Excess Share Provisions Sample Clauses
The Excess Share Provisions clause defines how shares in excess of a specified ownership threshold are treated under an agreement. Typically, this clause applies when a shareholder acquires more shares than allowed by the contract or by law, and it may require that such excess shares be transferred, sold, or otherwise disposed of to maintain compliance. Its core practical function is to prevent any party from exceeding agreed-upon ownership limits, thereby ensuring regulatory compliance and maintaining the intended balance of control among shareholders.
Excess Share Provisions. Each Limited Partner hereby represents to the General Partner that it has reviewed the provisions of Exhibit B, which sets forth, among other things, certain restrictions on direct and indirect transfers of equity interests in each REIT Subsidiary and the circumstances in which equity interests in a REIT Subsidiary will be converted into Excess Shares. Notwithstanding any other provision of this Agreement, in the event that (i) any Partnership Interest is Transferred or any direct or indirect ownership interest in any Limited Partner is Transferred and (ii) as a result of such Transfer, the interests in any REIT Subsidiary that are held by the Partnership are converted into Excess Shares, then (A) the transferee of the Partnership Interests or the direct or indirect ownership interest in the Limited Partner, as the case may be, shall (1) repay to the Partnership the amount of any distributions received by it from the Partnership that are attributable to any interests in such REIT Subsidiary that are held by the Partnership, that are designated as Excess Shares and that were received on or after the date that such shares became Excess Shares, and (2) have its right to receive distributions pursuant to this Agreement reduced by an amount equal to the sum of the amount of cash and the fair market value of any property received by the Excess Share Trust with respect to such Excess Shares and distributed by the Excess Share Trust to the Charitable Beneficiary or used by the Excess Share Trust to pay its expenses, (B) the allocations of income, gain, loss or expense of the Partnership pursuant to Section 4.1 shall be adjusted to the extent necessary to reflect the rights and obligations of such Transferee or Limited Partner as described in clause (A) of this sentence and (C) for purposes of determining such transferee’s or Limited Partner’s Beneficial Ownership of the interests in such REIT Subsidiary, any interests in the REIT Subsidiary that otherwise would be Beneficially Owned by such transferee or Limited Partner (but for the transfer to the Excess Share Trust) shall be reduced by such number of Excess Shares.
Excess Share Provisions