A sunset provision is a contract clause that sets an expiration date for certain terms or the entire agreement unless expressly renewed or extended by all parties involved. This clause is often used to ensure that outdated or unnecessary stipulations do not persist indefinitely, prompting periodic review and reconsideration.
Sunset Provision. Each outstanding share of Class B Common Stock shall automatically, without further action by the Corporation or the holder thereof, convert into one (1) fully paid and nonassessable share of Class A Common Stock on December 22, 2028.
The Company respectfully advises the Staff that the time-based sunset provision of seven (7) years was chosen as the Company believes a seven (7) year period is a reasonably limited period of time and aligns with the voting policies and recommendations of proxy advisory firms and numerous institutional investors.
The Restated Charter includes a sunset provision pursuant to which all of the outstanding Class A Common Stock will automatically convert to Common Stock if: (a) less than 4,300,000 shares of Class A Common Stock, in the aggregate, are beneficially owned by Immediate Family Members and/or Permitted Transferees, or (b) if less than 4,600,000 shares of Class A Common Stock and Common Stock, in the aggregate, are beneficially owned by Immediate Family Members and/or Permitted Transferees.
Shareholder protection mechanisms (sunset provision or commitment to cause expiration of the protective amendment upon exhaustion or expiration of the NOL);
Bankruptcy and Sunset Provision. Notwithstanding any other provision herein to the contrary, if any payment received by Bank under this Note is rescinded, avoided or for any reason returned by Bank because of any adverse claim or threatened action by a bankruptcy trustee or otherwise, the returned payment shall remain payable as an obligation of all parties liable under this Note, including but not limited to any guarantors.
A Sunset Provision is a clause within a contract, law, or regulation that sets an expiration date for the provision itself, typically unless further legislative action is taken to extend it. This clause ensures that the stipulation is only in effect for a limited time unless renewed or made permanent. The primary purpose is to provide a built-in mechanism for reevaluation and revision.
Sunset provisions are used in various contexts to ensure periodic review and adjustment. Consider using a sunset provision when:
To write a sunset provision, consider the following components:
Example
This section shall expire five years from the date of enactment unless extended by legislative action. A review committee shall report on the effectiveness and necessity of the provision one year prior to expiration.
Sunset provisions are commonly found in a variety of contracts and legislative documents, including:
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The "Supersedes Previous Agreements" clause indicates that the current contract nullifies all prior agreements or understandings, whether written or verbal, related to the same subject matter. This ensures that only the terms and conditions set forth in the new contract are binding between the parties involved.
The "Supersedes Prior Agreements" clause states that the current contract invalidates and replaces all previous agreements, understandings, or communications between the parties related to the subject matter. Its purpose is to ensure that the terms in the existing contract are the authoritative and exclusive terms governing the relationship, preventing conflicts with prior arrangements.
A superseding agreement clause is a contractual provision that nullifies and replaces all prior agreements, understandings, or negotiations related to the subject matter of the contract. It ensures that the current contract is the complete and exclusive agreement between the parties, overriding any conflicting terms from previous documents.
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