Common use of Distribution of Stock and Liquidity Restrictions Clause in Contracts

Distribution of Stock and Liquidity Restrictions. (a) Except as set forth herein, XM Ventures shall not effect any offer to sell, sale, contract to sell or otherwise dispose of any shares of AMSC Common Stock. Notwithstanding the foregoing, XM Ventures may pledge shares of AMSC Common Stock to a pledgee that is a bank, savings and loan association or credit union organized under the laws of the United States or any state thereof, the deposits of which are insured by a United States federal agency, pursuant to a bona fide pledge of such shares as collateral security for indebtedness or other obligations due to the pledgee, provided that such shares shall remain subject to, and upon foreclosure, realization or other similar action by the pledgee, shall be transferred only in accordance with, the provisions of Section 3.1(b). (i) Upon the receipt by XM Ventures of the First Transfer, XM Ventures may sell or otherwise dispose of and/or distribute to the WorldSpace Stockholders and/or Option Holders (if and when such Option Holders become stockholders of WorldSpace) up to 1.7 million shares of AMSC Common Stock received under the First Transfer, and the remaining shares from the First Transfer as well as all of the shares under the Second Transfer shall be held by XM Ventures in accordance with the terms of this Agreement. (ii) On or after the last day of each consecutive 3-month period following the Closing Date, XM Ventures may sell or otherwise dispose of and/or distribute to the WorldSpace Stockholders and/or Option Holders (if and when such Option Holders become stockholders of WorldSpace) up to an additional 20% of the Acquired AMSC Stock. Any such sales, disposals or distributions by XM Ventures pursuant to this Section 3.1(a) shall be made in compliance with the terms of this Agreement (including without limitation Sections 3.1(b) and 7.7 hereof, and the legend set forth in Section 4.9 hereof) and applicable securities laws. (b) XM Ventures and each of the Significant Stockholders, without the prior written consent of AMSC, which consent shall not be unreasonably withheld, shall not (i) knowingly transfer in a directed sale any of the AMSC Common Stock held by them to: (A) WorldSpace or any affiliate of WorldSpace (other than a WorldSpace Stockholder or Option Holder in accordance with the terms of this Agreement); (B) any alien or the representative of any alien; or (C) any corporation, partnership, or other legal entity of which more than one-fourth of the capital stock or other ownership interests is owned of record or voted by aliens, their representatives, or by a foreign government or representative thereof; or (ii) transfer, in any single transaction or in any related series of transactions to any individual, entity, or group of individuals or entities, such number of shares of AMSC Common Stock held by them constituting 5% or more of the then outstanding shares of AMSC Common Stock. The parties hereto acknowledge and agree that nothing in this Agreement is intended to restrict the right of XM Ventures to adjust the amount of shares of AMSC Common Stock distributed to its beneficiaries to give effect to the respective interests of WorldSpace Stockholders and Option Holders in WorldSpace. XM Ventures and each Significant Stockholder further agree to provide notice to any WorldSpace Stockholder or Option Holder to whom XM Ventures or any Significant Stockholder distributes or transfers any shares of AMSC Common Stock of the transfer and voting restrictions imposed by Sections 3.1(b) and 3.2(a) hereof which would apply in the event such WorldSpace Stockholder or Option Holder becomes a Significant Stockholder. (c) Except with respect to the rights of AMSC under this Agreement, XM Ventures and WorldSpace acknowledge and agree that AMSC and XM Holdings shall have no control over, and shall not in any way participate in, any distribution by XM Ventures of AMSC Acquired Stock to the WorldSpace Stockholders. The parties hereto further acknowledge and agree that neither AMSC nor XM Holdings shall have any liability to XM Ventures, WorldSpace or to any WorldSpace Stockholders arising out of or in connection with any such distribution.

Distribution of Stock and Liquidity Restrictions. (a) Except as set forth herein, XM Ventures shall not effect any offer to sell, sale, contract to sell or otherwise dispose of any shares of AMSC Common Stock. Notwithstanding the foregoing, XM Ventures may pledge shares of AMSC Common Stock to a pledgee that is a bank, savings and loan association or credit union organized under the laws of the United States or any state thereof, the deposits of which are insured by a United States federal agency, pursuant to a bona fide pledge of such shares as collateral security for indebtedness or other obligations due to the pledgee, provided that such shares shall remain subject to, and upon foreclosure, realization or other similar action by the pledgee, shall be transferred only in accordance with, the provisions of Section 3.1(b). (i) Upon the receipt by XM Ventures of the First Transfer, XM Ventures may sell or otherwise dispose of and/or distribute to the WorldSpace Stockholders and/or Option Holders (if and when such Option Holders become stockholders of WorldSpace) up to 1.7 million shares of AMSC Common Stock received under the First Transfer, and the remaining shares from the First Transfer as well as all of the shares under the Second Transfer shall be held by XM Ventures in accordance with the terms of this Agreement. (ii) On or after the last day of each consecutive 3-month period following the Closing Date, XM Ventures may sell or otherwise dispose of and/or distribute to the WorldSpace Stockholders and/or Option Holders (if and when such Option Holders become stockholders of WorldSpace) up to an additional 20% of the Acquired AMSC Stock. Any such sales, disposals or distributions by XM Ventures pursuant to this Section 3.1(a) shall be made in compliance with the terms of this Agreement (including without limitation Sections 3.1(b) and 7.7 hereof, and the legend set forth in Section 4.9 hereof) and applicable securities laws. (b) XM Ventures and each of the Significant Stockholders, without the prior written consent of AMSC, which consent shall not be unreasonably withheld, shall not not (i) knowingly transfer in a directed sale any of the AMSC Common Stock held by them to: (A) WorldSpace or any affiliate of WorldSpace (other than a WorldSpace Stockholder or Option Holder in accordance with the terms of this Agreement); (B) any alien or the representative of any alien; or (C) any corporation, partnership, or other legal entity of which more than one-fourth of the capital stock or other ownership interests is owned of record or voted by aliens, their representatives, or by a foreign government or representative thereof; or (ii) transfer, in any single transaction or in any related series of transactions to any individual, entity, or group of individuals or entities, such number of shares of AMSC Common Stock held by them constituting 5% or more of the then outstanding shares of AMSC Common Stock. The parties hereto acknowledge and agree that nothing in this Agreement is intended to restrict the right of XM Ventures to adjust the amount of shares of AMSC Common Stock distributed to its beneficiaries to give effect to the respective interests of WorldSpace Stockholders and Option Holders in WorldSpace. XM Ventures and each Significant Stockholder further agree to provide notice to any WorldSpace Stockholder or Option Holder to whom XM Ventures or any Significant Stockholder distributes or transfers any shares of AMSC Common Stock of the transfer and voting restrictions imposed by Sections 3.1(b) and 3.2(a) hereof which would apply in the event such WorldSpace Stockholder or Option Holder becomes a Significant Stockholder. (c) Except with respect to the rights of AMSC under this Agreement, XM Ventures and WorldSpace acknowledge and agree that AMSC and XM Holdings shall have no control over, and shall not in any way participate in, any distribution by XM Ventures of AMSC Acquired Stock to the WorldSpace Stockholders. The parties hereto further acknowledge and agree that neither AMSC nor XM Holdings shall have any liability to XM Ventures, WorldSpace or to any WorldSpace Stockholders arising out of or in connection with any such distribution.