Exchange Fund; Exchange of Certificates. (a) Prior to the Closing Date, Pi and Lambda shall mutually select a bank or trust company, which may be the transfer agent for the Pi Common Stock, to act as exchange agent in the First Merger (the “Exchange Agent”), and, not later than the Effective Time, Pi shall enter into an agreement with the Exchange Agent, which will provide that, at or prior to the Effective Time, Pi shall deposit with the Exchange Agent all of the shares of Pi Common Stock required to pay the aggregate Merger Consideration pursuant to Section 1.6(a)(ii) and Section 1.8(f). The shares of Pi Common Stock so deposited with the Exchange Agent, together with (i) any dividends or distributions received by the Exchange Agent with respect to such shares and (ii) proceeds received from the sale of the Pi Excess Shares pursuant to Section 1.8(f), are referred to collectively as the “Exchange Fund.” (b) As soon as practicable after the Effective Time, but in no event more than two (2) Business Days after the Closing Date, Pi shall cause the Exchange Agent to mail to the record holders of Lambda Stock Certificates (i) a letter of transmittal in customary form and containing such provisions as Pi and Lambda may reasonably specify (including a provision confirming that delivery of Lambda Stock Certificates shall be effected, and risk of loss and title to Lambda Stock Certificates shall pass, only upon delivery of such Lambda Stock Certificates to the Exchange Agent) and (ii) instructions for use in effecting the surrender of Lambda Stock Certificates in exchange for Pi Common Stock, as provided in Section 1.6, and any cash in lieu of a fractional share which the shares of Lambda Common Stock represented by such Lambda Stock Certificates shall have been converted into the right to receive pursuant to this Agreement, as well as any dividends or distributions to be paid pursuant to Section 1.8(c). Upon surrender of a Lambda Stock Certificate to the Exchange Agent for exchange, together with a duly executed letter of transmittal and such other documents as may be reasonably required by the Exchange Agent or Pi, (A) the holder of such Lambda Stock Certificate shall be entitled to receive in book-entry form the number of whole shares of Pi Common Stock that such holder has the right to receive pursuant to the provisions of Section 1.6 (and cash in lieu of any fractional share of Pi Common Stock) as well as any dividends or distributions to be paid pursuant to Section 1.8(c), and (B) the Lambda Stock Certificate so surrendered shall be immediately canceled. (c) No dividends or other distributions declared with respect to the Pi Common Stock shall be paid to the holder of any unsurrendered Lambda Stock Certificate until the holder thereof shall surrender such Lambda Stock Certificate in accordance with this Article I. After the surrender of a Lambda Stock Certificate in accordance with this Article I, the record holder thereof shall be entitled to receive any such dividends or other distributions, without any interest thereon, which theretofore had become payable with respect to the whole shares of Pi Common Stock which the shares of Lambda Common Stock represented by such Lambda Stock Certificate have been converted into the right to receive. (d) Until surrendered as contemplated by this Section 1.8, each Lambda Stock Certificate shall be deemed, from and after the Effective Time, to represent only the right to receive shares of Pi Common Stock (and cash in lieu of any fractional share of Pi Common Stock) as contemplated by this Article I and any distribution or dividend with respect to Pi Common Stock the record date for which is after the Effective Time. (e) In the event of a transfer of ownership of shares of Lambda Common Stock that is not registered in the transfer records of Lambda, shares in book-entry form representing the proper number of shares of Pi Common Stock may be issued to a Person, other than the Person in whose name such Lambda Stock Certificate so surrendered is registered if such Lambda Stock Certificate shall be properly endorsed or otherwise be in proper form for transfer and the Person requesting such issuance shall pay any transfer or other Taxes required by reason of the issuance of Pi Common Stock to a Person other than the registered holder of such Lambda Stock Certificate or, establish to the satisfaction of Pi, that such Taxes have been paid or are not applicable. If any Lambda Stock Certificate shall have been lost, stolen or destroyed, Pi may, in its discretion and as a condition precedent to the issuance of any shares in book-entry form representing Pi Common Stock, require the owner of such lost, stolen or destroyed Lambda Stock Certificate to provide an appropriate affidavit and to deliver a bond (in such sum as Pi may reasonably direct) as indemnity against any claim that may be made against the Exchange Agent, Pi or the Surviving Corporation with respect to such Lambda Stock Certificate. (i) As promptly as practicable following the Effective Time, the Exchange Agent shall (A) determine the number of whole shares of Pi Common Stock and the number of fractional shares of Pi Common Stock that each holder of Lambda Common Stock is entitled to receive in connection with the consummation of the First Merger and (B) aggregate all such fractional shares of Pi Common Stock that would, except as provided in Section 1.6(c), be issued to the holders of Lambda Common Stock, rounding up to the nearest whole number (the “Pi Excess Shares”), and the Exchange Agent shall, on behalf of former stockholders of Lambda, sell the Pi Excess Shares at then-prevailing prices on The Nasdaq Stock Market LLC (“Nasdaq”), all in the manner provided in Section 1.8(f)(ii). (ii) The sale of the Pi Excess Shares by the Exchange Agent shall be executed on Nasdaq through one or more member firms of Nasdaq and shall be executed in round lots to the extent practicable. The Exchange Agent shall use reasonable efforts to complete the sale of the Pi Excess Shares as promptly following the Effective Time as, in the Exchange Agent’s sole judgment, is practicable consistent with obtaining the best execution of such sales in light of prevailing market conditions. Until the net proceeds of such sale or sales have been distributed to the former holders of Lambda Common Stock, the Exchange Agent shall hold such proceeds in trust for such holders (the “Lambda Common Stock Trust”). Pi shall pay all commissions and other out-of-pocket transaction costs (other than any transfer or similar Taxes imposed on a holder of Lambda Common Stock), including the expenses and compensation of the Exchange Agent incurred in connection with such sale of the Pi Excess Shares. The Exchange Agent shall determine the portion of the Lambda Common Stock Trust to which each former holder of Lambda Common Stock is entitled, if any, by multiplying the amount of the aggregate net proceeds composing the Lambda Common Stock Trust by a fraction, the numerator of which is the amount of the fractional share interest to which such former holder of Lambda Common Stock is entitled (after taking into account all shares of Lambda Common Stock held at the Effective Time by such holder) and the denominator of which is the aggregate amount of fractional share interests to which all former holders of Lambda Common Stock are entitled. (iii) As soon as practicable after the determination of the amount of cash, if any, to be paid to former holders of Lambda Common Stock with respect to any fractional share interests, the Exchange Agent shall make available such amounts to such holders, subject to and in accordance with the terms of this Section 1.8. (g) Any portion of the Exchange Fund that remains undistributed to stockholders of Lambda as of the date six (6) months after the Effective Time shall be delivered to Pi upon demand, and any holders of Lambda Stock Certificates who have not theretofore surrendered their Lambda Stock Certificates to the Exchange Agent in accordance with this Section 1.8 and any holders of Book-Entry Common Shares who have not theretofore cashed any check payable to them in accordance with Section 1.9, shall thereafter look only to Pi for satisfaction of their claims for Pi Common Stock, cash in lieu of fractional shares of Pi Common Stock and any dividends or distributions with respect to Pi Common Stock subject to applicable abandoned property law, escheat laws or similar Laws. (h) Each of the Exchange Agent, Pi, Lambda, the Surviving Corporation, the Surviving Company and their respective Affiliates and agents shall be entitled to deduct and withhold from any consideration payable or otherwise deliverable pursuant to this Agreement such amounts as are required to be deducted or withheld therefrom under the Code or any provision of state, local or foreign Tax Law; provided, however, that the parties hereto agree that the consideration payable or otherwise deliverable pursuant to this Agreement shall not be subject to withholding under Section 1445 of the Code or the Treasury Regulations promulgated thereunder so long as the representation set forth in Section 2.11(f) is true and correct in all respects as of the Closing Date, except to the extent required pursuant to a change in applicable Law after the date of this Agreement. To the extent that amounts are so properly deducted or withheld, and timely remitted to the appropriate Governmental Entity, such amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction or withholding was made. Notwithstanding any other provision of this Agreement, the parties acknowledge that if the representation set forth in Section 2.11(f) is not true and correct in all respects as of the Closing Date, Pi, Merger Sub Inc. and Merger Sub LLC’s sole recourse and remedy with respect to such breach will be to deduct and withhold under this Section 1.8(h). (i) Neither Pi nor the Surviving Corporation shall be liable to any holder or former holder of Lambda Common Stock or to any other Person with respect to any share of Lambda Common Stock (or any dividends or distributions with respect thereto), or for any cash amounts, properly delivered to any public official in compliance with any applicable abandoned property law, escheat law or similar Law. If any Lambda Stock Certificate shall not have been surrendered prior to five (5) years after the Effective Time (or immediately prior to such earlier date on which any such shares of Pi Common Stock or any dividends or other distributions payable to the holder thereof would otherwise escheat to or become the property of any Governmental Entity), any shares of Pi Common Stock issuable upon the surrender of, or any dividends or other distributions in respect of, such Lambda Stock Certificate shall, to the extent permitted by applicable Law, become the property of Pi, free and clear of all claims or interest of any Person previously entitled thereto. (j) No interest shall be paid or accrued on any Merger Consideration, cash in lieu of fractional shares, or any unpaid dividends or distributions payable to holders of Lambda Common Stock.
Appears in 2 contracts
Samples: Merger Agreement (Penn Virginia Corp), Merger Agreement (Lonestar Resources US Inc.)
Exchange Fund; Exchange of Certificates. (a) Prior to the Closing Date, Pi Parent and Lambda the Company shall mutually select a bank or trust company, which may be the transfer agent for the Pi Parent Common Stock, to act as exchange agent in the First Merger (the “Exchange Agent”), and, not later than the Effective Time, Pi Parent shall enter into an agreement with the Exchange Agent, which will provide that, at or prior to the Effective Time, Pi Parent shall deposit with the Exchange Agent all of the shares of Pi Parent Common Stock required to pay the aggregate Merger Consideration pursuant to Section 1.6(a)(ii) and Section 1.8(f). The shares of Pi Parent Common Stock so deposited with the Exchange Agent, together with (i) any dividends or distributions received by the Exchange Agent with respect to such shares and (ii) proceeds received from the sale of the Pi Parent Excess Shares pursuant to Section 1.8(f), are referred to collectively as the “Exchange Fund.”
(b) As soon as practicable after the Effective Time, but in no event more than two five (25) Business Days after the Closing Date, Pi Parent shall cause the Exchange Agent to mail to the record holders of Lambda Company Stock Certificates (i) a letter of transmittal in customary form and containing such provisions as Pi Parent and Lambda the Company may reasonably specify (including a provision confirming that delivery of Lambda Company Stock Certificates shall be effected, and risk of loss and title to Lambda Company Stock Certificates shall pass, only upon delivery of such Lambda Company Stock Certificates to the Exchange Agent) and (ii) instructions for use in effecting the surrender of Lambda Company Stock Certificates in exchange for Pi Parent Common Stock, as provided in Section 1.6, and any cash in lieu of a fractional share which the shares of Lambda Company Common Stock represented by such Lambda Company Stock Certificates shall have been converted into the right to receive pursuant to this Agreement, as well as any dividends or distributions to be paid pursuant to Section 1.8(c). Upon surrender of a Lambda Company Stock Certificate to the Exchange Agent for exchange, together with a duly executed letter of transmittal and such other documents as may be reasonably required by the Exchange Agent or PiParent, (A) the holder of such Lambda Company Stock Certificate shall be entitled to receive in book-entry form the number of whole shares of Pi Parent Common Stock that such holder has the right to receive pursuant to the provisions of Section 1.6 (and cash in lieu of any fractional share of Pi Parent Common Stock) ), as well as any dividends or distributions to be paid pursuant to Section 1.8(c), and (B) the Lambda Company Stock Certificate so surrendered shall be immediately canceled.
(c) No dividends or other distributions declared with respect to the Pi Parent Common Stock shall be paid to the holder of any unsurrendered Lambda Company Stock Certificate until the holder thereof shall surrender such Lambda Company Stock Certificate in accordance with this Article I. After the surrender of a Lambda Company Stock Certificate in accordance with this Article I, the record holder thereof shall be entitled to receive any such dividends or other distributions, without any interest thereon, which theretofore had become payable with respect to the whole shares of Pi Parent Common Stock which the shares of Lambda Company Common Stock represented by such Lambda Company Stock Certificate have been converted into the right to receive.
(d) Until surrendered as contemplated by this Section 1.8, each Lambda Company Stock Certificate shall be deemed, from and after the Effective Time, to represent only the right to receive shares of Pi Parent Common Stock (and cash in lieu of any fractional share of Pi Parent Common Stock) as contemplated by this Article I and any distribution or dividend with respect to Pi Parent Common Stock the record date for which is after the Effective Time.
(e) In the event of a transfer of ownership of shares of Lambda Company Common Stock that is not registered in the transfer records of Lambdathe Company, shares in book-entry form representing the proper number of shares of Pi Parent Common Stock may be issued to a Person, Person other than the Person in whose name such Lambda Company Stock Certificate so surrendered is registered if such Lambda Company Stock Certificate shall be properly endorsed or otherwise be in proper form for transfer and the Person requesting such issuance shall pay any transfer or other Taxes required by reason of the issuance of Pi Parent Common Stock to a Person other than the registered holder of such Lambda Company Stock Certificate or, or establish to the satisfaction of Pi, Parent that such Taxes have been paid or are not applicable. If any Lambda Company Stock Certificate shall have been lost, stolen or destroyed, Pi Parent may, in its discretion and as a condition precedent to the issuance of any shares in book-entry form representing Pi Parent Common Stock, Stock require the owner of such lost, stolen or destroyed Lambda Company Stock Certificate to provide an appropriate affidavit and to deliver a bond (in such sum as Pi Parent may reasonably direct) as indemnity against any claim that may be made against the Exchange Agent, Pi Parent or the Surviving Corporation with respect to such Lambda Company Stock Certificate.
(f) (i) As promptly as practicable following the Effective Time, the Exchange Agent shall (A) determine the number of whole shares of Pi Parent Common Stock and the number of fractional shares of Pi Parent Common Stock that each holder of Lambda Company Common Stock is entitled to receive in connection with the consummation of the First Merger and (B) aggregate all such fractional shares of Pi Parent Common Stock that would, except as provided in Section 1.6(c), be issued to the holders of Lambda Company Common Stock, rounding up to the nearest whole number (the “Pi Parent Excess Shares”), and the Exchange Agent shall, on behalf of former stockholders of Lambdathe Company, sell the Pi Parent Excess Shares at then-prevailing prices on The the Nasdaq Stock Global Select Market LLC (“Nasdaq”), all in the manner provided in Section 1.8(f)(ii).
(ii) The sale of the Pi Parent Excess Shares by the Exchange Agent shall be executed on Nasdaq through one or more member firms of Nasdaq and shall be executed in round lots to the extent practicable. The Exchange Agent shall use reasonable efforts to complete the sale of the Pi Parent Excess Shares as promptly following the Effective Time as, in the Exchange Agent’s sole judgment, is practicable and consistent with obtaining the best execution of such sales in light of prevailing market conditions. Until the net proceeds of such sale or sales have been distributed to the former holders of Lambda Company Common Stock, the Exchange Agent shall hold such proceeds in trust for such holders (the “Lambda Company Common Stock Trust”). Pi Parent shall pay all commissions and other out-of-pocket transaction costs (other than any transfer or similar Taxes imposed on a holder of Lambda Company Common Stock), including the expenses and compensation of the Exchange Agent incurred in connection with such sale of the Pi Parent Excess Shares. The Exchange Agent shall determine the portion of the Lambda Company Common Stock Trust to which each former holder of Lambda Company Common Stock is entitled, if any, by multiplying the amount of the aggregate net proceeds composing the Lambda Company Common Stock Trust by a fraction, the numerator of which is the amount of the fractional share interest to which such former holder of Lambda Company Common Stock is entitled (after taking into account all shares of Lambda Company Common Stock held at the Effective Time by such holder) and the denominator of which is the aggregate amount of fractional share interests to which all former holders of Lambda Company Common Stock are entitled.
(iii) As soon as practicable after the determination of the amount of cash, if any, to be paid to former holders of Lambda Company Common Stock with respect to any fractional share interests, the Exchange Agent shall make available such amounts to such holders, subject to and in accordance with the terms of this Section 1.8.
(iv) The parties acknowledge that payment of cash in lieu of issuing fractional shares was not separately bargained-for consideration but merely represents a mechanical rounding off for purposes of avoiding the expense and inconvenience to Parent that would otherwise be caused by the issuance of fractional shares.
(g) Any portion of the Exchange Fund that remains undistributed to stockholders of Lambda the Company as of the date six (6) months after the Effective Time shall be delivered to Pi Parent upon demand, and any holders of Lambda Company Stock Certificates who have not theretofore surrendered their Lambda Company Stock Certificates to the Exchange Agent in accordance with this Section 1.8 and any holders of Book-Entry Common Shares who have not theretofore cashed any check payable to them in accordance with Section 1.9, 1.9 shall thereafter look only to Pi Parent for satisfaction of their claims for Pi Parent Common Stock, cash in lieu of fractional shares of Pi Parent Common Stock and any dividends or distributions with respect to Pi Common Stock be paid pursuant to Section 1.8(c), subject to applicable abandoned property law, escheat laws or similar Laws.
(h) Each of the Exchange Agent, Pi, LambdaParent, the Surviving Corporation, the Surviving Company Corporation and their respective Affiliates and agents any other withholding agent shall be entitled to deduct and withhold from any consideration payable or otherwise deliverable pursuant to this Agreement such amounts as are required to be deducted or withheld therefrom under the Code Code, or any provision of state, local or foreign Tax Law or under any other applicable Law; provided, however, that the parties hereto agree that the consideration payable or otherwise deliverable pursuant to this Agreement shall not be subject to withholding under Section 1445 of the Code or the Treasury Regulations promulgated thereunder so long as the representation set forth in Section 2.11(f) is true and correct in all respects as of the Closing Date, except to the extent required pursuant to a change in applicable Law after the date of this Agreement. To the extent that amounts are so properly deducted or withheld, and timely remitted to the appropriate Governmental Entity, such deducted or withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction or withholding was made. Notwithstanding any other provision If withholding is taken in shares of this AgreementParent Common Stock, the parties acknowledge that if the representation set forth in Section 2.11(f) is not true and correct in all respects relevant withholding agent shall be treated as having sold such shares of Parent Common Stock on behalf of the Closing Date, Pi, Merger Sub Inc. applicable Person for an amount of cash equal to the fair market value thereof at the time of such withholding and Merger Sub LLC’s sole recourse and remedy with respect paid such cash proceeds to such breach will be to deduct and withhold under this Section 1.8(h)the relevant Taxing Authority.
(i) Neither Pi nor the Surviving Corporation No Parent Party shall be liable to any holder or former holder of Lambda Company Common Stock or to any other Person with respect to any share of Lambda Company Common Stock (or any dividends or distributions with respect thereto), or for any cash amounts, properly delivered to any public official in compliance with any applicable abandoned property law, escheat law or similar Law. If any Lambda Company Stock Certificate shall not have been surrendered prior to five (5) years after the Effective Time (or immediately prior to such earlier date on which any such shares of Pi Parent Common Stock or any dividends or other distributions payable to the holder thereof would otherwise escheat to or become the property of any Governmental Entity), any shares of Pi Parent Common Stock issuable upon the surrender of, or any dividends or other distributions in respect of, such Lambda Company Stock Certificate shall, to the extent permitted by applicable Law, become the property of PiParent, free and clear of all claims or interest of any Person previously entitled thereto.
(j) No interest shall be paid or accrued on any Merger Consideration, cash in lieu of fractional shares, or any unpaid dividends or distributions payable to holders of Lambda Company Common Stock.
Appears in 1 contract
Samples: Merger Agreement (APA Corp)
Exchange Fund; Exchange of Certificates. (a) Prior to the Closing Date, Pi Parent and Lambda the Company shall mutually select a bank or trust company, which may be the transfer agent for the Pi Parent Common Stock, to act as exchange agent in the First Merger (the “Exchange Agent”), and, not later than the Effective Time, Pi Parent shall enter into an agreement with the Exchange Agent, which will provide that, at or prior to the Effective Time, Pi Parent shall deposit with the Exchange Agent all of the shares of Pi Parent Common Stock required to pay the aggregate Merger Consideration pursuant to Section 1.6(a)(ii) and Section 1.8(f). The shares of Pi Parent Common Stock so deposited with the Exchange Agent, together with (i) any dividends or distributions received by the Exchange Agent with respect to such shares and (ii) proceeds received from the sale of the Pi Parent Excess Shares pursuant to Section 1.8(f), are referred to collectively as the “Exchange Fund.”
(b) As soon as practicable after the Effective Time, but in no event more than two five (25) Business Days after the Closing Date, Pi Parent shall cause the Exchange Agent to mail to the record holders of Lambda Company Stock Certificates (i) a letter of transmittal in customary form and containing such provisions as Pi Parent and Lambda the Company may reasonably specify (including a provision confirming that delivery of Lambda Company Stock Certificates shall be effected, and risk of loss and title to Lambda Company Stock Certificates shall pass, only upon delivery of such Lambda Company Stock Certificates to the Exchange Agent) and (ii) instructions for use in effecting the surrender of Lambda Company Stock Certificates in exchange for Pi Parent Common Stock, as provided in Section 1.6, and any cash in lieu of a fractional share which the shares of Lambda Company Common Stock represented by such Lambda Company Stock Certificates shall have been converted into the right to receive pursuant to this Agreement, as well as any dividends or distributions to be paid pursuant to Section 1.8(c). Upon surrender of a Lambda Company Stock Certificate to the Exchange Agent for exchange, together with a duly executed letter of transmittal and such other documents as may be reasonably required by the Exchange Agent or PiParent, (A) the holder of such Lambda Company Stock Certificate shall be entitled to receive in book-entry form the number of whole shares of Pi Parent Common Stock that such holder has the right to receive pursuant to the provisions of Section 1.6 (and cash in lieu of any fractional share of Pi Parent Common Stock) ), as well as any dividends or distributions to be paid pursuant to Section 1.8(c), and (B) the Lambda Company Stock Certificate so surrendered shall be immediately canceled.
(c) No dividends or other distributions declared with respect to the Pi Parent Common Stock shall be paid to the holder of any unsurrendered Lambda Company Stock Certificate until the holder thereof shall surrender such Lambda Company Stock Certificate in accordance with this Article I. After the surrender of a Lambda Company Stock Certificate in accordance with this Article I, the record holder thereof shall be entitled to receive any such dividends or other distributions, without any interest thereon, which theretofore had become payable with respect to the whole shares of Pi Parent Common Stock which the shares of Lambda Company Common Stock represented by such Lambda Company Stock Certificate have been converted into the right to receive.
(d) Until surrendered as contemplated by this Section 1.8, each Lambda Company Stock Certificate shall be deemed, from and after the Effective Time, to represent only the right to receive shares of Pi Parent Common Stock (and cash in lieu of any fractional share of Pi Parent Common Stock) as contemplated by this Article I and any distribution or dividend with respect to Pi Parent Common Stock the record date for which is after the Effective Time.
(e) In the event of a transfer of ownership of shares of Lambda Company Common Stock that is not registered in the transfer records of Lambdathe Company, shares in book-entry form representing the proper number of shares of Pi Parent Common Stock may be issued to a Person, Person other than the Person in whose name such Lambda Company Stock Certificate so surrendered is registered if such Lambda Company Stock Certificate shall be properly endorsed or otherwise be in proper form for transfer and the Person requesting such issuance shall pay any transfer or other Taxes required by reason of the issuance of Pi Parent Common Stock to a Person other than the registered holder of such Lambda Company Stock Certificate or, or establish to the satisfaction of Pi, Parent that such Taxes have been paid or are not applicable. If any Lambda Company Stock Certificate shall have been lost, stolen or destroyed, Pi Parent may, in its discretion and as a condition precedent to the issuance of any shares in book-entry form representing Pi Parent Common Stock, Stock require the owner of such lost, stolen or destroyed Lambda Company Stock Certificate to provide an appropriate affidavit and to deliver a bond (in such sum as Pi Parent may reasonably direct) as indemnity against any claim that may be made against the Exchange Agent, Pi Parent or the Surviving Corporation with respect to such Lambda Company Stock Certificate.
(f) (i) As promptly as practicable following the Effective Time, the Exchange Agent shall (A) determine the number of whole shares of Pi Parent Common Stock and the number of fractional shares of Pi Parent Common Stock that each holder of Lambda Company Common Stock is entitled to receive in connection with the consummation of the First Merger and (B) aggregate all such fractional shares of Pi Parent Common Stock that would, except as provided in Section 1.6(c), be issued to the holders of Lambda Company Common Stock, rounding up to the nearest whole number (the “Pi Parent Excess Shares”), and the Exchange Agent shall, on behalf of former stockholders of Lambdathe Company, sell the Pi Parent Excess Shares at then-prevailing prices on The the Nasdaq Stock Global Select Market LLC (“Nasdaq”), all in the manner provided in Section 1.8(f)(ii).
(ii) The sale of the Pi Excess Shares by the Exchange Agent shall be executed on Nasdaq through one or more member firms of Nasdaq and shall be executed in round lots to the extent practicable. The Exchange Agent shall use reasonable efforts to complete the sale of the Pi Excess Shares as promptly following the Effective Time as, in the Exchange Agent’s sole judgment, is practicable consistent with obtaining the best execution of such sales in light of prevailing market conditions. Until the net proceeds of such sale or sales have been distributed to the former holders of Lambda Common Stock, the Exchange Agent shall hold such proceeds in trust for such holders (the “Lambda Common Stock Trust”). Pi shall pay all commissions and other out-of-pocket transaction costs (other than any transfer or similar Taxes imposed on a holder of Lambda Common Stock), including the expenses and compensation of the Exchange Agent incurred in connection with such sale of the Pi Excess Shares. The Exchange Agent shall determine the portion of the Lambda Common Stock Trust to which each former holder of Lambda Common Stock is entitled, if any, by multiplying the amount of the aggregate net proceeds composing the Lambda Common Stock Trust by a fraction, the numerator of which is the amount of the fractional share interest to which such former holder of Lambda Common Stock is entitled (after taking into account all shares of Lambda Common Stock held at the Effective Time by such holder) and the denominator of which is the aggregate amount of fractional share interests to which all former holders of Lambda Common Stock are entitled.
(iii) As soon as practicable after the determination of the amount of cash, if any, to be paid to former holders of Lambda Common Stock with respect to any fractional share interests, the Exchange Agent shall make available such amounts to such holders, subject to and in accordance with the terms of this Section 1.8.
(g) Any portion of the Exchange Fund that remains undistributed to stockholders of Lambda as of the date six (6) months after the Effective Time shall be delivered to Pi upon demand, and any holders of Lambda Stock Certificates who have not theretofore surrendered their Lambda Stock Certificates to the Exchange Agent in accordance with this Section 1.8 and any holders of Book-Entry Common Shares who have not theretofore cashed any check payable to them in accordance with Section 1.9, shall thereafter look only to Pi for satisfaction of their claims for Pi Common Stock, cash in lieu of fractional shares of Pi Common Stock and any dividends or distributions with respect to Pi Common Stock subject to applicable abandoned property law, escheat laws or similar Laws.
(h) Each of the Exchange Agent, Pi, Lambda, the Surviving Corporation, the Surviving Company and their respective Affiliates and agents shall be entitled to deduct and withhold from any consideration payable or otherwise deliverable pursuant to this Agreement such amounts as are required to be deducted or withheld therefrom under the Code or any provision of state, local or foreign Tax Law; provided, however, that the parties hereto agree that the consideration payable or otherwise deliverable pursuant to this Agreement shall not be subject to withholding under Section 1445 of the Code or the Treasury Regulations promulgated thereunder so long as the representation set forth in Section 2.11(f) is true and correct in all respects as of the Closing Date, except to the extent required pursuant to a change in applicable Law after the date of this Agreement. To the extent that amounts are so properly deducted or withheld, and timely remitted to the appropriate Governmental Entity, such amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction or withholding was made. Notwithstanding any other provision of this Agreement, the parties acknowledge that if the representation set forth in Section 2.11(f) is not true and correct in all respects as of the Closing Date, Pi, Merger Sub Inc. and Merger Sub LLC’s sole recourse and remedy with respect to such breach will be to deduct and withhold under this Section 1.8(h).
(i) Neither Pi nor the Surviving Corporation shall be liable to any holder or former holder of Lambda Common Stock or to any other Person with respect to any share of Lambda Common Stock (or any dividends or distributions with respect thereto), or for any cash amounts, properly delivered to any public official in compliance with any applicable abandoned property law, escheat law or similar Law. If any Lambda Stock Certificate shall not have been surrendered prior to five (5) years after the Effective Time (or immediately prior to such earlier date on which any such shares of Pi Common Stock or any dividends or other distributions payable to the holder thereof would otherwise escheat to or become the property of any Governmental Entity), any shares of Pi Common Stock issuable upon the surrender of, or any dividends or other distributions in respect of, such Lambda Stock Certificate shall, to the extent permitted by applicable Law, become the property of Pi, free and clear of all claims or interest of any Person previously entitled thereto.
(j) No interest shall be paid or accrued on any Merger Consideration, cash in lieu of fractional shares, or any unpaid dividends or distributions payable to holders of Lambda Common Stock.
Appears in 1 contract
