Escrow Matters. For purposes of administering claims by Buyer under -------------- this Section 10, at Closing each Shareholder shall place in escrow, under the terms of the Indemnification Escrow Agreement attached as Exhibit F, two-thirds of the number of shares of Retained Stock held by such Shareholder at the Closing. Except as provided below, the Retained Stock shall be held in escrow for a period of thirty (30) months after the Closing Date. After DBI completes a public offering of its Common Stock, or an event under 3.2.1 or 3.2.2 of the Stockholders Agreement occurs, the entire balance of the Retained Stock (or, if an event under 3.2.1 or 3.2.2 of the Stockholders Agreement, up to the amount removed to comply with such provisions) may be removed from the escrow and replaced by the amount of cash received from the sale of such shares, but not in excess of $20,000,000, in which case the Liability Cap shall be adjusted upward by the amount by which the cash received upon sale, up to $20,000,000, exceeds the Liability Cap. After the Retained Stock is released from escrow, the Shareholders shall be free to sell such Retained Stock without lien or other encumbrance of Buyer arising under the terms of this Agreement.
Appears in 2 contracts
Sources: Recapitalization Agreement (Diamond Brands Operating Corp), Recapitalization Agreement (Diamond Brands Inc)