty-four (24) month anniversary investment of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as Escrow Cash pursuant to the Escrow Deposit Agreement shall be treated for Tax purposes as earned by Parent. Within ten (10) days after the end of each calendar quarter and within ten (10) days after the final distribution of the Escrow Cash to the Company Indemnitors, Parent shall be entitled to a distribution equal to twenty eight percent (28%) of all interest and earnings from the percentage investment and reinvestment of the Escrow Cash for such calendar quarter or portion thereof ending on such final distribution of the Escrow Cash, as applicable; provided that such rate shall be adjusted to reflect any subsequent change in the combined effective U.S. federal and state income tax rate applicable to corporate income of Parent. (b) The approval and adoption of this Agreement and approval of the Merger Consideration by the Company Indemnitors, and the delivery of the Joinder Agreements and Warrant Cancellation Agreements by the Company Indemnitors, constitutes approval by such Company Indemnitors, as specific terms of the Merger, and the irrevocable agreement of such Company Indemnitors to which such Shareholder is entitled as be bound by and comply with, this Agreement and all of the arrangements and provisions of this Agreement relating to the matters set forth on Schedule 2.3. For purposes in this Section 2.4, including Parent’s deposit of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on Escrow Cash with the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrow Agent.

Appears in 1 contract

Samples: Merger Agreement (Procore Technologies, Inc.)

Escrow. The At the Closing, TWO HUNDRED FIFTY THOUSAND (250,000) of the shares of CCA Common Stock to be received by the shareholders listed on Schedule 9.8 pursuant to Section 1.5 (the “Escrow Deposit Shares”), shall be held by and deposited with U.S. Bank National Association (the “Escrow Agent”) and not distributed to the shareholders of StorCOMM except as provided below and in the Escrow Agreement. The Escrow Shares shall be used to satisfy any indemnification obligation owed to any Indemnified Person pursuant to ARTICLE IX. The Escrow Agent shall hold the Escrow Shares pursuant to the terms and conditions of the Escrow Agreement, which shall provide that the Escrow Shares less all costs and expenses of the Escrow Agent and less any amounts for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as which CCA is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit shall be held and disbursed by the Escrow Agent in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right entitled to indemnification pursuant to this Article XII the provisions of ARTICLE IX shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect be delivered to the Excluded Obligations the maximum aggregate liability shareholders of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning StorCOMM listed on Schedule 9.8 on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month first anniversary of the Closing Date (the “Escrow Termination Date”); provided, however, if any claim for indemnification has been made by an Indemnified Person pursuant to this Agreement and continuing until has not been finally resolved prior to the eighteen (18) month anniversary of the Closing Escrow Termination Date, the maximum liability Escrow Agent will withhold from delivery to the shareholders of each Stockholder StorCOMM the number of Escrow Shares subject to the claim for indemnification until such time as the claim for indemnification has been settled or finally adjudicated. The number of Escrow Shares transferred to an Indemnified Person to satisfy an indemnification claim pursuant to ARTICLE IX shall be limited based on the value of such Escrow Shares as determined by the average closing share price of CCA’s Common Stock during the preceding 30 calendar days. For income tax purposes, each shareholder of StorCOMM shall be treated as the owner of such shareholder’s portion of the Escrow Shares while the Escrow Agent holds the Escrow Shares. Consistent with the foregoing, while the Escrow Agent holds the Escrow Shares, (i) any dividends and distributions declared and paid by CCA in respect of the Escrow Shares shall be paid to such Stockholder’s Pro Rata Portion the shareholders of Four Million Dollars StorCOMM according to their pro rata portion of the Escrow Holdback ($4,000,000except that any stock dividends shall be delivered to the Escrow Agent to be held in accordance with the Escrow Agreement), (cii) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary number of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder Escrow Shares shall be limited adjusted for any combinations, splits, recapitalizations and the like with respect to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000)Escrow Shares, (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder any additional CCA Common Stock to be issued in connection therewith shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as delivered to the Escrow Deposit shall Agent to be equal held in accordance with the Escrow Agreement and (iii) the shareholders of StorCOMM will have the right to vote the percentage of Escrow Shares until such time, if at all, as any such Escrow Shares are delivered to an Indemnified Person in accordance with ARTICLE IX and the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEscrow Agreement.

Appears in 1 contract

Samples: Merger Agreement (Creative Computer Applications Inc)

Escrow. The At the Effective Time, ten percent (10%) of the Merger Shares received by the Principal Shareholder, but in no event less than eight percent (8%) of the sum of the Merger Shares and Option Shares (collectively, the "Escrow Deposit Shares") shall be held by delivered to U.S. Bank, as escrow agent (the "Escrow Agent "), to be held for a period ending on the Escrow Release Date, except the Escrow Deposit Shares may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release Date. The Escrow Deposit Shares shall be held and disbursed by the Escrow Agent in accordance with an Escrow AgreementAgreement in the form attached hereto as Exhibit C. For the purpose of any claim against the Escrow Shares hereunder, the value per share of the Escrow Shares shall be deemed to be the Closing Market Price. If Except with respect to claims based on fraud committed by the Company or the Principal Shareholder which are not limited, if the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s 's sole and exclusive remedy and recourse against the Shareholders Principal Shareholder under this Agreement for Losses attributable to any Indemnifiable Matters. Except with respect inaccuracy or breach of any representation or warranty of the Company or the Principal Shareholder which is contained in this Agreement or the Letter of Transmittal or any Schedule or certificate delivered pursuant hereto or thereto other than Losses arising from breaches of the representations and warranties set forth in Sections 3.4, 3.11 and 3.23 (the "Covered Representations") shall be against the Merger Shares held in escrow pursuant to the Excluded Obligations Escrow Agreement. Notwithstanding anything herein to the maximum contrary, (i) the Principal Shareholder shall have no liability for indemnification pursuant to this Article XI until the aggregate liability of any Losses to the Parent and the Company exceed $25,000, at which point the Principal Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion liable for the full amount of all Losses, and (ii) except as provided in the Escrow Deposit and next sentence, the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) Principal Shareholder hereunder shall be limited to the Cash Consideration (and for the Employee Shareholders also not exceed the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited determined by reference to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as ) of the Escrow Shares. Any claims for indemnification arising under Section 11.1(i) from any inaccuracy in or breach of any Covered Representations or under Section 11.1(ii) of this Article XI will not be subject to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesany limitation.

Appears in 1 contract

Samples: Merger Agreement (Go2net Inc)

Escrow. (i) In connection with the consummation of the Merger, the Thane Escrow Shares shall be delivered to the Escrow Agent for purposes of securing Thane's indemnification obligations pursuant to Section 9.4 of this Agreement. The Thane Escrow Deposit Shares shall be held by the Escrow Agent for a period ending on pursuant to the terms of the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior to the Escrow Release DateAgreement. The Thane Escrow Deposit Shares shall be held as a trust fund and shall not be subject of any Lien, attachment, trustee process or any other judicial process of any creditor of any Party, and shall be held and disbursed solely for purposes and in accordance with the terms of the Escrow Agreement. (ii) In connection with the consummation of the Merger, at Closing each of the Controlling Stockholders shall deliver irrevocable written instructions to Thane's transfer agent directing the transfer agent to deliver all of the Thane Common Stock constituting the Reliant Escrow Shares to the Escrow Agent for purposes of securing (a) the indemnification obligations of the Corporation and the Controlling Stockholders, (b) the repayment of obligations owed by the Controlling Stockholders to Thane and (c) the Corporation's satisfaction of certain performance targets set forth in this Section 2.8(c). The Reliant Escrow Shares shall be held by the Escrow Agent pursuant to the terms of the Escrow Agreement. The Reliant Escrow Shares shall be held as a trust fund and shall not be subject of any Lien, attachment, trustee process or any other judicial process of any creditor of any Party, and shall be held and disbursed solely for purposes and in accordance with an the terms of the Escrow Agreement. If The Reliant Escrow Shares shall be distributed as follows: (A) Subject to subsection (C) below, twenty percent (20%) of the Closing occursnumber of Reliant Escrow Shares shall be distributable to the Controlling Stockholders in accordance with the terms of the Escrow Agreement and certain stock pledge agreements between Thane and each of the Controlling Stockholders. (B) Subject to subsection (C) hereof, Parent agrees eighty percent (80%) of the number of Reliant Escrow Shares (the "VESTING RELIANT ESCROW SHARES") shall be distributable to the Controlling Stockholders during the Vesting Period based on the Corporation achieving an aggregate of at least $15.0 million EBITDA (the "TARGET EBITDA") during the three (3) year fiscal period commencing on April 1, 2002 and ending March 31, 2005 (the "VESTING PERIOD"). During the Vesting Period the Vesting Reliant Escrow Shares shall be distributed as follows: (1) Subject to subsection (C) hereof, following the completion of each fiscal quarter during each fiscal year of the Vesting Period, a number of Vesting Reliant Escrow Shares not otherwise subject to an indemnification claim shall be distributed to the Controlling Stockholders as set forth on EXHIBIT Y hereto, determined by MULTIPLYING (a) the number of Vesting Reliant Escrow Shares by (b) the Cumulative Fraction, and subtracting from the forgoing product the aggregate number of Vesting Escrow Shares previously distributed to the Controlling Stockholders. (2) In the event that the right Target EBITDA is earned by the Corporation following the completion of the Vesting Period, any and all remaining Vesting Reliant Escrow Shares not otherwise subject to an indemnification claim shall be distributed to the Controlling Stockholders as set forth on EXHIBIT Y hereto. (3) In the event that the Target EBITDA is not fully earned by the Corporation during the Vesting Period, any and all Vesting Reliant Escrow Shares remaining in escrow after the disbursements provided for in subsection (B)(1) above and not otherwise subject to an indemnification claim, shall be disbursed to the Existing Thane Stockholders on a prorata basis based upon their proportionate interests set forth on EXHIBIT X hereto. (C) The escrow established pursuant to this Article XII shall constitute Parent’s sole Section 2.8 and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect pursuant to the Excluded Obligations the maximum aggregate liability of any Shareholder individually Employment Agreements shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Mattersi) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of period commencing on the Closing Date, maintain a number of Reliant Escrow Shares owned by the maximum liability Controlling Stockholders and not otherwise subject to the forefeiture provisions of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion this Section 2.8(c) having a fair market value of Four Million Dollars (at least $4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning 2.4 million based on the day after opening price of the eighteen Thane Common Stock on the Nasdaq National Market, or if the Thane Common Stock is not then admitted for trading on the Nasdaq National Market, the opening price of the Thane Common Stock on such national securities exchange or such other exchange on which the Thane Common Stock is then listed for quotation and (18ii) month anniversary of in addition to those Reliant Escrow Shares set forth in subsection (i) immediately above, commencing on the Closing Date and continuing until ending on the twenty-four earlier of (24x) month anniversary June 1, 2005 or (y) the date on which all of the Closing Dateobligations of the Controlling Stockholders under the Promissory Notes are satisfied, maintain an aggregate of 442,854 Reliant Escrow Shares owned by the maximum liability Controlling Stockholders and not otherwise subject to the forfeiture provisions of this Section 2.8(c). (D) For purposes of the indemnification provisions contained in Section 9.4 hereof, Claims for indemnification by Thane or any Affiliate thereof against the Corporation and/or the Controlling Stockholders may only be satisfied from Reliant Escrow Shares that are no longer subject to potential forfeiture pursuant to this Section 2.8(c). In no event shall the foregoing limit or otherwise modify the Controlling Stockholder's obligations to indemnify Thane in accordance with the provisions of Section 9.4. (E) Within forty five (45) days following the completion of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary fiscal quarter of the Closing Date and continuing until Vesting Period or sixty (60) days following the thirty (30) month anniversary completion of each fiscal year of the Closing DateVesting Period, Thane and the maximum liability of each Stockholder Controlling Stockholders shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), execute and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as deliver disbursement instructions to the Escrow Deposit Agent as follows: (1) If the Corporation's financial statements indicate the Controlling Stockholders are entitled to receive Vesting Reliant Escrow Shares in accordance subsection (B) above, the parties shall be equal execute disbursement instructions to the percentage Escrow Agent to deliver the number of Vesting Reliant Escrow Shares that are in excess of the Merger Consideration escrow requirements of subsection (C) above; and (2) If the Vesting Period has expired, in addition to which such Shareholder (E)(1) above, if the Corporation's Cumulative Three Year EBITDA is entitled as less than the Target Amount, the parties shall execute disbursement instructions to the Escrow Agent to deliver any Vesting Reliant Escrow Shares not earned by the Controlling Stockholders to the Existing Thane Stockholders in the proportions set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested sharesEXHIBIT X hereto.

Appears in 1 contract

Samples: Agreement and Plan of Merger (Thane International Inc)

Escrow. The Escrow Deposit Notwithstanding anything to the contrary in this Agreement, if the sum of the cash, the RAME Common Stock (valued at the RAME Stock Price) and the RAME Warrants (valued at the RAME Warrant Price) delivered to the Senior Subordinated Note Holders at the Recapitalization Closing pursuant to this Agreement and the Merger Agreement is less than the Outstanding Senior Subordinated Note Indebtedness (such difference, the "Senior Subordinated Note Holder Shortfall Amount"), then each Person that was a Senior Subordinated Note Holder as of the Recapitalization Closing shall be held by entitled to its Pro Rata Share of all distributions, if any, from the Escrow Agent for Fund and the Representative Fund until such Persons have received an aggregate amount of distributions equal to the Senior Subordinated Note Holder Shortfall Amount. Notwithstanding anything to the contrary in this Agreement, if the sum of the RAME Common Stock (valued at the RAME Stock Price) and the RAME Warrants (valued at the RAME Warrant Price) delivered to the Preferred Stockholders at the Recapitalization Closing pursuant to this Agreement and the Merger Agreement is less than the sum of the Preferred Stock Accrued Dividend Payoff Amount (such difference, the "Preferred Stock Accrued Dividend Shortfall Amount"), then, after the Senior Subordinated Note Holder Shortfall Amount has been satisfied in full, each Person that was a period ending on Preferred Stockholder as of the Recapitalization Closing shall be entitled to its Pro Rata Share of all distributions, if any, from the Escrow Release DateFund and the Representative Fund until such Persons have received an aggregate amount of distributions equal to the Preferred Stock Accrued Dividend Shortfall Amount. Notwithstanding anything to the contrary in this Agreement, except if the Escrow Deposit may be withheld sum of the cash, the RAME Common Stock (valued at the RAME Stock Price) and the RAME Warrants (valued at the RAME Warrant Price) delivered to the Preferred Stockholders in connection with the Merger pursuant to the Merger Agreement is less than the Outstanding Preferred Stock Face Amount (such difference, the "Preferred Stock Face Shortfall Amount"), then, after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are Senior Subordinated Note Holder Shortfall Amount and the subject to Preferred Stock Accrued Dividend Shortfall Amount have been satisfied in full, each Person that was a Claims Notice delivered Preferred Stockholder immediately prior to the Escrow Release Date. The Escrow Deposit Effective Time of the Merger shall be held and disbursed by entitled to all distributions, if any, from the Escrow Agent Fund and the Representative Fund, pro rata based on the number of shares of Preferred Stock held by such Persons immediately prior to the Effective Time of the Merger, until such Persons have received an aggregate amount of distributions equal to the Preferred Stock Face Shortfall Amount. All distributions, if any, from the Escrow Fund and the Representative Fund after the satisfaction in full of the Senior Subordinated Note Holder Shortfall Amount, the Preferred Stock Accrued Dividend Shortfall Amount and the Preferred Stock Face Shortfall Amount, shall be made to the Persons that were the holders of Common Stock immediately prior to the Effective Time of the Merger (including holders of Common Stock deemed to be outstanding immediately prior to the Effective Time of the Merger pursuant to Section 1.5(g)(iii) of the Merger Agreement), pro rata based on the number of shares of Common Stock held by such Persons immediately prior to the Effective Time of the Merger. For the avoidance of doubt, any amounts delivered to the Representative or the Representative Fund pursuant to Section 6.7(d) of the Merger Agreement (relating to forfeited retention bonuses) shall be distributed in accordance with an Escrow Agreement. If the Closing occurs, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except with respect to the Excluded Obligations the maximum aggregate liability of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion of the Escrow Deposit and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as to any Losses or as to the Escrow Deposit shall be equal to the percentage of the Merger Consideration to which such Shareholder is entitled as set forth on Schedule 2.3. For purposes of Article XII, the Restricted Equity Consideration shall be valued (irrespective of vesting) based on the Closing Market Price, and as to shares not yet vested pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares2.12.

Appears in 1 contract

Samples: Note Holder Payoff and Recapitalization Agreement (Jefferies & Company, Inc.)

Escrow. (a) At the Effective Time, Parent will withhold from the shares of Parent Common Stock to be issued to Company Shareholders in the Merger upon conversion of their Company Common Stock pursuant to Section 2.1.2, each Common Shareholder's Pro Rata Share of 10% of the Common Shares Consideration (such withheld shares of Parent Common Stock, the "Common Escrow Shares"). At the Effective Time, Parent will withhold from the shares of Parent Common Stock to be issued to Company Shareholders in the Merger upon conversion of their Company Preferred Stock pursuant to Section 2.1.3, each Preferred Shareholder's Pro Rata Share of 10% of the Preferred Shares Consideration (such withheld shares of Parent Common Stock, the "Preferred Escrow Shares", and together with the Common Escrow Shares, the "Escrow Shares"). Any shares of Parent Common Stock or other equity securities issued or distributed by Parent (including shares issued upon a stock split, stock dividend, recapitalization or other similar event) in respect of Escrow Shares (the "New Shares") shall also be withheld in the Escrow Fund. The Escrow Deposit Shares and any New Shares are collectively referred to herein as the "Escrow Funds." Cash dividends on Escrow Funds shall not be held by the Escrow Agent for a period ending on the Escrow Release Date, except the Escrow Deposit may be withheld after the Escrow Release Date for so long as is reasonably necessary to satisfy claims for indemnification which are the subject to a Claims Notice delivered prior added to the Escrow Release Date. The Escrow Deposit Funds but shall be held and disbursed by distributed to the record holders of such Escrow Agent in accordance with an Escrow AgreementFunds. If the Closing occursa Company Shareholder holds both vested shares of Company Common Stock and Unvested Company Shares, Parent agrees that the right to indemnification pursuant to this Article XII shall constitute Parent’s sole and exclusive remedy and recourse against the Shareholders for Losses attributable to any Indemnifiable Matters. Except then, with respect to any particular Company Shareholder, upon conversion of such shares of Company Common Stock into Parent Common Stock the Excluded Obligations the maximum aggregate liability percentage of any Shareholder individually shall be limited to such Shareholder’s Pro Rata Portion shares of the Escrow Deposit Parent Common Stock withheld and the maximum aggregate liability of the Shareholders collectively for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to the Cash Consideration (and for the Employee Shareholders also the value of the Restricted Equity Consideration) and of any Shareholder individually for the Excluded Obligations (other than the Section 3.12 Indemnifiable Matters) shall be limited to such Shareholder’s Pro Rata Portion of the Losses up to the aggregate amount of the Cash Consideration which such Shareholder is entitled (and for an Employee Shareholder the value of his share of the Restricted Equity Consideration). The maximum aggregate liability of the Stockholders for the Section 3.12 Indemnifiable Matters shall be limited as follows: (a) for Section 3.12 Indemnifiable Matters arising during the period beginning on the Closing Date and continuing until the twelve (12) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Five Million Dollars ($5,000,000), (b) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twelve (12) month anniversary of the Closing Date and continuing until the eighteen (18) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Four Million Dollars ($4,000,000), (c) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the eighteen (18) month anniversary of the Closing Date and continuing until the twenty-four (24) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of Three Million Dollars ($3,000,000), (d) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the twenty-four (24) month anniversary of the Closing Date and continuing until the thirty (30) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of $Two Million Dollars ($2,000,000), and (e) for Section 3.12 Indemnifiable Matters arising during the period beginning on the day after the thirty (30) month anniversary of the Closing Date and continuing until the thirty six (36) month anniversary of the Closing Date, the maximum liability of each Stockholder shall be limited to such Stockholder’s Pro Rata Portion of One Million Dollars ($1,000,000). For the purposes of this Agreement, “Pro Rata Portion” of a Shareholder as placed in escrow that are unvested or subject to any Losses right of repurchase or as to the Escrow Deposit other risk of forfeiture ("Parent Unvested Shares") shall be equal to the percentage of such holder's shares of Company Common Stock that were Unvested Company Shares. Parent will hold the Merger Consideration certificates representing such Escrow Shares as security for the Company Shareholders' indemnification obligations for Damages under Article 11. The payment of any Escrow Funds in satisfaction of any indemnification obligations under Article 11 shall be made, with respect to which each Company Shareholder, first with shares of Parent Common Stock not subject to any vesting or right of repurchase or other risk of forfeiture and then, if such shares are insufficient to satisfy such indemnification obligation and only to the extent of such insufficiency, shall such payment be made with Unvested Parent Shares. The Escrow Funds will be represented by a certificate or certificates issued in the names of each Company Shareholder is entitled in proportion to each Common Shareholder's Pro Rata Share and/or Preferred Shareholder's Pro Rata Share, as set forth on Schedule 2.3. For purposes applicable, and will be held by Parent, subject to the terms and conditions of Article XII11, until the Restricted Equity Consideration shall be valued Escrow Release Date (irrespective of vesting) based on the Closing Market Price, and as subject to shares not yet vested any such Escrow Funds being withheld pursuant to Section 7.8 the Employee Shareholders’ liability with respect thereto shall be limited to forfeiting such unvested shares11.2(c)).

Appears in 1 contract

Samples: Merger Agreement (Interwoven Inc)

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