Common use of Initial Merger Consideration Clause in Contracts

Initial Merger Consideration. Subject to Section 1.11 (Dissenting Shares) and Section 5.6 (Right of Set-Off), Parent shall pay as consideration for the Merger the amounts set forth in this Section 1.8 and Section 1.9. (a) At Closing, Parent shall pay One Million Dollars ($1,000,000) (the “Initial Payment”) minus (i) the amount of all Liabilities of the Company (exclusive, however, of the Lease Liabilities and any liabilities set forth on Schedule 1.8(a)) outstanding as of the Closing (including, without limitation, any and all Transaction Expenses) (the “Company Liabilities”), and (ii) the amount of consideration that would have been payable to Dissenting Stockholders who would be entitled to receive a portion of the Initial Payment if they have perfected their rights as Dissenting Stockholders as of the Closing Date (the Initial Payment as so adjusted, the “Initial Merger Consideration”), which shall be paid by Parent to the Persons and in the amounts as follows: (x) One Hundred Thousand Dollars ($100,000) (the “Escrow Funds”) to the Escrow Agent to be held in escrow to secure any indemnification obligation of the Stockholders under Section 5.2; and (y) the balance of the Initial Merger Consideration to the Payment Agent for distribution in accordance with Schedule 1.8(b) and the terms of the Payment Agreement (any portion of the Initial Merger Consideration in excess of the Escrow Funds payable to the Stockholders is sometimes referred to herein as the “Net Initial Merger Consideration”). Prior to the Closing, the Company shall prepare and deliver to Parent a balance sheet of the Company dated as of the Closing Date which discloses all the Company Liabilities (the “Closing Date Balance Sheet”), a copy of which is attached hereto as Schedule 1.8(c). The Closing Date Balance Sheet shall be prepared in accordance with GAAP (subject to the absence of footnote disclosures and changes resulting from normal year-end adjustments, but including supporting account detail for all balance sheet accounts) and consistent with and using the same methods, procedures, assumptions and adjustments employed on the Latest Balance Sheet. (b) The Escrow Funds shall not be distributed until six (6) months after the Effective Time and shall only be distributed in accordance with the terms and conditions of the Escrow Agreement. In the event that Parent shall have timely given a notice of a claim for indemnification pursuant to Article 5, prior to the expiration of such six-month period, the Stockholders’ Representative and the Parent shall endeavor in good faith to determine a reasonable estimate of the maximum amount of such claim and shall instruct the Escrow Agent to deliver any excess amount of Escrow Funds to the Payment Agent for distribution in accordance with the Escrow Agreement.

Initial Merger Consideration. Subject to Section 1.11 1.13 (Dissenting Shares) and Section 5.6 (Right of Set-Off), Parent shall pay as for all of the Company Common Stock and Company Preferred Stock issued and outstanding immediately prior to the Effective Time the consideration for the Merger the amounts set forth in this Section 1.8 and Section 1.91.8. (a) At Closing, Parent shall pay One pay, by wire transfer in immediately available funds, Forty Million Dollars ($1,000,00040,000,000) (the “"Initial Payment”") minus plus or minus, as the case may be, the Purchase Price Adjustment (i) the amount of all Liabilities of the Company (exclusive, however, of the Lease Liabilities and any liabilities set forth on Schedule 1.8(aas defined in section 1.8(b)) outstanding as of the Closing (including, without limitation, any and all Transaction Expenses) (the “Company Liabilities”), and (ii) the amount of consideration that would have been payable to Dissenting Stockholders who would be entitled to receive a portion of the Initial Payment if they have perfected their rights as Dissenting Stockholders as of the Closing Date (the Initial Payment as so adjusted, the “"Estimated Initial Merger Consideration”"), which shall be paid by Parent to the Persons and in the amounts as follows: (xi) One Hundred Thousand Four Million Dollars ($100,0004,000,000) (the “"Escrow Funds”") to U.S. Bank National Association (the "Escrow Agent Agent") to be held in escrow pursuant to the Escrow Agreement to secure any indemnification obligation of the Stockholders under Section 5.28.2 and to refund to Parent any negative Purchase Price Adjustment due Parent after final determination of the Closing Balance Sheet in accordance with Section 1.10; and (yii) the balance of the Estimated Initial Merger Consideration to the Payment Agent for distribution to the Stockholders who are not otherwise Dissenting Stockholders (as defined in Section 1.13) in accordance with Schedule 1.8(b) and the terms of the Payment Agreement (any portion of the Initial Merger Consideration in excess of the Escrow Funds such balance payable to the Stockholders is sometimes referred to herein as the “"Net Initial Merger Consideration”"). Prior to the Closing, the Company shall prepare and deliver to Parent a balance sheet of the Company dated as of the Closing Date which discloses all the Company Liabilities (the “Closing Date Balance Sheet”), a copy of which is attached hereto as Schedule 1.8(c). The Closing Date Balance Sheet shall be prepared in accordance with GAAP (subject to the absence of footnote disclosures and changes resulting from normal year-end adjustments, but including supporting account detail for all balance sheet accounts) and consistent with and using the same methods, procedures, assumptions and adjustments employed on the Latest Balance Sheet. (b) The Escrow Funds shall not be distributed to the Stockholders until six (6) months after the Effective Time and shall only be distributed in accordance with the terms and conditions of the Escrow Agreement. In the event that Parent shall have timely given a notice of a claim for indemnification pursuant to Article 5perfected, prior to the expiration of such six-6 month period, a claim for indemnification pursuant to Section 8.4, the Stockholders’ ' Representative and the Parent shall endeavor in good faith to determine a reasonable estimate of the maximum amount of such claim and shall instruct the Escrow Agent to deliver any excess amount of Escrow Funds to the Payment Agent for distribution to the Stockholders in accordance with the Escrow Agreement. (b) The Initial Payment shall be adjusted (the "Purchase Price Adjustment") as follows: (a) increased or decreased on a dollar-for-dollar basis, by the amount that the Net Equity (as defined below), as reflected in the Estimated Closing Balance Sheet (as defined in Section 1.8(c)) is greater or less than Seven Million ($7,000,000) (the "Net Equity Threshold"); and (b) decreased by the amount of consideration that would have been payable to Dissenting Stockholders (as defined below) if they had not perfected their rights as Dissenting Stockholders. For purposes of clarity, the Purchase Price Adjustment shall increase the amount of Initial Merger Consideration to the extent the Net Equity is greater than the Net Equity Threshold and shall decrease the amount of Initial Merger Consideration to the extent the Net Equity is less than the Net Equity Threshold. For purposes hereof, the term "Net Equity" shall mean the Company's total assets less total liabilities as reflected on the Estimated Closing Balance Sheet, prepared in accordance with Section 1.10, and shall include Transaction Expenses and Severance Accruals.

Initial Merger Consideration. Subject to Section 1.11 (Dissenting Shares) and Section 5.6 (Right of Set-Off), Parent shall pay as consideration for the Merger the amounts set forth in this Section 1.8 and Section 1.9. (a) At Closingor at any time following the Effective Time, Parent TLC shall pay One Million Dollars ($1,000,000) (the “Initial Payment”) minus (i) the amount of all Liabilities of the Company (exclusivedeliver, however, of the Lease Liabilities and any liabilities set forth on Schedule 1.8(a)) outstanding as of the Closing (including, without limitation, any and all Transaction Expenses) (the “Company Liabilities”)or cause to be delivered, and (ii) the amount of consideration that would have been payable to Dissenting Stockholders who would a Shareholder shall be entitled to receive receive, upon surrender to TLC of one or more certificates representing Shares and a portion duly executed election form and transmittal letter in the form attached hereto as Exhibit A (an "Election Form"), subject to Section 2.01(c) and Section 2.01(d) hereof and to the terms of the Initial Payment if they have perfected their rights as Dissenting Stockholders as of Indemnification Agreement and Escrow Agreement, cash consideration equal to such Shareholder's Percentage Interest multiplied by the Closing Date (the Initial Payment as so adjusted, the “Initial Merger Consideration”), which shall be paid by Parent . (b) A Shareholder may elect to the Persons and in the amounts as follows: receive up to twenty percent (x20%) One Hundred Thousand Dollars ($100,000) (the “Escrow Funds”) to the Escrow Agent to be held in escrow to secure any indemnification obligation of the Stockholders under Section 5.2; and (y) the balance of the Initial Merger Consideration to which the Payment Agent for distribution Shareholder is entitled in accordance with Schedule 1.8(bTLC Shares, in lieu of cash, provided that such Shareholder has submitted a duly completed Election Form to TLC no later than the Effective Time; provided, however, that no Shareholder who is not an "accredited investor" as defined in Rule 501(a) and of Regulation D under the terms U.S. Securities Act (a "Non-Accredited Investor") may elect to receive TLC Shares. Unless a Shareholder has 84 submitted a duly completed Election Form prior to the Effective Time, such Shareholder shall be deemed to have elected to receive one hundred percent (100%) of the Payment Agreement Initial Merger Consideration to which he is entitled in cash. (any c) For purposes of determining the number of TLC Shares to be delivered to an Electing Shareholder as part of the Initial Merger Consideration, the value of the TLC Shares shall be $6.13 per share, being the average closing price of TLC Shares on NASDAQ for the five (5) trading days prior to the date hereof. (d) At the Closing, pursuant to the Escrow Agreement, TLC shall deposit with the Escrow Agent (as defined in the Escrow Agreement) a portion of the Initial Merger Consideration in excess equal to: (i) a cash amount equal to twenty five percent (25%) of the Escrow Funds payable to the Stockholders is sometimes referred to herein as the “Net total Initial Merger Consideration”). Prior to the ClosingConsideration (together with all earnings thereon, collectively, the Company shall prepare and deliver "Indemnity Escrow Deposit"); and (ii) a cash amount equal to Parent a balance sheet twenty-five percent (25%) of the Company dated as of the Closing Date which discloses all the Company Liabilities Required Net Assets (the “"Closing Date Balance Sheet”Adjustment Escrow Amount" and, together with all earnings thereon, collectively, the "Closing Adjustment Escrow Deposit"), a copy of which is attached hereto as Schedule 1.8(c). The Closing Date Balance Sheet shall be prepared in accordance with GAAP (subject to the absence of footnote disclosures and changes resulting from normal year-end adjustments, but including supporting account detail for all balance sheet accounts) and consistent with and using the same methods, procedures, assumptions and adjustments employed on the Latest Balance Sheet. (be) The Indemnity Escrow Funds Deposit shall not be distributed until six (6) months after held, invested and disbursed as provided in the Effective Time Indemnification Agreement and shall only be distributed in accordance with the terms and conditions of the Escrow Agreement. In the event that Parent The Closing Adjustment Escrow Deposit shall have timely given a notice of a claim for indemnification pursuant to Article 5be held, prior to the expiration of such six-month period, the Stockholders’ Representative invested and the Parent shall endeavor disbursed as provided in good faith to determine a reasonable estimate of the maximum amount of such claim Section 2.09(c) and shall instruct the Escrow Agent to deliver any excess amount of Escrow Funds to the Payment Agent for distribution in accordance with the Escrow Agreement.

Initial Merger Consideration. Subject to Section 1.11 1.13 (Dissenting Shares) and Section 5.6 (Right of Set-Off), Parent shall pay as for all of the Company Common Stock and Company Preferred Stock issued and outstanding immediately prior to the Effective Time the consideration for the Merger the amounts set forth in this Section 1.8 and Section 1.91.8. (a) At Closing, Parent shall pay One pay, by wire transfer in immediately available funds, Forty Million Dollars ($1,000,00040,000,000) (the “Initial Payment”) minus plus or minus, as the case may be, the Purchase Price Adjustment (i) the amount of all Liabilities of the Company (exclusive, however, of the Lease Liabilities and any liabilities set forth on Schedule 1.8(aas defined in section 1.8(b)) outstanding as of the Closing (including, without limitation, any and all Transaction Expenses) (the “Company Liabilities”), and (ii) the amount of consideration that would have been payable to Dissenting Stockholders who would be entitled to receive a portion of the Initial Payment if they have perfected their rights as Dissenting Stockholders as of the Closing Date (the Initial Payment as so adjusted, the “Estimated Initial Merger Consideration”), which shall be paid by Parent to the Persons and in the amounts as follows: (xi) One Hundred Thousand Four Million Dollars ($100,0004,000,000) (the “Escrow Funds”) to U.S. Bank National Association (the “Escrow Agent Agent”) to be held in escrow pursuant to the Escrow Agreement to secure any indemnification obligation of the Stockholders under Section 5.28.2 and to refund to Parent any negative Purchase Price Adjustment due Parent after final determination of the Closing Balance Sheet in accordance with Section 1.10; and (yii) the balance of the Estimated Initial Merger Consideration to the Payment Agent for distribution to the Stockholders who are not otherwise Dissenting Stockholders (as defined in Section 1.13) in accordance with Schedule 1.8(b) and the terms of the Payment Agreement (any portion of the Initial Merger Consideration in excess of the Escrow Funds such balance payable to the Stockholders is sometimes referred to herein as the “Net Initial Merger Consideration”). Prior to the Closing, the Company shall prepare and deliver to Parent a balance sheet of the Company dated as of the Closing Date which discloses all the Company Liabilities (the “Closing Date Balance Sheet”), a copy of which is attached hereto as Schedule 1.8(c). The Closing Date Balance Sheet shall be prepared in accordance with GAAP (subject to the absence of footnote disclosures and changes resulting from normal year-end adjustments, but including supporting account detail for all balance sheet accounts) and consistent with and using the same methods, procedures, assumptions and adjustments employed on the Latest Balance Sheet. (b) The Escrow Funds shall not be distributed to the Stockholders until six (6) months after the Effective Time and shall only be distributed in accordance with the terms and conditions of the Escrow Agreement. In the event that Parent shall have timely given a notice of a claim for indemnification pursuant to Article 5perfected, prior to the expiration of such six-6 month period, a claim for indemnification pursuant to Section 8.4, the Stockholders’ Representative and the Parent shall endeavor in good faith to determine a reasonable estimate of the maximum amount of such claim and shall instruct the Escrow Agent to deliver any excess amount of Escrow Funds to the Payment Agent for distribution to the Stockholders in accordance with the Escrow Agreement. (b) The Initial Payment shall be adjusted (the “Purchase Price Adjustment”) as follows: (a) increased or decreased on a dollar-for-dollar basis, by the amount that the Net Equity (as defined below), as reflected in the Estimated Closing Balance Sheet (as defined in Section 1.8(c)) is greater or less than Seven Million ($7,000,000) (the “Net Equity Threshold”); and (b) decreased by the amount of consideration that would have been payable to Dissenting Stockholders (as defined below) if they had not perfected their rights as Dissenting Stockholders. For purposes of clarity, the Purchase Price Adjustment shall increase the amount of Initial Merger Consideration to the extent the Net Equity is greater than the Net Equity Threshold and shall decrease the amount of Initial Merger Consideration to the extent the Net Equity is less than the Net Equity Threshold. For purposes hereof, the term “Net Equity” shall mean the Company’s total assets less total liabilities as reflected on the Estimated Closing Balance Sheet, prepared in accordance with Section 1.10, and shall include Transaction Expenses and Severance Accruals. (c) Not less than three business days prior to the Closing, the Company shall prepare and deliver to Parent (i) a good faith estimate of the Estimated Initial Merger Consideration, setting forth, in reasonable detail, a calculation of: (A) the estimated Net Equity; (B) the estimated Transaction Expenses and Severance Accruals; and (C) the estimated consideration that would have been payable to Dissenting Stockholders if they had not perfected their rights as Dissenting Stockholders; (ii) an estimated consolidated balance sheet for the Company as of the Closing Date (the “Estimated Closing Balance Sheet”), with the items described in subclauses (c)(i) and (ii) above prepared in accordance with GAAP as applicable to interim financial statements (and thus may not contain all notes and may not contain prior period comparative data which are required for compliance with GAAP) on a basis consistent with the accounting methods, practices and procedures used to prepare the Latest Financial Statements (as defined in Section 2.6), except as described in Section 2.6 of the Disclosure Schedule; and (iii) a certificate of a duly authorized officer of the Company certifying the foregoing.