Conduct of Business of Company. Except as expressly provided ------------------------------ for herein, during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality of the foregoing, Company shall not, and shall not permit any of its Subsidiaries to, without the prior consent of Parent: (i) (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares; (ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement; (iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement; (iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice; (v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule; (vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims; (vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice; (viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice; (ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law; (x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits; (xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days; (xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d)); (xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries; (xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries; (xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law; (xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999); (xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice; (xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities; (xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries; (xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed; (xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or (xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1.
Appears in 1 contract
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereinherein (including, without limitation, Section 6.9 hereof relating to Company Options), during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable best efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality of the foregoing, Company shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of Parent:
(ia) (Ai) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parentParent), (Bii) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (Ciii) purchase, redeem or otherwise acquire any shares of its outstanding capital stock or any rights, warrants or options to acquire any such shares, except, in the case of this clause (iii), for the acquisition of Shares from holders of Company Options in full or partial payment of the exercise price payable by such holder upon exercise of Company Options;
(iib) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Company Options and Warrants outstanding on the date of this Agreement;
(iiic) amend its certificate articles of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreementdocuments;
(ivd) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(viie) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viiif) (Ai) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company Company, or (Bii) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine travel advances to employees or customer trade credit consistent with past practice, except, in the case of clause (Ai), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ixg) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by lawlaw and normal, regularly scheduled increases in respect of non-officer employees consistent with past practices;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xih) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into individual, except with respect to new hires of nonofficer employees in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not consistent with a term in excess of 90 dayspast practice;
(xiii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d)6.3);
(xiiij) make or rescind any tax election or settle or compromise any Tax income tax liability of Company or of any of its SubsidiariesSubsidiaries involving on an individual basis more than $50,000;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xvk) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes)policy, except as required by any changes in generally accepted accounting principles or as otherwise required by lawprinciples;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviiil) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, includingexcept for any such agreement, but not limited to, geographic limitations on Company's activitiesunderstanding or commitment entered into in the ordinary course of business consistent with past practice;
(xixm) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xxn) accelerate except as previously approved by the collection Board of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities Directors of Company prior to the date hereof and as identified to Parent prior to the date hereof, authorize or any commit to make capital expenditures in excess of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed$75,000;
(xxio) take any action that would result in (i) any of its representations and warranties set forth in amend the Company Rights Plan except as required by this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfiedAgreement; or
(xxiip) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1.
Appears in 1 contract
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereincontemplated by this Agreement or as specifically set forth in Schedule 6.1 of Seller's Disclosure Schedule, during the period from the date of this Agreement to the Effective Time, Seller will cause each Acquired Company shalland its Subsidiaries to conduct its operations according to its ordinary course of business, consistent with past practice, will use its commercially reasonable efforts to (i) preserve intact its business organization, (ii) maintain its material rights and franchises, (iii) keep available the services of its officers and key employees, and shall cause each (iv) keep in full force and effect insurance comparable in amount and scope of coverage to that maintained as of the date hereof. Without limiting the generality of and in addition to the foregoing, and except as otherwise contemplated by this Agreement, neither Acquired Company nor any of their Subsidiaries will, without the prior written consent of Parent;
(a) amend its charter or by-laws (or other organizational documents);
(b) authorize for issuance, issue, sell, deliver or agree or commit to issue, sell or deliver (whether through the issuance or granting of options, warrants, commitments, subscriptions, rights to purchase or otherwise) any stock of any class or any other securities or, except as required by law, amend any of the terms of any such securities or agreements outstanding on the date hereof, except for (i) the issuance by Company of Company Shares upon exercise of Company Options outstanding on the date hereof and (ii) the granting of options upon cancellation of existing options, so long as the aggregate number of options outstanding at any time prior to the Effective Time does not exceed the number of options outstanding on the date hereof;
(c) split, combine or reclassify any shares of its Subsidiaries tocapital stock, act declare, set aside or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its capital stock or redeem or otherwise acquire any of its securities or any securities of its Subsidiaries; provided, however, that each Acquired Company (and carry on its business only Subsidiaries) may, prior to the Effective Time, declare and pay cash dividends in respect of their capital stock;
(i) pledge or otherwise encumber shares of capital stock of either Acquired Company or any of their Subsidiaries; or (ii) except in the ordinary course of business consistent with past practice andpractices, (A) incur, assume or prepay any long-term debt or incur, assume, or prepay any obligations with respect to letters of credit or any material short- term debt, unless after the incurrence or assumption thereof all such debt for the Acquired Companies and their Subsidiaries does not in the aggregate exceed $105 million; (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for any material obligations of any other person except wholly owned Subsidiaries of each Acquired Company; (C) make any material loans, advances or capital contributions to, or investments in, any other Person; (D) change the practices of either Acquired Company or its Subsidiaries with respect to the extent consistent therewithtiming of payments or collections; or (E) except as contemplated by existing credit arrangements set forth on Seller's Disclosure Schedule, use reasonable efforts to preserve intact its current business organizations, keep available the services mortgage or pledge any properties or assets of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality of the foregoing, either Acquired Company shall not, and shall not permit or any of its Subsidiaries to, without the prior consent of Parent:or create or permit to exist any material Encumbrance thereupon;
(e) except (i) (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible arrangements entered into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
practices, (vii) make any new capital expenditure or expenditures in excess of $50,000 individuallyas contemplated by this Agreement with respect to the Company Options, or $250,000 in the aggregate(iii) as required by Law, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) enter into, adopt or materially amend or terminate change the funding or accrual practices of any Material Contract where such amendment bonus, profit sharing, compensation, severance, termination, stock option, stock appreciation right, restricted stock, performance unit, pension, retirement, deferred compensation, employment, severance or termination would have a Material Adverse Affect on Companyother employee benefit agreements, trusts, plans, funds or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose other arrangements of or encumber for the benefit or welfare of any employee of either Acquired Company or any of its properties Subsidiaries (or assets that are material to any other person for whom either Acquired Company or any of its businessSubsidiaries will have liability), or (except for sales, pledges or other dispositions or encumbrances normal increases in the ordinary course of business that are consistent with past practicepractices) increase in any manner the compensation or fringe benefits of any employee of either Acquired Company or any of its Subsidiaries (or any other person for whom either Acquired Company or any of its Subsidiaries will have liability) or pay any benefit not required by any existing plan and arrangement (including the granting of stock options, stock appreciation rights, shares of restricted stock or performance units) or enter into any contract, agreement, commitment or arrangement to do any of the foregoing;
(viiif) transfer, sell, lease, license or dispose of any lines of business, Subsidiaries, divisions, operating units or facilities (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing facilities currently closed or currently proposed to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (Bbe closed) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in outside the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into any material commitment or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in transaction outside the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 daysbusiness;
(xiig) adopt acquire or enter into agree to acquire, by merging or consolidating with, by purchasing an equity interest in or a plan portion of complete the properties or partial liquidationassets of, dissolutionor by any other manner, mergerany business or any corporation, consolidationpartnership, restructuring, recapitalization association or other material reorganization business organization or division thereof, or otherwise acquire or agree to acquire any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make properties or rescind any tax election or settle or compromise any Tax liability of Company or assets of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 Person (other than the settlement purchase of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary properties or a loss payable payee to be cancelled or terminated without notice to Parent, except assets in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement), understanding or commitment that restrains, limits or impedes Company's ability in each case where such action would be material to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Acquired Companies and their Subsidiaries;
(xxh) accelerate except as may be required by Law, take any action to terminate or materially amend any of its pension plans or retiree medical plans with respect to or for the collection benefit of any account receivable or delay the payment employee of any account payable, or otherwise reduce the assets or increase the liabilities of either Acquired Company or any of its Subsidiaries otherwise than (or any other person for whom either Acquired Company or any of its Subsidiaries will have liability);
(i) materially modify, amend or terminate any Acquired Company Material Contract or waive any material rights or claims of either Acquired Company or any of its Subsidiaries thereunder, except in the ordinary course of business consistent with past practice; provided, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.16.1(i) shall not apply to any arrangement, agreement or contract proposal previously submitted by either Acquired Company or a Subsidiary thereof which proposal, upon acceptance thereof, cannot be revised or withdrawn;
(j) effect any material change in any of its methods of accounting in effect as of August 31, 1996, except as may be required by Law or GAAP;
(k) enter into any Acquired Company Material Contract other than in the ordinary course of business; or
(l) enter into a legally binding commitment with respect to, or any agreement to take, any of the foregoing actions.
Appears in 1 contract
Conduct of Business of Company. Except During the period from the date of ------------------------------ this Agreement to the Effective Time of the Merger (except as expressly provided ------------------------------ for hereinotherwise specifically required by the terms of this Agreement), Company shall, and shall cause its Subsidiaries to, act and carry on their respective businesses in the ordinary course of business consistent with past practice and use all its and their respective reasonable efforts to preserve intact their current business organizations, keep available the services of their current officers and employees and preserve their relationships with customers, suppliers, licensors, licensees, advertisers, distributors and others having business dealings with them and to preserve goodwill. Without limiting the generality of the foregoing, during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality Time of the foregoingMerger, Company shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of ParentBuyer, which consent shall not be unreasonably withheld:
(i) (Aa) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (stock, other than, with respect to than dividends and distributions by a Subsidiary of Company, Company to its corporate parent), Company in accordance with applicable law;
(Bb) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or ;
(Cc) purchase, redeem or otherwise acquire any shares of outstanding capital stock of Company or any of its Subsidiaries or any other securities thereof or any rights, warrants or options to acquire any such sharesshares or other securities, except for the cash-out (or in the case of the warrants issued under the Xxxxxxx Warrant Agreement, the redemption in accordance with the current terms thereof) of Company Stock Options and Warrants (as provided in Section 3.2) outstanding on the date of this Agreement;
(iid) authorize for issuance, issue, deliver, sell, grant, pledge or otherwise encumber any shares of its capital stockstock or the capital stock of any of its Subsidiaries, any other voting securities or any securities convertible into or exchangeable forinto, or any rights, warrants or options to acquire, any such shares, voting securities or convertible securities or exchangeable securities, any other securities or equity equivalents (including without limitation stock appreciation rights) other than the issuance of Company Common Stock upon the exercise of Company Stock Options and Warrants outstanding on the date of this AgreementAgreement and in accordance with their present terms (such issuances, together with the acquisitions of shares of Company Common Stock permitted under clause (c) above, being referred to herein as "Permitted Changes");
(iiie) amend its certificate or articles of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreementdocuments;
(ivf) directly subject to the provisions of Section 7.6 hereof and except as set forth in Section 6.1(f) of the Disclosure Schedule, acquire or indirectly acquire, make any investment inagree to acquire by merging or consolidating with, or make by purchasing a substantial portion of the stock or assets of, or by any capital contributions toother manner, any person business or any corporation, partnership, joint venture, association or other business organization;
(g) other than as specifically described in Section 6.1 of the Disclosure Schedule, mortgage or otherwise encumber or subject to any Lien (in each case except as provided by the existing terms of Company's credit agreements) or otherwise dispose of, sell, lease or license any of its properties or assets, other than sales of inventory in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (Ah) incur any indebtedness for borrowed money or guarantee any such indebtedness of another personPerson, issue or sell any debt securities or warrants or other than indebtedness owing rights to or guarantees acquire any debt securities of indebtedness owing to Company or any direct of its Subsidiaries, guarantee any debt securities of another Person, enter into any "keep well" or indirect wholly owned Subsidiary other agreement to maintain any financial statement condition of Company another Person or (B) make enter into any loans or advances to arrangement having the economic effect of any other personof the foregoing, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), except for borrowings under existing current credit facilities described and for lease obligations, in the Filed SEC Documents each case incurred in the ordinary course of business consistent with past practice;
(ixi) grant make any loans, advances or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefitscapital contributions to, or establish investments in, any new compensation other Person, other than to Company or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by lawSubsidiary of Company;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xivj) pay, discharge or satisfy any claimsclaims (including claims of shareholders), liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than except for the payment, discharge or satisfaction (xi) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or in accordance with their terms as in effect on the date hereof or (yii) of claims, liabilities claims settled or obligations reflected or reserved against incompromised to the extent permitted by Section 6.1(n), or contemplated bywaive, the consolidated financial statements (release, grant, or the notes thereto) transfer any rights of Company and its consolidated Subsidiaries;
(xv) make any material value or modify or change in any method of accounting or accounting practice or policy (including material respect any methodexisting license, practice or policy relating to Taxes)lease, except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any actionPermit, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program contract or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payabledocument, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise other than in the ordinary course of business consistent with past practice;
(k) adopt resolutions providing for or authorizing a liquidation or a dissolution;
(l) enter into any new collective bargaining agreement;
(m) change any material accounting principle used by it, except to the extent required by generally accepted accounting principles;
(n) settle or compromise any litigation (whether or not commenced prior to the date of this Agreement) other than settlements or compromises of litigation where the amount paid (after giving effect to insurance proceeds actually received) in settlement or compromise is not greater than $50,000;
(o) make any new capital expenditure or expenditures, other than capital expenditures not to exceed $200,000, in any such case with the purpose or effect of using the resulting increase aggregate;
(p) except in the cash flow ordinary course of business or otherwise permitted by this Agreement, modify, amend or terminate any contract or agreement set forth in the SEC Documents filed and publicly available prior to the date of this Agreement to which Company or any Subsidiary is a party or waive, release or assign any material rights or claims;
(q) except as set forth in Section 6.1(q) of the Disclosure Schedule, (i) enter into any employment or other agreement with any officer, director or key employee of Company or any of its Subsidiaries or (ii) hire or agree to reduce the total indebtedness hire any new or additional key employees with annual compensation of Company and its Subsidiaries for money borrowed$50,000 or more or officers;
(xxir) take make any Tax election or settle or compromise any material Tax liability;
(s) voluntarily take, or voluntarily agree to commit to take, any action that would result in (i) make any representation or warranty of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue Company contained herein inaccurate in any material respect at, or (iii) as of any time prior to, the Effective Time of the conditions to the Offer set forth in Exhibit A not being satisfiedMerger; or
(xxiit) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1actions.
Appears in 1 contract
Samples: Merger Agreement (Desc Sa De Cv)
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereinherein (including, without limitation, Section 6.9 hereof relating to Company Options), during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable best efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality of the foregoing, Company shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of Parent:
(ia) (Ai) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parentParent), (Bii) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (Ciii) purchase, redeem or otherwise acquire any shares of its outstanding capital stock or any rights, warrants or options to acquire any such shares, except, in the case of this clause (iii), for the acquisition of Shares from holders of Company Options in full or partial payment of the exercise price payable by such holder upon exercise of Company Options;
(iib) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1.
Appears in 1 contract
Conduct of Business of Company. Except as expressly provided ------------------------------ for herein, during During the period from the date of this Agreement through the Closing Date (the “Pre-Closing Period”), except (i) as expressly provided in this Agreement, (ii) as consented to in writing by Parent (which consent will not be unreasonably withheld or delayed) or (iii) as required by applicable Legal Requirements, the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on will (1) conduct its business only in the ordinary course of business consistent with past practice andbusiness, to the extent consistent therewith, (2) use commercially reasonable efforts to preserve intact its current present business organizationsorganization, keep available the services of operations and goodwill, and (3) preserve its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Companycustomers, suppliers, distributors, licensors, licensees and others to that end, without whom the Company or a Company Subsidiary has material contractual obligations. Without limiting the generality of the foregoing, during the Pre-Closing Period, except (i) as expressly provided in this Agreement, (ii) as consented to in writing by Parent (which consent will not be unreasonably withheld, conditioned or delayed), or (iii) as required by applicable Legal Requirements the Company shall will not, and shall will cause each Company Subsidiary not permit any of its Subsidiaries to, without the prior written consent of Parent:
(a) amend the Company Charter or the bylaws of the Company or the organizational documents of any Company Subsidiary;
(b) transfer, issue, sell, pledge, encumber or dispose of any Company Shares or other securities of, or ownership interests in, the Company or any Company Subsidiary, or otherwise change its capitalization as it exists on the date hereof, or issue, grant or sell any options, warrants, conversion rights or other rights, securities or commitments obligating it to issue or sell any Company Shares, or any securities or obligations convertible into, or exercisable or exchangeable for, any Company Shares, or securities of any Company Subsidiary;
(c) (i) effect any recapitalization, reclassification, stock split, combination or like change in the capitalization of the Company or any Company Subsidiary, or amend the terms of any outstanding securities of the Company or any Company Subsidiary or the underlying agreements related thereto; (Aii) declare, set aside or pay any dividends on, dividend or make any other distributions (whether distribution payable in cash, securities stock or other propertyproperty whether or not in respect of its capital stock; or (iii) redeem, purchase or otherwise acquire directly or indirectly any of the capital stock of the Company or any Company Subsidiary;
(d) spend or commit to any new capital expenditures (other than capital expenditures already reserved pursuant to the budget for the current fiscal year) in respect ofexcess of $250,000, whether individually or in the aggregate, other than as specified on Section 4.1(d) of the Company Disclosure;
(e) enter into or amend any agreement pursuant to which the Company or any Company Subsidiary grants or receives rights in or to any Intellectual Property;
(f) fail to take any action or pay any fee required in connection with the renewal, continuation, or continued prosecution of any Owned Intellectual Property;
(g) (i) grant or announce any increase in the salary, severance or other direct or indirect compensation or benefits payable or to become payable to any employee or consultant (except as required by applicable Legal Requirements or under any Company Employee Plan as in effect on the date hereof); (ii) grant any bonus, benefit or other direct or indirect compensation to any employee or consultant not required by applicable Legal Requirements or under any Company Employee Plan as in effect on the date hereof; (iii) loan or advance any money or other property to any employee or consultant (except advancement of expenses as required by applicable Legal Requirements or any existing Employee Plan as in effect on the date hereof in the ordinary course of business); or (iv) except as required by applicable Legal Requirements, amend, terminate, modify, extend, or materially increase the rate or terms of benefits provided under, any Company Employee Plan or enter into, grant, or adopt any arrangement that would be a Company Employee Plan if in effect on the date hereof;
(h) sell, assign, lease, transfer or license to any Person, or permit the imposition of any Encumbrance (other than Permitted Encumbrances) on, any of its outstanding capital stock (other thanmaterial properties or material assets, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practicebusiness;
(vi) make form any new capital expenditure Subsidiary or expenditures acquire any interest in excess of $50,000 individually, or $250,000 in the aggregate, any other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
Person (vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances short-term investments in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d)business);
(xiiij) incur, create or assume any Indebtedness or amend, modify or make or rescind any tax election or settle or compromise any Tax liability of Company or changes to the terms of any Indebtedness, except (i) pursuant to a contract, agreement, license, lease or other instrument existing on the date of its Subsidiaries;
this Agreement (xivii) payin an amount not to exceed $250,000, discharge whether individually or satisfy any claimsin the aggregate, liabilities or (iii) trade payables and similar obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations incurred in the ordinary course of business and consistent with past practice practices, (iv) obligations incurred in connection with the Company’s entry into or performance of its obligations under this Agreement; and (yv) any such Indebtedness incurred in connection with the refinancing of claimsany indebtedness existing on the date of this Agreement or permitted to be incurred, liabilities assumed or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiariesotherwise entered into hereunder;
(xvk) make acquire or agree to acquire by merging with, or by purchasing a substantial portion of the equity interests or material assets of, or by any other manner, any material business or any Person or division thereof or otherwise acquire or agree to acquire any assets that are material individually or in the aggregate to the business of the Company and the Company Subsidiaries, taken as a whole;
(l) amend, modify or change in any method of its accounting policies, practices or accounting practice or policy (including any method, practice or policy relating to Taxes)procedures, except as required by GAAP;
(m) materially amend, modify or make any changes in generally accepted accounting principles the Company’s or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program Company Subsidiary’s standardized or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payablesales terms and conditions, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise other than in the ordinary course of business consistent with past practicebusiness;
(n) materially delay or postpone any payment of any accounts payable or other payables or expenses, or materially accelerate the collection of accounts receivable or cash collections of any type, other than in the ordinary course of business;
(o) enter into any contract or agreement that would be a Material Contract if it had been in existence on the date hereof, or materially amend, modify, elect not to renew or terminate any Material Contract, except, in any such case with the purpose or effect of using the resulting increase each case, in the cash flow ordinary course of business;
(p) amend, modify, terminate or make any changes to the coverage levels of any material insurance coverage provided by existing insurance policies, other than in the ordinary course of business;
(q) institute any legal proceeding or claim, or compromise, settle, or fail to defend any pending legal proceeding or any claim, except for settlements or compromises in an amount less than $50,000, whether individually or in the aggregate, for which the Company and any applicable Company Subsidiary receives a full release;
(r) communicate with any Governmental Authority regarding the businesses of the Company or any Company Subsidiary with respect to any matter that would, or would reasonably be expected to, have a Company Material Adverse Effect or result in the institution of its Subsidiaries to reduce any investigation or legal proceeding against the total indebtedness of Company and its Subsidiaries for money borrowedor any Company Subsidiary;
(xxis) waive any right of material value;
(t) make, amend, modify, revoke or change any election in respect of Taxes, amend, modify, adopt or change (or make a request to change) any accounting method in respect of Taxes, enter into any Tax sharing, Tax indemnity or closing agreement, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, file any amended Tax return or consent to any extension or waiver of the limitation period applicable to any Tax return, Tax claim or assessment in respect of Taxes, in each case if such election, amendment, modification, adoption, change, agreement, settlement, filing, or consent would have the effect of increasing the Tax liability of the Company or any Company Subsidiary for any period ending after the Closing Date;
(u) enter into any commitment or transaction that would constitute a material breach of the representations, warranties or agreements contained in this Agreement, or take any action that or fail to take an action or, to the extent within the Company’s or a Company Subsidiary’s control, permit to occur any event that, individually or in the aggregate, would reasonably be expected to result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfieda Material Adverse Effect; or
(xxiiv) authorize any ofagree or commit, whether in writing or commit or agree otherwise, to take any of, of the foregoing actions described in respect of which it is restricted by the provisions of this Section 5.1Sections 4.1(a) through 4.1(u).
Appears in 1 contract
Samples: Merger Agreement (Techne Corp /Mn/)
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereinherein or in the Fiber Cement Agreement, during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to . To that end, without limiting the generality of the foregoing, except as expressly provided for in this Agreement or the Fiber Cement Agreement, Company shall not, and shall not permit any of its Subsidiaries to, without the prior consent of Parent:
(i) (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares, except, in the case of this clause (C), for the acquisition of Shares from holders of Options in full or partial payment of the exercise price payable by such holder upon exercise of Options;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem documents, except for any amendment required in connection with the performance by Company Rights of its obligations under this Agreement, including but not limited to its obligations under Section 1.4;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viiivi) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ixvii) enter into any compromise or settlement of, or take any material action with respect to, any litigation, action, suit, claim, proceeding or investigation other than the prosecution, defense and settlement of routine litigation, actions, suits, claims, proceedings or investigations in the ordinary course of business;
(viii) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by lawlaw or pursuant to the normal severance policies or practices of Company or its Subsidiaries as in effect on the date of this Agreement, or increases in salary or wages payable or to become payable in the ordinary course of business consistent with past practice;
(xix) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1.
Appears in 1 contract
Conduct of Business of Company. Except During the period from the date of this Agreement to the Effective Time of the Merger (except as expressly provided ------------------------------ for hereinotherwise specifically required by the terms of this Agreement), or the earlier termination of this Agreement, Company shall, and shall cause its Subsidiaries to, act and carry on their respective businesses in the ordinary course of business consistent with past practice. Without limiting the generality of the foregoing, during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality Time of the foregoingMerger, or the earlier termination of this Agreement, Company shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of ParentBuyer or MergerCo, which consent shall not be unreasonably withheld:
(i) (Aa) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (stock, other than, with respect to than dividends and distributions by a Subsidiary of Company, Company to its corporate parent), Company in accordance with applicable law;
(Bb) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or ;
(Cc) purchase, redeem or otherwise acquire any shares of outstanding capital stock of Company or any of its Subsidiaries or any other securities thereof or any rights, warrants or options to acquire any such sharesshares or other securities outstanding on the date of this Agreement, except for the cash-out of Company Stock Options as provided in Section 3.2 of this Agreement;
(iid) authorize for issuance, issue, deliver, sell, grant, pledge or otherwise encumber any shares of its capital stockstock or the capital stock of any of its Subsidiaries, any other voting securities or any securities convertible into or exchangeable forinto, or any rights, warrants or options to acquire, any such shares, voting securities or convertible securities or exchangeable securities, any other securities or equity equivalents (including without limitation stock appreciation rights) other than the issuance of Company Common Stock upon the exercise of Company Stock Options and Warrants outstanding on the date of this AgreementAgreement and in accordance with their present terms (such issuances, together with the acquisitions of shares of Company Common Stock permitted under clause (c) above, being referred to herein as "Permitted Changes");
(iiie) amend its certificate or articles of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreementdocuments;
(ivf) directly or indirectly acquiresubject to the provisions of Section 7.7 hereof, make any investment in, or make any capital contributions to, any person other than and except in the ordinary course of business, acquire by merging or consolidating with, or by purchasing a substantial portion of the stock or assets of, or by any other manner, any business consistent with past practiceor any corporation, partnership, joint venture, association or other business organization which would be material to the Company and its subsidiaries, taken as a whole;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (Ag) incur any indebtedness for borrowed money or guarantee any such indebtedness of another personPerson in an amount in excess of $1,000,000, issue or sell any debt securities or warrants or other than indebtedness owing rights to or guarantees acquire any debt securities of indebtedness owing to Company or any direct of its Subsidiaries, guarantee any debt securities of another Person, enter into any "keep well" or indirect wholly owned Subsidiary other agreement to maintain any financial statement condition of Company another Person or (B) make enter into any loans or advances to arrangement having the economic effect of any other personof the foregoing, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), except for borrowings under existing current credit facilities described and for lease obligations, in the Filed SEC Documents each case incurred in the ordinary course of business consistent with past practice;
(ixh) grant make any loans, advances or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefitscapital contributions to, or establish investments in, any new compensation other Person, other than to Company or benefit plans or arrangementsany Subsidiary of Company, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by lawin an amount exceeding $100,000;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xiii) adopt resolutions providing for or enter into authorizing a plan of complete liquidation or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), a dissolution except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess part of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfiedTransaction Proposal; or
(xxiij) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1actions.
Appears in 1 contract
Samples: Offer to Purchase (Murdock David H)
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereincontemplated by this Agreement or as described in Section 4.1 of the Company Disclosure Schedule, during the period from the date of this Agreement hereof to the Effective Time, Company shallwill, and shall will cause each of its Subsidiaries subsidiaries to, act and carry on conduct its business only operations in the ordinary course of business consistent with past practice practice, and, to the extent consistent therewiththerewith and with no less diligence and effort than would be applied in the absence of this Agreement, use reasonable efforts will seek to preserve intact its current business organizations, keep available the services service of its current key officers and employees and preserve the goodwill of those engaged in material business its relationships with Companycustomers, suppliers and others having business dealings with it to the end that end, without their goodwill and ongoing businesses shall be unimpaired at the Effective Time. Without limiting the generality of the foregoing, except as otherwise expressly provided in this Agreement or as described in Section 4.1 of the Company shall notDisclosure Schedule, and shall not permit prior to the Effective Time, neither Company nor any of its Subsidiaries tosubsidiaries will, without the prior written consent of Parent:Parent and Newco (which consent shall not be unreasonably withheld):
(ia) amend its charter or bylaws (Aor other similar governing instrument);
(b) authorize for issuance, issue, sell, deliver or agree or commit to issue sell or deliver (whether through the issuance or granting of options, warrants, commitments, subscriptions, rights to purchase or otherwise) any stock of any class or any other securities or equity equivalents (including, without limitation, any stock options or stock appreciation rights), except for the issuance and sale of Shares pursuant to options previously granted under Company Plans or pursuant to previously granted warrants;
(c) split, combine or reclassify any shares of its capital stock, declare, set aside or pay any dividends on, dividend or make any other distributions distribution (whether in cash, securities stock or other propertyproperty or any combination thereof) in respect of, any of its outstanding capital stock (stock, make any other thanactual, with constructive or deemed distribution in respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of otherwise make any other securities payments to shareholders in respect of, in lieu of or in substitution for shares of its outstanding capital stocktheir capacity as such, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or of any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreementsubsidiaries;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xiid) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d)other than the Merger);
(xiiie) make alter, through merger, liquidation, reorganization, restructuring or rescind any tax election or settle or compromise any Tax liability other fashion, the corporate structure of Company or ownership of any of its Subsidiariessubsidiary;
(xivf) pay(i) incur or assume any long-term or short-term debt or issue any debt securities, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) except for borrowings under existing lines of any such claims, liabilities or obligations credit in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without practices provided that notice is provided to Parent; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person except in the ordinary course of business consistent with past practice and except for obligations of subsidiaries of Company incurred in the ordinary course of business consistent with past practices provided that notice is provided to Parent; (iii) make any loans, advances or capital contributions to or investments in any other person (other than to subsidiaries of Company or customary loans or advances to employees in each case in the ordinary course of business consistent with past practice); (iv) pledge or otherwise encumber shares of capital stock of Company or its subsidiaries; or (v) mortgage or pledge any of its material assets, tangible or intangible, or create or suffer to exist any material Lien thereupon (other than tax liens for Taxes not yet due and Liens incurred in the ordinary course of business securing borrowings permitted under clause (i) above);
(xviiig) except as set forth in Section 4.1 of the Company Disclosure Schedule or as may be required by law, enter into adopt or amend or terminate any bonus, profit sharing, compensation, severance, termination, stock option, stock appreciation right, restricted stock, performance unit, stock equivalent, stock purchase agreement, pension, retirement, deferred compensation, employment, severance or other employee benefit agreement, trust, plan, fund or other arrangement for the benefit or welfare of any director, officer or employee in any manner or increase in any manner the compensation or fringe benefits of any director, officer or employee or pay any benefit not required by any plan and arrangement as in effect as of the date hereof (including, without limitation, the granting of stock appreciation rights or performance units);
(h) except as set forth in Section 4.1 of the Company Disclosure Schedule, acquire, sell, lease or dispose of any assets in any single transaction or series of related transactions having a fair market value in excess of $50,000 in the aggregate, provided that none of the foregoing shall limit contracting for sale and sale of completed residences in the ordinary course of business consistent with past practices;
(i) except as may be required as a result of a change in law or in generally accepted accounting principles, change any of the accounting principles or practices used by it;
(j) revalue in any material respect any of its assets, including without limitation writing down the value of inventory or writing-off notes or accounts receivable other than in the ordinary course of business consistent with past practices;
(i) acquire (by merger, consolidation or acquisition of stock or assets) any corporation, partnership or other business organization or division thereof or any equity interest therein; (ii) enter into any contract or agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries that would be material to reduce the total indebtedness of Company and its Subsidiaries for money borrowedsubsidiaries, taken as a whole; (iii) authorize any new capital expenditure or expenditures that individually is in excess of $50,000 or in the aggregate are in excess of $250,000 provided that none of the foregoing shall limit any capital expenditure required pursuant to existing Projects or other existing contracts in the ordinary course of business consistent with past practices;
(xxil) make any tax election or settle or compromise any income tax liability material to Company and its subsidiaries taken as a whole;
(m) settle or compromise any pending or threatened suit, action or claim that (i) relates to the transactions contemplated hereby or (ii) the settlement or compromise of which could have a Material Adverse Effect on Company;
(n) pay, or award any increases in, any salary, wages, vacation pay, sick pay, bonuses or other compensation except in the ordinary course of business consistent with past practice;
(o) made any material change in the conduct of its business or operations, or take or omit to take any actions not in the ordinary course of business consistent with past practices;
(p) enter into any transaction, agreement, arrangement or understanding with any affiliate of the Company, or amend or modify the terms of any existing agreement, arrangement or understanding with any affiliate of the Company;
(q) enter into any transaction, agreement, arrangement or understanding, or take any other action, that would prevent the Merger from qualifying as a tax free reorganization; or
(r) take or agree in writing or otherwise commit to take any of the actions described in Sections 4.1(a) through 4.1(q) or any action that would result in (i) make any of its the representations and or warranties set forth of Company contained in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming materially untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1incorrect.
Appears in 1 contract
Samples: Merger Agreement (Writer Corp)
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereincontemplated by this Agreement or as described in Section 4.1 of the Company Disclosure Schedule, during the period from the date of this Agreement hereof to the Effective Time, Company shallwill, and shall will cause each of its Subsidiaries subsidiaries to, act and carry on conduct its business only operations in the ordinary course of business consistent with past practice practice, and, to the extent consistent therewiththerewith and with no less diligence and effort than would be applied in the absence of this Agreement, use reasonable efforts will seek to preserve intact its current business organizations, keep available the services service of its current key officers and employees and preserve the goodwill of those engaged in material business its relationships with Companycustomers, suppliers and others having business dealings with it to the end that end, without goodwill and ongoing businesses shall be unimpaired at the Effective Time. Without limiting the generality of the foregoing, except as otherwise expressly provided in this Agreement or as described in Section 4.1 of the Company shall notDisclosure Schedule, and shall not permit prior to the Effective Time, neither Company nor any of its Subsidiaries tosubsidiaries will, without the prior written consent of Parent:Parent and Newco (which consent shall not be unreasonably withheld):
(ia) amend its Charter or bylaws (Aor other similar governing instrument);
(b) authorize for issuance, issue, sell, deliver or agree or commit to issue sell or deliver (whether through the issuance or granting of options, warrants, commitments, subscriptions, rights to purchase or otherwise) any stock of any class or any other securities (except bank loans) or equity equivalents (including, without limitation, any stock options or stock appreciation rights), except for the issuance and sale of Shares pursuant to options previously granted or subsequently granted in the ordinary course and consistent with past practice under Company Plans or pursuant to previously granted warrants;
(c) split, combine or reclassify any shares of its capital stock, declare, set aside or pay any dividends on, dividend or make any other distributions distribution (whether in cash, securities stock or other propertyproperty or any combination thereof) in respect of, any of its outstanding capital stock (stock, make any other thanactual, with constructive or deemed distribution in respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of otherwise make any other securities payments to stockholders in respect of, in lieu of or in substitution for shares of its outstanding capital stocktheir capacity as such, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or of any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreementsubsidiaries;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xiid) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization of Company or any agreement relating to an Acquisition Proposal of its subsidiaries (as defined in Section 6.5(d)other than the Merger);
(xiiie) make alter, through merger, liquidation, reorganization, restructuring or rescind any tax election or settle or compromise any Tax liability other fashion, the corporate structure of Company or ownership of any of its Subsidiariessubsidiary;
(xivf) pay(i) incur or assume any long-term or short-term debt or issue any debt securities, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) except for borrowings under existing lines of any such claims, liabilities or obligations credit in the ordinary course of business and provided that notice is provided to Parent; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person except in the ordinary course of business consistent with past practice or (y) and except for obligations of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) subsidiaries of Company and its consolidated Subsidiaries;
incurred in the ordinary course of business provided that notice is provided to Parent; (xviii) make any change loans, advances or capital contributions to or investments in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 other person (other than to subsidiaries of Company or customary loans or advances to employees in each case in the settlement ordinary course of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) business consistent with the terms past practice); (iv) pledge or otherwise encumber shares of the Memorandum capital stock of UnderstandingCompany or its subsidiaries; or (v) mortgage or pledge any of its material assets, dated February 5tangible or intangible, 1999or create or suffer to exist any material Lien thereupon (other than tax liens for Taxes not yet due);
(xviig) permit except as set forth in Section 4.1 of the Company Disclosure Schedule or as may be required by law, enter into adopt or amend or terminate any material insurance policy naming it bonus, profit sharing, compensation, severance, termination, stock option, stock appreciation right, restricted stock, performance unit, stock equivalent, stock purchase agreement, pension, retirement, deferred compensation, employment, severance or other employee benefit agreement, trust, plan, fund or other arrangement for the benefit or welfare of any director, officer or employee in any manner or increase in any manner the compensation or fringe benefits of any director, officer or employee or pay any benefit not required by any plan and arrangement as a beneficiary in effect as of the date hereof (including, without limitation, the granting of stock appreciation rights or a loss payable payee to be cancelled performance units); provided, however, that this paragraph shall not prevent Company or terminated without notice to Parentits subsidiaries from entering into employment agreements, except severance agreements or other compensation arrangements with employees in the ordinary course of business and consistent with past practice;
(xviiih) except as set forth in Section 4.1 of the Company Disclosure Schedule, acquire, sell, lease or dispose of any assets in any single transaction or series of related transactions having a fair market value in excess of $50,000 in the aggregate;
(i) except as may be required as a result of a change in law or in generally accepted accounting principles, change any of the accounting principles or practices used by it;
(j) revalue in any material respect any of its assets, including without limitation writing down the value of inventory or writing-off notes or accounts receivable other than in the ordinary course of business;
(i) acquire (by merger, consolidation or acquisition of stock or assets) any corporation, partnership or other business organization or division thereof or any equity interest therein; (ii) enter into any contract or agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries that would be material to reduce the total indebtedness of Company and its Subsidiaries for money borrowedsubsidiaries, taken as a whole; (iii) authorize any new capital expenditure or expenditures that individually is in excess of $50,000 or in the aggregate are in excess of $400,000 provided that none of the foregoing shall limit any capital expenditure required pursuant to existing Leases or other existing contracts;
(xxil) make any tax election or settle or compromise any income tax liability material to Company and its subsidiaries taken as a whole;
(m) settle or compromise any pending or threatened suit, action or claim that (i) relates to the transactions contemplated hereby or (ii) the settlement or compromise of which could have a Material Adverse Effect on Company; or
(n) take or agree in writing or otherwise to take any of the actions described in Sections 4.1(a) through 4.1(m) or any action that would result in (i) make any of its the representations and or warranties set forth of Company contained in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming materially untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1incorrect.
Appears in 1 contract
Samples: Merger Agreement (Coffee People Inc)
Conduct of Business of Company. Except as expressly provided ------------------------------ permitted during the period from the Signing Date until including the Closing Date the Company shall, and shall cause each of its respective corporations, partnerships, limited liability companies, joint ventures or other legal entities of which the Acquiror or the Company, as the case may be (either alone or through or together with any other Subsidiary), owns, directly or indirectly, 50% or more of the stock or other equity interests the holders of which are generally entitled to vote for hereinthe election of the board of directors or other governing body of such corporation, partnership, limited liability company, joint venture or other legal entity, (“Subsidiaries”) to, in compliance with all legal rules and provisions under any applicable jurisdiction:
14.1 in all material respects, carry on their businesses in the ordinary course of business and to use reasonable efforts to preserve intact their current business organizations and goodwill;
14.2 use reasonable efforts to keep available the services of their current key officers and employees (“Führungskräfte”), to the extent commercially reasonable;
14.3 use reasonable efforts to preserve their relationships with customers, suppliers, distributors, consultants, and with others with which they have business relationships and/or business dealings, to the extent commercially reasonable.
14.4 to not, during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality Expiration of the foregoing, Company shall not, and shall not permit any of its Subsidiaries to, without the prior consent of ParentTender Offer:
(i) (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (Ca) purchase, redeem or otherwise acquire any of its shares or any of outstanding capital stock its other securities or any rights, warrants or options to acquire any such shares or other securities, other than as required under existing Stock Option Schemes of the Company;
(b) issue, any shares or any other voting securities or equity equivalent or any securities convertible into, or any rights, warrants or options to acquire any such shares;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities securities, equity equivalent or convertible or exchangeable securities, other than the issuance of shares upon the exercise of currently outstanding stock options in accordance with their current Stock Options and Warrants outstanding on the date of this AgreementSchemes;
(iiic) amend its certificate acquire by merging or consolidating with, or by purchasing a substantial portion of incorporationthe assets of or equity in, bylaws or by any other comparable charter manner, any business or organizational documents or amend or redeem the Company Rights Agreementbusiness organization;
(ivd) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practiceguarantee, or otherwise become responsible for any obligations of any person;
(ve) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practicemake any loans, advances or capital contributions to, or other investments in, any other person;
(f) other than in the ordinary course of business enter into or amend any such case compensation agreement, benefit plan, employment agreement, consulting agreement, or bonus plan or hire additional personnel or engage additional consultants, provided, however, that any entering into or amending of any of these actions, to the extent that they apply to members of the Company`s management board (Vorstand), require the prior consent by Open Text, even though otherwise in the ordinary course of business;
(g) enter into any transaction or perform any act which (i) interferes or is inconsistent with the purpose successful completion of the transaction contemplated by this Agreement or effect of using (ii) adversely affects the resulting increase in the cash flow of Company Company’s ability to perform its covenants and agreements under this Agreement.
(h) permit or cause any of its respective Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) do any of the conditions foregoing or commit to do any of the foregoing.
14.5 The foregoing provisions about the conduct of business shall be deemed not to violate any legal obligations of the Company or its management, in particular Section 76 German Corporation Act (AktG) and Section 33 German Takeover Act (WpÜG) and be understood as an obligation vis à vis the Acquiror and Open Text to the Offer set forth extent allowed by German law. These provisions shall in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, particular secure the foregoing actions Acquiror and Open Text against material adverse changes in respect the business of which it is restricted the Company that may be initiated by the provisions management of this Section 5.1the Company during the Tender Offer and have significant influence on the share price of the Company at a later date.
Appears in 1 contract
Conduct of Business of Company. Except as expressly provided ------------------------------ permitted during the period from the Signing Date until including the Closing Date the Company shall, and shall cause each of its respective corporations, partnerships, limited liability companies, joint ventures or other legal entities of which the Acquiror or the Company, as the case may be (either alone or through or together with any other Subsidiary), owns, directly or indirectly, 50% or more of the stock or other equity interests the holders of which are generally entitled to vote for hereinthe election of the board of directors or other governing body of such corporation, partnership, limited liability company, joint venture or other legal entity, (“Subsidiaries”) to, in compliance with all legal rules and provisions under any applicable jurisdiction:
14.1 in all material respects, carry on their businesses in the ordinary course of business and to use reasonable efforts to preserve intact their current business organizations and goodwill;
14.2 use reasonable efforts to keep available the services of their current key officers and employees (“Führungskräfte”), to the extent commercially reasonable;
14.3 use reasonable efforts to preserve their relationships with customers, suppliers, distributors, consultants, and with others with which they have business relationships and/or business dealings, to the extent commercially reasonable.
14.4 to not, during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality Expiration of the foregoing, Company shall not, and shall not permit any of its Subsidiaries to, without the prior consent of ParentTender Offer:
(i) (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (Ca) purchase, redeem or otherwise acquire any of its shares or any of outstanding capital stock its other securities or any rights, warrants or options to acquire any such shares or other securities, other than as required under existing Stock Option Schemes of the Company;
(b) issue, any shares or any other voting securities or equity equivalent or any securities convertible into, or any rights, warrants or options to acquire any such shares;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities securities, equity equivalent or convertible or exchangeable securities, other than the issuance of shares upon the exercise of currently outstanding stock options in accordance with their current Stock Options and Warrants outstanding on the date of this AgreementSchemes;
(iiic) amend its certificate acquire by merging or consolidating with, or by purchasing a substantial portion of incorporationthe assets of or equity in, bylaws or by any other comparable charter manner, any business or organizational documents or amend or redeem the Company Rights Agreementbusiness organization;
(ivd) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practiceguarantee, or otherwise become responsible for any obligations of any person;
(ve) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practicemake any loans, advances or capital contributions to, or other investments in, any other person;
(f) other than in the ordinary course of business enter into or amend any such case compensation agreement, benefit plan, employment agreement, consulting agreement, or bonus plan or hire additional personnel or engage additional consultants, provided, however, that any entering into or amending of any of these actions, to the extent that they apply to members of the Company’s management board (Vorstand), require the prior consent by Open Text, even though otherwise in the ordinary course of business;
(g) enter into any transaction or perform any act which (i) interferes or is inconsistent with the purpose successful completion of the transaction contemplated by this Agreement or effect of using (ii) adversely affects the resulting increase in the cash flow of Company Company’s ability to perform its covenants and agreements under this Agreement.
(h) permit or cause any of its respective Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) do any of the conditions foregoing or commit to do any of the foregoing.
14.5 The foregoing provisions about the conduct of business shall be deemed not to violate any legal obligations of the Company or its management, in particular Section 76 German Corporation Act (AktG) and Section 33 German Takeover Act (WpÜG) and be understood as an obligation vis à vis the Acquiror and Open Text to the Offer set forth extent allowed by German law. These provisions shall in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, particular secure the foregoing actions Acquiror and Open Text against material adverse changes in respect the business of which it is restricted the Company that may be initiated by the provisions management of this Section 5.1the Company during the Tender Offer and have significant influence on the share price of the Company at a later date.
Appears in 1 contract
Conduct of Business of Company. Except as expressly provided ------------------------------ for herein, during During the period from the date of this Agreement through the earlier of the termination of this Agreement in accordance with Article VII or the Closing Date (the “Pre-Closing Period”), except (i) to the Effective Timeextent necessary to comply with Company’s obligations under this Agreement, (ii) as reasonably necessary to ensure that the Company shallcomplies with applicable Legal Requirements, and or (iii) as consented to in writing by Parent (A) the Company shall cause each of its Subsidiaries to, act and use reasonable best efforts to (1) carry on its business only in a manner that does not depart materially from the ordinary course of manner in which such business consistent with past practice and, was being conducted prior to the extent consistent therewith, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality of the foregoing, Company shall not, and shall not permit any of its Subsidiaries to, without the prior consent of Parent:
(i) (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed Agreement and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, (2) preserve intact its present business organization, (3) maintain and preserve intact the business and franchise of the Company and to preserve the rights, franchises, goodwill and relationships of its employees, customers, licensees, licensors, distributors, lenders, suppliers, regulators and otheconrs having business relationships with the Company, (4) pay its debts, Taxes and other obligations when due, (5) defend and protect its properties and assets from infringement or usurpation, (6) preserve and maintain all of its Permits, and (7) comply in all material respects with all applicable Legal Requirements, and (B) the Company shall not, without the prior written consent of Parent (which consent may not be unreasonably withheld, conditioned or delayed):
(a) amend the Company Charter or the Amended and Restated Bylaws of the Company or permit the amendment of any of the organizational documents of any Subsidiary;
(b) issue or sell any equity securities (other than in connection with the exercise of Company Options or Company Warrants) or otherwise change its capitalization as it exists on the date hereof, or issue, grant, or sell any options, warrants, conversion rights or other rights, securities or commitments obligating it to issue or sell any Company Shares, or any securities or obligations convertible into, or exercisable or exchangeable for, any Company Shares;
(c) enter into or amend any agreements pursuant to which Company (i) transfers or licenses exclusively to any Person any material Owned Intellectual Property, or (ii) otherwise grants to any person exclusive rights in any such case with material Owned Intellectual Property;
(d) sell, lease or license to any Person, or permit the purpose or effect imposition of using the resulting increase in the cash flow of Company or any Encumbrance (other than Permitted Encumbrances) on, any of its Subsidiaries properties or assets that are material to reduce the total indebtedness of Company and its Subsidiaries for money borrowedSubsidiaries, taken as a whole;
(xxie) form any Subsidiary or acquire any material equity interest in any other Person (except for short-term investments);
(f) incur any Indebtedness in excess of $25,000 outside the ordinary course of business;
(g) enter into any contract or agreement that would be a Material Contract, Lease or Third Party Intellectual Property if it had been in existence on the date hereof, or terminate, modify or amend in any material respect any Material Contract, Lease or Third Party Intellectual Property;
(h) materially reduce the amount of any insurance coverage provided by existing insurance policies other than upon the expiration of any such policy;
(i) waive any material right under any Material Contract;
(j) acquire or agree to acquire by merging with, or by purchasing a substantial portion of the equity interests or assets of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof or otherwise acquire or agree to acquire any assets that are material individually or in the aggregate, to the Company’s business, taken as a whole;
(k) make or change any material election in respect of Taxes, adopt or change any material accounting method in respect of Taxes, enter into any closing agreement with any taxing authority, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any material assessment in respect of Taxes, in each case if such election, change, settlement or consent would have the effect of materially increasing the Tax liability of the Company for any period ending after the Closing Date;
(l) cause the Company not to take or permit any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) cause any of the changes, events or conditions described in Section 2.29 to the Offer set forth in Exhibit A not being satisfiedoccur; or
(xxiim) authorize any of, or commit or agree enter into a binding agreement to take any of, of the foregoing actions described in respect of which it is restricted by Sections 4.1(a) through 4.1(l). For the provisions purposes of this Section 5.1Article IV, references to the Company include any Subsidiary of the Company.
Appears in 1 contract
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereincontemplated by this Agreement, during the period from the date of this Agreement to the Effective Time, Company shallwill, and shall will cause each its subsidiaries to, conduct their operations according to their ordinary course of business consistent with past practice, and will use all reasonable best efforts to preserve intact their business organization, to keep available the services of their officers and employees, to maintain all permits, licenses and franchises from governmental entities required to conduct their businesses as now being conducted and to maintain satisfactory relationships with producers, brokers, insureds, suppliers, distributors, customers and others having business relationships with it and will take no action which would materially adversely affect the ability of the Parties to consummate the transactions contemplated by this Agreement (it being understood that Company will discuss with Parent the implementation of the joint venture with Capital Re Corporation and the writing of any insurance thereby or thereunder). Without limiting the generality of the foregoing, and except as otherwise expressly provided in this Agreement, prior to the Effective Time, Company will not, and will not permit any of its Subsidiaries subsidiaries to, act without the prior written consent of Parent, directly or indirectly:
(a) amend the Organizational Documents of Company or any of its subsidiaries;
(b) authorize for issuance, issue, sell, deliver, grant any options for, or otherwise agree or commit to issue, sell or deliver any securities of Company or any of its subsidiaries, except pursuant to and carry in accordance with the terms of any Company Options outstanding on the date hereof;
(c) split, combine or reclassify any shares of Company or any of its subsidiaries, declare, set aside or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of any such shares or purchase, redeem or otherwise acquire any such shares, except that the Company may pay the dividend of $0.62 per Share declared on April 25, 1997 payable on May 27, 1997 to shareholders of record on May 14, 1997 (the "Second Quarter Dividend");
(d) (i) create, incur, assume, maintain or permit to exist any long-term debt or any short-term debt for borrowed money, except pursuant to Company's existing credit agreements in the ordinary course of the property catastrophe business only to the extent required to pay properly documented claims, (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any person except in the ordinary course of its reinsurance business, consistent with past practices (except customary letters of credit issued in the ordinary course of business consistent with past practice andpractices), to the extent consistent therewithor (iii) make any loans, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality of the foregoing, Company shall not, and shall not permit any of its Subsidiaries advances or capital contributions to, without the prior consent of Parent:or investments in, any person;
(i) increase in any manner the compensation (Aincluding bonuses) declareof any director, set aside or pay any dividends on, or make any other distributions (whether in cash, securities officer or other property) in respect of, employee of Company or any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares;
subsidiaries; (ii) issuepay or agree to pay any pension, sellretirement allowance or other employee benefit not required, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible enter into or exchangeable foragree to enter into any agreement or arrangement with any such director, officer or employee, whether past or present relating to any such pension, retirement allowance or other employee benefit; (iii) grant any severance or termination pay to, or enter into any rights, warrants employment or options to acquireseverance agreement with, any such sharesdirector, voting securities officer or convertible other employee; or exchangeable securities(iv) become obligated under any new pension plan, other than upon the exercise of Options and Warrants outstanding welfare plan, multi-employer plan, employee benefit plan, benefit arrangement, or similar plan or arrangement, which was not in existence on the date of this Agreement;
(iii) amend its certificate of incorporationhereof, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of including any bonus, severance, profit sharing, retirementincentive, deferred compensation, stock purchase, stock option, insurance stock appreciation right, group insurance, severance pay, retirement or other compensation benefit plan, agreement or benefitsarrangement, or employment or consulting agreement with or for the benefit of any person, or amend any of such plans or any of such agreements in existence on the date hereof;
(xif) except as required by this Agreement, authorize, recommend, propose or announce an intention to authorize, recommend or propose, or enter into into, any agreement in principle or amend any employment, consulting, severance or similar agreement with respect to any individual plan of liquidation or dissolution, any acquisition of a material amount of assets or securities, any sale, transfer, lease, license, pledge, mortgage, or other disposition or encumbrance of any assets or securities or any change in the capitalization of Company or any of its subsidiaries (other than consulting upon exercise of Company Options outstanding on the date hereof), or, except for reinsurance agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrueother material agreements, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect commitments or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1.contracts,
Appears in 1 contract
Samples: Amalgamation Agreement (Exel LTD)
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereincontemplated by this Agreement or set forth in the Company Disclosure Letter or with the prior written consent of the other party, during the period from the date of this Agreement to the Effective Time, the Company shallwill, and shall will cause each of its Subsidiaries to, act conduct its operations only in the ordinary and carry usual course of business consistent with past practice and will use its commercially reasonable efforts, and will cause each of its Subsidiaries to use its commercially reasonable efforts, to preserve intact the business organization of the Company and its Subsidiaries, to keep available the services of its and their present officers and key employees, and to preserve the good will of those having business relationships with it. Without limiting the generality of the foregoing, and except as otherwise expressly contemplated by this Agreement or as set forth in the Company Disclosure Letter, the Company agrees that it will not, and will not permit any of its Subsidiaries to, prior to the Effective Time, without the prior written consent of the other party:
(a) adopt any amendment to its Certificate of Incorporation or Bylaws or comparable organizational documents;
(b) except for issuances of capital stock of Subsidiaries to itself or its wholly-owned Subsidiary, issue, reissue, pledge or sell, or authorize the issuance, reissuance, pledge or sale of (i) additional shares of capital stock of any class, or securities convertible into, exchangeable for or evidencing the right to substitute for, capital stock of any class, or any rights, warrants, options, calls, commitments or any other agreements of any character, to purchase or acquire any capital stock or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for, capital stock, other than the issuance of Shares, pursuant to the exercise of Company Stock Options outstanding on the date hereof; or (ii) any other securities;
(c) declare, set aside or pay any dividend or other distribution (whether in cash, securities or property or any combination thereof) in respect of any class or series of its capital stock other than between the Company and any of its wholly-owned Subsidiaries including any dividend required to be declared, set aside or paid pursuant to the Certificates of Designation, Preferences and Rights of the Parent Preferred Stock;
(d) split, combine, subdivide, reclassify or redeem, purchase or otherwise acquire, or propose to redeem or purchase or otherwise acquire, any shares of its capital stock, or any of its other securities;
(e) except for (i) increases in salary and wages granted to officers and employees of the Company or its Subsidiaries in conjunction with promotions or other changes in job status or normal compensation reviews (within the amounts projected in the Company's 2000 operating plan previously provided to Parent) in the ordinary course of business consistent with past practice; or (ii) increases in salary, wages and benefits to employees of the Company pursuant to collective bargaining agreements in effect on the date hereof, increase the compensation or benefits payable or to become payable to its directors, officers or employees (whether from the Company or any of its Subsidiaries), or pay or award any benefit not required by any existing plan or arrangement (including the granting of stock options, stock appreciation rights, shares of restricted stock or performance units pursuant to the Company Plans or otherwise) or grant any additional severance or termination pay to (other than as required by existing agreements or policies, each of which are described in the Company Disclosure Letter) or enter into any employment or severance agreement with, any director, officer or other employee of the Company or any of its Subsidiaries, or establish, adopt, enter into, amend, accelerate any rights or benefits or waive any performance or vesting criteria under any collective bargaining, bonus, profit sharing, thrift, compensation, restricted stock, pension, retirement, savings, welfare, deferred compensation, employment, termination, severance or other employee benefit plan (other than any automatic acceleration of all unvested options as a result of this transaction as provided in the applicable plan), agreement, trust, fund, policy or arrangement for the benefit or welfare of any directors, officers or current or former employees (any of the foregoing being an "Employee Benefit Arrangement"), except in each case to the extent required by applicable law or regulation or existing plan or agreement;
(f) acquire, sell, lease or dispose of any assets or securities which are material to and used in the operations of the Company and its Subsidiaries, or acquire any businesses, or enter into any commitment to do any of the foregoing or enter into any material commitment or transaction, in each case outside the ordinary course of business consistent with past practice other than transactions between a wholly owned Subsidiary of the Company and the Company or another wholly owned Subsidiary of the Company; provided, however, that the Company and its Subsidiaries shall not, during the period from the date hereof to the Effective Time, make or commit to make capital expenditures that are not disclosed in Part 5.1(f) of the Company Disclosure Letter that in the aggregate exceed $50,000. Any permitted capital expenditures may be made through leasing arrangements.
(g) incur, assume or pre-pay, or modify or amend the terms of, any long-term or short-term debt of the Company or its Subsidiaries, except that the Company and its Subsidiaries may (i) incur or pre-pay debt in the ordinary course of business in amounts and for purposes consistent with past practice under existing lines of credit; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person in the ordinary course of business consistent with past practice; or (iii) make any loans, advances or capital contributions to, or investments in, any other person but only in the ordinary course of business consistent with past practice andand loans, to the extent consistent therewithadvances, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to that end, without limiting the generality capital contributions or investments between any wholly owned Subsidiary of the foregoing, Company shall not, and shall not permit the Company or another wholly owned Subsidiary of the Company;
(h) settle or compromise any of its Subsidiaries to, without the prior consent of Parent:material suit or claim or material threatened suit or claim;
(i) (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
, (vi) make any new capital expenditure or expenditures in excess of $50,000 individuallymodify, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or contract; (ii) waive, release release, relinquish or assign any material rights contract (or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties the Company's rights thereunder), right or assets that are material to its business, except for sales, pledges claim; or other dispositions (iii) cancel or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur forgive any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing owed to or guarantees of indebtedness owing to the Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xivj) paymake any tax election not required by law or settle or compromise any tax liability, discharge or satisfy in either case that is material to the Company and its Subsidiaries;
(k) make any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise)material change, other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes applicable law, regulation or change in generally accepted accounting principles or as otherwise required principles, applied by law;
the Company (xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999including tax accounting principles);
(xviil) permit initiate, solicit, negotiate or discuss any proposal or offer to acquire all or any material insurance policy naming it as a beneficiary part of the business, assets, properties or a loss payable payee to be cancelled associated technologies of the Company or terminated without notice to Parent, except in the ordinary course any Subsidiary or of business and consistent with past practiceany third party;
(xviiim) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction agree in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, writing or otherwise reduce to take any of the assets or increase the liabilities of Company foregoing actions prohibited under Section 5.1 or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in action which would cause any such case with the purpose representation or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth warranty in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming be or become untrue or incorrect in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1respect.
Appears in 1 contract
Samples: Merger Agreement (Sheldahl Inc)
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereincontemplated by this Agreement or as described on SCHEDULE 5.5, during the period from the date of this Agreement hereof to the Effective Time, Company shall, and shall cause each of will use its Subsidiaries to, act and carry on best efforts to conduct its business only operations in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts with no less diligence and effort than would be applied in the absence of this Agreement, seek to preserve intact its current business organizations, keep available the services service of its current key officers and employees Employees and preserve the goodwill of those engaged in material business its relationships with Companycustomers, suppliers and others having business dealings with it to the end that end, without goodwill and ongoing businesses shall be unimpaired at the Effective Time. Without limiting the generality of the foregoing, except as otherwise expressly provided in this Agreement or as described on SCHEDULE 5.5, during the period from the date hereof to the Effective Time, Company shall will not, and shall not permit any of its Subsidiaries to, without the prior written consent of Parent:
(ia) amend its Articles of Incorporation or bylaws in any material respect;
(Ab) authorize for issuance, issue, sell, deliver or agree or commit to issue, sell or deliver (whether through the issuance or granting of options, warrants, commitments, subscriptions, rights to purchase or otherwise) any shares of any class or any other securities or equity equivalents (including, without limitation, any options or appreciation rights) except for the issuance and sale of shares pursuant to options or warrants previously granted under the Stock Plans or otherwise;
(c) split, combine or reclassify any shares, declare, set aside or pay any dividends on, dividend or make any other distributions distribution (whether in cash, securities shares or other propertyproperty or any combination thereof) in respect of, any of its outstanding capital stock (shares, make any other thanactual, with constructive or deemed distribution in respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock shares or issue or authorize otherwise make any payments to the issuance of any other securities Stockholders in respect of, in lieu of or in substitution for shares of its outstanding capital stocktheir capacity as such, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such sharesits securities;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xiid) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal of Company (as defined in Section 6.5(d)other than the Merger);
(xiiie) make (i) incur or rescind assume any tax election long-term or settle short-term debt or compromise issue any Tax liability of Company debt securities (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, person except in the ordinary course of business and consistent with past practicepractice (iii) make any loans, advances or capital contributions to or investments in any other person, (iv) pledge or otherwise encumber shares of the capital stock of Company, or (v) mortgage or pledge any of its assets, tangible or intangible, or create or suffer to exist any lien thereupon (other than Permitted Liens) or (vi) accelerate the repayment date of any debt;
(xviiif) except as may be required by law, enter into, adopt or amend or terminate any bonus, profit sharing, compensation, severance, termination, option, appreciation right, performance unit, stock equivalent, share purchase agreement, pension, retirement, deferred compensation, employment, severance or other employee benefit agreement, trust, plan, fund or other arrangement for the benefit or welfare of any director, officer or employee in any manner or increase or accelerate in any manner the compensation, vesting schedule or fringe benefits of any director, officer or employee, grant any Company Options or pay any benefit not required by any plan and arrangement as in effect as of the date hereof (including, without limitation, the granting of appreciation rights or performance units);
(g) terminate the employment of any manager, officer or engineer;
(i) acquire, sell, lease or dispose of any fixed assets in any single transaction or series of related transactions having a fair market value in excess of $50,000 in the aggregate, or (ii) acquire, sell, lease, license, transfer or otherwise dispose of any Intellectual Property;
(i) except as may be required as a result of a change in law or in generally accepted accounting principles, change any of the accounting principles or practices used by it;
(i) acquire (by merger, consolidation or acquisition of stock or assets) any corporation, partnership or other business organization or division thereof or any equity interest therein, (ii) enter into any agreement, understanding contract or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or agreement other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practicepractice which would be material to Company, in (iii) amend, modify or waive any such case with right under any Material Agreement or any other material contract of Company, (iv) breach or otherwise violate the purpose terms of any Material Agreement or effect of using the resulting increase in the cash flow any other material contract of Company or (v) authorize any new capital expenditure or expenditures which individually is in excess of its Subsidiaries $10,000 or in the aggregate are in excess of $500,000; PROVIDED, that none of the foregoing shall limit any capital expenditure required pursuant to reduce the total indebtedness of Company and its Subsidiaries for money borrowedexisting contracts listed on Schedule 5.5(j);
(xxik) commence any litigation or binding dispute resolution process (other than in respect on any breach of or claim arising under this Agreement), or settle or compromise any pending or threatened suit, action or claim which (i) relates to the transactions contemplated hereby or (ii) the settlement or compromise of which could involve more than $25,000 or that would otherwise be material to Company or relates to any Intellectual Property matters;
(l) make or revoke any tax election or settle or compromise any income tax liability or agree to any tax audit;
(m) fail to file any Returns when due (or, alternatively, fail to file for available extensions) or fail to cause such Returns when filed to be complete and accurate in all material respects;
(n) fail to pay any taxes or other material debts when due;
(o) take any action or fail to take any action that would result in (i) any could reasonably be expected to limit the utilization of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions net operating losses, built-in losses, tax credits or other similar items of Company under Section 382, 383, 384 or 1502 of the Code and the Treasury Regulations thereunder;
(p) allow any insurance policy relating to Company's assets, properties or business to be amended or terminated without replacing such policy with a policy providing at least equal coverage, insuring comparable risks and issued by an insurance company financially comparable to the Offer set forth prior insurance company;
(q) enter into any license, distribution, marketing, sales or other agreement out of the ordinary course of business;
(r) engage in Exhibit A not being satisfiedany willful action with the intent to directly or indirectly adversely impact any of the transactions contemplated by this Agreement; or
(xxiis) authorize any of, or commit take or agree in writing or otherwise to take any of, of the foregoing actions described in respect SECTIONS 5.5(a) through 5.5(r) or any action which would make any of which it is restricted by the provisions representations or warranties of Company contained in this Section 5.1Agreement untrue or incorrect.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (Silicon Image Inc)
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereincontemplated by this Agreement or as described on Schedule 5.5, during the period from the date of this Agreement hereof to the Effective Time, Company shall, and shall cause each of will conduct its Subsidiaries to, act and carry on its business only operations in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts with no less diligence and effort than would be applied in the absence of this Agreement, seek to preserve intact its current business organizations, keep available the services service of its current key officers and employees Employees and preserve the goodwill of those engaged in material business its relationships with Companycustomers, suppliers and others having business dealings with it to the end that end, without goodwill and ongoing businesses shall be unimpaired at the Effective Time. Without limiting the generality of the foregoing, except as otherwise expressly provided in this Agreement or as described on Schedule 5.5, during the period from the date hereof to the Effective Time, Company shall will not, and shall not permit any of its Subsidiaries to, without the prior written consent of Parent:, which shall be evidenced by a signed waiver or e-mail in the form of Exhibit K from Xxxxx Xxxxxx, Senior Director Business Development of Parent (the “Parent Representative”):
(ia) amend its Certificate of Incorporation or bylaws;
(Ab) declare, set aside or pay enter into any dividends oncontract that would be a Material Agreement (as defined in Section 2.12), or make amend or, otherwise modify or waive any other distributions (whether in cash, securities or other property) in respect of, of the material terms of any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such sharesMaterial Agreements;
(iic) authorize for issuance, issue, sell, grantdeliver or agree or commit to issue, sell or deliver (whether through the issuance or granting of options, warrants, commitments, subscriptions, rights to purchase or otherwise) any shares of any class or any other securities or equity equivalents (including, without limitation, any options or appreciation rights), except for (i) the issuance and sale of shares pursuant to exercise of currently outstanding stock options, Milestone Options and the Additional Options and (ii) the granting of the Milestone Options and the Additional Options in accordance with Section 6.7 of the Option Agreement;
(d) (i) incur or assume any long-term or short-term debt (other than the obligation to reimburse employees for any employee advance of travel, meals or other employee expense in the ordinary course of business) or issue any debt securities, (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, (iii) make any loans, advances or capital contributions or investments, (iv) pledge or otherwise encumber any shares of its capital stockCompany Capital Stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem the Company Rights Agreement;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make mortgage or pledge any new capital expenditure of its assets, tangible or expenditures in excess of $50,000 individuallyintangible, or $250,000 create or suffer to exist any lien thereupon (other than Permitted Liens, as defined in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
Security Agreement) or (vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viii) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ix) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by law;
(x) accelerate the payment, right to payment or vesting repayment date of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance debt or other compensation or benefitslease;
(xi) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments in the aggregate for all such consulting agreements not in excess of $50,000 in any month and not with a term in excess of 90 days;
(xii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiii) make or rescind any tax election or settle or compromise any Tax liability of Company or of any of its Subsidiaries;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xv) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes), except as required by any changes in generally accepted accounting principles or as otherwise required by law;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviii) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xix) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxii) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (Silicon Image Inc)
Conduct of Business of Company. Except as expressly provided ------------------------------ for hereinherein or in the Fiber Cement Agreement, during the period from the date of this Agreement to the Effective Time, Company shall, and shall cause each of its Subsidiaries to, act and carry on its business only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, use reasonable efforts to preserve intact its current business organizations, keep available the services of its current key officers and employees and preserve the goodwill of those engaged in material business relationships with Company, and to . To that end, without limiting the generality of the foregoing, except as expressly provided for in this Agreement or the Fiber Cement Agreement, Company shall not, and shall not permit any of its Subsidiaries to, without the prior consent of Parent:
(i) (A) declare, set aside or pay any dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its outstanding capital stock (other than, with respect to a Subsidiary of Company, to its corporate parent), (B) split, combine or reclassify any of its outstanding capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its outstanding capital stock, or (C) purchase, redeem or otherwise acquire any shares of outstanding capital stock or any rights, warrants or options to acquire any such shares, except, in the case of this clause (C), for the acquisition of Shares from holders of Options in full or partial payment of the exercise price payable by such holder upon exercise of Options;
(ii) issue, sell, grant, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into or exchangeable for, or any rights, warrants or options to acquire, any such shares, voting securities or convertible or exchangeable securities, other than upon the exercise of Options and Warrants outstanding on the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws or other comparable charter or organizational documents or amend or redeem documents, except for any amendment required in connection with the performance by Company Rights of its obligations under this Agreement, including but not limited to its obligations under Section 1.4;
(iv) directly or indirectly acquire, make any investment in, or make any capital contributions to, any person other than in the ordinary course of business consistent with past practice;
(v) make any new capital expenditure or expenditures in excess of $50,000 individually, or $250,000 in the aggregate, other than the specific capital expenditures disclosed and set forth on Schedule 5.1 of Company Disclosure Schedule;
(vi) amend or terminate any Material Contract where such amendment or termination would have a Material Adverse Affect on Company, or waive, release or assign any material rights or claims;
(vii) directly or indirectly sell, pledge or otherwise dispose of or encumber any of its properties or assets that are material to its business, except for sales, pledges or other dispositions or encumbrances in the ordinary course of business consistent with past practice;
(viiivi) (A) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, other than indebtedness owing to or guarantees of indebtedness owing to Company or any direct or indirect wholly owned Subsidiary of Company or (B) make any loans or advances to any other person, other than to Company or to any direct or indirect wholly owned Subsidiary of Company and other than routine advances to employees consistent with past practice, except, in the case of clause (A), for borrowings under existing credit facilities described in the Filed SEC Documents in the ordinary course of business consistent with past practice;
(ixvii) enter into any compromise or settlement of, or take any material action with respect to, any litigation, action, suit, claim, proceeding or investigation other than the prosecution, defense and settlement of routine litigation, actions, suits, claims, proceedings or investigations in the ordinary course of business;
(viii) grant or agree to grant to any officer, employee or consultant any increase in wages or bonus, severance, profit sharing, retirement, deferred compensation, insurance or other compensation or benefits, or establish any new compensation or benefit plans or arrangements, or amend or agree to amend any existing Company Plans, except as may be required under existing agreements or by lawlaw or pursuant to the normal severance policies or practices of Company or its Subsidiaries as in effect on the date of this Agreement, or increases in salary or wages payable or to become payable in the ordinary course of business consistent with past practice;
(xix) accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(xix) enter into or amend any employment, consulting, severance or similar agreement with any individual other than consulting agreements entered into in the ordinary course of business involving payments consistent with past practice, except with respect to new hires of non-officer employees in the aggregate for all such consulting agreements not in excess ordinary course of $50,000 in any month and not business consistent with a term in excess of 90 dayspast practice;
(xiixi) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization or any agreement relating to an Acquisition Proposal (as defined in Section 6.5(d));
(xiiixii) make or rescind any tax election or settle or compromise any Tax income tax liability of Company or of any of its SubsidiariesSubsidiaries involving on an individual basis more than $100,000;
(xiv) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction (x) of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice or (y) of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of Company and its consolidated Subsidiaries;
(xvxiii) make any change in any method of accounting or accounting practice or policy (including any method, practice or policy relating to Taxes)policy, except as required by any changes in generally accepted accounting principles or as otherwise required by lawprinciples;
(xvi) settle any action, suit, claim, investigation or proceeding (legal, administrative or arbitrative) in an amount in excess of $50,000 (other than the settlement of the IQ class action (Xxxxxx Xxxxxx v. IQ Software Corporation, et al., N.D. Georgia, No. 1-97-CV3203) consistent with the terms of the Memorandum of Understanding, dated February 5, 1999);
(xvii) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be cancelled or terminated without notice to Parent, except in the ordinary course of business and consistent with past practice;
(xviiixiv) enter into any agreement, understanding or commitment that restrains, limits or impedes Company's ability to compete with or conduct any business or line of business, including, but not limited to, geographic limitations on Company's activities;
(xixxv) plan, announce, implement or effect any reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of Company or its Subsidiaries;
(xx) accelerate the collection of any account receivable or delay the payment of any account payable, or otherwise reduce the assets or increase the liabilities of Company or any of its Subsidiaries otherwise than in the ordinary course of business consistent with past practice, in any such case with the purpose or effect of using the resulting increase in the cash flow of Company or any of its Subsidiaries to reduce the total indebtedness of Company and its Subsidiaries for money borrowed;
(xxi) take any action that would result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the conditions to the Offer set forth in Exhibit A not being satisfied; or
(xxiixvi) authorize any of, or commit or agree to take any of, the foregoing actions in respect of which it is restricted by the provisions of this Section 5.1.
Appears in 1 contract
