Common use of Elimination of Minority Interest Clause in Contracts

Elimination of Minority Interest. (a) A Reduced Participant whose Recalculated Participating Interest becomes less than ten percent due to elections made pursuant to Section 9.5 to contribute less to an adopted Program and Budget than the percentage equal to its Participating Interest, or to contribute nothing to an adopted Program and Budget shall be deemed to have withdrawn from the Business and shall relinquish its entire Participating Interest free and clear of any Encumbrances arising by, through or under the Reduced Participant, except any such Encumbrances listed in Paragraph 1.1 of Exhibit A or to which the Participants have agreed in writing. Such relinquished Participating Interest shall be deemed to have accrued automatically to the other Participant. The Reduced Participant’s Capital Account shall be transferred to the remaining Participant. The Reduced Participant shall have the right to receive five percent of Net Proceeds, if any, to a maximum amount of 100 percent of the Reduced Participant’s Equity Account balance as of the effective date of the withdrawal. Upon receipt of such amount, and subject to Section 6.4, the Reduced Participant shall thereafter have no further right, title, or interest in the Assets or under this Agreement, and the tax partnership established by Exhibit C shall dissolve pursuant to Paragraph 4.2

Elimination of Minority Interest. (a) A Reduced Participant whose Recalculated Participating Interest becomes less than ten percent due to elections made pursuant to Section 9.5 to contribute less to an adopted Program and Budget than the percentage equal to its Participating Interest, or to contribute nothing to an adopted Program and Budget (10%) shall be deemed to have withdrawn from the Business and shall relinquish its entire Participating Interest free and clear of any Encumbrances arising by, through or under the Reduced Participant, except any such Encumbrances listed in Paragraph 1.1 of Exhibit A or to which the Participants have agreed in writingagreed. Such relinquished Participating Interest shall be deemed to have accrued automatically to the other Participant. The Reduced Participant’s Capital Account shall be transferred to the remaining Participant. The Reduced Participant shall have the right to receive five percent of Net Proceeds, if any, to a maximum amount of 100 percent of the Reduced Participant’s Equity Account balance as of the effective date of the withdrawal. Upon receipt of such amount, and subject Subject to Section 6.4, the Reduced Participant shall thereafter have no further right, title, or interest in the Assets Assets, the Business, or under this Agreement, except that the Reduced Participant shall have the right to receive a royalty equal to one percent (1%) of Net Smelter Returns calculated as provided in Exhibit D. In such event, the Reduced Participant shall execute and deliver an appropriate conveyance of all of its right, title and interest in the Assets and the tax partnership established by Exhibit C Business to the remaining Participant. (b) The relinquishment, withdrawal and entitlements for which this Section provides shall dissolve pursuant be effective as of the effective date of the recalculation under Sections 9.5 or 10.5 and shall not be subject to Paragraph 4.2subsequent recalculation.