Offering Not Consummated Clause Samples
The "Offering Not Consummated" clause defines the consequences and procedures if a proposed offering, such as a sale of securities or assets, does not reach completion. Typically, this clause outlines what happens to any funds held in escrow, the return of documents, or the termination of obligations between the parties if the offering fails to close by a specified date or due to unmet conditions. Its core practical function is to provide clarity and certainty for all parties by specifying the steps to be taken in the event the transaction does not proceed, thereby minimizing disputes and ensuring an orderly unwinding of the process.
Offering Not Consummated. If the Offering contemplated by this Agreement is not consummated for any reason other than a Company Failure (as hereinafter defined), then the Company shall reimburse the Underwriters in full for their out of pocket expenses, including, without limitation, its legal fees and disbursements only up to the amounts previously paid as deposits against commissions (up to a maximum of $50,000). The Representative shall retain such part of the deposits against commissions previously paid as shall equal its actual out-of-pocket expenses and refund the balance. If the Offering contemplated by this Agreement is not consummated because the Company has materially breached any of its representations, warranties or obligations under this Agreement, or failed to expeditiously proceed with the Offering (each a “Company Failure”), the Company shall reimburse the Representative in full for its legal fees and disbursements up to an aggregate of $100,000, less the amount of $50,000 to the extent previously advanced to the Representative.