The Backstop Commitment Clause Samples
The Backstop Commitment clause establishes an obligation for a party, often a financial institution or investor, to provide funding or purchase securities if other parties fail to do so. In practice, this means that if a company is raising capital and not all shares are subscribed for by existing shareholders or the public, the backstop provider will step in to buy the remaining shares, ensuring the fundraising target is met. This clause is crucial for guaranteeing the success of capital raises or similar transactions by mitigating the risk of insufficient participation.
The Backstop Commitment. (a) On and subject to the terms and conditions hereof, including entry of the Confirmation Order, each Commitment Party agrees, severally and not jointly, to fully exercise all Subscription Rights that are properly issued to it and its Affiliates based on the Unsecured Notes Claims listed on Schedule 2 pursuant to the Rights Offering and duly purchase all Rights Offering Securities issuable to it and its Affiliates pursuant to such exercise at the applicable Purchase Price, in accordance with the Rights Offering Procedures and the Plan.
(b) On and subject to the terms and conditions hereof, including entry of the Confirmation Order, each Commitment Party agrees, severally and not jointly, to purchase, and the Company agrees to sell to such Commitment Party, on the Closing Date for the applicable Purchase Price, the number of Unsubscribed Securities equal to (a) such Commitment Party’s Backstop Commitment Percentage multiplied by (b) the aggregate number of Unsubscribed Securities, rounded among the Commitment Parties solely to avoid fractional securities as the Commitment Parties may determine in their sole discretion. The obligations of the Commitment Parties to purchase such Unsubscribed Securities as described in this Section 2.2(b) shall be referred to as the “Backstop Commitment.”
The Backstop Commitment. (a) On the basis of the representations and warranties contained herein, but subject to the conditions set forth in Section 11 hereof and the utilization of the proceeds of the Rights Offering solely as set forth in Section 9(i) hereof, and pursuant to Sections 25 and 26 hereof, each Investor agrees to subscribe for in accordance with the Plan and purchase on the Effective Date (the “Closing Date”), and the Company agrees to sell and issue, at a purchase price per Unit equal to the Subscription Purchase Price, (i) such Investor’s Subscription Units and (ii) a number of Residual Units calculated by multiplying (x) such Investor’s Backstop Percentage times (y) the aggregate number of Residual Units (collectively, the “Commitment”). Subject to the foregoing, each Investor shall, or shall cause its Affiliates to, elect to receive and exercise all of the Rights offered to such Investor or Affiliate in respect of its Eligible Claims in accordance with the Plan.
(b) The Company shall pay or reimburse each Investor for its Transaction Expenses; provided, that the Company shall not be responsible for any fees and expenses of legal, accounting and financial advisors and management consultants that are engaged by the Investors after the date hereof unless the Company consents to such payment or reimbursement, such consent not to be unreasonably withheld. The Transaction Expenses shall be paid upon the earlier of the Closing Date and termination of this Equity Commitment Agreement in accordance with Section 19 hereof, except for termination resulting from the breach by such Investor of any representation, warranty or covenant set forth herein. The filing fees, if any, required by the HSR Act or other Antitrust Laws shall be paid by the Company when filings under the HSR Act are made. For the avoidance of doubt, this Section 3(b) shall not affect the Company’s obligation to pay the fees and expenses of (i) ▇▇▇▇, Weiss, Rifkind, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, (ii) Wachtell, Lipton, ▇▇▇▇▇ & ▇▇▇▇, (iii) Milbank, Tweed, ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP and (iv) The Blackstone Group pursuant to the Bankruptcy Court’s order approving debtor-in-possession financing and the DIP Financing Documents (as defined therein).
The Backstop Commitment. On and subject to the terms and conditions hereof, including entry of the Approval Order, each HoldCo Noteholders Commitment Party and each HoldCo Equityholders Commitment Party agrees, severally and not jointly, to fully exercise (or cause certain of its and its affiliates’ managed funds and/or accounts to fully exercise) all Subscription Rights that are owned by it (or such managed funds or accounts) as of the Rights Offering Expiration Time pursuant to the Rights Offerings, respectively, and duly purchase all Rights Offering Shares issuable to it pursuant to such exercise, in accordance with the Rights Offering Procedures and the Plan; provided, that any Defaulting Commitment Party shall be liable to each non-Defaulting Commitment Party, the Company and the Reorganized Debtors as a result of any breach of its obligations hereunder. On and subject to the terms and conditions hereof, including entry of the Confirmation Order, (a) each HoldCo Noteholders Commitment Party agrees, severally and not jointly, to purchase (or cause certain of its and its affiliates’ managed funds and/or accounts to purchase), and the Reorganized Company shall sell to such HoldCo Noteholders Commitment Party (or such managed funds or accounts), on the Closing Date for the applicable aggregate Per Share Purchase Price, the number of HoldCo Noteholders Unsubscribed Shares equal to (x) such HoldCo Noteholders Commitment Party’s HoldCo Noteholders Backstop Commitment Percentage multiplied by (y) the aggregate number of HoldCo Noteholders Unsubscribed Shares (such obligation to purchase, the “HoldCo Noteholders Backstop Commitment”), rounded among the HoldCo Noteholders Commitment Parties solely to avoid fractional shares as the applicable Requisite Commitment Parties may determine in its sole discretion (provided, that in no event shall such rounding reduce the aggregate commitment of such HoldCo Noteholders Commitment Parties) and (b) each HoldCo Equityholders Commitment Party agrees, severally and not jointly, to purchase (or cause certain of its and its affiliates’ managed funds and/or accounts to purchase), and the Reorganized Company shall sell to such HoldCo Equityholders Commitment Party (or such managed funds and/or accounts), on the Closing Date for the applicable aggregate Per Share Purchase Price, the number of HoldCo Equityholders Unsubscribed Shares equal to (x) such HoldCo Equityholders Commitment Party’s HoldCo Equityholders Backstop Commitment Percentage multiplied b...
The Backstop Commitment. (a) On the basis of the representations and warranties contained herein, but subject to the conditions set forth in Section 7 (including without limitation the entry of the Agreement Order (as defined below) and the Agreement Order becoming a Final Agreement Order), the Investor agrees to subscribe for and purchase on the Closing Date, and the Company agrees to sell and issue, at the aggregate Purchase Price therefor, all Unsubscribed Shares as of the Expiration Time (the “Backstop Commitment”). For purposes of this Agreement, “Final Agreement Order” shall mean an order or judgment of the Bankruptcy Court, which has not been reversed, stayed, modified or amended, and as to which (a) the time to appeal, seek certiorari or request reargument or further review or rehearing has expired and no appeal, petition for certiorari or request for reargument or further review or rehearing has been timely filed, or (b) any appeal that has been or may be taken or any petition for certiorari or request for reargument or further review or rehearing that has been or may be filed has been resolved by the highest court to which the order or judgment was appealed, from which certiorari was sought or to which the request was made and no further appeal or petition for certiorari has been or can be taken or granted.
The Backstop Commitment. Subject to the terms and conditions hereof, each Backstop Participant, severally and not jointly (the “Backstop Commitment”):
(a) shall duly exercise its (x) Primary Rights with respect to its Senior Notes Rights Offering Allocation Percentage of the Senior Notes Primary Rights Offering Shares, and (y) Incremental Liquidity Rights with respect to its Senior Notes Rights Offering Allocation Percentage of the Senior Notes Incremental Liquidity Shares (as to each Backstop Participant, its “Direct Allocation Commitment”);
(b) shall purchase, on the Closing Date, the Senior Notes Primary Rights Offering Shares and, if applicable, Senior Notes Incremental Liquidity Shares, in each case, for which it has duly exercised its Rights if such shares are issued pursuant to the terms hereof, the Plan and the Rights Offering Procedures;
(c) shall (for the benefit of the Company and each other Backstop Participant), duly exercise its Call Option during the Call Option Exercise Period; and
(d) shall purchase, on the Closing Date, the Unsubscribed Rights Offering Shares (if any) it is required to purchase pursuant to a duly exercised Call Option or Put Option pursuant to the terms hereof. Schedule 1 hereto sets forth each Backstop Participant’s Direct Allocation Commitment as of the date hereof.
The Backstop Commitment. On the basis of the representations and warranties contained herein, but (a) subject to the terms and conditions set forth herein, each Investor agrees, severally and not jointly, to subscribe for and purchase on the Effective Date, and the Company agrees to sell and issue, at the Purchase Price per Note, the principal amount of Unsubscribed Notes (the “Investor’s Unsubscribed Notes”), calculated by multiplying (x) such Investor’s Backstop Percentage times (y) the aggregate number of Unsubscribed Notes (the “Backstop Commitment”).
The Backstop Commitment. (a) Subject to Sections 2.02(b), 2.02(c) and Section 2.06, on and subject to the terms and conditions hereof, including entry of the BCA Approval Order and BCA Consummation Approval Order by the Bankruptcy Court, each Backstop Party hereby agrees, severally and not jointly, to purchase its Backstop Commitment Percentage of New Common Stock in an amount equal to $200.0 million in the aggregate at the Per Share Price (the “Backstop Commitment”).
The Backstop Commitment. On the terms and subject to the conditions hereof, in the Rights Offering each Backstop Party agrees, severally and not jointly, to purchase and shall purchase, and Exide agrees to issue and sell to such Backstop Party and shall issue and sell to such Backstop Party, on the Closing Date and for the Purchase Price, the aggregate principal amount of Backstop Notes equal to such Backstop Party’s pro rata portion of the Unsubscribed Notes, determined based upon the relative Backstop Commitment Amounts of the Backstop Parties, in each case up to such Backstop Party’s Backstop Commitment Amount (such obligation to purchase the Unsubscribed Notes, the “Backstop Commitment”).
The Backstop Commitment. Subject to Section 2.06 and to the terms and conditions hereof, including entry of the BCA Approval Order and BCA Consummation Approval Order by the Bankruptcy Court, each Backstop Party hereby agrees, severally and not jointly, to purchase its Backstop Commitment Percentage of New Common Stock in an amount equal to $189.8 million in the aggregate at the Per Share Price (the “Backstop Commitment”).
The Backstop Commitment. On and subject to the terms and conditions hereof, each Backstop Commitment Party agrees, severally and not jointly, to purchase, and the Company Parties agree to sell to such Backstop Commitment Party, on the Closing Date the aggregate principal amount of Unsubscribed Securities equal to (i) such Backstop Commitment Party’s Backstop Commitment Percentage multiplied by (ii) the aggregate principal amount of Unsubscribed Securities at a purchase price of 100% of the principal amount thereof (in each case rounding down to the applicable minimum denomination to avoid fractional notes) (the “Backstop Commitment”).