Actions Pending the Merger Clause Samples
The "Actions Pending the Merger" clause defines the obligations and restrictions placed on the parties involved in a merger during the period between signing the merger agreement and the actual closing of the transaction. Typically, this clause outlines what actions the companies can or cannot take, such as prohibiting significant changes to business operations, incurring new debt, or entering into major contracts without the other party's consent. Its core practical function is to preserve the value and stability of the businesses involved, ensuring that neither party makes material changes that could affect the terms or desirability of the merger before it is finalized.
Actions Pending the Merger. (a) Prior to the Closing Date, and except as otherwise provided for by this Reorganization Agreement, the Plan of Merger, the Option Agreement, or consented to or approved by FESC, OBC shall, and shall cause each of the OBC subsidiaries to, use its reasonable best efforts to preserve its properties, business and relationships with customers, employees and other persons.
(b) OBC shall not, and shall not permit any of the OBC Subsidiaries to, except with the prior written consent of FESC and except as Previously Disclosed or expressly contemplated or permitted by this Agreement, the Plan of Merger, or the Option Agreement:
(1) carry on its business other than in the usual, regular and ordinary course in substantially the same manner as heretofore conducted;
(2) in the case of OBC only, declare, set aside, make or pay any dividend or other distribution in respect of its capital stock other than its regular quarterly cash dividends on OBC Common Stock in amounts not in excess of $.34 per share;
(3) issue any shares of its capital stock or permit any treasury shares to become outstanding other than pursuant to the Option Agreement or Rights outstanding at the date hereof;
(4) incur any additional debt obligation or other obligation for borrowed money other than in the ordinary course of business consistent with past practice;
(5) issue, grant or authorize any Rights or effect any recapitalization, reclassification, stock dividend, stock split or like change in capitalization, or redeem, repurchase or otherwise acquire any shares of its capital stock, except as contemplated by Section 2.27 hereof and except for Trust Account Shares and DPC Shares (each as defined in the Plan of Merger);
(6) amend its articles or certificate of incorporation or association or by-laws; impose, or suffer the imposition, on any share of stock of any OBC Subsidiary held by OBC of any lien, charge or encumbrance, or permit any such lien, charge or encumbrance to exist, except, in each case, for liens, charges and encumbrances which have been Previously Disclosed; (7) merge with any other corporation, savings association or bank or permit any other corporation, savings association or bank to merge into it or consolidate with any other corporation, savings association or bank; other than through the acquisition of DPC Shares acquire control over any other firm, bank, corporation, savings association or organization or create any subsidiary;
Actions Pending the Merger