Deferred Purchase Price. The Deferred Purchase Price shall be paid in five equal annual installments, with the first such installment to be paid on May 21, 2002. The Deferred Purchase Price shall be evidenced by a promissory note from Buyer in the form attached hereto as Exhibit 2.03 (the "Note"). No interest shall accrue on the Deferred Purchase Price so long as there is no default under the Note. If there is default under the Note, interest shall accrue as provided therein. In addition; (a) If CTC (or its successor in interest) completely discontinues and abandons the technology described in Section 1.00(a) of that certain License Agreement between Buyer, Seller and CTC, dated on even date herewith, and any technology materially derived therefrom (collectively, the "Licensed Technology"), then Buyer shall be relieved from the obligations to make additional installment payments under the Note. Payment obligations under the Note shall not cease until Seller receives written notice ("Discontinuation Notice") of the discontinuation and abandonment of the Licensed Technology (regardless whether such discontinuance and abandonment in fact have occurred prior to the date Seller receives the Discontinuance Notice). In addition to any other payments then due hereunder, Buyer shall also promptly pay Seller a pro-rated amount based on the period between the date the last installment payment was due hereunder and the later of the date (i) the Discontinuation Notice is received by Seller, and (ii) the actual date use of the Licensed Technology is discontinued and abandoned. Upon issuance of a Discontinuation Notice, Buyer shall afford Seller reasonable access to facilities and records to verify such discontinuation. Any disagreement in respect to a Discontinuation Notice shall be resolved as provided in Section 11.07 of this Agreement. If, in conjunction with the Discontinuation Notice, CTC discontinues all of its other business operations, and CTC has insufficient funds to pay all of CTC's debts, the Final Payment shall be paid to Holder after the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Amcast or any of its Affiliates, is paid in full. (b) All principal under the Note, and all accrued and unpaid interest thereon ("Balance"), shall become immediately due and payable (x) if the Licensed Technology or the use thereof is sold, licensed, or otherwise transferred to anyone other than Buyer, (y) upon the sale or transfer of substantially all of the assets of CTC (or, if CTC is consolidated into or merged with Buyer or an Affiliate thereof, then upon the sale or transfer of substantially all of the assets of the division or entity comprising the successor to CTC) to an entity other than Buyer, or (z) if Buyer (or any Affiliate of Buyer) ceases to be a general partner, or own in excess of 50% of CTC. The Balance will be paid to Seller only to the extent the value of the consideration received by Buyer or any Affiliate thereof exceeds the sum of the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Buyer or any of its Affiliates). If the entire Balance is not paid pursuant to this provision, the remaining Balance shall be paid as provided in the first paragraph of this Section 2.03. Buyer shall give Seller written notice in reasonable detail of the foregoing events within ten (10) days of the occurrence and shall afford Seller reasonable access to facilities and records to verify Buyer's representation.
Appears in 1 contract
Deferred Purchase Price. The (a) Promptly following the first anniversary of the Initial Closing, Purchaser shall deliver to Seller a statement setting forth its good faith calculation of Trailing Total Volume along with reasonable supporting documentation related thereto. In the event that Seller disputes Purchaser’s calculation of Trailing Total Volume, Seller shall notify Purchaser and the Parties shall work in good faith for a period up to thirty (30) days to resolve any discrepancies or disagreements. In the event that the Parties are unable to resolve any such discrepancies or disagreements during such thirty (30) day period, the Parties shall submit the matter to the Independent Accountant in accordance with the process contemplated by Section 2.4. In the event that the Trailing Total Volume is equal to or greater than 65% of the Total Volume, Purchaser shall pay to Seller, by wire transfer of immediately available funds, $1,000,000.00 (the “Deferred Purchase Price shall be paid in five equal annual installments, with the first such installment to be paid on May 21, 2002. The Deferred Purchase Price shall be evidenced by a promissory note from Buyer in the form attached hereto as Exhibit 2.03 (the "Note"Payment”). No interest shall accrue on Subject to Section 5.15(b), the Deferred Purchase Price so long Payment, if payable as there is no default under the Note. If there is default under the Note, interest shall accrue as provided therein. In addition;
(a) If CTC (determined by Purchaser’s calculation of Trailing Total Volume or its successor in interest) completely discontinues and abandons the technology described in Section 1.00(a) of that certain License Agreement between Buyer, Seller and CTC, dated on even date herewith, and any technology materially derived therefrom (collectively, the "Licensed Technology"), then Buyer shall be relieved from the obligations to make additional installment payments under the Note. Payment obligations under the Note shall not cease until Seller receives written notice ("Discontinuation Notice") subsequently by agreement of the discontinuation and abandonment Parties or determination of the Licensed Technology (regardless whether such discontinuance and abandonment in fact have occurred prior to the date Seller receives the Discontinuance Notice). In addition to any other payments then due hereunderIndependent Accountant, Buyer shall also promptly pay Seller a pro-rated amount based on the period between the date the last installment payment was due hereunder and the later of the date (i) the Discontinuation Notice is received by Seller, and (ii) the actual date use of the Licensed Technology is discontinued and abandoned. Upon issuance of a Discontinuation Notice, Buyer shall afford Seller reasonable access to facilities and records to verify such discontinuation. Any disagreement in respect to a Discontinuation Notice shall be resolved as provided in Section 11.07 of this Agreement. If, in conjunction with the Discontinuation Notice, CTC discontinues all of its other business operations, and CTC has insufficient funds to pay all of CTC's debts, the Final Payment shall be paid to Holder after Seller within three (3) Business Days following the Bank Debt and first to occur of (i) Purchaser’s determination that such amount is owed, (ii) such time as the trade debt Parties resolve any discrepancies or disagreements related thereto in accordance with this Section 5.15(a), or (iii) following the date of CTC final determination by the Independent Accountant. Purchaser shall not take any action or omit to take any action with the intent of reducing the Trailing Total Volume during the twelve (excluding debt owed to CTC by Amcast or any of its Affiliates, is paid in full12) months following the Initial Closing.
(b) All principal under In the Noteevent the Deferred Purchase Price Payment is due to Seller, and at or prior to such time Purchaser has delivered to Seller notice of a Claim in accordance with Section 8.4, and such Claim has not been resolved, Purchaser and Seller agree that all accrued or any portion of the Deferred Purchase Price Payment representing the Purchaser’s good faith estimate of the indemnifiable Losses that may be incurred pursuant to such unresolved Claim shall not be paid over to Seller, but shall instead be deposited with a third party escrow agent reasonably acceptable to Purchaser and unpaid interest thereon ("Balance")Seller, to be held pending resolution of such Claim, it being agreed that the balance of the Deferred Purchase Price Payment that is not subject to dispute, if any, shall become immediately due and payable (x) if the Licensed Technology or the use thereof is sold, licensed, or otherwise transferred to anyone other than Buyer, (y) upon the sale or transfer of substantially all of the assets of CTC (or, if CTC is consolidated into or merged with Buyer or an Affiliate thereof, then upon the sale or transfer of substantially all of the assets of the division or entity comprising the successor to CTC) to an entity other than Buyer, or (z) if Buyer (or any Affiliate of Buyer) ceases to be a general partner, or own in excess of 50% of CTC. The Balance will be paid to Seller only to the extent the value of the consideration received by Buyer or any Affiliate thereof exceeds the sum of the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Buyer or any of its Affiliatesas set forth in Section 5.15(a). If the entire Balance is not paid pursuant to this provision, the remaining Balance shall be paid as provided in the first paragraph of this Section 2.03. Buyer shall give Seller written notice in reasonable detail of the foregoing events within ten (10) days of the occurrence and shall afford Seller reasonable access to facilities and records to verify Buyer's representation.
Appears in 1 contract
Sources: Purchase and Assumption Agreement (HomeStreet, Inc.)
Deferred Purchase Price. The Deferred Purchase Price (a) Within ninety (90) days after the end of each of Purchaser's 1999 through 2003 fiscal years (or as soon thereafter as reasonably practicable), Purchaser shall be paid in five equal annual installmentsprepare and deliver to the Seller financial statements for the Purchaser for such year, together with the first such installment to be paid on May 21, 2002. The Deferred Purchase Price shall be evidenced by a promissory note from Buyer in the form attached hereto as Exhibit 2.03 statement (the "NoteStatement")) setting forth the Purchaser's Pre-Tax Income for such year, prepared in accordance with Applicable Accounting Principles. No interest Such financial statements may consist of the financial statements of the Parent, including consolidating balance sheets and income statements setting forth the various subsidiaries/divisions of the Parent. On such financial statements, the Business shall accrue on be allocated overhead and other expenses (including the Deferred Purchase Price so long as there is no default under cost of capital employed by the Note. If there is default under Business) in accordance with the Note, interest shall accrue as provided therein. In addition;
terms and procedure set forth in Schedule 2.06 (a) hereto and otherwise in accordance with Applicable Accounting Principles. If CTC (or its successor in interest) completely discontinues and abandons the technology described in Section 1.00(a) of that certain License Agreement between Buyerrequested, Seller and CTC▇▇▇▇▇ shall make reasonable efforts to assist Purchaser and its representatives in the preparation of the Statement. During the forty-five (45) day period following Seller's receipt of the Statement, dated Seller, at its sole expense, will be permitted to review, or have its accountants, auditors or counsel review, all relevant working papers and books and records of the Purchaser relating to the Statement. Purchaser shall provide reasonable cooperation with this review. The Statement shall become final and binding upon the parties on even date herewith, and any technology materially derived therefrom (collectively, the "Licensed Technology"), then Buyer shall be relieved from the obligations to make additional installment payments under the Note. Payment obligations under the Note shall not cease until forty-fifth day following receipt thereof by Seller receives unless Seller delivers a written notice (a "Discontinuation NoticeNotice of Disagreement") to the Parent on or prior to such date that Seller disagrees with the statement. In order to be valid, any Notice of Disagreement shall specify in reasonable detail the nature of any disagreement so asserted and shall be accompanied by a certificate of Seller's independent auditors that they concur with each of the discontinuation positions taken by Seller in the Notice of Disagreement. If a Notice of Disagreement is received by the Parent in a timely manner, then the Statement (as revised in accordance with clause (x) or (y) below) shall become final and abandonment of binding upon the Licensed Technology (regardless whether such discontinuance and abandonment in fact have occurred prior to the date Seller receives the Discontinuance Notice). In addition to any other payments then due hereunder, Buyer shall also promptly pay Seller a pro-rated amount based parties on the period between earlier of (x) the date the last installment payment was due hereunder and parties hereto resolve in writing any differences they have with respect to any matter specified in the later Notice of Disagreement or (y) the date (i) any disputed matters are finally resolved in writing by the Discontinuation Notice is received by Seller, and (ii) Arbitrator in accordance with the actual date use of the Licensed Technology is discontinued and abandoned. Upon issuance of a Discontinuation Notice, Buyer shall afford Seller reasonable access to facilities and records to verify such discontinuation. Any disagreement in respect to a Discontinuation Notice shall be resolved as provided arbitration provision set forth in Section 11.07 of this Agreement. If, in conjunction with the Discontinuation Notice, CTC discontinues all of its other business operations, and CTC has insufficient funds to pay all of CTC's debts, the Final Payment shall be paid to Holder after the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Amcast or any of its Affiliates, is paid in full2.07 hereto.
(b) All principal under In the Noteevent the Statement reveals that the Purchaser has achieved certain Pre-Tax Income targets (each, and all accrued and unpaid interest thereon a "Pre-Tax Income Target") for the years 1999 through 2003, then Purchaser shall pay to Seller additional purchase consideration (the "BalanceObligation"), shall become immediately due and payable ) in the amounts set forth below: Pre-Tax Obligation Income Target Payable ------------- ------- 1999 $521,000 $115,000 2000 $573,000 $135,000 2001 $630,000 $155,000 2002 $693,000 $175,000 2003 $762,000 $195,000 (xc) if the Licensed Technology or the use thereof is sold, licensed, or otherwise transferred to anyone other than Buyer, (y) upon the sale or transfer of substantially all Any annual portion of the assets of CTC (or, if CTC is consolidated into or merged with Buyer or an Affiliate thereof, then upon Obligation in the sale or transfer of substantially all amount of the assets annual payment set forth in clause 2.06(b) above will be forfeited in any year that the Purchaser does not achieve at least sixty percent (60%) of the division or entity comprising Pre-Tax Income Target for that year. Any annual portion of the successor to CTC) to an entity other than Buyer, or (z) if Buyer (or any Affiliate of Buyer) ceases to be a general partner, or own in excess of 50% of CTC. The Balance Obligation will be paid postponed by five (5) years (the "Postponed Obligations") in the amount set forth above in any year that the Purchaser achieves pre-tax income less than eighty-five percent (85%) of the Pre-Tax Income Target amount set forth above, but more than sixty percent (60%) for that year. Fifty percent (50%) of the Obligation will be deferred for five (5) years (the "Delayed Obligations") in any year that the Purchaser achieves a pre-tax income of less than the Pre-Tax Income Target but 85% or more of the Pre-Tax Income Target for that year. No portion of the Obligation shall be payable during or with respect to any period in which ▇▇▇▇▇ or Seller only is in breach of a material contractual obligation to the extent Purchaser, the value of the consideration received by Buyer or any Affiliate thereof exceeds the sum of the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Buyer Parent or any of its their Affiliates. In any year that the Purchaser's Pre-Tax Income exceeds the relevant target set forth above, Seller may elect to have all or a portion of such excess credited to prior years (in chronological order) for which the Pre-Tax Income Targets have not been satisfied in full (other than years in which the Obligation was forfeited) rather than crediting such excess Pre-Tax Income to the year in which it is actually earned (thereby reducing or eliminating the bonus payable to ▇▇▇▇▇ in respect of such year under the Employment Agreement). If Any Delayed or Postponed Obligations which are no longer deferrable as a result of the entire Balance is not paid pursuant to this provision, the remaining Balance credit shall be paid at the time the credit is recognized. Forfeited Obligations will not be recognized as provided in the first paragraph earned as a result of this Section 2.03. Buyer shall give Seller written notice in reasonable detail of the foregoing events within ten (10) days of the occurrence and shall afford Seller reasonable access to facilities and records to verify Buyer's representationany such credit.
Appears in 1 contract
Deferred Purchase Price. The Deferred Purchase Price shall be paid in five equal annual installments, with the first such installment to be paid on May 21, 2002. The Deferred Purchase Price shall be evidenced by a promissory note from Buyer in the form attached hereto as Exhibit 2.03 (the "Note"). No interest shall accrue on the Deferred Purchase Price so long as there is no default under the Note. If there is default under the Note, interest shall accrue as provided therein. In addition;
(ai) If CTC Net Sales for fiscal year 2009 (or its successor in interestwhich is the calendar year) completely discontinues and abandons the technology described in Section 1.00(a) of that certain License Agreement between Buyer, Seller and CTC, dated on even date herewith, and any technology materially derived therefrom (collectively, the "Licensed Technology"), then Buyer shall be relieved from the obligations to make additional installment payments under the Note. Payment obligations under the Note shall not cease until Seller receives written notice ("Discontinuation Notice") of the discontinuation and abandonment of the Licensed Technology (regardless whether such discontinuance and abandonment in fact have occurred prior to the date Seller receives the Discontinuance Notice). In addition to any other payments then due hereunderexceed $6,835,120, Buyer shall also promptly pay to Seller, in accordance with the procedures set forth in Section 2.7(b)(ii), an amount in cash (the “Deferred Cash Consideration”) equal to the product of $500,000 multiplied by a fraction, the numerator of which is Net Sales for fiscal year 2009 and the denominator of which is the Net Sales Target; provided, however, that the amount of the Deferred Cash Consideration shall not exceed $500,000.
(ii) Within forty-five (45) days after December 31, 2009, Buyer shall deliver to Seller a pro-rated written statement (the “Payment Statement”), including supporting documentation, setting forth the amount based of Net Sales for fiscal year 2009. The Payment Statement shall become final and binding upon Buyers and Seller on the period between 15th day following delivery thereof, unless Seller gives notice of disagreement with the date Payment Statement (a “Dispute Notice”) to Buyer prior to such date. Any Dispute Notice shall specify in reasonable detail the last installment payment was due hereunder nature of any disagreement so asserted. If a Dispute Notice is received by Buyer in a timely manner, then the Payment Statement shall become final and binding upon Buyers and Seller on the later earlier of the date (i) the Discontinuation date Buyer and Seller resolve in writing any differences they have with respect to the matters specified in the Dispute Notice is received by Seller, and (ii) the actual date use of any disputed matters are finally resolved in writing by the Licensed Technology is discontinued and abandonedAccounting Firm. Upon issuance During the 30-day period (the “Resolution Period”) following the delivery of a Discontinuation Dispute Notice, Buyer and Seller shall afford Seller use their commercially reasonable access efforts and seek in good faith to facilities and records to verify such discontinuation. Any disagreement resolve in writing any differences that they may have with respect to a Discontinuation the matters specified in the Dispute Notice. At the end of the Resolution Period, Buyer and Seller shall submit to an independent accounting firm (the “Accounting Firm”) for arbitration, in accordance with the standards set forth in this Section 2.7(b), only matters that remain in dispute and were properly included in the Notice of Disagreement in accordance with this Section 2.7(b) and any claim of calculation-related errors. The Accounting Firm shall be resolved as RSM McGladrey (which the parties represent has not provided in Section 11.07 of this Agreement. If, in conjunction with the Discontinuation Notice, CTC discontinues all of its other business operations, and CTC has insufficient funds services to pay all of CTC's debts, the Final Payment shall be paid to Holder after the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Amcast or any of its Affiliates, is paid in full.
(bthem or their respective subsidiaries during the past three years) All principal under the Note, and all accrued and unpaid interest thereon ("Balance"), shall become immediately due and payable (x) if the Licensed Technology or the use thereof is sold, licensed, or otherwise transferred to anyone other than Buyer, (y) upon the sale or transfer of substantially all of the assets of CTC (or, if CTC such firm is consolidated into unable or merged with unwilling to act, such other independent public accounting firm as shall be agreed upon by Buyer or an Affiliate thereof, then upon and Seller in writing. Buyer and Seller shall use their commercially reasonable efforts to cause the sale or transfer Accounting Firm to render a written decision resolving the matters submitted to the Accounting Firm within thirty (30) days of substantially all their delivery of the assets of the division or entity comprising the successor to CTC) to an entity other than Buyer, or (z) if Buyer (or any Affiliate of Buyer) ceases to be a general partner, or own in excess of 50% of CTCsuch submission. The Balance will be paid to Seller only to the extent the value of the consideration received by Buyer or any Affiliate thereof exceeds the sum of the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Buyer or any of its Affiliates). If the entire Balance is not paid Accounting Firm shall determine Net Sales for fiscal year 2009 pursuant to this provisionSection 2.7(b) in accordance with GAAP and the principles, policies and practices that were used in preparing the remaining Balance Business Financial Statements; provided, however, that no adjustment shall be paid as provided made by the Accounting Firm in favor of Seller with respect to any item that was not included in Seller’s Dispute Notice. The Accounting Firm’s decision shall be based solely on written submissions by Buyer and Seller and their respective representatives and by reference to the first paragraph terms of this Section 2.03. Buyer shall give Seller written notice in reasonable detail of the foregoing events within ten (10) days of the occurrence and shall afford Seller reasonable access to facilities and records to verify Buyer's representation.this
Appears in 1 contract
Deferred Purchase Price. The Deferred Purchase Price (a) Within ninety (90) days after the end of each of Purchaser's 1999 through 2004 fiscal years (which shall be paid in five equal annual installmentscalendar years) (or as soon thereafter as reasonably practicable), Purchaser shall prepare and deliver to the Seller financial statements for the Purchaser for such year, together with the first such installment to be paid on May 21, 2002. The Deferred Purchase Price shall be evidenced by a promissory note from Buyer in the form attached hereto as Exhibit 2.03 statement (the "NoteStatement") setting forth the Pre-Tax Income for such year, prepared in accordance with Applicable Accounting Principles. Such financial statements may consist of the financial statements of the Purchaser's parent corporation, The ▇▇▇▇▇▇▇▇▇▇ Corporation, a Delaware corporation (the "Parent"), including consolidating balance sheets and income statements setting forth the various subsidiaries/divisions of the Parent. No interest On such financial statements, the Business shall accrue on be allocated overhead and other expenses (including the Deferred Purchase Price so long as there is no default under cost of capital employed by the Note. If there is default under Business) in accordance with the Note, interest shall accrue as provided therein. In addition;
terms and procedures set forth in Schedule 2.06 (a) hereto and otherwise in accordance with Applicable Accounting Principles. If CTC (or its successor in interest) completely discontinues and abandons the technology described in Section 1.00(a) of that certain License Agreement between Buyerrequested, Seller shall make reasonable efforts to assist Purchaser and CTCits representatives in the preparation of the Statement. During the forty-five (45) day period following Seller's receipt of the Statement, dated Seller, at its sole expense, will be permitted to review, or have its accountants, auditors or counsel review, all relevant working papers and books and records of the Purchaser relating to the Statement. Purchaser shall provide reasonable cooperation with this review. The Statement shall become final and binding upon the parties on even date herewith, and any technology materially derived therefrom (collectively, the "Licensed Technology"), then Buyer shall be relieved from the obligations to make additional installment payments under the Note. Payment obligations under the Note shall not cease until forty-fifth day following receipt thereof by Seller receives unless Seller delivers a written notice (a "Discontinuation NoticeNotice of Disagreement") to the Purchaser on or prior to such date that Seller disagrees with the Statement. In order to be valid, any Notice of Disagreement delivered to the Purchaser shall specify in reasonable detail the amount in dispute and the items on the Statement disputed, shall describe in reasonable detail the basis for the objection and all information in the possession of Purchaser which forms the basis thereof, and shall be accompanied by a certificate of Seller's independent auditors that they concur with each of the discontinuation and abandonment positions taken by Seller in the Notice of the Licensed Technology (regardless whether such discontinuance and abandonment in fact have occurred prior to the date Seller receives the Discontinuance Notice)Disagreement. In addition to any other payments then due hereunder, Buyer shall also promptly pay Seller If a pro-rated amount based on the period between the date the last installment payment was due hereunder and the later Notice of the date (i) the Discontinuation Notice Disagreement is received by Sellerthe Purchaser in a timely manner, then the Statement shall become final and (ii) binding upon the actual parties on the date use of any disputed matters are resolved in accordance with the Licensed Technology is discontinued and abandoned. Upon issuance of a Discontinuation Notice, Buyer shall afford Seller reasonable access to facilities and records to verify such discontinuation. Any disagreement in respect to a Discontinuation Notice shall be resolved as provided provisions set forth in Section 11.07 of this Agreement. If, in conjunction with the Discontinuation Notice, CTC discontinues all of its other business operations, and CTC has insufficient funds to pay all of CTC's debts, the Final Payment shall be paid to Holder after the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Amcast or any of its Affiliates, is paid in full2.07 hereto.
(b) All principal In the event the Statement reveals that the Business has achieved certain Pre-Tax Income targets (each, a "Pre-Tax Income Target") for the years 1999 through 2004 as set forth below, then Purchaser shall pay to Seller additional purchase consideration (the "Obligation") in the amounts set forth below: Pre-Tax Obligation Income Target Payable ------------- ---------- 1999 $ 1,824,000 $530,000 2000 $ 2,230,000 $600,000 2001 $ 2,375,000 $700,000 2002 $ 2,720,000 $850,000 2003 $ 2,812,000 $850,000 2004 $ 3,220,000 $1,000,000 provided, however, in the event that in year 2004 the Seller is due any (i) Postponed Obligation, (ii) Delayed Obligation, (iii) an Obligation in respect of year 2004 or (iv) any other monetary obligation from Purchaser under the Note, and all accrued and unpaid interest thereon this Agreement or any other related agreements (each a "BalanceYear 2004 Obligation"), Purchaser's obligation of payment for the Year 2004 Obligations (individually or collectively at the option of the Purchaser) shall be reduced by $165,000.
(c) The obligations for each year set forth in Section 2.06(b) above shall be paid upon the following terms: In each year that the Purchaser has Pre-Tax Income, as set forth in clause 2.06(b) above, in an amount equal to or greater than the Pre-Tax Income Target for such year Seller will be paid 100% of the obligation for such year. In the event that the Purchaser has Pre-Tax Income in an amount equal to or greater than 80%, but less than 100%, of the Pre-tax Income Target for such year, Seller will be paid 50% of the obligation for such year, with payment of the remaining 50% deferred for five (5) years ("Delayed Obligation"). In the event that the Purchaser has Pre-Tax Income in an amount less than 80% of the Pre-Tax Income Target, but not less than the greater of (x) $1,100,000 or (y) 60% of the Pre-Tax Income Target for such year, then payment of 100% of the unpaid installment for such year will be deferred for ten (10) years ("Postponed Obligation") subject to the terms hereof. In any year where Purchaser has Pre-Tax Income in an amount less than the greater of (x) $1,100,000 or (y) 60% of the Pre-Tax Income Target for such year, Seller will forfeit payment of 100% of the obligation for such year ("Forfeited Obligation"). No portion of the Obligation shall be payable during or with respect to any period in which ▇▇▇▇▇ is in breach of a noncompete obligation contained in the Employment Agreement. In any year that the Pre-Tax Income exceeds the relevant target set forth above, Seller may elect to have all or a portion of such excess credited to prior years (credited to the earliest year first) for which the Pre-Tax Income Targets have not been satisfied in full (other than years in which the Obligation was forfeited) rather than crediting such excess Pre-Tax Income to the year in which it is actually earned (thereby reducing or eliminating the bonus payable to ▇▇▇▇▇ in respect of such year under the Employment Agreement). Any Delayed or Postponed Obligations which are no longer deferrable as a result of the credit shall be paid at the time the credit is recognized. Forfeited Obligations will not be recognized as earned as a result of any such credit.
(d) The Obligation in respect of any year shall be paid to Seller as follows:
(i) If no Notice of Disagreement is timely filed (or Seller notifies the Purchaser in writing that they accept the Statement), Purchaser shall deliver the Obligation in the amount set forth above in cash or at the option of the Parent, in the event of an IPO, in shares of ▇▇▇▇▇▇▇▇▇▇ Stock that are issued pursuant to an effective registration statement and which are free from any restrictions on resale. Such payment shall be delivered to Seller as soon as practicable, but in no event later than sixty-days following the delivery to Seller of the Statement;
(ii) If a Notice of Disagreement is timely filed, upon final resolution of the matter, Purchaser shall deliver the Obligation in the amount set forth above in cash or at the option of the Parent, in the event of an IPO, in shares of ▇▇▇▇▇▇▇▇▇▇ Stock that are issued pursuant to an effective registration statement and which are free from any restrictions on resale; and
(iii) Postponed Obligations and Delayed Obligations shall be paid at their respective maturity (as determined in accordance with the first paragraph of clause (c) of Section 2.06) in cash, or at the option of the Parent, in the event of an IPO, in shares of ▇▇▇▇▇▇▇▇▇▇ Stock that are issued pursuant to an effective registration statement and which are free from any restrictions on resale; provided, however, any amounts due to Seller from Purchaser pursuant to this paragraph (d) and remain unpaid shall be subject to set off and deduction for amounts due from Seller under this Agreement, including Sections 2.05 and Article VIII hereof. With respect to payments made by Purchaser under this paragraph (d) by the issuance (each such issuance, a "Stock Payment") of shares of ▇▇▇▇▇▇▇▇▇▇ Stock in respect of all or any portion of an Obligation the following provisions apply:
(i) the number of shares of ▇▇▇▇▇▇▇▇▇▇ Stock issued to Seller in respect of any Obligation shall not exceed the average trading volume of shares of ▇▇▇▇▇▇▇▇▇▇ Stock in the preceding five (5) trading days, it being understood and agreed that if no shares of ▇▇▇▇▇▇▇▇▇▇ Stock are traded on any one or more of the preceding five (5) trading days, the volume of shares traded for such day(s), which is zero (0), will still be included for such day(s) in calculating the average trading volume of shares of ▇▇▇▇▇▇▇▇▇▇ Stock for such five (5) trading day period;
(ii) all shares issued (except with respect to shares issued in respect of an Additional Stock Payment, as defined below) shall be valued at the average of the closing price for such shares for the twenty (20) trading days preceding such payment;
(iii) in the event that Seller sells all of the shares comprising such Stock Payment within five (5) business days after its receipt of such shares and such sale of shares results in gross cash proceeds to Seller that are less than the portion of the Obligation paid by such Stock Payment (such difference, the "Obligation Shortfall"), the Purchaser shall issue to Seller an additional number of shares of ▇▇▇▇▇▇▇▇▇▇ Stock (the "Additional Stock Payment") equal to the quotient of the Obligation Shortfall divided by the closing price of ▇▇▇▇▇▇▇▇▇▇ Stock on the trading day immediately preceding such sale of shares; and
(iv) if the sale by Seller of any shares of ▇▇▇▇▇▇▇▇▇▇ Stock included in a Stock Payment results in per share gross cash proceeds to Seller in excess of the per share value of such shares used to determine the number of shares of ▇▇▇▇▇▇▇▇▇▇ Stock issued in such Stock Payment (such excess the "Per Share Windfall Amount"), the Seller shall pay to Purchaser, within five (5) business days of such sale of shares, an amount equal to the Per Share Windfall Amount multiplied by the number of shares of ▇▇▇▇▇▇▇▇▇▇ Stock included in such sale. Notwithstanding the foregoing, in the event (i) the Parent is acquired in a transaction in which the current holders of the Parent's equity securities, as listed on Schedule 2.06(c) hereto, own less than 50% of the combined equity interests of the post-acquisition entity, (ii) the Parent sells or otherwise transfers all or substantially all of its assets to an unrelated third party, (iii) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ceases to hold an executive position with the Parent (other than by reason of his death or disability) or (iv) the Purchaser shall sell the Business to an unrelated third party, then all unpaid installments of the purchase price (including all Delayed and Postponed Obligations but excluding any Forfeited Obligations) will become immediately due and payable (x) if the Licensed Technology or the use thereof is sold, licensed, or otherwise transferred to anyone other than Buyer, (y) upon the sale or transfer of substantially all of the assets of CTC (or, if CTC is consolidated into or merged with Buyer or an Affiliate thereof, then upon the sale or transfer of substantially all of the assets of the division or entity comprising the successor to CTC) to an entity other than Buyer, or (z) if Buyer (or any Affiliate of Buyer) ceases to be a general partner, or own in excess of 50% of CTC. The Balance will be paid to Seller only to the extent the value of the consideration received by Buyer or any Affiliate thereof exceeds the sum of the Bank Debt and the trade debt of CTC (excluding debt owed to CTC by Buyer or any of its Affiliates). If the entire Balance is not paid pursuant to this provision, the remaining Balance shall be paid as provided in the first paragraph of this Section 2.03. Buyer shall give Seller written notice in reasonable detail of the foregoing events within ten (10) days of the occurrence and shall afford Seller reasonable access to facilities and records to verify Buyer's representationcash.
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