Fundamental Deadlock Clause Samples

Fundamental Deadlock. In the event that (i) a Deadlock arises out of a disagreement with respect to the following matters listed in Section 5.4 (collectively, the “Fundamental Matters”): Section 5.4(a)(iii) (Issuance of Equity), Sections 5.4(a)(v) (Litigation), 5.4(a)(vi) (Indebtedness), 5.4(a)(vii) (Liens), 5.4(a)(viii) (Loans), 5.4(a)(x) (Cap Ex), 5.4(a)(xi) (Contracts), 5.4(a)(xiii) (Dispositions) or 5.4(a)(xvii) (Material Change); or Section 5.4(b) (Board of Member Matters) other than Sections 5.4(b)(i) (Bank Accounts), and 5.4(b)(xviii) (Related Project Agreements); (ii) a Member or any of its appointed Board Members are breaching or have breached their duty of good faith and fair dealing with respect to the Deadlock involving a Fundamental Matter (a “Breaching Member”); (iii) the Deadlock involving a Fundamental Matter is (A) causing a material adverse effect on the Company’s ability to produce low-cost ethylene in the most efficient manner for off-take by the Members, while ensuring the highest levels of health, safety, and environmental performance, or (B) materially frustrating the purpose of the Company as contemplated by Section 1.3; and (iv) the parties have not resolved the Deadlock involving a Fundamental Matter within thirty (30) days after receiving the recommendation from the Independent Expert, then, if all of the foregoing conditions in clauses (i)-(iv) are satisfied, a “Fundamental Deadlock” shall be deemed to have occurred, and the provisions of Section 7.6 shall apply.