What is change of control covenant?

What is change of control covenant?

Change of Control Covenant means any covenant, agreement or other provision pursuant to which the occurrence or existence of a Change of Control would result in a violation or breach of, constitute (with or without due notice or lapse of time or both) or permit any Person to declare a default or event of default under.

What determines change of control?

A “Change of Control” shall be deemed to have occurred if, after the Effective Date, (i) the beneficial ownership (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of securities representing more than 50% of the combined voting power of the Company is acquired by any …

What is a change of control waiver?

More Definitions of Change of Control Waivers Change of Control Waivers means the waiver agreements entered into between the Company and certain specified employees of the Company, in substantially the form attached hereto as Exhibit D or as may be mutually agreed by the Company and the Purchaser.

Where are change of control provisions?

The provisions are often at the end of the agreement and are not taken seriously. This is dangerous, as it will complicate any future acquisitions when the party tries to sell the business in the future. It will also cause the contractual party to require concessions to be extorted in exchange for its consent.

Is change of control assignment?

An assignment clause governs whether and when a party can transfer the contract to someone else. Change of control terms don’t address assignment. They say whether a party can terminate if the other party goes through a merger or other change of control.

What are control provisions?

A change of control provision is an agreement where a party has certain rights, such as payment, consent, or termination. There is a provision in every employment agreement that gives employees specific protections in case there is a change in ownership of the company.

What does change in control mean in business?

A change in control often occurs in a corporate context. The precise definition varies by jurisdiction and entity. Typically, it refers to a transfer of ownership in which a new person or entity obtains a fifty percent or greater ownership interest.

What is change of control in finance?

In finance, a Change of Control occurs when there is a material change in the ownership of a company. The exact criteria that determine such a change can vary and are defined by law and through contractual agreements. A change of control clause is often included in creditor pacts.

Is a change of control a transfer?

1. Transfer of Percentage of Company Stock. A change of control typically includes the transfer of a certain percentage of the target company’s issued and outstanding shares from the target company to the acquirer.

What is a change of control transaction?

Change of Control Transaction means (i) the sale, lease, exchange, or other disposition (other than liens and encumbrances created in the ordinary course of business, including liens or encumbrances to secure indebtedness for borrowed money that are approved by the Board, so long as no foreclosure occurs in respect of …

What is a change of control in business?

What is meant by a change in corporate control?

Change in Corporate Control means (a) the time of approval by the shareholders of the Company of (i) any consolidation or merger of the Company in which the Company is not the continuing or surviving corporation or pursuant to which shares of Stock would be converted into cash, securities or other property, other than …