Business in Ordinary Course. AAC and Classic further covenant and agree with each other that each of the representations and warranties set forth in Article IV will be true and correct on the Effective Date. Except as set forth on the Exceptions Schedule and elsewhere herein, until the Effective Date, neither AAC nor Classic shall do any of the following except with the prior written consent of the other party: (a) effect any general salary increase except in line with its past practices; (b) enter into any written employment agreement; (c) increase the base compensation or other benefits of any employee by more than 10%; (d) make any contribution to any trust or plan for the benefit of employees not required by the present terns thereof or in accordance with its past practices; (e) make any change in any employee benefit plan which would materially increase the cost thereof or adopt any new employee benefit plan; (f) issue or commit to issue any capital stock or other ownership interests, except for the sale of shares of Classic Common Stock in a private placement or under Regulation S, or the conversion of notes or preferred stock of Classic into Classic Class A Common Stock; (g) grant or omit to grant any options, warrants, or other rights to subscribe for or purchase or otherwise acquire any shares of capital stock or other ownership interests or issue or commit to issue any securities convertible into or exchangeable for shares of its common stock or other ownership interests; (h) declare, set aside, or pay any dividend or distribution with respect to its common stock or other ownership interests; (i) directly or indirectly redeem, purchase, or otherwise acquire or commit to acquire any of its common stock or other ownership interest or directly or indirectly terminate or reduce or commit to terminate or reduce any bank line of credit or the availability of any funds under any loan or financing agreement; (j) effect a split or reclassification of any capital stock or recapitalization; (k) change its articles of incorporation, bylaws, or other governing instruments, except to effectuate the transactions contemplated by this Agreement; (l) borrow or agree to borrow any funds except pursuant to existing bank lines of credit or other existing loan agreements or financing arrangements; or (m) waive or commit to waive any right of substantial value.
Appears in 1 contract
Samples: Share Exchange Agreement (Classic Restaurants International Inc /Co/)
Business in Ordinary Course. AAC and Classic further covenant and agree with each other that each (a) During the period from the date of the representations and warranties set forth in Article IV will be true and correct on this Agreement to the Effective Date. Except as set forth on Time, BBI shall, and shall cause its Subsidiary to, conduct its business only in the Exceptions Schedule ordinary and elsewhere hereinusual course consistent with past practices and shall, until and shall cause such Subsidiary to, use its best efforts to maintain and preserve its business organization, employees and advantageous business relationships and retain the Effective Date, neither AAC nor Classic shall do any services of the following except with its officers and key employees.
(b) Without the prior written consent of FCN, BBI shall not declare, set aside or pay any dividend or make any other distribution with respect to its capital stock whether in cash, stock or other property, after the other party:
(a) effect date of this Agreement, except for the declaration and payment of regular quarterly cash dividends on the BBI Common Stock in an amount not to exceed the amount of the most recent quarterly cash dividend paid by BBI prior to the date of this Agreement; provided, however, that the parties agree that BBI shall coordinate the declaration of dividends on BBI Common Stock, and the record date and payment dates relating thereto, with the dividend record and payment dates for FCN Common Stock so that the holders of BBI Common Stock shall not receive two dividends, or fail to receive one dividend, for any general salary increase except in line quarter with its past practices;
(b) enter into any written employment agreement;respect to their shares of BBI Common Stock.
(c) increase Except as expressly provided herein, during the base compensation or other benefits period from the date hereof to the Effective Time, BBI and BBI Bank will not, without the prior written consent of any employee by more than 10%;FCN, and except as set forth in Schedule 4.01 of the BBI Disclosure Schedule:
(di) make any contribution to any trust issue, sell or plan for the benefit of employees not required by the present terns thereof or in accordance with its past practices;
(e) make any change in any employee benefit plan which would materially increase the cost thereof or adopt any new employee benefit plan;
(f) issue or commit to issue pledge any capital stock or other ownership interests, except for the sale of shares of Classic Common Stock in a private placement or under Regulation S, or the conversion of notes or preferred stock of Classic into Classic Class A Common Stock;
(g) grant or omit to grant any options, warrants, or other rights to subscribe for or purchase or otherwise acquire any shares of capital stock or other ownership interests or issue or commit to issue any securities convertible into or exchangeable for shares any capital stock, except pursuant to options outstanding on the date hereof under the BBI Stock Option Plan or pursuant to the exercise of the Stock Option Agreement dated of even date hereof, between FCN and BBI (the "FCN Stock Option Agreement") in accordance with its common stock or other ownership intereststerms;
(h) declare, set aside, or pay any dividend or distribution with respect to its common stock or other ownership interests;
(iii) directly or indirectly redeem, purchase, purchase or otherwise acquire or commit to acquire any of its common stock or other ownership interest or directly or indirectly terminate or reduce or commit to terminate or reduce any bank line of credit or the availability of any funds under any loan or financing agreement;
(j) effect a split or reclassification of any capital stock or recapitalizationownership interests of BBI or BBI Bank (except for the acquisition of shares held in a fiduciary capacity or in satisfaction of debts previously contracted);
(kiii) effect a reclassification, recapitalization, split-up, exchange of shares, readjustment or other similar change in or to any capital stock or otherwise merge, liquidate, reorganize or recapitalize;
(iv) change its articles Charter, Certificate of incorporationIncorporation or Bylaws;
(v) enter into, bylawsadopt or amend any employment agreement, severance agreement, change of control agreement or similar agreement or plan relative to the foregoing; or grant any increase (other than ordinary and normal increases consistent with past practices) in the compensation payable or to become payable to directors, officers or employees; or except as required by law, pay or agree to pay any bonus, or adopt or make any change in any bonus, insurance, pension, or other governing instruments, except to effectuate BBI Benefit Plan or grant or award any additional shares of BBI Common Stock under the transactions contemplated by this AgreementRRP;
(lvi) except in the ordinary course of its business consistent with past practice, borrow or agree to borrow any funds except pursuant funds, including but not limited to existing bank lines repurchase transactions, or indirectly guarantee or agree to guarantee any obligations of others;
(vii) make or commit to make any new loan or letter of credit or any new or additional discretionary advance under any existing line of credit, in a principal amount in excess of $500,000 or that would increase the aggregate credit outstanding to any one borrower (or group of affiliated borrowers) to more than $500,000 (excluding for this purpose any accrued interest or overdrafts) (except for new loans, letters of credit or advances in an aggregate principal amount up to $2,500,000 to Raintree Homes Inc.), without the prior written consent of FCN, which approval or rejection shall be given on a timely basis after delivery by BBI to FCN of the complete loan package;
(viii) enter into, modify or extend any agreement, contract or commitment out of the ordinary course of business, other existing than letters of credit, loan agreements, deposit agreements, and other lending, credit and deposit documents made in the ordinary course of business;
(ix) except in the ordinary course of business, place on any of its assets or properties any mortgage, pledge, lien, charge, or other encumbrance;
(x) place on any of its real estate assets or properties any mortgage, pledge, lien, charge or other encumbrance;
(xi) cancel any material indebtedness owing to it or any claims which it may possess or waive any rights of material value;
(xii) sell or otherwise dispose of any real property or any material amount of tangible or intangible personal property other than properties acquired in foreclosure or otherwise in the ordinary collection of indebtedness owed to BBI Bank;
(xiii) knowingly or wilfully commit any act or fail to commit any act which will cause a material breach of any agreement, contract or commitment;
(xiv) violate any law, statute, rule, governmental regulation, or order, which violation might have a Material Adverse Effect on BBI;
(xv) purchase or commit to purchase any real or personal property, deposit liabilities or make any capital expenditure where the amount paid or committed therefor is in excess of $50,000, except for outstanding commitments set forth in Section 3.19 of the BBI Disclosure Schedule;
(xvi) engage in any activity or transaction outside the ordinary course of business;
(xvii) enter into or acquire any derivatives contract or structured note;
(xviii) enter into any new, or modify, amend or extend the terms of any existing, contracts relating to the purchase or sale of financial or other futures, or any put or call option relating to cash, securities or commodities or any interest rate swap agreements or financing arrangementsother agreements relating to the hedging of interest rate risk; or
(mxix) waive settle any claim, action or commit proceeding involving monetary damages, except in the ordinary course of business consistent with past practice.
(d) BBI and BBI Bank shall not, without the prior written consent of FCN, wilfully engage in any transaction or wilfully take any action that would render untrue any of the representations and warranties of BBI contained in Article III hereof, if such representations and warranties were given as of the date of such transaction or action.
(e) BBI will, and will cause BBI Bank to, use their best efforts to waive any right maintain their respective properties and assets in their present state of substantial valuerepair, order and condition, reasonable wear and tear excepted, and to maintain and keep in full force and effect all policies of insurance presently in effect, including the insurance of accounts with the FDIC. BBI will, and will cause BBI Bank to, take all requisite action (including without limitation the making of claims and the giving of notices) pursuant to its directors' and officers' liability insurance policy or policies in order to preserve all rights thereunder with respect to all matters known by BBI which could reasonably give rise to a claim prior to the Effective Time.
(f) BBI and BBI Bank will as soon as possible following the execution of this Agreement, but in no event later than the Effective Time, (i) amend the First Federal Savings Bank of Barrington Employee Severance Compensation Plan (the "Employee Severance Compensation Plan") to provide that such plan shall terminate one year following the Effective Time and (ii) amend the federal stock charter of BBI Bank to repeal Section 8(A) effective no later than the Effective Time.
Appears in 1 contract
Business in Ordinary Course. AAC (a) Pinnacle shall not declare or pay any dividend or make any other distribution to shareholders, whether in cash, stock or other property, after the date hereof, except that (i) in the case of dividends payable until June 30, 1998, Pinnacle may declare and Classic further covenant pay its regular quarterly dividend on the Pinnacle Common not to exceed $0.235 per share, at approximately the same times during each quarter during such period which it has historically declared and agree paid such dividends, and (ii) in the case of dividends payable on or after July 1, 1998, Pinnacle may declare and pay its regular quarterly dividend on the Pinnacle Common in an aggregate amount equal to the aggregate amount that Pinnacle shareholders would have received on their shares of CNB Common received in the Merger had the Effective Time been immediately before the record date or dates for the payment of each such dividend, at approximately the same times during each quarter during such period which it has historically declared and paid such dividends; PROVIDED, HOWEVER, that Pinnacle and CNB shall cooperate with each other to coordinate the record and payment dates of their respective dividends for the quarter in which the Effective Time occurs such that the Pinnacle shareholders shall receive a quarterly dividend from either Pinnacle or CNB but not from both during or with respect to such quarter.
(b) Pinnacle shall, and shall cause each of its subsidiaries to, (1) continue to carry on after the representations date hereof its respective business and warranties set forth the discharge or incurrence of obligations and liabilities, only in Article IV will be true the usual, regular and correct on ordinary course of business, as heretofore conducted, (2) use reasonable best efforts to maintain and preserve intact its respective business organization, employees and advantageous business relationships and retain the Effective Date. Except as set forth on the Exceptions Schedule services of its officers and elsewhere hereinkey employees, until the Effective Dateand (3) by way of amplification and not limitation, neither AAC nor Classic Pinnacle and each of its subsidiaries shall do any of the following except with not, without the prior written consent of the other party:CNB (which shall not be unreasonably withheld):
(ai) effect issue any general salary increase except in line with its past practices;
(b) enter into any written employment agreement;
(c) increase the base compensation Pinnacle Common or other benefits of any employee by more than 10%;
(d) make any contribution to any trust or plan for the benefit of employees not required by the present terns thereof or in accordance with its past practices;
(e) make any change in any employee benefit plan which would materially increase the cost thereof or adopt any new employee benefit plan;
(f) issue or commit to issue any capital stock or other ownership interests, except for the sale of shares of Classic Common Stock in a private placement or under Regulation S, or the conversion of notes or preferred stock of Classic into Classic Class A Common Stock;
(g) grant or omit to grant any options, warrants, or other rights to subscribe for or purchase Pinnacle Common or otherwise acquire any shares of other capital stock or other ownership interests or issue or commit to issue any securities convertible into or exchangeable for shares any capital stock of Pinnacle or any of its common subsidiaries (except for (i) the issuance of Pinnacle Common pursuant to the valid exercise of Pinnacle Stock Options which are outstanding on the date hereof, (ii) the issuance of Pinnacle Common pursuant to the Pinnacle Option Agreement, and (iii) in the event that the Effective Time shall not have occurred on or before April 30, 1998, grants of Pinnacle Stock Options after April 30, 1998, in accordance with the Stock Option Plans and in a manner and pursuant to policies consistent with past practices; PROVIDED, HOWEVER, that (1) such grants shall not be made if CNB shall have determined, in consultation with its independent auditors, KPMG Peat Marwick, LLP, that such grants would disqualify the Merger as a "pooling of interests" for accounting purposes, and (2) any persons who shall receive such grants of Pinnacle Stock Options from Pinnacle shall not be eligible to receive stock or other ownership interests;
(h) declare, set aside, or pay any dividend or distribution options with respect to its common stock or other ownership interests;shares of CNB Common from CNB during 1998); or
(iii) directly or indirectly redeem, purchase, purchase or otherwise acquire any Pinnacle Common or commit to acquire any other capital stock of its common stock Pinnacle or effect a reclassification, recapitalization, splitup, exchange of shares, readjustment or other ownership interest similar change in or directly or indirectly terminate or reduce or commit to terminate or reduce any bank line of credit or the availability of any funds under any loan or financing agreement;
(j) effect a split or reclassification of any capital stock or recapitalization;otherwise reorganize or recapitalize Pinnacle; or
(kiii) directly or indirectly redeem, purchase or otherwise acquire any capital stock of subsidiaries of the Pinnacle or effect a reclassification, recapitalization, splitup, exchange of shares, readjustment or other similar change in or to any capital stock or otherwise reorganize or recapitalize any subsidiary of Pinnacle (other than any of the foregoing all of the parties to which shall consist exclusively of Pinnacle and the wholly-owned subsidiaries of Pinnacle); or
(iv) change its articles Articles of incorporationIncorporation or Association, bylawsas the case may be, or Bylaws; or
(v) grant any increase, other than ordinary and normal increases consistent with past practices, in the compensation payable or to become payable to officers or salaried employees, grant any stock options (other than grants of Pinnacle Stock Options after April 30, 1998, as provided in Section 4.01(b)(i) hereof) or, except as required by law or as required by existing contractual obligations which shall have been described in Section 2.11 of the Disclosure Schedule, adopt or make any material change in any bonus, insurance, pension, or other governing instrumentsPinnacle Employee Plan, except to effectuate the transactions contemplated by this Agreement;agreement, payment or arrangement made to, for or with any of such officers or employees; or
(lvi) borrow or agree to borrow any material amount of funds except pursuant in the ordinary course of business, or directly or indirectly guarantee or agree to existing bank lines guarantee any material obligations of credit or other existing loan agreements or financing arrangementsothers, except in the ordinary course of business; or
(mvii) waive make or commit to make any new loan or letter of credit or any new or additional discretionary advance under any existing line of credit, including risk exposure in the mortgage repurchase program, in principal amounts in excess of $5,000,000 or that would increase the aggregate credit outstanding to any one borrower (or group of affiliated borrowers) to more than $10,000,000 (excluding for this purpose any accrued interest or overdrafts), without the prior written consent of CNB, acting through its Senior Vice President and Chief Credit Officer or such other designee as CNB may give notice of to Pinnacle; or
(viii) purchase or otherwise acquire any investment security for its own account, except in a manner and pursuant to policies consistent with past practice; or
(ix) materially increase or decrease the rate of interest paid on time deposits, or on certificates of deposit, except in a manner and pursuant to policies consistent with past practices; or
(x) except as set forth in Section 4.01(b)(x) of the Disclosure Schedule, enter into any agreement, contract or commitment of a material nature out of the ordinary course of business; or
(xi) except in the ordinary course of business, place on any of its material assets or properties any mortgage, pledge, lien, charge, or other encumbrance of a material nature; or
(xii) except in the ordinary course of business, cancel or accelerate any material indebtedness owing to Pinnacle or its subsidiaries or any claims which Pinnacle or its subsidiaries may possess or waive any right material rights with respect thereto; or
(xiii) except as set forth in Section 4.01(b)(xiii) of the Disclosure Schedule, sell or otherwise dispose of any material real property or any material amount of any tangible or intangible personal property other than in the ordinary course of business and other than properties acquired in foreclosure or otherwise in the ordinary collection of indebtedness to Pinnacle and its subsidiaries; or
(xiv) foreclose upon or otherwise take title to or possession or control of any real property without first obtaining a phase one environmental report thereon which indicates that the property is free of pollutants, contaminants or hazardous or toxic waste materials; PROVIDED, HOWEVER, that Pinnacle and its subsidiaries shall not be required to obtain such a report with respect to single family, non-agricultural residential property of one acre or less to be foreclosed upon unless it has reason to believe that such property might contain any such waste materials or otherwise might be contaminated; or
(xv) commit any act or fail to do any act which would cause a breach of any agreement, contract or commitment and which would have a Material Adverse Effect on Pinnacle; or
(xvi) purchase any real or personal property or make any other capital expenditure, except in a manner and pursuant to policies consistent with past practice; or
(xvii) affirmatively take, or cause to be taken, any action, whether before or after the Effective Time, which would disqualify the Merger as a "pooling of interests" for accounting purposes or as a "reorganization" within the meaning of Section 368(a) of the Code; or
(xviii) take any action which would materially and adversely effect or delay the ability of either CNB or Pinnacle to obtain any necessary approvals of any Regulatory Agency or other governmental authority required for the transactions contemplated by this Agreement or to perform its covenants and agreements under this Agreement or the Pinnacle Option Agreement.
(c) Pinnacle and its subsidiaries shall not, without the prior written consent of CNB, engage in any transaction or take any action that would render untrue (under the standard of Section 1.11 hereof) any of the representations and warranties of Pinnacle contained in Article Two hereof, if such representations and warranties were given as of the date of such transaction or action.
(d) Pinnacle shall promptly notify CNB in writing of the occurrence of any matter or event known to and directly involving Pinnacle, which would not include any changes in conditions that affect the banking industry generally, that would have, either individually or in the aggregate, a Material Adverse Effect on Pinnacle.
(e) Pinnacle and its subsidiaries shall not, and shall not authorize or permit any of their respective officers, directors, employees or agents to, on or before the earlier of the Closing Date or the date of termination of this Agreement, directly or indirectly solicit, initiate or encourage or (subject to the fiduciary duties of its directors as advised by counsel) hold discussions or negotiations with or provide any information to any person in connection with any proposal from any person for the acquisition of all or any substantial valueportion of the business, assets, shares of Pinnacle Common or other securities of Pinnacle or its subsidiaries. Pinnacle shall promptly (which for this purpose shall mean within twenty-four (24) hours) advise CNB of its receipt of any such proposal or inquiry concerning any possible such proposal, the substance of such proposal or inquiry, and the identity of such person.
Appears in 1 contract
Business in Ordinary Course. AAC (a) Heartland shall not declare or pay any dividend or make any other distribution to shareholders, whether in cash, stock or other property, after the date hereof.
(b) Heartland shall, and Classic further covenant and agree with each other that shall cause each of its subsidiaries to, (1) continue to carry on after the representations date hereof its respective business and warranties set forth the discharge or incurrence of obligations and liabilities, only in Article IV will be true the usual, regular and correct on ordinary course of business, as heretofore conducted, (2) use reasonable best efforts to maintain and preserve intact its respective business organization, employees and advantageous business relationships and retain the Effective Date. Except as set forth on the Exceptions Schedule services of its officers and elsewhere hereinkey employees, until the Effective Dateand (3) by way of amplification and not limitation, neither AAC nor Classic Heartland and each of its subsidiaries shall do any of the following not, except with respect to the exercise of vested stock options as disclosed in Schedule 2.01(b)-1, without the prior written consent of the other partyBanterra:
(ai) effect issue any general salary increase except in line with its past practices;
(b) enter into any written employment agreement;
(c) increase the base compensation shares of Heartland Common or other benefits of any employee by more than 10%;
(d) make any contribution to any trust or plan for the benefit of employees not required by the present terns thereof or in accordance with its past practices;
(e) make any change in any employee benefit plan which would materially increase the cost thereof or adopt any new employee benefit plan;
(f) issue or commit to issue any capital stock or other ownership interests, except for the sale of shares of Classic Common Stock in a private placement or under Regulation S, or the conversion of notes or preferred stock of Classic into Classic Class A Common Stock;
(g) grant or omit to grant any options, warrants, or other rights to subscribe for or purchase shares of Heartland Common or any other capital stock or any securities convertible into or exchangeable for any capital stock of Heartland or any of its subsidiaries; or
(ii) directly or indirectly redeem, purchase or otherwise acquire any shares of Heartland Common or any other capital stock of Heartland or effect a reclassification, recapitalization, splitup, exchange of shares, readjustment or other similar change in or to any capital stock or otherwise reorganize or recapitalize Heartland; or
(iii) directly or indirectly redeem, purchase or otherwise acquire any shares of capital stock of or effect a reclassification, recapitalization, splitup, exchange of shares, readjustment or other ownership interests similar change in or issue or commit to issue any securities convertible into or exchangeable for shares of its common stock or other ownership interests;
(h) declare, set aside, or pay any dividend or distribution with respect to its common stock or other ownership interests;
(i) directly or indirectly redeem, purchase, or otherwise acquire or commit to acquire any of its common stock or other ownership interest or directly or indirectly terminate or reduce or commit to terminate or reduce any bank line of credit or the availability of any funds under any loan or financing agreement;
(j) effect a split or reclassification of any capital stock or recapitalization;otherwise reorganize or recapitalize any subsidiary of Heartland; or
(kiv) change its articles Articles of incorporationIncorporation or Bylaws; or
(v) grant any increase, bylawsother than ordinary and normal increases consistent with past practices, in the compensation payable or to become payable to officers or salaried employees, grant any Heartland Options or, except as required by law or as required by existing contractual obligations which shall have been described in Section 2.11 of the Disclosure Schedule, adopt or make any change in any bonus, insurance, pension, or other governing instrumentsHeartland Employee Plan, except to effectuate the transactions contemplated by this Agreement;agreement, payment or arrangement made to, for or with any of such officers or employees; or
(lvi) borrow or agree to borrow any amount of funds except pursuant in the ordinary course of business, or directly or indirectly guarantee or agree to existing bank lines guarantee any obligations of credit or other existing loan agreements or financing arrangementsothers, except in the ordinary course of business; or
(mvii) waive make or commit to make any new loan or letter of credit or any new or additional discretionary advance under any existing line of credit in principal amounts in excess of $150,000 or that would increase the aggregate credit outstanding to any one borrower (or group of affiliated borrowers) to more than $150,000 (excluding for this purpose any accrued interest or overdrafts) unless the amount of any additional loan, letter of credit or advance is no greater than $50,000, and is made to an existing borrower whose indebtedness currently exceeds $150,000, provided that such borrower is not on a watchlist of Heartland or its subsidiaries or has any credit classified for regulatory purposes, without the prior written consent of Banterra; or
(viii) purchase or otherwise acquire any investment security for its own account, except in a manner and pursuant to policies consistent with past practice; or
(ix) increase or decrease the rate of interest paid on time deposits, or on certificates of deposit, except in a manner and pursuant to policies consistent with past practices; or
(x) enter into any agreement, contract or commitment out of the ordinary course of business that requires an annual payment in excess of Ten Thousand Dollars ($10,000); or
(xi) except in the ordinary course of business, place on any of its assets or properties any mortgage, pledge, lien, charge, or other encumbrance; or
(xii) except in the ordinary course of business, cancel or accelerate any material indebtedness owing to Heartland or any of its subsidiaries or any claims which Heartland or any of its subsidiaries may possess or waive any right material rights with respect thereto; or
(xiii) sell or otherwise dispose of any real property or any material amount of any tangible or intangible personal property other than in the ordinary course of business and other than properties acquired in foreclosure or otherwise in the ordinary collection of indebtedness to Heartland or any of its subsidiaries; or
(xiv) foreclose upon or otherwise take title to or possession or control of any real property without first obtaining a phase one environmental report thereon which indicates that the property is free of pollutants, contaminants or hazardous or toxic waste materials; provided, however, that Heartland and its subsidiaries shall not be required to obtain such a report with respect to single family, non-agricultural residential property of one acre or less to be foreclosed upon unless it has reason to believe that such property might contain any such waste materials or otherwise might be contaminated; or
(xv) commit any act or fail to do any act which would cause a breach of any agreement, contract or commitment and which would have a Material Adverse Effect on Heartland; or
(xvi) except as may be necessary to comply with Year 2000 requirements in an amount not to exceed Ten Thousand Dollars ($10,000) or as may otherwise be approved in writing by Banterra, purchase any real or personal property or make any other capital expenditure, except in a manner and pursuant to policies consistent with past practice; or
(xvii) take any action which would materially and adversely effect or delay the ability of either Banterra or Heartland to obtain any necessary approvals of any Regulatory Agency or other governmental authority required for the transactions contemplated by this Agreement or to perform its covenants and agreements under this Agreement; or
(xviii) violate any law, statute, rule, governmental regulation or order, which violation would have a Material Adverse Effect on Heartland; or
(xix) change accounting principles or practices, or the method of applying such principles or practices, except as required by generally accepted accounting principles.
(c) Heartland and its subsidiaries shall not engage in any transaction or take any action that would render untrue (under the standard of Section 1.12 hereof) any of the representations and warranties of Heartland contained in Article Two hereof, except as otherwise required herein, if such representations and warranties were given as of the date of such transaction or action.
(d) Heartland shall promptly notify Banterra in writing of the occurrence of any matter or event known to and directly involving Heartland, which would not include any changes in conditions that affect the banking industry generally, that would have, either individually or in the aggregate, a Material Adverse Effect on Heartland.
(e) Heartland and its subsidiaries shall not, and shall not authorize or permit any of their respective officers, directors, employees or agents to, on or before the earlier of the Closing Date or the date of termination of this Agreement, directly or indirectly solicit, initiate or encourage or (subject to the fiduciary duties of its directors as advised by counsel) hold discussions or negotiations with or provide any information to any person in connection with any proposal from any person for the acquisition of all or any substantial valueportion of the business, assets, shares of Heartland Common or other securities of Heartland or Subsidiary Bank or any merger of Heartland or Subsidiary Bank with any person. Heartland shall promptly (which for this purpose shall mean within twenty-four (24) hours) advise Banterra of its receipt of any such proposal or inquiry concerning any possible such proposal, the substance of such proposal or inquiry, and the identity of such person.
Appears in 1 contract
Business in Ordinary Course. AAC (a) Heartland shall not declare or pay any dividend or make any other distribution to shareholders, whether in cash, stock or other property, after the date hereof.
(b) Heartland shall, and Classic further covenant and agree with each other that shall cause each of its subsidiaries to, (1) continue to carry on after the representations date hereof its respective business and warranties set forth the discharge or incurrence of obligations and liabilities, only in Article IV will be true the usual, regular and correct on ordinary course of business, as heretofore conducted, (2) use reasonable best efforts to maintain and preserve intact its respective business organization, employees and advantageous business relationships and retain the Effective Date. Except as set forth on the Exceptions Schedule services of its officers and elsewhere hereinkey employees, until the Effective Dateand (3) by way of amplification and not limitation, neither AAC nor Classic Heartland and each of its subsidiaries shall do any of the following not, except with respect to the exercise of vested stock options as disclosed in Schedule 2.01(b)-1, without the prior written consent of the other partyBanterra:
(ai) effect issue any general salary increase except in line with its past practices;
(b) enter into any written employment agreement;
(c) increase the base compensation shares of Heartland Common or other benefits of any employee by more than 10%;
(d) make any contribution to any trust or plan for the benefit of employees not required by the present terns thereof or in accordance with its past practices;
(e) make any change in any employee benefit plan which would materially increase the cost thereof or adopt any new employee benefit plan;
(f) issue or commit to issue any capital stock or other ownership interests, except for the sale of shares of Classic Common Stock in a private placement or under Regulation S, or the conversion of notes or preferred stock of Classic into Classic Class A Common Stock;
(g) grant or omit to grant any options, warrants, or other rights to subscribe for or purchase shares of Heartland Common or any other capital stock or any securities convertible into or exchangeable for any capital stock of Heartland or any of its subsidiaries; or
(ii) directly or indirectly redeem, purchase or otherwise acquire any shares of Heartland Common or any other capital stock of Heartland or effect a reclassification, recapitalization, splitup, exchange of shares, readjustment or other similar change in or to any capital stock or otherwise reorganize or recapitalize Heartland; or
(iii) directly or indirectly redeem, purchase or otherwise acquire any shares of capital stock of or effect a reclassification, recapitalization, splitup, exchange of shares, readjustment or other ownership interests similar change in or issue or commit to issue any securities convertible into or exchangeable for shares of its common stock or other ownership interests;
(h) declare, set aside, or pay any dividend or distribution with respect to its common stock or other ownership interests;
(i) directly or indirectly redeem, purchase, or otherwise acquire or commit to acquire any of its common stock or other ownership interest or directly or indirectly terminate or reduce or commit to terminate or reduce any bank line of credit or the availability of any funds under any loan or financing agreement;
(j) effect a split or reclassification of any capital stock or recapitalization;otherwise reorganize or recapitalize any subsidiary of Heartland; or
(kiv) change its articles Articles of incorporationIncorporation or Bylaws; or
(v) grant any increase, bylawsother than ordinary and normal increases consistent with past practices, in the compensation payable or to become payable to officers or salaried employees, grant any Heartland Options or, except as required by law or as required by existing contractual obligations which shall have been described in Section 2.11 of the Disclosure Schedule, adopt or make any change in any bonus, insurance, pension, or other governing instrumentsHeartland Employee Plan, except to effectuate the transactions contemplated by this Agreement;agreement, payment or arrangement made to, for or with any of such officers or employees; or
(lvi) borrow or agree to borrow any amount of funds except pursuant in the ordinary course of business, or directly or indirectly guarantee or agree to existing bank lines guarantee any obligations of credit or other existing loan agreements or financing arrangementsothers, except in the ordinary course of business; or
(mvii) waive make or commit to make any new loan or letter of credit or any new or additional discretionary advance under any existing line of credit in principal amounts in excess of $150,000 or that would increase the aggregate credit outstanding to any one borrower (or group of affiliated borrowers) to more than $150,000 (excluding for this purpose any accrued interest or overdrafts) unless the amount of any additional loan, letter of credit or advance is no greater than $50,000, and is made to an existing borrower whose indebtedness currently exceeds $150,000, provided that 19 such borrower is not on a watchlist of Heartland or its subsidiaries or has any credit classified for regulatory purposes, without the prior written consent of Banterra; or
(viii) purchase or otherwise acquire any investment security for its own account, except in a manner and pursuant to policies consistent with past practice; or
(ix) increase or decrease the rate of interest paid on time deposits, or on certificates of deposit, except in a manner and pursuant to policies consistent with past practices; or
(x) enter into any agreement, contract or commitment out of the ordinary course of business that requires an annual payment in excess of Ten Thousand Dollars ($10,000); or
(xi) except in the ordinary course of business, place on any of its assets or properties any mortgage, pledge, lien, charge, or other encumbrance; or
(xii) except in the ordinary course of business, cancel or accelerate any material indebtedness owing to Heartland or any of its subsidiaries or any claims which Heartland or any of its subsidiaries may possess or waive any right material rights with respect thereto; or
(xiii) sell or otherwise dispose of any real property or any material amount of any tangible or intangible personal property other than in the ordinary course of business and other than properties acquired in foreclosure or otherwise in the ordinary collection of indebtedness to Heartland or any of its subsidiaries; or
(xiv) foreclose upon or otherwise take title to or possession or control of any real property without first obtaining a phase one environmental report thereon which indicates that the property is free of pollutants, contaminants or hazardous or toxic waste materials; provided, however, that Heartland and its subsidiaries shall not be required to obtain such a report with respect to single family, non-agricultural residential property of one acre or less to be foreclosed upon unless it has reason to believe that such property might contain any such waste materials or otherwise might be contaminated; or
(xv) commit any act or fail to do any act which would cause a breach of any agreement, contract or commitment and which would have a Material Adverse Effect on Heartland; or
(xvi) except as may be necessary to comply with Year 2000 requirements in an amount not to exceed Ten Thousand Dollars ($10,000) or as may otherwise be approved in writing by Banterra, purchase any real or personal property or make any other capital expenditure, except in a manner and pursuant to policies consistent with past practice; or
(xvii) take any action which would materially and adversely effect or delay the ability of either Banterra or Heartland to obtain any necessary approvals of any Regulatory Agency or other governmental authority required for the transactions contemplated by this Agreement or to perform its covenants and agreements under this Agreement; or
(xviii) violate any law, statute, rule, governmental regulation or order, which violation would have a Material Adverse Effect on Heartland; or
(xix) change accounting principles or practices, or the method of applying such principles or practices, except as required by generally accepted accounting principles.
(c) Heartland and its subsidiaries shall not engage in any transaction or take any action that would render untrue (under the standard of Section 1.12 hereof) any of the representations and warranties of Heartland contained in Article Two hereof, except as otherwise required herein, if such representations and warranties were given as of the date of such transaction or action.
(d) Heartland shall promptly notify Banterra in writing of the occurrence of any matter or event known to and directly involving Heartland, which would not include any changes in conditions that affect the banking industry generally, that would have, either individually or in the aggregate, a Material Adverse Effect on Heartland.
(e) Heartland and its subsidiaries shall not, and shall not authorize or permit any of their respective officers, directors, employees or agents to, on or before the earlier of the Closing Date or the date of termination of this Agreement, directly or indirectly solicit, initiate or encourage or (subject to the fiduciary duties of its directors as advised by counsel) hold discussions or negotiations with or provide any information to any person in connection with any proposal from any person for the acquisition of all or any substantial valueportion of the business, assets, shares of Heartland Common or other securities of Heartland or Subsidiary Bank or any merger of Heartland or Subsidiary Bank with any person. Heartland shall promptly (which for this purpose shall mean within twenty-four (24) hours) advise Banterra of its receipt of any such proposal or inquiry concerning any possible such proposal, the substance of such proposal or inquiry, and the identity of such person.
Appears in 1 contract
Business in Ordinary Course. AAC Bancorp and Classic further covenant and Bank of San Francisco agree with each other that each that, from the date of this Agreement until the earlier of the representations and warranties set forth Closing Date or the termination of this Agreement in Article IV will be true and correct on the Effective Date. Except as set forth on the Exceptions Schedule and elsewhere herein, until the Effective Date, neither AAC nor Classic shall do any of the following except accordance with the prior written consent of the other partyits terms:
(a) effect any general salary increase except Bancorp and the Bancorp Subsidiaries shall continue to carry on their business and the discharge or incurrence of obligations and liabilities only in line with its past practices;the usual, regular and ordinary course of business, as heretofore conducted, and by way of amplification and not limitation, Bancorp and each Bancorp Subsidiary will not:
(bi) enter into except for semi-annual dividends payable on shares of Bancorp Preferred which Bancorp is required to declare and pay pursuant to its Certificate of Incorporation, declare or pay any written employment agreement;dividend or make any other distribution to shareholders, whether in cash, stock or other property; or
(cii) increase the base compensation or other benefits of any employee by more than 10%;
(d) make any contribution to any trust or plan for the benefit of employees not required by the present terns thereof or in accordance with its past practices;
(e) make any change in any employee benefit plan which would materially increase the cost thereof or adopt any new employee benefit plan;
(f) issue or commit to issue any capital stock or other ownership interests, except for the sale of shares of Classic Common Stock in a private placement or under Regulation S, or the conversion of notes or preferred stock of Classic into Classic Class A Common Stock;
(g) grant or omit to grant any options, warrants, or other rights to subscribe for or purchase or otherwise acquire any shares of capital stock or other ownership interests or issue or commit to issue any securities convertible into or exchangeable for shares any capital stock (except for the issuance of its common stock Bancorp Common pursuant to the convertible securities, exchangeable securities or other ownership interests;Bancorp Stock Options described in Section 2.01(d) of the Disclosure Schedule); or
(h) declare, set aside, or pay any dividend or distribution with respect to its common stock or other ownership interests;
(iiii) directly or indirectly redeem, purchasepurchase or otherwise acquire any capital stock of Bancorp or any Bancorp Subsidiary; or
(iv) effect a reclassification, recapitalization, splitup, exchange of shares, readjustment or other similar change in or to any capital stock, or otherwise acquire reorganize or commit recapitalize; or
(v) except as contemplated in Section 1.02, change its Certificate or Articles of Incorporation or association, as the case may be, or Bylaws, nor enter into any agreement to acquire merge or consolidate with, or sell a significant portion of its assets to, any person or entity.
(b) Bancorp and each Bancorp Subsidiary will not, without the prior written consent of FBA (which consent shall not be unreasonably withheld or delayed):
(i) Except as disclosed in Section 4.01(b) of the Disclosure Schedule, grant any increase (other than ordinary and normal increases consistent with past practices) in the compensation payable or to become payable to officers or salaried employees, grant any stock options or, except as required by law, adopt or make any change in any employment, bonus, insurance, pension, salary continuation, retention, indemnification or other Employee Plan, agreement, payment or arrangement made to, for or with any of its common stock such officers or other ownership interest or directly or indirectly terminate or reduce or commit to terminate or reduce any bank line of credit or the availability of any funds under any loan or financing agreementemployees;
(j) effect a split or reclassification of any capital stock or recapitalization;
(k) change its articles of incorporation, bylaws, or other governing instruments, except to effectuate the transactions contemplated by this Agreement;
(lii) borrow or agree to borrow any amount of funds except pursuant in the ordinary course of business, or directly or indirectly guarantee or agree to existing bank lines guarantee any obligations of others;
(iii) make or commit to make any new loan or letter of credit or any new or additional discretionary advance under any existing line of credit, in principal amounts in excess of $1,000,000 or that would increase the aggregate credit outstanding to any one borrower (or group of affiliated borrowers) to more than $1,500,000 (excluding for this purpose any accrued interest or overdrafts);
(iv) purchase or otherwise acquire any investment security for its own account having an average remaining life to maturity greater than five years or any asset-backed securities other than those issued or guaranteed by the Federal Home Loan Bank Board, the Government National Mortgage Association, the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation;
(v) enter into any agreement, contract or commitment having a term in excess of six (6) months other than, in the ordinary course of business: letters of credit, loan agreements, credit and deposit agreements and documents, renewals with current market rates and terms of expiring subleases of office space located at 000 Xxxxxxxxxx Xxxxxx, San Francisco, California (all current subleases scheduled to expire prior to March 31, 2001 being identified in Section 4.01(b) of the Disclosure Schedule) and renewals or replacements of insurance policies (in either case for terms not exceeding one year) on terms substantially similar to existing loan agreements Bancorp and Bank of San Francisco policies;
(vi) except in the ordinary course of business, place on any of its assets or financing arrangementsproperties any mortgage, pledge, lien, charge, or other encumbrance;
(vii) except in the ordinary course of business, cancel or accelerate any material indebtedness owing to Bancorp or a Bancorp Subsidiary or any claim which Bancorp or any Bancorp Subsidiary may possess, or waive any material rights of substantial value;
(viii) sell or otherwise dispose of any real property or any material amount of any tangible or intangible personal property, other than properties acquired in foreclosure or otherwise in the ordinary collection of indebtedness;
(ix) foreclose upon or otherwise take title to or possession or control of any real property without first obtaining a phase one environmental report thereon which indicates that the property is free of pollutants, contaminants or hazardous or toxic waste materials; provided, however, that a report shall not be required with respect to single family, non- agricultural residential property of one acre or less to be foreclosed upon unless the entity proposing to acquire the property has reason to believe that such property might contain any such waste materials or otherwise might be contaminated;
(x) commit any act or fail to do any act which will cause a breach of any agreement, contract or commitment and which will have a material adverse effect on the business, financial condition or earnings of Bancorp or a Bancorp Subsidiary;
(xi) violate any law, statute, rule, governmental regulation or order, which violation would have a material adverse effect on the business, financial condition, or earnings of Bancorp or a Bancorp Subsidiary;
(xii) purchase any real or personal property or make any other capital expenditure where the amount paid or committed therefor is in excess of $75,000; or
(mxiii) waive increase or commit decrease the rate of interest paid on time deposits, except in the ordinary course of business in a manner consistent with past practices.
(c) Bancorp and the Bancorp Subsidiaries shall not, without the prior written consent of FBA, engage in any transaction or take any action that would render untrue in any material respect any of the representations and warranties of Bancorp or Bank of San Francisco contained in Article II hereof, if such representations and warranties were given immediately following such transaction or action.
(d) Bancorp shall promptly notify FBA of the occurrence of any matter or event known to waive and directly involving Bancorp or Bank of San Francisco that has or would be reasonably expected to have a material adverse effect on the business, operations, properties, assets, or condition (financial or otherwise) of Bancorp and the Bancorp Subsidiaries, taken as a whole, or that would otherwise materially and adversely affect the ability of Bancorp or Bank of San Francisco to consummate the transactions contemplated by this Agreement.
(e) Bancorp shall not solicit or encourage, or, except to the extent otherwise required by applicable Corporate Law or applicable directors' fiduciary principles, hold discussions or negotiations with or provide information to any right person or entity in connection with any proposal for the acquisition of all or a substantial valueportion of the business, assets, shares of Bancorp Common or other securities or assets of Bancorp or any Bancorp Subsidiary. Bancorp shall promptly advise FBA of its receipt of any such proposal or inquiry and the substance thereof.
Appears in 1 contract
Samples: Merger Agreement (Evans Robb)
