Securityholders’ Representative. (a) By virtue of their execution of the Written Consents and Letters of Transmittal and as more specifically provided for therein, each of the holders of Company Shares and each of the holders of CEA Shares (other than Dissenting Shares and Company Shares or CEA Shares held in the Company’s or CEA’s treasury, as the case may be, if any) and CEA Options shall approve and confirm, in accordance with the terms set forth herein, his, her or its irrevocable appointment of CEA Rep, LLC as his, her or its sole and exclusive agent, representative and attorney-in-fact for the purposes of this Agreement and the Escrow Agreement. The Securityholders’ Representative shall have the authority to act for and on behalf of the Former Securityholders, including, without limitation, to give and receive notices and communications, to act on behalf of the Former Securityholders with respect to the Escrow Agreement and any other matters arising under this Agreement, to authorize delivery to Parent of any funds and property in its possession or in the possession of the Escrow Agent in satisfaction of claims by Parent, to object to such deliveries, to agree to, negotiate, enter into settlements and compromises of, and commence, prosecute, participate in, settle, dismiss or otherwise terminate, as applicable, lawsuits and claims, mediation and arbitration proceedings, and to comply with orders of courts and awards of courts, mediators and arbitrators with respect to such suits, claims or proceedings, and to take all actions necessary or appropriate in the judgment of the Securityholders’ Representative for the accomplishment of the foregoing. The Securityholders’ Representative shall for all purposes be deemed the sole authorized agent of the Former Securityholders until such time as the agency is terminated. Such agency may be changed by the Former Securityholders from time to time upon not less than thirty (30) days prior written notice to Parent; provided, however, that the Securityholders’ Representative may not be removed unless holders of at least two-thirds interest in the Merger Consideration agree to such removal and to the identity of the substituted Securityholders’ Representative. Any vacancy in the position of Securityholders’ Representative may be filled by approval of the recipients of a majority of the Merger Consideration. No bond shall be required of the Securityholders’ Representative, and the Securityholders’ Representative shall not receive compensation for its services. Notices or communications to or from the Securityholders’ Representative shall constitute notice to or from each of the Former Securityholders during the term of the agency. (b) The Securityholders’ Representative shall not incur any liability with respect to any action taken or suffered by it or omitted hereunder as Securityholders’ Representative while acting in its capacity as Securityholders’ Representative. The Securityholders’ Representative may, in all questions arising hereunder, rely on the advice of counsel and other professionals and for anything done, omitted or suffered by the Securityholders’ Representative shall not be liable to anyone while acting in its capacity as Securityholders’ Representative. The Securityholders’ Representative undertakes to perform such duties and only such duties as are specifically set forth in this Agreement and no other covenants or obligations shall be implied under this Agreement against the Securityholders’ Representative; provided, however, that the foregoing shall not act as a limitation on the powers of the Securityholders’ Representative determined by it to be reasonably necessary to carry out the purposes of its obligations. The Former Securityholders shall indemnify the Securityholders’ Representative and hold it harmless against any loss, liability or expense incurred on the part of the Securityholders’ Representative (unless arising out of its gross negligence or willful misconduct) and arising out of or in connection with the acceptance or administration of its duties under this Agreement. The Securityholders’ Representative shall be entitled to satisfy any such loss, liability and expense from the proceeds of the Indemnity Escrow Amount received by the Securityholders’ Representative for distribution to the Former Securityholders on a pro rata basis following such time that any such Indemnity Escrow Amount is distributed to the Securityholders’ Representative in accordance with the terms of the Escrow Agreement. (c) The Securityholders’ Representative shall have the reasonable assistance of the Surviving Corporation’s, the CEA Surviving Corporation’s and Parent’s officers and employees for purposes of performing its duties and exercising its rights hereunder, provided that the Securityholders’ Representative shall treat confidentially and not disclose any nonpublic information from or about the Surviving Corporation, the CEA Surviving Corporation or Parent or any Affiliate thereof to anyone (except on a need to know basis to individuals who agree to treat such information confidentially) other than in connection with the enforcement of any rights hereunder or any other proceeding brought in connection herewith. (d) A decision, act, consent or instruction of the Securityholders’ Representative shall constitute a decision, act, consent or instruction of all of the Former Securityholders and shall be final, binding and conclusive upon each such Former Securityholders. Parent may rely upon any such decision, act, consent or instruction of the Securityholders’ Representative as being the decision, act, consent or instruction of every such Former Securityholders. (e) In the Securityholders’ Representative’s sole discretion, part or all of the Former Securityholders’ Escrow Amount may be deposited in the Escrow Account, and any such amounts so deposited shall then become subject to the terms of the Escrow Agreement as provided therein. (f) The Securityholders’ Representative shall release the Former Securityholders Escrow Amount upon the later to occur of (i) the General Survival Date, (ii) the final resolution of all claims made by the Parent Claimants under Article VII or (iii) the date that the Securityholders’ Representative reasonably determines that the Former Securityholders Escrow Amount is no longer necessary in connection with any potential claims. (g) The Securityholder Claimants may not make a claim for indemnity against Parent pursuant to this Agreement except through the Securityholders’ Representative.
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Securityholders’ Representative. (a) By virtue of their execution of Prior to entry into this Agreement, the Written Consents Company and Letters of Transmittal and as more specifically provided for therein, each of the holders of Company Shares and each of the holders of CEA Shares Unitholders (other than Dissenting Shares and Company Shares or CEA Shares held in the Company’s or CEA’s treasuryBlocker Members) shall appoint Chilly Water, LLC to act as the case may be, if anyrepresentative for the benefit of each Unitholder (other than the Blocker Members) as the exclusive agent and CEA Options shall approve and confirm, in accordance with the terms set forth herein, his, her or its irrevocable appointment of CEA Rep, LLC as his, her or its sole and exclusive agent, representative and attorney-attorney- in-fact for to act on behalf of each Unitholder (other than the purposes of this Agreement and Blocker Members), in connection with the Escrow Agreement. transactions contemplated hereby.
(b) The Securityholders’ Representative shall have the authority to act for and on behalf of the Former SecurityholdersUnitholders (other than the Blocker Members), including, without limitation, (i) to give and receive notices and communications, (ii) to act on behalf of the Former Securityholders such Persons with respect to the Adjustment Escrow Agreement Account, the PPP Escrow Account, the Earn-Out Payments and any other matters arising under this AgreementAgreement or the other Transaction documents, (iii) to authorize delivery to Parent and Merger Sub of any funds and property in its possession or in the possession of the Adjustment Escrow Agent or PPP Escrow Agent in satisfaction of claims by ParentParent and Merger Sub, (iv) to object to such deliveries, (v) to agree to, negotiate, enter into settlements and compromises of, and commence, prosecute, participate in, settle, dismiss or otherwise terminate, as applicable, lawsuits and claims, mediation and arbitration proceedings, and to comply with orders of courts and awards of courts, mediators and arbitrators with respect to such suits, claims or proceedings, (vi) subject to the restrictions in Section 6.11(f), to use the Securityholders’ Representative Expense Amount to satisfy costs, expenses and/or Liabilities of the Securityholders’ Representative or the Unitholders (other than the Blocker Members) in connection with matters related to this Agreement and/or the Transaction documents and satisfy a portion of the Downward Adjustment Amount in accordance with Section 2.13(a)(i), with any balance of the Securityholders’ Representative Expense Amount not used for such purposes to be disbursed and paid to the Unitholders (other than the Blocker Members) in accordance with the Payment Schedule at such time as the Securityholders’ Representative determines in its sole discretion that no additional such costs, expenses and/or Liabilities shall become due and payable, (vii) appoint the Paying Agent and enter into the Paying Agent Agreement and (viii) to take all actions necessary or appropriate in the judgment of the Securityholders’ Representative for the accomplishment of the foregoing. The Securityholders’ Representative shall for all purposes be deemed the sole authorized agent of the Former Securityholders Unitholders (other than the Blocker Members) from and after Closing until such time as the agency is terminated. Such agency may be changed by the Former Securityholders from time to time upon not less than thirty (30) days prior written notice to Parent; provided, however, that the Securityholders’ Representative may not be removed unless holders of at least two-thirds interest in the Merger Consideration agree to such removal and to the identity of the substituted Securityholders’ Representative. Any vacancy successor in the position of Securityholders’ Representative may be filled by approval of the recipients of a majority of the Merger Consideration. No bond shall be required of the Securityholders’ Representative, and any such replacement shall acknowledge and agree to be treated the “Securityholders’ Representative shall not receive compensation Representative” for its servicespurposes of this Agreement and any other Transaction Document. Notices or communications to or from the Securityholders’ Representative shall constitute notice to or from each of the Former Securityholders Unitholder (other than the Blocker Members) during the term of the agency.
(b) The Securityholders’ Representative shall not incur any liability with respect to any action taken or suffered by it or omitted hereunder as Securityholders’ Representative while acting in its capacity as Securityholders’ Representative. The Securityholders’ Representative may, in all questions arising hereunder, rely on the advice of counsel and other professionals and for anything done, omitted or suffered by the Securityholders’ Representative shall not be liable to anyone while acting in its capacity as Securityholders’ Representative. The Securityholders’ Representative undertakes to perform such duties and only such duties as are specifically set forth in this Agreement and 88758860_15 no other covenants or obligations shall be implied under this Agreement against the Securityholders’ Representative; provided, however, that the foregoing shall not act as a limitation on the powers of the Securityholders’ Representative determined by it to be reasonably necessary to carry out the purposes of its obligations. The Former Securityholders shall indemnify the Securityholders’ Representative and hold it harmless against any loss, liability or expense incurred on the part of the Securityholders’ Representative (unless arising out of its gross negligence or willful misconduct) and arising out of or in connection with the acceptance or administration of its duties under this Agreement. The Securityholders’ Representative shall be entitled to satisfy any such loss, liability and expense from the proceeds of the Indemnity Escrow Amount received by the Securityholders’ Representative for distribution to the Former Securityholders on a pro rata basis following such time that any such Indemnity Escrow Amount is distributed to the Securityholders’ Representative in accordance with the terms of the Escrow Agreement.
(c) The Securityholders’ Representative shall have reasonable access to information about the Company, Blocker, Parent, Merger Sub and the Surviving Entity necessary or appropriate for it to fulfill its obligations under this Agreement and the reasonable assistance of the Surviving CorporationEntity’s, the CEA Surviving CorporationBlocker’s and Parent’s officers and employees for purposes of performing its duties and exercising its rights hereunder, provided that the Securityholders’ Representative shall treat confidentially and not disclose any nonpublic information from or about the Surviving CorporationEntity, the CEA Surviving Corporation Blocker or Parent or any Affiliate thereof to anyone (except on a need to know basis to individuals agents or representatives of Securityholders’ Representative who first agree to treat such information confidentially) other than in connection with the enforcement of any rights hereunder or any other proceeding brought in connection herewith.
(d) A decision, act, consent or instruction of the Securityholders’ Representative shall constitute a decision, act, consent or instruction of all of the Former Securityholders Unitholders (other than the Blocker Members) and shall be final, binding and conclusive upon each such Former SecurityholdersPerson. Parent may rely upon any such decision, act, consent or instruction of the Securityholders’ Representative as being the decision, act, consent or instruction of every such Former Unitholder (other than the Blocker Members) and shall have no Liability to any such Person for any actions taken in reliance upon any such decision, act, consent or instruction of the Securityholders’ Representative.
(e) In The Securityholders’ Representative will not be liable for any act taken or omitted to be taken as Securityholders’ Representative while acting in good faith, and any act taken or omitted to be taken pursuant to the reasonable advice of counsel will be conclusive evidence of such good faith. The Securityholders’ Representative shall be entitled to rely, and shall be fully protected in relying, upon any statements furnished to it by the Surviving Entity, Parent, Merger Sub and any third party or any other evidence deemed by the Securityholders’ Representative’s sole discretionRepresentative to be reliable, part or all of and the Former Securityholders’ Escrow Amount Representative shall be entitled to act on the advice of counsel selected by it. The Securityholders’ Representative shall be fully justified in failing or refusing to take any action under this Agreement or any related document or agreement if it shall have received such advice or concurrence as it deems appropriate with respect to such inaction, or if it shall not have been expressly indemnified to its satisfaction against any and all Liability and expense that the Securityholders’ Representative may be deposited in the Escrow Account, and incur by reason of taking or continuing to take any such amounts so deposited shall then become subject to the terms of the Escrow Agreement as provided thereinaction.
(f) The Notwithstanding anything contained herein to the contrary, the Securityholders’ Representative covenants and agrees that, prior to the payment of any amounts required to be paid pursuant to Section 2.13(a)(i) from the Securityholders’ Representative Expense Amount, the Securityholders’ Representative shall release the Former Securityholders Escrow Amount upon the later to occur not use any portion of (i) the General Survival Date, (ii) the final resolution of all claims made by the Parent Claimants under Article VII or (iii) the date that the Securityholders’ Representative Expense Amount to pay costs, fees or expenses or otherwise distribute any portion of the Securityholders’ Representative Expense Amount to any Person (other than the Unitholders (other than the Blocker Members)) other than those costs, fees and expenses reasonably determines that the Former Securityholders Escrow Amount is no longer necessary incurred in connection with any potential claimsthe Securityholders’ Representative discharging its duties hereunder.
(g) The Securityholder Claimants may not make a claim for indemnity against Parent pursuant Notwithstanding anything contained herein to this Agreement except through the contrary, the Securityholders’ Representative.Representative shall not have the authority to act for and on behalf of the Blocker Members, and all decisions, acts, consents or instructions required by any of the Blocker Members or Blocker Partners herein shall be made by the Blocker Seller. 88758860_15
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Sources: Merger Agreement (Tilray, Inc.)