Release of Escrow Securities. The Escrow Securities shall be released by the Escrow Agent in accordance with the following. For the avoidance of doubt, the Escrow Agent will confirm receipt of any notice or correspondence within two (2) hours' of receipt and if no confirmation is received by either the Company or the Lead Investor, the Company shall telephonically advise the Escrow Agent of the prior delivery of such notice or correspondence: (a) In the event that the Company and Lead Investor advise the Escrow Agent in writing that the Offering has been terminated (the "Termination Notice"), the Escrow Agent shall promptly return the Escrow Securities to the Company. (b) If prior to 3:00 P.M. Eastern time on the Termination Date, the Escrow Agent receives written notice, in the form of Exhibit A, attached hereto and made a part hereof, and signed by the Company and Lead Investor, stating that the Termination Date has been extended to the Final Termination Date (the "Extension Notice"), then the Termination Date shall be so extended. (c) Provided that the Escrow Agent does not receive the Termination Notice in accordance with Section 2(a) on or prior to later of the Termination Date or the date stated in the Extension Notice, if any, received by the Escrow Agent in accordance with Section 2(b) above, the Escrow Agent shall, upon receipt of written instructions in a form and substance satisfactory to the Escrow Agent, received from the Company and Lead Investor, release the Escrow Securities to the Subscribers in accordance with such written instructions, which instructions shall be in accordance with this Section 2(c). The Escrow Securities shall be released on or before the Termination Date (or, if extended, the Final Termination Date) in accordance with the written instructions of the Company and the Lead Investor, provided that the Company and the Lead Investor certify the following conditions have been met: (a) The Lead Investor has approved the release in writing and waived the requirement for the occurrence of a "Qualified Transaction" (as such term is defined in the Purchase Agreement); or (b) The Company has executed definitive binding documents for a Qualified Transaction and the Qualified Transaction shall close contemporaneously with the release of the Escrow Securities following approval of the Company's stockholders as required by NASDAQ, which Qualified Transaction requires the filing by the Company of a Current Report on Form 8-K with the inclusion of audited financial statements of the target. (d) If by 3:00 P.M. Eastern time on the later of the Termination Date or the date stated in the Extension Notice, if any, that the Escrow Agent has received in accordance with Section 2(b) above, the Escrow Agent has not received written instructions from the Company and Lead Investor regarding the release of the Escrow Securities, then the Escrow Agent shall promptly return the Escrow Securities to the Company. The Escrow Securities returned to the Company shall be free and clear of any and all claims of the Escrow Agent. (e) If the Termination Date, Final Termination Date or any date that is a deadline under this Agreement for giving the Escrow Agent notice or instructions or for the Escrow Agent to take action is not a Business Day, then such date shall be the Business Day that immediately preceding that date. A Business Day is any day other than a Saturday, Sunday or a Bank holiday.
Appears in 2 contracts
Sources: Escrow Deposit Agreement (Bioptix, Inc.), Escrow Deposit Agreement (Bioptix, Inc.)
Release of Escrow Securities. The 3.1. Subject to any other release or cancellation under this Agreement, the Escrow Securities are to be released from escrow upon the achievement of certain milestones by the Purchaser (the "Milestones"). Schedule "A" to this Agreement sets forth the applicable Milestones and the percentage or number of Escrow Securities to be released from escrow upon the achievement of each such Milestone. In Schedule "A", the percentage figure for the percent of Escrow Securities to be released from escrow upon the achievement of a particular Milestone represents the percent of the original number of Escrow Securities (as may be adjusted from time to time to account for any subdivision, consolidation, stock dividend, reclassification, or other like change affecting the Purchaser's common share capital subsequent to the Effective Time (each such change, a "Capital Change")) as opposed to the percent of the Escrow Securities remaining in escrow at the time of achievement of such Milestone. In respect of the release from escrow pursuant to the Escrow Agreements of any Milestone Shares, whether upon the Achievement of any Milestone or otherwise, the Milestone Shares shall be released from escrow to the Escrow Holders (including the Shareholder) on a pro-rata basis. Notwithstanding the occurrence of any or all of the Milestones, in no event shall the number of Milestone Shares releasable in the aggregate to all Escrow Shareholders exceed 25,000,000 (subject to adjustment from time to time to account for any Capital Change).
3.2. For the purposes of this Agreement and the release from escrow of the Escrow Securities, the board of directors of the Purchaser shall have the sole responsibility of determining whether or not a Milestone has been achieved, subject to the rights of the Escrow Shareholders described in section 3.9. The Purchaser shall make any such determination acting reasonably and in good faith. Until the earlier to occur of (i) such time as all of the Escrow Securities have been released from escrow, or (ii) the Expiration Date (as defined below), the Purchaser agrees to use, and to cause its Affiliates to use, reasonable efforts and devote a reasonable amount of resources (such efforts and resources are collectively referred to herein as the "Agreed Resources") in order to achieve, in the ordinary course of business, Milestones one (1) through nine (9) set forth on Schedule "A". Notwithstanding anything herein to the contrary, the Purchaser and the Shareholder acknowledge and agree that, in the event that the Purchaser's board of directors acting in good faith determines that it is in the best interests of the Purchaser and all of its stockholders to reduce or suspend the Agreed Resources, and that the failure to take such action could reasonably be determined to result in or lead to a breach of the fiduciary duties of the Purchaser's board of directors, then the Purchaser may reduce or suspend, as the case may be, the Agreed Resources until such time and by such amount as the board of directors determines to be reasonably necessary in light of the circumstances under which such action is taken. The Purchaser shall resume providing the Agreed Resources as soon as the continuation of providing such Agreed Resources could not reasonably be determined to result in or lead to a breach of the fiduciary duties of the Purchaser's board of directors.
3.3. Upon the Purchaser having determined that a Milestone has been achieved, the Purchaser shall forthwith provide the Escrow Agent (with a copy to the Shareholder and, if applicable, the Shareholder's Agent) with written notice (a "Release Notice"): (a) confirming that such Milestone has been achieved and the date (a "Release Date") such Milestone has been achieved; and, subject to section 3.8, (b) providing an irrevocable direction to release a specified percentage or number of Escrow Securities to the Shareholder. A Release Notice must be signed by the Chief Executive Officer and the Chief Financial Officer of the Purchaser.
3.4. In the event that a Capital Change occurs subsequent to the Effective Time and prior to six years after the Effective Date of the Arrangement (the "Expiration Date"), the Purchaser shall ensure that: (a) the percentage or number of Escrow Securities to be released from escrow on a Release Date takes into account the change in number of Escrow Securities that occurred as a result of such Capital Change and is adjusted, where necessary, such that the number of Escrow Securities released from escrow on a Release Date is equal to that number of Escrow Securities that would be eligible for release had such Capital Change been given effect immediately prior to the Effective Time; and (b) the applicable Release Notice sets out the Purchaser's calculations in this regard.
3.5. Irrespective of when a Release Notice is delivered by the Purchaser or received by the Escrow Agent, the Release Date specified in such Release Notice shall be deemed to be the date on which the Escrow Securities covered by such Release Notice were released from escrow under this Agreement.
3.6. The Purchaser and the Escrow Agent acknowledge and agree that on the basis that all of the Milestone Shares are to be held in escrow by the Escrow Agent pursuant to terms and conditions identical to this Agreement, the Purchaser may, for each Milestone that is achieved, provide a single Release Notice covering all Escrow Shareholders and their respective portion of the Milestone Shares in accordance lieu of providing the Escrow Agent with a separate Release Notice for each Escrow Shareholder.
3.7. Upon receipt of a Release Notice, the Escrow Agent shall deliver to the Shareholder, within three (3) Business Days, a share certificate registered in the name of the Shareholder evidencing the Escrow Securities released from escrow in connection with such Release Notice. If, on a date that Escrow Securities are to be released, the Escrow Agent holds a share certificate or other evidence representing more Escrow Securities than are to be released, the Escrow Agent shall deliver the share certificate or other evidence to the Purchaser or its transfer agent and request replacement share certificates or other evidence in denominations necessary to allow for: (a) the delivery to the Shareholder of the number of Escrow Securities so released; and (b) the balance of the Escrow Securities to remain in escrow with the followingEscrow Agent. For After the avoidance of doubtEscrow Agent receives the replacement share certificates or other evidence, the Escrow Agent will confirm receipt send to the Shareholder the replacement share certificate or other evidence of any notice or correspondence within two (2) hours' the Escrow Securities released.
3.8. As provided for in the Plan of receipt and if no confirmation is received by either the Company or the Lead InvestorArrangement, the Company shall telephonically advise Purchaser is entitled to withhold from any consideration issuable or payable pursuant to the Plan of Arrangement to the Shareholder (including the Escrow Agent Securities), provided that the Shareholder is not a Canadian Resident, such amounts as the Purchaser is required to deduct and withhold with respect to such issuance or payment, as the case may be, under Section 116 of the prior delivery Income Tax Act (Canada). Notwithstanding that the Purchaser has determined that Escrow Securities are eligible for release from escrow pursuant to section 2.3 hereof, the Purchaser shall not be obligated to deliver a Release Notice in respect of such notice or correspondence:
determination until the Shareholder has (a) In satisfied all amounts owing to the event Purchaser under section 4.8 of the Plan of Arrangement and (b) complied with the requirements of section 4.9 of the Plan of Arrangement.
3.9. The Purchaser shall, on a semi-annual basis commencing on the day that is six-months from the Company Effective Date, provide the Escrow Shareholders with a written update (a "Milestone Update") on the status of the achievement of Milestones one (1) through eight (8) set forth in Schedule "A". The initial Milestone Update shall set out in reasonable detail the then current status of achievement of the relevant Milestones while all subsequent Milestone Updates shall describe the progress in respect of each Milestone since the previous Milestone Update. If, at any time, the Purchaser receives, from Escrow Shareholders holding in the aggregate not less than two-thirds (2/3) of the Milestone Shares then remaining in escrow pursuant to the Escrow Agreements, a written request (a "Clarification Request") to provide a detailed account of the status of achievement of any Milestone, the Purchaser shall within 10 Business Days of the receipt of such Clarification Request provide a written response (a "Clarification Response") to the Escrow Shareholders setting out a detailed account of the status of achievement of such Milestone. A Clarification Request must: (a) identify the Escrow Shareholder(s) who are providing such Clarification Request; and Lead Investor advise (b) set out the specific Milestone or Milestones in respect of which the Escrow Shareholders are requesting clarification. For greater certainty, a particular Clarification Request may take the form of a single document submitted to the Purchaser on behalf of multiple Escrow Shareholders or multiple documents each submitted to the Purchaser on behalf of one or more Escrow Shareholders provided that such documents shall only collectively be treated as one Clarification Request if they all relate to the same Milestone or Milestones, as the case may be. If, within 15 Business Days of the delivery of a Clarification Response (or, if a Clarification Response is not delivered within the required 10 Business Day period, then within 25 Business Days of the delivery of the Clarification Request), the Purchaser receives, from Escrow Shareholders holding in the aggregate not less than two-thirds (2/3) of the Milestone Shares then remaining in escrow pursuant to the Escrow Agreements, a written notice (a "Dispute Notice") that said Escrow Shareholders (the "Disputing Shareholders") dispute the Purchaser's position that any one or more of the Milestones identified in the corresponding Clarification Request has not been achieved, the matter (a "Dispute") shall be resolved in accordance with the provisions of Schedule "C". For greater certainty, a particular Dispute Notice may take the form of a single document submitted to the Purchaser on behalf of multiple Escrow Shareholders or multiple documents each submitted to the Purchaser on behalf of one or more Escrow Shareholders provided that such documents shall only collectively be treated as one Dispute Notice if they all relate to the same Milestone or Milestones, as the case may be. If, upon following the procedures set forth in Schedule "C", it is determined that a particular Milestone has in fact been achieved, the Purchaser shall forthwith provide a Release Notice to the Escrow Agent in writing that respect of such Milestone. Notwithstanding the Offering has been terminated (Purchaser's obligation to provide the "Termination Notice")Milestone Updates and, if applicable, a Clarification Response, the Escrow Agent Purchaser shall promptly return the Escrow Securities in no manner be obligated to the Company.
(b) If prior to 3:00 P.M. Eastern time on the Termination Date, the Escrow Agent receives written notice, in the form of Exhibit A, attached hereto and made a part hereof, and signed by the Company and Lead Investor, stating that the Termination Date has been extended to the Final Termination Date (the "Extension Notice"), then the Termination Date shall be so extended.
(c) Provided that the Escrow Agent does not receive the Termination Notice in accordance with Section 2(a) on or prior to later of the Termination Date or the date stated in the Extension Notice, if any, received by the Escrow Agent in accordance with Section 2(b) above, the Escrow Agent shall, upon receipt of written instructions in a form and substance satisfactory disclose to the Escrow AgentShareholders in any such document, received from the Company and Lead Investoror otherwise, release the Escrow Securities to the Subscribers in accordance with such written instructions, which instructions shall be in accordance with this Section 2(c). The Escrow Securities shall be released on or before the Termination Date (or, if extended, the Final Termination Date) in accordance with the written instructions of the Company and the Lead Investor, provided that the Company and the Lead Investor certify the following conditions have been met:
(a) The Lead Investor has approved the release in writing and waived the requirement for the occurrence of a "Qualified Transaction" any undisclosed material information (as such term is commonly defined under applicable securities laws) in the Purchase Agreement); or
(b) The Company has executed definitive binding documents for a Qualified Transaction and the Qualified Transaction shall close contemporaneously with the release respect of the Escrow Securities following approval business and affairs of the Company's stockholders as required by NASDAQPurchaser ("Undisclosed Information"). In the event of a Dispute, which Qualified Transaction requires the filing if any Undisclosed Information is provided by the Company Purchaser to the Disputing Shareholders for the purpose of a Current Report settling such Dispute, such information shall only be provided to the Disputing Shareholders on Form 8-K with the inclusion of audited financial statements condition that the Disputing Shareholders agree to treat such information as confidential and agree not to trade in any securities of the target.
(d) If by 3:00 P.M. Eastern Purchaser until such time on the later of the Termination Date or the date stated in the Extension Notice, if any, that the Escrow Agent has received in accordance with Section 2(b) above, the Escrow Agent has not received written instructions from the Company and Lead Investor regarding the release of the Escrow Securities, then the Escrow Agent shall promptly return the Escrow Securities to the Company. The Escrow Securities returned to the Company shall be free and clear of any and all claims of the Escrow AgentUndisclosed Information is made public.
(e) If the Termination Date, Final Termination Date or any date that is a deadline under this Agreement for giving the Escrow Agent notice or instructions or for the Escrow Agent to take action is not a Business Day, then such date shall be the Business Day that immediately preceding that date. A Business Day is any day other than a Saturday, Sunday or a Bank holiday.
Appears in 1 contract
Release of Escrow Securities. The Escrow Securities shall be released by (a) If the Notes remain outstanding on the first anniversary of the Closing Date (the "MATURITY DATE"), and the Escrow Agent receives a notice in accordance with the following. For form of Exhibit A hereto from the avoidance of doubt, the Escrow Agent will confirm receipt of any notice or correspondence within two (2) hours' of receipt and if no confirmation is received by either the Company or the Lead Investor, the Company shall telephonically advise the Escrow Agent of the prior delivery of such notice or correspondence:
(a) In the event that the Company and Lead Investor advise the Escrow Agent in writing that the Offering has been terminated (the "Termination Notice")Administrative Agent, the Escrow Agent shall promptly return deliver to the Trustee, for authentication and delivery to the holders of Notes who have elected to exchange Notes for Exchange Notes, an executed authentication order and an Exchange Note or Exchange Notes, registered in the name of such person or persons designated by the Administrative Agent and dated the date of the delivery thereof, in an aggregate principal amount equal to the aggregate principal amount of Notes so exchanged, together with a copy of the executed Exchange Note Indenture. Concurrently with the delivery of the Exchange Notes to the Trustee pursuant to this Escrow Agreement, the Escrow Securities Agent shall deliver, or cause to be delivered to the Company, all outstanding Notes so exchanged.
(b) If Notes remain outstanding on the Maturity Date, and the Escrow Agent shall have received written notice in the form of Exhibit B hereto from the Arranger, the Escrow Agent shall deliver to the Warrant Agent for countersignature and delivery to the Arranger, on any one or more occasions, an executed countersignature order and Warrants, registered in the name of such person or persons designated by the Arranger and dated the date of the release thereof, as shall be specified in the notice to the Escrow Agent. Upon the payment in full of the Notes prior to the Maturity Date, and the receipt by the Escrow Agent of written notice in the form of Exhibit C hereto from the Arranger, the Escrow Agent shall release Warrants remaining in escrow to the Company.
(bc) If prior on any date after the Closing Date the Arranger determines (after consultation with the Company) that in connection with issuance of any indebtedness, convertible debt or equity securities incurred or issued by the Company or any affiliate thereof, the proceeds of which will be applied in full or in part to 3:00 P.M. Eastern time on refinance, directly or indirectly, the Termination DateBridge Loans (as converted, extended or exchanged) (the "PERMANENT SECURITIES"), it is necessary to deliver to the Warrant Agent for countersignature and delivery to the purchasers of the Permanent Securities an executed countersignature order and any or all of the Warrants then held in escrow pursuant to this Escrow Agreement, and the Escrow Agent receives shall have received written notice, notice in the form of Exhibit A, attached D hereto and made a part hereof, and signed by from the Company and Lead Investor, stating that the Termination Date has been extended to the Final Termination Date (the "Extension Notice"), then the Termination Date shall be so extended.
(c) Provided that the Escrow Agent does not receive the Termination Notice in accordance with Section 2(a) on or prior to later of the Termination Date or the date stated in the Extension Notice, if any, received by the Escrow Agent in accordance with Section 2(b) aboveArranger, the Escrow Agent shallshall release to the Arranger the aggregate amount of Warrants, upon receipt registered in the name of written instructions such person or persons designated by the Administrative Agent and dated the date of the delivery thereof, as shall be specified in a form and substance satisfactory the notice to the Escrow Agent, received from the Company and Lead Investor, release the Escrow Securities to the Subscribers in accordance with such written instructions, which instructions shall be in accordance with this Section 2(c). The Escrow Securities shall be released on or before the Termination Date (or, if extended, the Final Termination Date) in accordance with the written instructions of the Company and the Lead Investor, provided that the Company and the Lead Investor certify the following conditions have been met:
(a) The Lead Investor has approved the release in writing and waived the requirement for the occurrence of a "Qualified Transaction" (as such term is defined in the Purchase Agreement); or
(b) The Company has executed definitive binding documents for a Qualified Transaction and the Qualified Transaction shall close contemporaneously with the release of the Escrow Securities following approval of the Company's stockholders as required by NASDAQ, which Qualified Transaction requires the filing by the Company of a Current Report on Form 8-K with the inclusion of audited financial statements of the target.
(d) If by 3:00 P.M. Eastern time any Bridge Loans are outstanding on the later of the Termination Date or the date stated in the Extension NoticeMaturity Date, if any, that and the Escrow Agent has shall have received written notice in accordance with Section 2(b) abovethe form of Exhibit E hereto from the Arranger, the Escrow Agent has not received written instructions from shall release to the Company Arranger, on any one or more occasions, the aggregate amount of Warrants, registered in the name of such person or persons designated by the Administrative Agent and Lead Investor regarding dated the release date of the Escrow Securitiesdelivery thereof, then the Escrow Agent shall promptly return the Escrow Securities to the Company. The Escrow Securities returned to the Company as shall be free and clear of any and all claims of specified in the notice to the Escrow Agent.
(e) If On the Termination Date, Final Termination Date or any date that is a deadline under this Agreement for giving (the "TERMINATION DATE") on which the Escrow Agent notice receives a certificate signed on behalf of the Administrative Agent and the Company to the effect that all outstanding obligations with respect to the Notes have been repaid in cash in their entirety on or instructions or for prior to the Maturity Date, the Escrow Agent to take action is not a Business Day, shall return any Escrow Securities then such date held by it marked "cancelled" as shall be specified in writing by the Business Day that immediately preceding that date. A Business Day is any day other than a SaturdayAdministrative Agent and the Company.
(f) The Company will provide, Sunday or a Bank holidaycause to be provided, to the Escrow Agent all such information as the Escrow Agent may from time to time reasonably request.
(g) The Arranger will provide, or cause to be provided, to the Escrow Agent all information required to fill in the blanks on the Notes and Warrants.
Appears in 1 contract
Release of Escrow Securities. The 3.1. Subject to any other release or cancellation under this Agreement, the Escrow Securities are to be released from escrow upon the achievement of certain milestones by the Purchaser (the “Milestones”). Schedule “A” to this Agreement sets forth the applicable Milestones and the percentage or number of Escrow Securities to be released from escrow upon the achievement of each such Milestone. In Schedule “A”, the percentage figure for the percent of Escrow Securities to be released from escrow upon the achievement of a particular Milestone represents the percent of the original number of Escrow Securities (as may be adjusted from time to time to account for any subdivision, consolidation, stock dividend, reclassification, or other like change affecting the Purchaser’s common share capital subsequent to the Effective Time (each such change, a “Capital Change”)) as opposed to the percent of the Escrow Securities remaining in escrow at the time of achievement of such Milestone. In respect of the release from escrow pursuant to the Escrow Agreements of any Milestone Shares, whether upon the Achievement of any Milestone or otherwise, the Milestone Shares shall be released from escrow to the Escrow Holders (including the Shareholder) on a pro-rata basis. Notwithstanding the occurrence of any or all of the Milestones, in no event shall the number of Milestone Shares releasable in the aggregate to all Escrow Shareholders exceed 1,388,889 (subject to adjustment from time to time to account for any Capital Change).
3.2. For the purposes of this Agreement and the release from escrow of the Escrow Securities, the board of directors of the Purchaser shall have the sole responsibility of determining whether or not a Milestone has been achieved, subject to the rights of the Escrow Shareholders described in section 3.9. The Purchaser shall make any such determination acting reasonably and in good faith. Until the earlier to occur of (i) such time as all of the Escrow Securities have been released from escrow, or (ii) the Expiration Date (as defined below), the Purchaser agrees to use, and to cause its Affiliates to use, reasonable efforts and devote a reasonable amount of resources (such efforts and resources are collectively referred to herein as the “Agreed Resources”) in order to achieve, in the ordinary course of business, Milestones one (1) through nine (9) set forth on Schedule “A”. Notwithstanding anything herein to the contrary, the Purchaser and the Shareholder acknowledge and agree that, in the event that the Purchaser’s board of directors acting in good faith determines that it is in the best interests of the Purchaser and all of its stockholders to reduce or suspend the Agreed Resources, and that the failure to take such action could reasonably be determined to result in or lead to a breach of the fiduciary duties of the Purchaser’s board of directors, then the Purchaser may reduce or suspend, as the case may be, the Agreed Resources until such time and by such amount as the board of directors determines to be reasonably necessary in light of the circumstances under which such action is taken. The Purchaser shall resume providing the Agreed Resources as soon as the continuation of providing such Agreed Resources could not reasonably be determined to result in or lead to a breach of the fiduciary duties of the Purchaser’s board of directors.
3.3. Upon the Purchaser having determined that a Milestone has been achieved, the Purchaser shall forthwith provide the Escrow Agent (with a copy to the Shareholder and, if applicable, the Shareholder’s Agent) with written notice (a “Release Notice”): (a) confirming that such Milestone has been achieved and the date (a “Release Date”) such Milestone has been achieved; and, subject to section 3.8, (b) providing an irrevocable direction to release a specified percentage or number of Escrow Securities to the Shareholder. A Release Notice must be signed by the Chief Executive Officer and the Chief Financial Officer of the Purchaser.
3.4. In the event that a Capital Change occurs subsequent to the Effective Time and prior to six years after the Effective Date of the Arrangement (the “Expiration Date”), the Purchaser shall ensure that: (a) the percentage or number of Escrow Securities to be released from escrow on a Release Date takes into account the change in number of Escrow Securities that occurred as a result of such Capital Change and is adjusted, where necessary, such that the number of Escrow Securities released from escrow on a Release Date is equal to that number of Escrow Securities that would be eligible for release had such Capital Change been given effect immediately prior to the Effective Time; and (b) the applicable Release Notice sets out the Purchaser’s calculations in this regard.
3.5. Irrespective of when a Release Notice is delivered by the Purchaser or received by the Escrow Agent, the Release Date specified in such Release Notice shall be deemed to be the date on which the Escrow Securities covered by such Release Notice were released from escrow under this Agreement.
3.6. The Purchaser and the Escrow Agent acknowledge and agree that on the basis that all of the Milestone Shares are to be held in escrow by the Escrow Agent pursuant to terms and conditions identical to this Agreement, the Purchaser may, for each Milestone that is achieved, provide a single Release Notice covering all Escrow Shareholders and their respective portion of the Milestone Shares in accordance lieu of providing the Escrow Agent with a separate Release Notice for each Escrow Shareholder.
3.7. Upon receipt of a Release Notice, the Escrow Agent shall deliver to the Shareholder, within three (3) Business Days, a share certificate registered in the name of the Shareholder evidencing the Escrow Securities released from escrow in connection with such Release Notice. If, on a date that Escrow Securities are to be released, the Escrow Agent holds a share certificate or other evidence representing more Escrow Securities than are to be released, the Escrow Agent shall deliver the share certificate or other evidence to the Purchaser or its transfer agent and request replacement share certificates or other evidence in denominations necessary to allow for: (a) the delivery to the Shareholder of the number of Escrow Securities so released; and (b) the balance of the Escrow Securities to remain in escrow with the followingEscrow Agent. For After the avoidance of doubtEscrow Agent receives the replacement share certificates or other evidence, the Escrow Agent will confirm receipt send to the Shareholder the replacement share certificate or other evidence of any notice or correspondence within two (2) hours' the Escrow Securities released.
3.8. As provided for in the Plan of receipt and if no confirmation is received by either the Company or the Lead InvestorArrangement, the Company shall telephonically advise Purchaser is entitled to withhold from any consideration issuable or payable pursuant to the Plan of Arrangement to the Shareholder (including the Escrow Agent Securities), provided that the Shareholder is not a Canadian Resident, such amounts as the Purchaser is required to deduct and withhold with respect to such issuance or payment, as the case may be, under Section 116 of the prior delivery Income Tax Act (Canada). Notwithstanding that the Purchaser has determined that Escrow Securities are eligible for release from escrow pursuant to section 3.3 hereof, the Purchaser shall not be obligated to deliver a Release Notice in respect of such notice or correspondence:
determination until the Shareholder has (a) In satisfied all amounts owing to the event Purchaser under section 4.8 of the Plan of Arrangement and (b) complied with the requirements of section 4.9 of the Plan of Arrangement.
3.9. The Purchaser shall, on a semi-annual basis commencing on the day that is six-months from the Company Effective Date, provide the Escrow Shareholders with a written update (a “Milestone Update”) on the status of the achievement of Milestones one (1) through eight (8) set forth in Schedule “A”. The initial Milestone Update shall set out in reasonable detail the then current status of achievement of the relevant Milestones while all subsequent Milestone Updates shall describe the progress in respect of each Milestone since the previous Milestone Update. If, at any time, the Purchaser receives, from Escrow Shareholders holding in the aggregate not less than two-thirds (2/3) of the Milestone Shares then remaining in escrow pursuant to the Escrow Agreements, a written request (a “Clarification Request”) to provide a detailed account of the status of achievement of any Milestone, the Purchaser shall within 10 Business Days of the receipt of such Clarification Request provide a written response (a “Clarification Response”) to the Escrow Shareholders setting out a detailed account of the status of achievement of such Milestone. A Clarification Request must: (a) identify the Escrow Shareholder(s) who are providing such Clarification Request; and Lead Investor advise (b) set out the specific Milestone or Milestones in respect of which the Escrow Shareholders are requesting clarification. For greater certainty, a particular Clarification Request may take the form of a single document submitted to the Purchaser on behalf of multiple Escrow Shareholders or multiple documents each submitted to the Purchaser on behalf of one or more Escrow Shareholders provided that such documents shall only collectively be treated as one Clarification Request if they all relate to the same Milestone or Milestones, as the case may be. If, within 15 Business Days of the delivery of a Clarification Response (or, if a Clarification Response is not delivered within the required 10 Business Day period, then within 25 Business Days of the delivery of the Clarification Request), the Purchaser receives, from Escrow Shareholders holding in the aggregate not less than two-thirds (2/3) of the Milestone Shares then remaining in escrow pursuant to the Escrow Agreements, a written notice (a “Dispute Notice”) that said Escrow Shareholders (the “Disputing Shareholders”) dispute the Purchaser’s position that any one or more of the Milestones identified in the corresponding Clarification Request has not been achieved, the matter (a “Dispute”) shall be resolved in accordance with the provisions of Schedule “C”. For greater certainty, a particular Dispute Notice may take the form of a single document submitted to the Purchaser on behalf of multiple Escrow Shareholders or multiple documents each submitted to the Purchaser on behalf of one or more Escrow Shareholders provided that such documents shall only collectively be treated as one Dispute Notice if they all relate to the same Milestone or Milestones, as the case may be. If, upon following the procedures set forth in Schedule “C”, it is determined that a particular Milestone has in fact been achieved, the Purchaser shall forthwith provide a Release Notice to the Escrow Agent in writing that respect of such Milestone. Notwithstanding the Offering has been terminated (Purchaser’s obligation to provide the "Termination Notice")Milestone Updates and, if applicable, a Clarification Response, the Escrow Agent Purchaser shall promptly return the Escrow Securities in no manner be obligated to the Company.
(b) If prior to 3:00 P.M. Eastern time on the Termination Date, the Escrow Agent receives written notice, in the form of Exhibit A, attached hereto and made a part hereof, and signed by the Company and Lead Investor, stating that the Termination Date has been extended to the Final Termination Date (the "Extension Notice"), then the Termination Date shall be so extended.
(c) Provided that the Escrow Agent does not receive the Termination Notice in accordance with Section 2(a) on or prior to later of the Termination Date or the date stated in the Extension Notice, if any, received by the Escrow Agent in accordance with Section 2(b) above, the Escrow Agent shall, upon receipt of written instructions in a form and substance satisfactory disclose to the Escrow AgentShareholders in any such document, received from the Company and Lead Investoror otherwise, release the Escrow Securities to the Subscribers in accordance with such written instructions, which instructions shall be in accordance with this Section 2(c). The Escrow Securities shall be released on or before the Termination Date (or, if extended, the Final Termination Date) in accordance with the written instructions of the Company and the Lead Investor, provided that the Company and the Lead Investor certify the following conditions have been met:
(a) The Lead Investor has approved the release in writing and waived the requirement for the occurrence of a "Qualified Transaction" any undisclosed material information (as such term is commonly defined under applicable securities laws) in the Purchase Agreement); or
(b) The Company has executed definitive binding documents for a Qualified Transaction and the Qualified Transaction shall close contemporaneously with the release respect of the Escrow Securities following approval business and affairs of the Company's stockholders as required by NASDAQPurchaser (“Undisclosed Information”). In the event of a Dispute, which Qualified Transaction requires the filing if any Undisclosed Information is provided by the Company Purchaser to the Disputing Shareholders for the purpose of a Current Report settling such Dispute, such information shall only be provided to the Disputing Shareholders on Form 8-K with the inclusion of audited financial statements condition that the Disputing Shareholders agree to treat such information as confidential and agree not to trade in any securities of the target.
(d) If by 3:00 P.M. Eastern Purchaser until such time on the later of the Termination Date or the date stated in the Extension Notice, if any, that the Escrow Agent has received in accordance with Section 2(b) above, the Escrow Agent has not received written instructions from the Company and Lead Investor regarding the release of the Escrow Securities, then the Escrow Agent shall promptly return the Escrow Securities to the Company. The Escrow Securities returned to the Company shall be free and clear of any and all claims of the Escrow AgentUndisclosed Information is made public.
(e) If the Termination Date, Final Termination Date or any date that is a deadline under this Agreement for giving the Escrow Agent notice or instructions or for the Escrow Agent to take action is not a Business Day, then such date shall be the Business Day that immediately preceding that date. A Business Day is any day other than a Saturday, Sunday or a Bank holiday.
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