Conduct of Business of Target. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, Target agrees (except to the extent expressly contemplated by this Agreement or as consented to in writing by Parent, such consent not to be unreasonably withheld or delayed) to: (i) conduct its business, and to cause each Subsidiary to conduct its respective business, in the ordinary course of business consistent with past practice; (ii) use commercially reasonable efforts to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, when due subject to (1) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or perform, and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use commercially reasonable efforts to preserve intact its and the Subsidiaries’ present business organizations, keep available the services of its and the Subsidiaries’ present officers and key employees and preserve its and the Subsidiaries’ relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent of (1) any material event or occurrence not in the ordinary course of Target’s or any Subsidiary’s business, and of any event which would reasonably be expected to have a Material Adverse Effect on Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2. Without limiting the foregoing, except as expressly contemplated by this Agreement, Target and each Subsidiary shall not do, cause or permit any of the following, without the prior written consent of Parent (which shall not be unreasonably withheld or delayed):
Appears in 2 contracts
Samples: Escrow Agreement (SCG Financial Acquisition Corp.), Merger Agreement (SCG Financial Acquisition Corp.)
Conduct of Business of Target. During the period from the date ----------------------------- of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, and except (i) as contemplated or permitted by the terms of this Agreement, (ii) as provided in Section 4.1 of the Target Disclosure Schedule and (iii) to the extent otherwise previously consented to by Acquiror in writing (which consent shall be withheld or delayed in Acquiror's sole discretion), Target and each Target Subsidiary shall carry on its business in the usual, regular and ordinary course, in substantially the same manner as heretofore conducted and in compliance with all applicable laws and regulations, and use its commercially reasonable efforts consistent with past practices and policies to (a) preserve intact its present business organization, (b) keep available the services of its present officers and employees and (c) preserve its relationships with customers, suppliers, distributors, licensors, licensees, and others with which it has business dealings. In addition, Target will promptly notify Acquiror of any event that it reasonably believes could have a Material Adverse Effect on Target or the Surviving Corporation. In addition, except as contemplated or permitted by the terms of this Agreement and except as provided in Section 4.1 of the Target Disclosure Schedule, without the prior written consent of Acquiror (which consent shall be withheld or delayed in Acquiror's sole discretion), during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, Target agrees shall not do, cause or permit, and shall not permit its Subsidiaries to do, cause or permit any of the following:
(a) Waive any stock repurchase rights, accelerate, amend or change the period of exercisability of options or restricted stock, or reprice options granted pursuant to any employee, consultant, director or other stock plans, including the Target Equity Plans, or authorize cash payments in exchange for any options granted under any of such plans;
(b) Grant any severance or termination pay, or other economic rights, to any officer or employee, except pursuant to written agreements outstanding or published policies existing on the date hereof and as previously disclosed in writing or made available to Acquiror, or adopt any new severance plan;
(c) Transfer or license to any person or otherwise extend, amend or modify in any material respect any rights to, or enter into grants to future rights related to, any Target Intellectual Property, except non-exclusive licenses to end users in the ordinary course of business consistent with past practices;
(d) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any capital stock (other than distributions from a Target Subsidiary to Target) or split, combine or reclassify any capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any capital stock;
(e) Purchase, redeem or otherwise acquire, directly or indirectly, any shares of capital stock of Target or the Target Subsidiaries, except repurchases of unvested shares at cost or lower in connection with the termination of the employment relationship with any employee pursuant to and in accordance with the express terms of a stock option purchase agreement or employment agreement in effect on the date hereof;
(f) Issue, deliver, sell, authorize, pledge or otherwise encumber any shares of capital stock or any securities convertible into shares of capital stock, or subscriptions, rights, warrants or options to acquire any shares of capital stock or any securities convertible into shares of capital stock, including under any of the Target Equity Plans, or enter into other agreements or commitments of any character obligating it to issue any such shares or convertible securities, other than the issuance, delivery and/or sale of shares of Target Common Stock pursuant to the extent expressly contemplated exercise for cash of Target options or stock purchase rights outstanding under the Target Equity Plans as of the date of this Agreement;
(g) Cause, permit or propose any amendments to the Certificate of Incorporation, Bylaws or similar organizational documents of Target or any Target Subsidiary;
(h) Acquire, or propose or agree to acquire, by this Agreement merging or as consented consolidating with, or by purchasing any equity interest in or a material portion of the 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 or capital stock that is material, individually or in writing by Parentthe aggregate, such consent not to be unreasonably withheld the business of Target or delayed) to: the Target Subsidiaries or enter into any material joint ventures, strategic partnerships or alliances;
(i) conduct its businessSell, and to cause each Subsidiary to conduct its respective businesslease, license, pledge, encumber or otherwise dispose of any properties or assets of Target or the Target Subsidiaries, except in the ordinary course of business consistent with past practice; , or enter into a new line of business;
(iij) use commercially reasonable efforts Incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, issue or sell any debt securities or options, warrants, calls or other rights to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, when due subject to (1) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or perform, and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use commercially reasonable efforts to preserve intact its and the Subsidiaries’ present business organizations, keep available the services of its and the Subsidiaries’ present officers and key employees and preserve its and the Subsidiaries’ relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of acquire any material Intellectual Property debt securities of Target or any Target Subsidiary; , enter into any "keep well" or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing other than in connection with Target's financing of ordinary-course trade payables consistent with past practice and not to exceed $2,000,000 in the aggregate (viiit being understood and agreed that Target shall not borrow, draw down upon, request any letters of credit or otherwise incur any indebtedness obligations under that certain Loan and Security Agreement dated February 26, 1993 (as amended) operate, between Target and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target Silicon Valley Bank or any Subsidiary of a material nature; amendments, modifications, continuations or replacements thereto);
(k) Except as set forth in Sections 1.6(d)(iv), 1.6(e) and 5.15(b), adopt, amend or terminate any employee benefit plan or employee stock purchase or employee stock option plan, including the Target Equity Plans, or enter into any employment contract or collective bargaining agreement (ix) maintain in effect and, when necessary, renew the insurance policies of Target other than offer letters and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent of (1) any material event or occurrence not letter agreements entered into in the ordinary course of Target’s business consistent with past practice with employees who are terminable "at will" without severance), pay any special bonus or special remuneration to any director or executive officer, or except in the ordinary course of business consistent with past practice, increase the salaries or wage rates or fringe benefits (including rights to severance or indemnification) of, its directors, officers, employees or consultants, or change in any material respect any management policies or procedures;
(l) Enter into, modify, amend or terminate any material contract or agreement to which Target or any Subsidiary’s businessTarget Subsidiary is a party or waive, release or assign any material rights or claims thereunder;
(i) Other than in the ordinary course of business and in each case after consultation with Acquiror (except in cases of closing out sales in the Pipeline in the ordinary course of business consistent with past practice), enter into any event which would contracts, agreements or obligations relating to the distribution, sale, license or marketing by third parties of Products or other products licensed by Target or any Target Subsidiary or (ii) enter into any agreement that provides for payments by Target in excess of $200,000;
(n) Revalue any of its assets or, except as required by GAAP, change its accounting methods, principles or practices as in effect as of the Target Balance Sheet Date;
(o) Engage in any action or enter into any transaction or permit any action to be taken or transaction to be entered into that could reasonably be expected to have a Material Adverse Effect on Target or any Subsidiary; and (2i) delay in any material change in its respect the consummation of, or otherwise adversely affect, any Subsidiary’s capitalization as set forth in Section 2.2. Without limiting of the foregoing, except as expressly transactions contemplated by this Agreement, Target and each Subsidiary shall not do, cause or permit (ii) increase the likelihood that a Governmental Entity will seek to object to or challenge the consummation of any of the followingtransactions contemplated by this Agreement;
(p) Fail to make in a timely matter any filings with the SEC required under the Securities Act or the Exchange Act or the rules and regulations promulgated thereunder;
(q) Make any capital expenditure in excess of (i) $75,000 individually or (ii) $225,000 in the aggregate, without taking into account all capital expenditures between the prior written date of this Agreement and the Effective Time;
(r) Make or change any Tax election, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, consent to any extension or waiver of the limitations period applicable to any claim or assessment in respect of Taxes, or settle or compromise any Tax liability; or
(s) Agree in writing to or otherwise take any of the actions described in Clauses (a) through (r) above. Notwithstanding the foregoing provisions of this Section 4.1, Target may:
(t) Continue negotiations with the entities (other than Silicon Valley Bank) specifically listed in Section 2.8(i) of the Target Disclosure Schedule, and enter into commercial agreements with such entities in connection with such negotiations, in each case with the consent of Parent Acquiror (which shall such consent not to be unreasonably withheld so long as such commercial agreements do not contain terms and conditions (i) that are manifestly adverse to Target or delayed):(ii) that adversely impact or otherwise conflict with Acquiror's current distribution and partnership relationships); provided, that Target shall actively and consistently keep Acquiror apprised of the status of negotiations and shall promptly deliver to Acquiror all information in respect of such negotiations that is reasonably requested by Acquiror as well as a true and correct copy of any final executed documentation; and
(u) Continue negotiations and enter into a credit facility with Silicon Valley Bank; provided, however, that such credit facility shall be on the terms and conditions as set forth in Exhibit 2.8(i) of the Target Disclosure Schedule or on terms and conditions that are not materially less favorable to Target; and provided further, that Target shall actively and consistently keep Acquiror apprised of the status of negotiations with Silicon Valley Bank and shall promptly deliver to Acquiror all information in respect of such negotiations that is reasonably requested by Acquiror as well as a true and correct copy of any final executed documentation.
Appears in 2 contracts
Samples: Merger Agreement (Data Critical Corp), Merger Agreement (Data Critical Corp)
Conduct of Business of Target. During Except as contemplated by this Agreement, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or to the Effective Time, Target agrees and its Subsidiaries shall each (except to the extent expressly contemplated by this Agreement or as consented to in writing by Parent, such consent not to be unreasonably withheld or delayed) to: (ia) conduct its business, operations according to its ordinary and to cause each Subsidiary to conduct its respective business, in the ordinary usual course of business and consistent with past practice, including, without limitation, continue its current drilling and workover program without cost xxxx-up or promotion charges being added to capital or workover related costs, or for additional reserves resulting from the drilling or workover operations; (iib) use commercially reasonable efforts to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, when due subject to (1) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or perform, and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use commercially reasonable best efforts to preserve intact its business organization and the Subsidiaries’ present business organizationsassets in all material respects, keep available the services of its and the Subsidiaries’ present officers and key employees and preserve its and the Subsidiaries’ maintain satisfactory relationships with material customers, suppliers, distributors, licensorscustomers, licensees, banks and others having business dealings relationships with it, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Timethem; (vc) use its confer on a regular and cause each Subsidiary frequent basis with one or more representatives of Parent to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning report operational matters of Target or any Subsidiary of a material naturenature and the general status of ongoing operations; and (ixd) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent of (1) any material event emergency or occurrence not other change in the ordinary normal course of Target’s its business or any Subsidiary’s business, its Subsidiaries' businesses or in the operation of its properties or its Subsidiaries' properties and of any event which would reasonably governmental complaints, investigations or hearings (or communications indicating that the same may be expected to have a Material Adverse Effect on Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2contemplated). Without limiting the generality of the foregoing, and except as otherwise expressly contemplated by provided in this Agreement, neither Target and each Subsidiary shall not do, cause or permit nor any of its Subsidiaries, as the followingcase may be, shall, without the prior written consent of Parent Parent, (i) issue, sell or pledge, or commit, authorize or propose the issuance, sale or pledge of (A) additional shares of capital stock of any class (including the Shares), or securities convertible into any such shares, or any rights, warrants or options to acquire any such shares or other convertible securities, or grant or accelerate any right to convert or exchange any securities of Target for Shares, or (B) any other securities in respect of, in lieu of or in substitution for Shares outstanding on the date thereof; (ii) purchase or otherwise acquire, or propose to purchase or otherwise acquire, any of its outstanding securities (including the Shares); (iii) split, combine or reclassify any shares of its capital stock, or redeem or otherwise acquire any of its securities; (iv) declare or pay any dividend or distribution on any shares of capital stock of Target; (v) make any acquisition of a material amount of assets or securities, any disposition of a material amount of assets or securities or any material change in its capitalization, or enter into a material contract or release or relinquish any material contract rights not in the ordinary course of business; (vi) incur any long-term debt for borrowed money or short-term debt for borrowed money; (vii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person; (viii) make any loans, advances (other than advances to employees for travel and entertainment in the ordinary course of business) or capital contributions to, or investments in, any other person; (ix) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, contingent or otherwise), other than when due; (x) waive, release, grant or transfer any rights of value or modify or change in any material respect any existing material license, lease, contract or other agreement or arrangement; (xi) other than in the ordinary course of business and consistent with past practice and not in an amount in excess of $50,000 or other than capital expenditures budgeted for the current period, make any capital expenditures or commitments for capital expenditures; (xii) acquire, sell, lease or dispose of (directly or by merger, consolidation or other business combination) any assets outside the ordinary course of business or any material assets, or enter into any commitment or transaction outside the ordinary course of business or adopt a plan of liquidation or resolutions providing for its liquidation, dissolution, merger, consolidation or other reorganization; (xiii) propose or adopt any amendments to its Articles of Incorporation or Bylaws; (xiv) enter into any new employment agreement with any officer, director or employee or grant any material increase in the compensation or benefits to any officer, director or employee; (xv) take any action to terminate any of its employee benefit plans; (xvi) take any action with respect to the grant of any severance or termination pay (otherwise than pursuant to written policies or consistent with written practices in effect prior to the date hereof) or with respect to any increase of benefits payable under its written severance or termination pay practices in effect on the date hereof; (xvii) adopt or amend any bonus, profit sharing, compensation, stock option, pension, retirement, deferred compensation, employment or other employee benefit plan, agreement, trust, fund, plan or arrangement for the benefit or welfare of any employee or pay any benefit not required by any existing plan or arrangement (including, without limitation, the granting of stock options, stock appreciation rights, shares of restricted stock or performance units); (xviii) file any consolidated Federal Tax Return relating to Taxes or income other than a Federal Tax Return to be filed by Target on or before January 15, 2007, in respect of federal income taxes for the fiscal year ended April 30, 2006; (xix) materially change accounting policies or procedures or any of its methods of reporting income, deductions or other material items for income tax purposes, except as required by GAAP or applicable law; or (xx) agree in writing or otherwise to take any of the foregoing actions or any action which shall not be unreasonably withheld would make any representation or delayed):warranty in this Agreement untrue or incorrect.
Appears in 2 contracts
Samples: Merger Agreement (Platinum Energy Resources Inc), Merger Agreement (Platinum Energy Resources Inc)
Conduct of Business of Target. During the period from the date of this Agreement and continuing until to the earlier Effective Time, except as provided in Section 5.1 of the termination of Target Disclosure Schedule or as otherwise expressly contemplated or permitted in this Agreement or the Effective Time, Target agrees (Transaction Agreements and except to the extent expressly contemplated by this Agreement or as consented to in writing by ParentPurchaser shall otherwise give its prior written consent, such consent not to be unreasonably withheld or delayed) toeach of Target and its Subsidiaries shall: (i) conduct its businessbusiness in the ordinary course and consistent with the budget attached hereto as Exhibit B (the “Budget”) and in compliance in all material respects with applicable Laws; (ii) pay or perform its material obligations when due; and (iii) use its commercially reasonable efforts consistent with past practices to: (A) preserve intact its present business organization, (B) keep available the services of its present officers and employees, (C) preserve in all material respects its relationships with customers, suppliers, distributors, joint venture partners, and others with which it has significant business dealings, and (D) preserve in all material respects any Target Intellectual Property. Without limiting the generality of the foregoing, except as provided in Section 5.1 of the Target Disclosure Schedule or as expressly contemplated or permitted by this Agreement or the Transaction Agreements, without the prior written consent of Purchaser, during the period from the date of this Agreement to cause each the Effective Time, Target shall not, and shall not permit any of its Subsidiaries to, do any of the following:
(a) amend the Target Charter Documents;
(b) split, combine, subdivide or reclassify any shares of its capital stock or other equity interests or 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, except for dividends paid to Target or any of its Subsidiaries by any Subsidiary that is, directly or indirectly, wholly-owned by Target;
(c) adopt a plan or agreement of complete or partial liquidation, dissolution, winding up, merger, consolidation, amalgamation, restructuring, recapitalization or other material reorganization;
(d) issue, deliver or sell, or authorize the issuance, delivery or sale of, any shares of its capital stock of any class or other equity interests or any securities convertible into or exercisable for, or any rights, warrants or options to conduct acquire, any such capital stock or other equity interests, other than the issuances of shares of Target Common Stock upon the exercise of Options outstanding on the date hereof or issued after the date hereof in compliance with the terms of this Agreement in accordance with their present terms;
(e) except as required to ensure that any Target Employee Plan in effect on the date of this Agreement is not then out of compliance with applicable Law or as specifically required or permitted pursuant to this Agreement or as provided in the Target Disclosure Schedule, (A) adopt, enter into, terminate or amend any Target Employee Plan, (B) increase in any manner the compensation or benefits of, or pay any bonus to, any employee of Target or its respective Subsidiaries, except as required by a Target Employee Plan or an employment agreement with an employee of Target or its Subsidiaries, (C) pay or provide to any employee of Target or its Subsidiaries any benefit not provided for under a Target Employee Plan as in effect on the date of this Agreement or as permitted by clause (B) above, (D) grant any awards under any Target Employee Plan (including the grant of stock or other equity options, stock or other equity appreciation rights, performance units, restricted stock or other equity, stock or other equity purchase rights or other stock or other equity-based or stock-related awards) or remove existing restrictions in any Target Employee Plan or awards made thereunder, (E) take any action to fund or in any other way secure the payment of compensation or benefits under any Target Employee Plan, except as required to comply with any Target Employee Plan as in effect on the date of this Agreement or (F) take any action to accelerate the vesting or payment of any compensation or benefits under any Target Employee Plan;
(f) except pursuant to agreements that are in effect as of the date hereof and previously disclosed to Purchaser, directly or indirectly purchase, redeem or otherwise acquire any shares of Target Common Stock or any shares of capital stock or other interests in the Subsidiaries of Target or any other securities thereof or any rights, warrant or options to acquire any such shares or other securities (which restriction shall not restrict any cashless exercise or similar transaction pursuant to any Options or other awards issued under an Target Employee Plan outstanding as of the date of this Agreement);
(g) acquire (by merger, consolidation, acquisition of stock or assets or otherwise), directly or indirectly, any business;
(h) other than pursuant to Contracts in effect as of the date hereof, sell, lease, license (as licensor or licensee), assign, encumber or otherwise transfer in one transaction or any series of related transactions, assets, property or rights;
(i) incur, assume or guarantee any Indebtedness for borrowed money or issue or sell any debt securities or warrants or other rights to acquire debt securities or enter into any keep-well or other arrangements to maintain the financial condition of any other Person;
(j) make any loan, advance or capital contribution to or investment in any Person, other than loans, advances or capital contributions to or investments (i) in its Subsidiaries or pursuant to Contracts in effect at the date hereof or (ii) in accordance with the Budget;
(k) make or change any election, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement, settle any Tax claim or assessment relating to Target or any of its Subsidiaries, surrender any right to claim a refund of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to Target or any of its Subsidiaries, or take any other similar action relating to the filing of any Tax Return or the payment of any Tax, if such election, adoption, change, amendment, agreement, settlement, surrender, consent or other action would have the effect of increasing the Tax liability of Target or any of its Subsidiaries for any period ending after the Closing Date or decreasing any Tax attribute of Target or any of its Subsidiaries existing on the Closing Date;
(l) take any action that would, or would reasonably be expected to, prevent or materially impair or delay the ability of Target to consummate the transactions contemplated by this Agreement;
(m) enter into, amend, cancel, terminate, or grant any waiver in respect of any Material Target Contract;
(n) file any registration statement under the Securities Act or an amendment to any Securities Act registration statement;
(o) make any capital expenditures in any fiscal quarter exceeding the Budget for such fiscal quarter;
(p) enter into any hedging agreements whether or not in the ordinary course of business consistent with past practice; ;
(iiq) use commercially reasonable efforts to pay its debts and Taxeswaive, and to cause each Subsidiary to pay its respective debts and Taxesrelease, when due subject to (1) good faith disputes over such debts assign, settle or Taxescompromise any claim, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay action or perform, and to cause each Subsidiary to pay or performproceeding, other material obligations when due; than waivers, releases, assignments, settlements or compromises not exceeding the amount reserved against in the Target Financial Statements, or otherwise pay, discharge or satisfy any claim, liability or obligation;
(ivr) to use commercially reasonable efforts to preserve intact its and enter into any “non-compete,” “non-solicit” or similar agreement that would materially restrict the Subsidiaries’ present business organizations, keep available the services businesses of its and the Subsidiaries’ present officers and key employees and preserve its and the Subsidiaries’ relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to the end that its goodwill and ongoing businesses shall be unimpaired at Target or Purchaser following the Effective Time; ;
(vs) use its and cause each Subsidiary enter into any closing agreement with respect to use its reasonable efforts material Taxes, settle or compromise any material liability for Taxes, make, revoke or change any material Tax election, agree to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse any adjustment of any material Intellectual Property of Target Tax attribute, file or surrender any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of claim for a material nature; and refund of Taxes, execute or consent to any waiver extending the statutory period of limitations with respect to the collection or assessment of material Taxes, file any material amended Tax Return or obtain any material Tax ruling;
(ixt) maintain in effect andenter into any new, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent or amend or otherwise alter any Affiliate Transaction or transaction that would be an Affiliate Transaction if such transaction occurred prior to making any modifications the date hereof; or (u) agree or commit to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent of (1) any material event or occurrence not in the ordinary course of Target’s or any Subsidiary’s business, and of any event which would reasonably be expected to have a Material Adverse Effect on Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2. Without limiting the foregoing, except as expressly contemplated by this Agreement, Target and each Subsidiary shall not do, cause or permit do any of the following, without the prior written consent of Parent (which shall not be unreasonably withheld or delayed):foregoing.
Appears in 2 contracts
Samples: Merger Agreement (Resource Capital Fund v L.P.), Merger Agreement (Uranium Resources Inc /De/)
Conduct of Business of Target. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective TimeRestricted Period, Target agrees, and agrees to cause its Subsidiaries (except to the extent expressly contemplated by this Agreement or as consented to in writing by ParentAcquiror), such consent not to be unreasonably withheld or delayed) to: (i) conduct carry on its businessand its Subsidiaries' business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay and to cause each Subsidiary to conduct its respective business, in the ordinary course of business consistent with past practice; (ii) use commercially reasonable efforts Subsidiaries to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, Taxes when due subject to (1) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or performperform other obligations when due, and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use all commercially reasonable efforts consistent with past practice and policies to preserve intact its and the its Subsidiaries’ ' present business organizations, use its commercially reasonable efforts consistent with past practice to keep available the services of its and the its Subsidiaries’ ' present officers and key employees and use its commercially reasonable efforts consistent with past practice to preserve its and the its Subsidiaries’ ' relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with itit or its Subsidiaries. During the Restricted Period, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target further agrees to promptly notify Parent Acquiror of (1) any material event or occurrence (i) not in the ordinary course of Target’s Target or its Subsidiaries' business, (ii) that would result in a material breach of any covenant or agreement of Target or any Subsidiary’s businessof its Subsidiaries set forth in this Agreement, and (iii) that would cause any representation or warranty of Target set forth in this Agreement to be untrue in any material respect as of the date of such event which or occurrence, or (iv) which, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect on Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2Target. Without limiting During the foregoingRestricted Period, except as expressly contemplated by this Agreement, Target and each Subsidiary shall not do, cause or permit any of the following, or allow, cause or permit any of its Subsidiaries to do, cause or permit any of the following, without the prior written consent of Parent (which shall not be unreasonably withheld or delayed):Acquiror:
Appears in 2 contracts
Samples: Agreement and Plan of Reorganization (Tandy Corp /De/), Agreement and Plan of Reorganization (Amerilink Corp)
Conduct of Business of Target. During the period from the date of ----------------------------- this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, Target agrees (except to the extent expressly contemplated by this Agreement or as consented to in writing by Parent, such consent not the Acquiror) to be unreasonably withheld or delayed) to: (i) conduct carry on its business, and to cause each Subsidiary to conduct its respective business, business in the usual, regular and ordinary course of business consistent with past practice; (ii) use commercially reasonable efforts in substantially the same manner as previously conducted. Target further agrees to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, Taxes when due (subject to (1) good faith disputes over such debts or Taxes), and to pay or perform other obligations when due (2) Parent’s subject to Acquiror's consent to the filing of material Tax Returns, Returns if applicable; (iii) pay or perform), and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use commercially all reasonable efforts consistent with past practice and policies to preserve intact its and the Subsidiaries’ present business organizations, keep available the services of its and the Subsidiaries’ present officers and key employees and preserve its and the Subsidiaries’ relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent Acquiror of (1) any material event or occurrence not in the ordinary course of Target’s or any Subsidiary’s its business, and of any event which would reasonably be expected to that could have a Material Adverse Effect on Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2Target. Without limiting the foregoing, except as expressly contemplated by this Agreement, Target and each Subsidiary shall not do, cause or permit any of the followingnot, without the prior written consent of Parent Acquiror:
(a) Cause or permit any amendments to its Articles of Incorporation or Bylaws;
(b) Declare or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any of its capital stock, or split, combine or reclassify any of its 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 capital stock, or repurchase or otherwise acquire, directly or indirectly, any shares of its capital stock;
(c) Enter into any Material Contract or violate, amend or otherwise modify or waive any of the terms of any Material Contract other than in the ordinary course of business consistent with past practice;
(d) Issue, deliver or sell or authorize or propose the issuance, delivery or sale of, or purchase or propose the purchase of, any shares of its capital stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue any such shares or other convertible securities;
(e) Transfer or license to any person or entity, or otherwise extend, amend or modify any rights to, Target Intellectual Property, other than the grant of nonexclusive licenses in the ordinary course of business consistent with past practice;
(f) Enter into or amend any agreements pursuant to which any third party is granted exclusive marketing, manufacturing or other exclusive rights of any type or scope with respect to any of Target's products or technology;
(g) Sell, lease, license or otherwise dispose of or encumber any of its properties or assets that are material, individually or in the aggregate, to its business, taken as a whole;
(h) Incur or commit to incur any indebtedness for borrowed money or guarantee any such indebtedness or issue or sell any debt securities or guarantee any debt securities of others;
(i) Enter into any operating lease requiring payments in excess of $5,000 in the aggregate;
(j) Pay, discharge or satisfy in an amount in excess of $5,000 in any one case, or $10,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise) arising other than in the ordinary course of business, other than the payment, discharge or satisfaction of liabilities reflected or reserved against in the Target Financial Statements;
(k) Incur or commit to incur any capital expenditures in excess of $5,000 in the aggregate;
(l) Terminate or reduce the amount of any insurance coverage provided by existing insurance policies;
(m) Terminate or waive any right of substantial value, other than in the ordinary course of business;
(n) Take any of the following actions: (i) increase or agree to increase the compensation payable or to become payable to its officers or employees, except for increases in salary or wages of nonofficer employees in the ordinary course of business and in accordance with past practices, (ii) grant any additional severance or termination pay to, or enter into any employment or severance agreements with, any officer or employee, (iii) enter into any collective bargaining agreement, (iv) establish, adopt, enter into or amend in any material respect any bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, trust, fund, policy or arrangement for the benefit of any directors, officers or employees, or (v) pay any bonus to any of its officers or employees; provided, however, that the foregoing provisions of this subsection shall not apply to any amendments to employee benefit plans described in ERISA Section 3(3) that may be required by law;
(o) Commence a lawsuit or arbitration proceeding other than for the routine collection of bills or for a breach of this Agreement;
(p) Acquire or agree to acquire by merging or consolidating with, or by purchasing a substantial portion of the 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 its business, taken as a whole;
(q) Make any material Tax election other than in the ordinary course of business and consistent with past practice, change any material Tax election, adopt any Tax accounting method other than in the ordinary course of business and consistent with past practice, change any Tax accounting method, file any Tax return (other than any estimated tax returns, immaterial information returns, payroll tax returns or sales tax returns) or any amendment to a Tax return, enter into any closing agreement, settle any Tax claim or assessment, or consent to any Tax claim or assessment, provided that Acquiror shall not unreasonably withheld withhold or delayed):delay approval of any of the foregoing actions;
(r) Take any action that would be reasonably expected to interfere with Acquiror's ability to account for the Merger as a pooling of interests;
(s) Revalue 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 practice; or
(t) Take or agree in writing or otherwise to take any of the actions described in Sections 5.1(a) through (s) above, or any action that would make any of Target's representations or warranties contained in this Agreement untrue or incorrect or prevent it from performing or cause it not to perform its covenants hereunder.
Appears in 1 contract
Samples: Merger Agreement (Hei Inc)
Conduct of Business of Target. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, and except (i) as contemplated or permitted by the terms of this Agreement, (ii) as provided in Section 4.1 of the Target agrees Disclosure Schedule and (except iii) to the extent expressly contemplated by this Agreement or as otherwise previously consented to by Acquiror in writing by Parent, such (which consent not to shall be unreasonably withheld or delayed) to: (i) conduct delayed in Acquiror's sole discretion), Target and each Target Subsidiary shall carry on its businessbusiness in the usual, regular and ordinary course, in substantially the same manner as heretofore conducted and in compliance with all applicable laws and regulations, and to cause each Subsidiary to conduct use its respective business, in the ordinary course of business commercially reasonable efforts consistent with past practice; (ii) use commercially reasonable efforts to pay its debts practices and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, when due subject policies to (1a) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or perform, and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use commercially reasonable efforts to preserve intact its and the Subsidiaries’ present business organizationsorganization, (b) keep available the services of its and the Subsidiaries’ present officers and key employees and (c) preserve its and the Subsidiaries’ relationships with material customers, suppliers, distributors, licensors, licensees, and others having with which it has business dealings with itdealings. In addition, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to will promptly notify Parent of (1) any material event or occurrence not in the ordinary course of Target’s or any Subsidiary’s business, and Acquiror of any event which would that it reasonably be expected to believes could have a Material Adverse Effect on Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2the Surviving Corporation. Without limiting the foregoingIn addition, except as expressly contemplated or permitted by the terms of this AgreementAgreement and except as provided in Section 4.1 of the Target Disclosure Schedule, without the prior written consent of Acquiror (which consent shall be withheld or delayed in Acquiror's sole discretion), during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, Target and each Subsidiary shall not do, cause or permit, and shall not permit its Subsidiaries to do, cause or permit any of the following:
(a) Waive any stock repurchase rights, accelerate, amend or change the period of exercisability of options or restricted stock, or reprice options granted pursuant to any employee, consultant, director or other stock plans, including the Target Equity Plans, or authorize cash payments in exchange for any options granted under any of such plans;
(b) Grant any severance or termination pay, or other economic rights, to any officer or employee, except pursuant to written agreements outstanding or published policies existing on the date hereof and as previously disclosed in writing or made available to Acquiror, or adopt any new severance plan;
(c) Transfer or license to any person or otherwise extend, amend or modify in any material respect any rights to, or enter into grants to future rights related to, any Target Intellectual Property, except non-exclusive licenses to end users in the ordinary course of business consistent with past practices;
(d) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock, equity securities or property) in respect of any capital stock (other than distributions from a Target Subsidiary to Target) or split, combine or reclassify any capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any capital stock;
(e) Purchase, redeem or otherwise acquire, directly or indirectly, any shares of capital stock of Target or the Target Subsidiaries, except repurchases of unvested shares at cost or lower in connection with the termination of the employment relationship with any employee pursuant to and in accordance with the express terms of a stock option purchase agreement or employment agreement in effect on the date hereof;
(f) Issue, deliver, sell, authorize, pledge or otherwise encumber any shares of capital stock or any securities convertible into shares of capital stock, or subscriptions, rights, warrants or options to acquire any shares of capital stock or any securities convertible into shares of capital stock, including under any of the Target Equity Plans, or enter into other agreements or commitments of any character obligating it to issue any such shares or convertible securities, other than the issuance, delivery and/or sale of shares of Target Common Stock pursuant to the exercise for cash of Target options or stock purchase rights outstanding under the Target Equity Plans as of the date of this Agreement;
(g) Cause, permit or propose any amendments to the Certificate of Incorporation, Bylaws or similar organizational documents of Target or any Target Subsidiary;
(h) Acquire, or propose or agree to acquire, by merging or consolidating with, or by purchasing any equity interest in or a material portion of the 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 or capital stock that is material, individually or in the aggregate, to the business of Target or the Target Subsidiaries or enter into any material joint ventures, strategic partnerships or alliances;
(i) Sell, lease, license, pledge, encumber or otherwise dispose of any properties or assets of Target or the Target Subsidiaries, except in the ordinary course of business consistent with past practice, or enter into a new line of business;
(j) Incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, issue or sell any debt securities or options, warrants, calls or other rights to acquire any debt securities of Target or any Target Subsidiary, enter into any "keep well" or other agreement to maintain any financial statement condition or enter into any arrangement having the economic effect of any of the foregoing other than in connection with Target's financing of ordinary-course trade payables consistent with past practice and not to exceed $2,000,000 in the aggregate (it being understood and agreed that Target shall not borrow, draw down upon, request any letters of credit or otherwise incur any indebtedness obligations under that certain Loan and Security Agreement dated February 26, 1993 (as amended) between Target and Silicon Valley Bank or any amendments, modifications, continuations or replacements thereto);
(k) Except as set forth in Sections 1.6(d)(iv), 1.6(e) and 5.15(b), adopt, amend or terminate any employee benefit plan or employee stock purchase or employee stock option plan, including the Target Equity Plans, or enter into any employment contract or collective bargaining agreement (other than offer letters and letter agreements entered into in the ordinary course of business consistent with past practice with employees who are terminable "at will" without severance), pay any special bonus or special remuneration to any director or executive officer, or except in the prior written ordinary course of business consistent with past practice, increase the salaries or wage rates or fringe benefits (including rights to severance or indemnification) of, its directors, officers, employees or consultants, or change in any material respect any management policies or procedures;
(l) Enter into, modify, amend or terminate any material contract or agreement to which Target or any Target Subsidiary is a party or waive, release or assign any material rights or claims thereunder;
(i) Other than in the ordinary course of business and in each case after consultation with Acquiror (except in cases of closing out sales in the Pipeline in the ordinary course of business consistent with past practice), enter into any contracts, agreements or obligations relating to the distribution, sale, license or marketing by third parties of Products or other products licensed by Target or any Target Subsidiary or (ii) enter into any agreement that provides for payments by Target in excess of $200,000;
(n) Revalue any of its assets or, except as required by GAAP, change its accounting methods, principles or practices as in effect as of the Target Balance Sheet Date;
(o) Engage in any action or enter into any transaction or permit any action to be taken or transaction to be entered into that could reasonably be expected to (i) delay in any material respect the consummation of, or otherwise adversely affect, any of the transactions contemplated by this Agreement, or (ii) increase the likelihood that a Governmental Entity will seek to object to or challenge the consummation of any of the transactions contemplated by this Agreement;
(p) Fail to make in a timely matter any filings with the SEC required under the Securities Act or the Exchange Act or the rules and regulations promulgated thereunder;
(q) Make any capital expenditure in excess of (i) $75,000 individually or (ii) $225,000 in the aggregate, taking into account all capital expenditures between the date of this Agreement and the Effective Time;
(r) Make or change any Tax election, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, consent to any extension or waiver of the limitations period applicable to any claim or assessment in respect of Taxes, or settle or compromise any Tax liability; or
(s) Agree in writing to or otherwise take any of the actions described in Clauses (a) through (r) above. Notwithstanding the foregoing provisions of this Section 4.1, Target may:
(t) Continue negotiations with the entities (other than Silicon Valley Bank) specifically listed in Section 2.8(i) of the Target Disclosure Schedule, and enter into commercial agreements with such entities in connection with such negotiations, in each case with the consent of Parent Acquiror (which shall such consent not to be unreasonably withheld so long as such commercial agreements do not contain terms and conditions (i) that are manifestly adverse to Target or delayed):(ii) that adversely impact or otherwise conflict with Acquiror's current distribution and partnership relationships); provided, that Target shall actively and consistently keep Acquiror apprised of the status of negotiations and shall promptly deliver to Acquiror all information in respect of such negotiations that is reasonably requested by Acquiror as well as a true and correct copy of any final executed documentation; and
(u) Continue negotiations and enter into a credit facility with Silicon Valley Bank; provided, however, that such credit facility (i) shall be on the terms and conditions as set forth in Exhibit 2.8(i) of the Target Disclosure Schedule or on terms and conditions that are not materially less favorable to Target and (ii) notwithstanding the foregoing, shall provide for the early prepayment and/or termination thereof without penalty, termination fee or similar charges or costs in the event of the occurrence of the Effective Time; and provided further, that Target shall actively and consistently keep Acquiror apprised of the status of negotiations with Silicon Valley Bank and shall promptly deliver to Acquiror all information in respect of such negotiations that is reasonably requested by Acquiror as well as a true and correct copy of any final executed documentation.
Appears in 1 contract
Samples: Merger Agreement (Vitalcom Inc)
Conduct of Business of Target. During Prior to the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective TimeClosing, Target agrees shall, and shall cause its Subsidiaries to (except to the extent expressly contemplated by this Agreement or as consented to in writing by ParentAcquiror), such consent not carry on its and its Subsidiaries' business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to be unreasonably withheld or delayed) to: (i) conduct its business, pay and to cause each Subsidiary to conduct its respective business, in the ordinary course of business consistent with past practice; (ii) use commercially reasonable efforts Subsidiaries to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, Taxes when due subject to (1) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or performperform other obligations when due, and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use commercially all reasonable efforts consistent with past practice and policies to preserve intact its and the its Subsidiaries’ ' present business organizations, use its reasonable best efforts consistent with past practice to keep available the services of its and the its Subsidiaries’ ' present officers and key employees and use its reasonable best efforts consistent with past practice to preserve its and the its Subsidiaries’ ' relationships with material all insurance regulatory authorities, independent insurance agents, reinsurers, customers, suppliers, distributors, licensors, licensees, licensees and others having business dealings with itit or its Subsidiaries, to the end such that its and its Subsidiaries' goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse . Target shall promptly notify Acquiror of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent of (1) any material event or occurrence (i) not in the ordinary course of Target’s Target or its Subsidiaries' business, (ii) that would result in a breach of any covenant or agreement of Target or any Subsidiary’s businessof its Subsidiaries set forth in this Agreement, and (iii) that would cause any representation or warranty of any Target in this Agreement to be untrue as of the date of such event or occurrence, or (iv) which would reasonably be expected to have a Material Adverse Effect on Target or any Subsidiary; and (2) any material change in of its or any Subsidiary’s capitalization as set forth in Section 2.2Subsidiaries. Without limiting the foregoing, except Except as expressly contemplated by this Agreement, Target and each Subsidiary shall not do, cause or permit any of the following, or allow, cause or permit any of its Subsidiaries to do, cause or permit any of the following, without the prior written consent of Parent (which shall not be unreasonably withheld or delayed):Acquiror:
Appears in 1 contract
Conduct of Business of Target. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement and the Effective Time, Target agrees (unless Target is required to take such action pursuant to this Agreement or Acquiror shall give its prior consent in writing) to carry on its business in the usual, regular and ordinary course of business consistent with past practice, to pay its Liabilities and Taxes consistent with Target's past practices (and in any event when due), to pay or perform other obligations when due consistent with Target's past practices (other than Liabilities, Taxes and other obligations, if any, contested in good faith through appropriate proceedings), and to use its best efforts and institute all policies to (i) preserve intact its present business organization and the rights and privileges pertinent to its business, (ii) keep available the services of its present directors, officers employees and consultants, (iii) preserve its relationships with customers, suppliers, distributors, licensors, licensees, independent contractors and other Persons having business dealings with it, all with the express purpose and intent of preserving unimpaired its goodwill and ongoing businesses at the Effective Time. Except as expressly contemplated by this Agreement, Target shall not, without the prior written consent of Acquiror, take or agree in writing or otherwise to take, any action that would result in the occurrence of any of the changes described in Section 2.9 of this Agreement. Without limiting the generality of the foregoing, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, Target agrees (except to the extent expressly contemplated by this Agreement or as consented to in writing by Parent, such consent not to be unreasonably withheld or delayed) to: (i) conduct its business, and to cause each Subsidiary to conduct its respective business, in the ordinary course of business consistent with past practice; (ii) use commercially reasonable efforts to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, when due subject to (1) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or perform, and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use commercially reasonable efforts to preserve intact its and the Subsidiaries’ present business organizations, keep available the services of its and the Subsidiaries’ present officers and key employees and preserve its and the Subsidiaries’ relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent of (1) any material event or occurrence not in the ordinary course of Target’s or any Subsidiary’s business, and of any event which would reasonably be expected to have a Material Adverse Effect on Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2. Without limiting the foregoing, except Target Disclosure Schedule or as required or expressly contemplated permitted by this Agreement, Target and each Subsidiary shall not do, cause or permit any of the following, without the prior written consent of Parent Acquiror (which consent shall not be unreasonably withheld or delayedwithheld):
Appears in 1 contract
Conduct of Business of Target. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, Target agrees (except to the extent expressly contemplated by this Agreement or as consented to in writing by Parentthe Acquiror), such consent not to be unreasonably withheld or delayed) to: carry on its and its Subsidiaries' business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay and to cause its Subsidiaries to pay debts and Taxes when due subject (i) conduct its business, and to cause each Subsidiary to conduct its respective business, in the ordinary course of business consistent with past practice; (ii) use commercially reasonable efforts to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, when due subject to (1) good faith disputes over such debts or Taxes, Taxes and (2ii) Parent’s in the case of Taxes of Target or any of its Subsidiaries, to Acquiror's consent (which shall not be unreasonably withheld) to the filing of material Tax Returns, Returns if applicable; (iii) , to pay or performperform other obligations when due, and to cause each Subsidiary to pay or perform, other material obligations when due; (iv) to use commercially all reasonable efforts consistent with past practice and policies to preserve intact its and the its Subsidiaries’ ' present business organizationsorganization, keep available the services of its and the its Subsidiaries’ ' present officers and key employees and preserve its and the its Subsidiaries’ ' relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with itit or its Subsidiaries, to the end that its and its Subsidiaries' goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent the other of (1) any material event or occurrence not in the ordinary course of Target’s its or any Subsidiary’s its Subsidiaries' business, and of any event which would reasonably be expected to could have a Material Adverse Effect on Effect. Target or shall give all notices and other information required to be given to the employees of Target, any Subsidiary; collective bargaining unit representing any group of employees of Target, and (2) any material change applicable government authority under the WARN Act, the National Labor Relations Act, the Internal Revenue Code, COBRA, and other applicable law in its or any Subsidiary’s capitalization as set forth connection with the transactions provided for in Section 2.2this Agreement. Without limiting the foregoing, except as expressly contemplated by this AgreementAgreement or the other Transaction Documents, Target and each Subsidiary shall not do, cause or permit any of the following, or allow, cause or permit any of its Subsidiaries to do, cause or permit any of the following, without the prior written consent of Parent (which shall not be unreasonably withheld or delayed):the Acquiror:
Appears in 1 contract
Conduct of Business of Target. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or and the Effective Time, Target agrees (except to the extent expressly contemplated by this Agreement or as consented that Acquiror shall otherwise consent in writing) to in writing by Parent, such consent not to be unreasonably withheld or delayed) to: (i) conduct carry on its business, business and to cause each Subsidiary to conduct its respective business, operations in the ordinary course Ordinary Course of business consistent with past practice; (ii) use commercially reasonable efforts Business in the same manner as heretofore conducted, to pay its debts and TaxesTaxes when due, and to cause each Subsidiary to pay its respective debts and Taxes, when due subject to (1) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or perform, and to cause each Subsidiary to pay or perform, perform other material obligations when due; (iv) , and, to the extent consistent with such business, to use commercially all reasonable efforts consistent with past practice and policies to preserve intact its and the Subsidiaries’ present business organizationsorganization, keep available the services of its and the Subsidiaries’ present officers and key employees and preserve its and the Subsidiaries’ relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to all with the end that goal of preserving unimpaired its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets . Target shall promptly notify Acquiror of any event or occurrence or emergency not in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use itthe Ordinary Course of Business, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent of (1) any material event or occurrence not in the ordinary course of Target’s or any Subsidiary’s business, and of any event which would reasonably be expected to have a Material Adverse Effect on adversely affecting Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2business. Without limiting the foregoing, except Except as expressly contemplated by this Agreement, Target and each Subsidiary shall not do, cause or permit any of the followingnot, without the prior written consent of Parent Acquiror:
(which shall a) Enter into any commitment, activity or transaction not in the Ordinary Course of Business;
(b) Except as set forth in Schedule 6.1(b) of the Target Disclosure Schedules, transfer to any person or entity any rights to any Target Intellectual Property (other than pursuant to end-user licenses in the Ordinary Course of Business) or enter into any agreement with respect to Target Intellectual Property (including the license thereof) with any person or entity;
(c) Hire (or make any offer therefor) or terminate any employees or consultants (other than terminations for cause) or encourage any employees to resign, provided that with respect to the hiring of new employees, Acquiror's consent will not be unreasonably withheld withheld;
(d) Amend or delayed):otherwise modify (or agree to do so), except in the Ordinary Course of Business, or violate the terms of, any of the agreements set forth or described in Schedule 4.16 of the Target Disclosure Schedules;
(e) Commence or settle any litigation;
(f) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any of its capital stock, or split, combine or reclassify any of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any outstanding shares of capital stock of Target, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of its capital stock (or options, warrants or other rights exercisable therefor) except for (i) repurchases of Target capital stock upon the termination of service of any service providers of Target in accordance with the standard terms set forth in the agreements governing such repurchases, all of which agreements have been provided or made available to Acquiror, (ii) conversion of Target Preferred Stock, and (iii) exercises or conversion of Target convertible securities;
(g) Except for (i) the issuance of shares of Target capital stock upon exercise or conversion of presently outstanding Target Preferred Stock or Target convertible securities, (ii) the granting of options to purchase shares of Target Common Stock to Target employees employed as of the date hereof as contemplated by Section 6.3 below, and (iii) as set forth in Schedule 6.1(g) of the Target Disclosure Schedules, issue, sell, grant, contract to issue, grant or sell, or authorize the issuance, delivery, sale or purchase of any shares of Target capital stock or securities convertible into, or exercisable or exchangeable for, shares of Target capital stock, or any securities, warrants, options or rights to purchase any of the foregoing;
(h) Cause or permit any amendments to its Articles of Incorporation or Bylaws;
(i) Acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities 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 which are material, individually or in the aggregate, to the business of Target;
(j) Sell, lease, license or otherwise dispose of any of the assets or properties of Target which are not Target Intellectual Property other than in the Ordinary Course of Business, or create any security interest in such assets or properties;
(k) Grant any loan to any person or entity, incur any indebtedness or guarantee any indebtedness, issue or sell any debt securities, guarantee any debt securities of others, purchase any debt securities of others or amend the terms of any outstanding agreements related to borrowed money, except for advances to employees for travel and business expenses in the Ordinary Course of Business, or otherwise incur any financial obligation other than in the Ordinary Course of Business;
(l) Except as set forth in Schedule 6.1(l) of the Target Disclosure Schedules, grant any severance or termination pay (i) to any director or officer, or (ii) to any employee or consultant or increase in the salary or other compensation payable or to become payable by Target to any of its officers, directors, employees or advisors, or declare, pay or make any commitment or obligation of any kind for the payment by Target of a bonus or other additional salary or compensation to any such person, regardless of whether recorded in the financial statements of Target, or adopt or amend any employee benefit plan (including the increase or amendment of any vacation periods) or enter into any employment contract;
(m) Revalue 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;
(n) Accelerate the collection of notes or accounts receivable other than in the Ordinary Course of Business;
(o) Take any action to accelerate the vesting schedule of any of the outstanding Target Options or Target capital stock;
(p) Except for the payment of Third Party Expenses, pay, incur, discharge or satisfy, in an amount in excess of $25,000 (in any one case) or $100,000 (in the aggregate) any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the Ordinary Course of Business of liabilities reflected or reserved against in Target's Most Recent Balance Sheet;
(q) Except for Third Party Expenses, incur any liabilities or commit to make any payments to any third party other than in the Ordinary Course of Business;
(r) Make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(s) Enter into any strategic alliance or joint development arrangement or agreement;
(t) Fail to pay or otherwise satisfy its monetary obligations as they become due, except such as are being contested in good faith;
(u) Waive or commit to waive any rights with a value in excess of $10,000 (in any one case) or $30,000 (in the aggregate);
(v) Cancel, materially amend or renew any insurance policy other than in the Ordinary Course of Business;
(w) Alter, or enter into any commitment to alter, its interest in any corporation, association, joint venture, partnership or business entity in which Target directly or indirectly holds any interest on the date hereof; or
(x) Take, or agree in writing or otherwise to take, any of the actions described in Sections 6.1(a) through (w) above, or any other action that would prevent Target from performing or cause Target not to perform its covenants hereunder or to be in breach of its representations hereunder.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (Simplex Solutions Inc)
Conduct of Business of Target. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, Target agrees (except to the extent expressly contemplated by this Agreement or as consented to in writing by ParentAcquiror, such consent which shall not to be unreasonably withheld withheld, delayed or delayed) toconditioned), with respect to itself and all of its Subsidiaries: (iA) conduct its business, and to cause each Subsidiary to conduct its respective business, carry on the Target Business in the ordinary course of business consistent with past practicein substantially the same manner as heretofore conducted; (iiB) use commercially reasonable efforts to pay its debts and Taxes, and to cause each Subsidiary to pay its respective debts and Taxes, Taxes when due subject to (1i) any good faith disputes over such debts or Taxes, ; and (2ii) ParentAcquiror’s consent to the filing of material Tax Returns, if applicable; and (iiiC) pay or perform, and to cause each Subsidiary to pay or perform, perform other material obligations when due; (ivD) to use commercially reasonable efforts to preserve intact its and the Subsidiaries’ present business organizations, keep available the services of its and the Subsidiaries’ present officers and key employees Key Employees and preserve its and the Subsidiaries’ relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to the end that its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to promptly notify Parent Acquiror of (1x) any creditor, employee, consultant, customer or vendor or other Person having a material business relationship with Target or any Subsidiary of Target, who notifies Target or any Subsidiary, that such Person currently intends to change such Person’s relationship with Target or any Subsidiary of Target, (y) any material event or occurrence not in the ordinary course of Target’s or any Subsidiary’s businessthe Target Business, and of any event which would could reasonably be expected to have a Material Adverse Effect on Target or any Subsidiaryits Subsidiaries; and (2z) any material change in its capitalization or the ownership of any Subsidiary’s capitalization of its Subsidiaries as set forth in Section 2.23.5. Without limiting the foregoing, except as expressly contemplated by this AgreementAgreement or Section 5 of the Target Disclosure Schedule, Target shall not, and each Subsidiary shall not cause its Subsidiaries to not, do, cause or permit any of the following, without the prior written consent of Parent Acquiror (which consent shall not be unreasonably withheld withheld, delayed or delayedconditioned):
Appears in 1 contract
Samples: Merger Agreement (INPHI Corp)
Conduct of Business of Target. During (1) Target covenants and agrees that, during the period from the date of this Agreement and continuing until the earlier of the termination of Effective Time and the time that this Agreement or is terminated in accordance with its terms, except: (a) with the Effective Time, Target agrees (except to the extent expressly contemplated by this Agreement or as consented to in writing by Parent, such prior written consent of 51st Parallel not to be unreasonably withheld withheld; (b) as required or delayedpermitted by this Agreement; or (c) to: (i) conduct its as expressly contemplated by the Target Disclosure Letter, it shall comply with all applicable Laws in all material respects, including, to the extent applicable, relating to cannabis, which are applicable to Target’s business, affairs and to cause each Subsidiary to operations, conduct its respective business, business in the ordinary course of business consistent Ordinary Course and in accordance with past practice; (ii) Laws and use commercially reasonable efforts to pay maintain and preserve its debts business organization, properties, employees, goodwill and Taxesbusiness relationships with customers, suppliers, partners and to cause each Subsidiary to pay its respective debts and Taxes, when due subject to (1) good faith disputes over such debts or Taxes, and other Persons with which it has material business relations.
(2) Parent’s consent All directors, officers, internal personnel and third party consultants of Target and the Target Subsidiaries have, where reasonably applicable to the filing position and services rendered by such persons, sufficient knowledge of material Tax ReturnsLaws relating to cannabis which are applicable to Target’s business, if applicable; affairs and operations and all such persons have all qualifications, including security clearances, training, experience and technical knowledge required by applicable Laws.
(iii3) pay Target covenants and agrees that it shall periodically review and update its internal compliance program to account for any changes in Laws applicable to its business, affairs or performoperations.
(4) Without limiting the generality of Section 4.2(1), Target covenants and to cause each Subsidiary to pay or performagrees that, other material obligations when due; (iv) to during the period from the date of this Agreement until the earlier of the Effective Time and the time that this Agreement is terminated in accordance with its terms, Target shall use commercially reasonable efforts to preserve intact its and the Subsidiaries’ present business organizations, keep available the services of its and the Subsidiaries’ present officers and key employees maintain and preserve its and the Target Subsidiaries’ business organization, properties, employees, goodwill and business relationships with material customers, suppliers, distributors, licensors, licenseespartners and other Persons with which Target or either of the Target Subsidiaries has material business relations, and others having business dealings with itshall not, directly or indirectly:
(a) amend its Constating Documents or similar organizational documents;
(b) split, combine or reclassify any shares of its capital stock or declare, set aside or pay any dividend or other distribution (whether in cash, stock or property or any combination thereof) or amend any term of any outstanding debt security;
(c) redeem, repurchase, or otherwise acquire or offer to redeem, repurchase or otherwise acquire any shares of its capital stock;
(d) issue, deliver, sell, pledge or otherwise encumber, or authorize the issuance, delivery, sale, pledge or other encumbrance of any shares of its capital stock or other equity or voting interests, or any options, warrants or similar rights exercisable or exchangeable for or convertible into such capital stock or other equity or voting interests, or other rights that are linked to the end price or the value of the Target Shares;
(e) amend the terms of any of its securities;
(f) acquire (by merger, consolidation, acquisition of stock or assets or otherwise), directly or indirectly, in one transaction or in a series of related transactions, assets, securities, properties, interests or businesses or make any investment either by the purchase of securities, contribution of capital, property transfer, or purchase of any other property or assets of any other Person, or acquire any license rights, other than pursuant to a Contract;
(g) sell, lease, transfer, license, mortgage, or otherwise dispose of any of its assets which in the aggregate exceed $50,000;
(h) enter into any joint venture or similar agreement, arrangement or relationship;
(i) make any capital expenditure or commitment to do so which individually or in the aggregate exceeds $50,000;
(j) prepay any long-term indebtedness before its scheduled maturity or increase, create, incur, assume or otherwise become liable for any indebtedness for borrowed money or guarantees thereof;
(k) make any loan or advance to, or any capital contribution or investment in, or assume, guarantee or otherwise become liable with respect to the liabilities or obligations of any Person;
(l) reduce the stated capital of any of its securities;
(m) reorganize, amalgamate, merge or adopt a plan of liquidation or resolution providing for the liquidation or dissolution of Target;
(n) grant any Lien (other than Permitted Liens) on any assets of Target;
(o) (i) make or rescind any material Tax election, amend, in any manner adverse to Target, any Tax Return, settle or compromise any material liability for Taxes or change or revoke any of its methods of Tax accounting, or (ii) take any action with respect to the computation of Taxes or the preparation of Tax Returns that its goodwill and ongoing businesses shall be unimpaired at is in any material respect inconsistent with past practice;
(p) enter into any interest rate, currency, equity or commodity swaps, xxxxxx, derivatives, forward sales contracts or similar financial instruments;
(q) make any bonus or profit sharing distribution or similar payment of any kind;
(r) make any change in the Effective TimeTarget’s methods of accounting, except as required by concurrent changes in GAAP or as required by a Governmental Entity;
(s) grant any general increase in the rate of wages, salaries, bonuses or other remuneration of any employees;
(t) (i) increase any severance, change of control or termination pay (or improvements to notice or pay in lieu of notice) to (or amend any existing arrangement with) any current or former Target Employee or any current or former director of Target; (ii) increase the benefits payable under any existing severance or termination pay policies with any current or former Target Employee or any current or former director of Target; (iii) increase the benefits payable under any employment agreements with any current or former Target Employee or any current or former director of Target; (iv) enter into any employment, deferred compensation or other similar agreement (or amend any such existing agreement) with any current or former Target Employee or any current or former director of Target; (v) use its and cause each Subsidiary increase compensation, bonus levels or other benefits payable to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear exceptedany current or former Target Employee or any current or former director of the Target; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of adopt any material Intellectual Property of Target new Employee Plan or any Subsidiaryamendment or modification of an existing Employee Plan; (vii) operateincrease or agree to increase, and cause each Subsidiary any funding obligation or accelerate, or agree to operateaccelerate, its business in all material respects in compliance with all applicable Lawsthe timing of any funding contribution under any Employee Plan; (viii) subject to applicable Law confer with Parent concerning operational matters of grant any equity, equity-based or similar awards; or (ix) reduce Target’s work force except in the Ordinary Course;
(u) enter into any agreement or arrangement that limits or otherwise restricts in any material respect Target or any Subsidiary of a successor thereto, or that would, after the Effective Time, limit or restrict in any material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of respect Target or any Subsidiary. Target agrees of its affiliates from competing in any manner;
(v) enter into or amend any Contract with any broker, finder or investment banker, other than the Financing Agreements;
(w) fail to promptly notify Parent comply in all respects with its internal compliance programs designed to detect and prevent violations of any applicable Laws;
(1x) cancel, waive, release, assign, settle or compromise any material event claims or occurrence not rights of Target;
(y) compromise or settle any litigation, proceeding or governmental investigation relating to the assets or the business of Target in excess of an aggregate amount of $25,000;
(z) amend or modify, or terminate or waive any right under, any Material Contract or enter into any contract or agreement that would be a Material Contract if in effect on the date hereof;
(aa) knowingly take any action or fail to take any action which action or failure to act would result in the ordinary course of Target’s material loss, expiration or any Subsidiary’s businesssurrender of, and or the loss of any event which would material benefit under, or reasonably be expected to have a Material Adverse Effect on Target cause any Governmental Entity to institute proceedings for the suspension, revocation or any Subsidiary; and (2) limitation of rights under, any material change in Authorizations necessary to conduct its businesses as now conducted or as proposed to be conducted, or fail to prosecute with commercially reasonable due diligence any Subsidiary’s capitalization as set forth in Section 2.2. Without limiting the foregoingpending applications to any Governmental Entities for material Authorizations; (bb) enter into, except as expressly contemplated by this Agreementamend or modify any union recognition agreement, Target and each Subsidiary shall not do, cause Collective Agreement or permit similar agreement with any of the following, without the prior written consent of Parent (which shall not be unreasonably withheld trade union or delayed):representative body;
Appears in 1 contract
Samples: Arrangement Agreement
Conduct of Business of Target. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or and the Effective Time, Target agrees (and each of its respective subsidiaries shall, except as otherwise expressly contemplated in this Agreement or to the extent expressly contemplated by this Agreement or as consented to that Parent shall otherwise consent in writing by Parentwriting, such consent not to be unreasonably withheld or delayed) to: (i) conduct carry on its business, and to cause each Subsidiary to conduct its respective business, business in the usual, regular and ordinary course of business consistent with past practice; (ii) use commercially reasonable efforts in substantially the same manner as heretofore conducted, to pay its debts and TaxesTaxes when due, and to cause each Subsidiary to pay its respective debts and Taxes, when due subject to (1) good faith disputes over such debts or Taxes, and (2) Parent’s consent to the filing of material Tax Returns, if applicable; (iii) pay or perform, and to cause each Subsidiary to pay or perform, perform other material obligations when due; (iv) , and, to the extent consistent with such business, to use commercially all reasonable efforts consistent with past practice and policies to preserve intact its and the Subsidiaries’ present business organizationsorganization, keep available the services of its and the Subsidiaries’ present officers and key employees and preserve its and the Subsidiaries’ their relationships with material customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, to all with the end that goal of preserving unimpaired its goodwill and ongoing businesses shall be unimpaired at the Effective Time; (v) use its and cause each Subsidiary to use its reasonable efforts to maintain and keep its properties and assets in as good repair and condition as at present, ordinary wear and tear excepted; (vi) use it, and cause each Subsidiary to use its reasonable efforts to prevent the lapse of any material Intellectual Property of Target or any Subsidiary; (vii) operate, and cause each Subsidiary to operate, its business in all material respects in compliance with all applicable Laws; (viii) subject to applicable Law confer with Parent concerning operational matters of Target or any Subsidiary of a material nature; and (ix) maintain in effect and, when necessary, renew the insurance policies of Target and each Subsidiary and to confer with Parent prior to making any modifications to the insurance policies of Target or any Subsidiary. Target agrees to shall promptly notify Parent of (1) any material event or occurrence or emergency not in the ordinary course of Target’s or any Subsidiary’s its business, and of any material event which would reasonably be expected to have a Material Adverse Effect on involving or adversely affecting Target or any Subsidiary; and (2) any material change in its or any Subsidiary’s capitalization as set forth in Section 2.2business. Without limiting the foregoing, except Except as expressly contemplated by this AgreementAgreement or required by law, Target and each Subsidiary shall not do, cause or permit any of the followingnot, without the prior written consent of Parent (which consent shall not be unreasonably withheld withheld):
(a) Enter into any commitment, activity or delayed):transaction not in the ordinary course of business;
(b) Transfer or license to any Person or entity or otherwise extend, amend or modify any rights to the Target Intellectual Property, or enter into grants to transfer or license to any Person future rights to the Target Intellectual Property, in each case other than non-exclusive licenses entered into in the ordinary course of business and consistent with past practice, or transfer or license from any Person or entity any Intellectual Property other than in the ordinary course of business and consistent with past practice; provided that in no event shall Target (i) license, on an exclusive basis, or enter into a distribution, reseller or similar arrangement, on an exclusive basis, or sell or transfer the ownership of, any Intellectual Property; or (ii) enter into any Contract (A) containing pricing or discounting terms or provisions other than in the ordinary course of business consistent with past practice, (B) limiting the right of Target to engage in any line of business or to compete with any Person, or (C) providing for unlimited indemnification;
(c) Hire any officers, consultants, independent contractors or employees or enter into, or amend or extend the term of, any employment or consulting agreement with any Employee other than in the ordinary course of business and consistent with past practice;
(d) Amend or otherwise modify (or agree to do so) or violate the terms of, any of the agreements set forth or described in the Target Disclosure Letter other than amendments to or modifications of any such agreements that are being negotiated by the Company as of the date hereof;
(e) Commence or settle any threatened or pending litigation;
(f) Engage in any transaction with the intent to, directly or indirectly, adversely impact or materially delay the consummation of the transactions contemplated by this Agreement;
(g) Except as expressly provided in the Redemption Documents, make any distributions (whether in cash, securities or property) in respect of any of its equity securities or any of its Subsidiaries’ equity securities or split, combine or reclassify any of its equity securities or any of its Subsidiaries’ equity securities or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for its equity securities of Target or any of its Subsidiaries;
(h) Except as expressly provided in the Redemption Documents, purchase, redeem or otherwise acquire, directly or indirectly, any of its equity securities or any of its Subsidiaries’ equity securities (nor shall Target allow any of its Subsidiaries to do the same) or securities exercisable or convertible into such equity securities;
(i) Issue, deliver, sell, purchase or authorize or pledge or otherwise encumber, or propose any of the foregoing with respect to any of its equity securities or any of its Subsidiaries’ equity securities or any securities exercisable or convertible into its equity securities or any Subsidiaries’ equity securities or subscriptions, rights, warrants or options to acquire any of its equity securities or any of its Subsidiaries or any securities exercisable or convertible into such equity securities, or enter into other agreements or commitments of any character obligating it to issue any such equity securities or securities exercisable or convertible into such equity securities other than the issuance of options to purchase up to 36,237 Target Common Shares to new hires or other employees pursuant to Target’s 2006 Option Plan;
(j) Cause or permit any amendments to its certificate of formation or Operating Agreement or similar documents of any of its Subsidiaries other than as may be necessary to give effect to the Redemption;
(k) Acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities 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 which are material, individually or in the aggregate, to its business;
(l) Sell, lease, license, encumber or otherwise dispose of any of its, or any of its Subsidiaries’, assets or properties other than in the ordinary course of business and consistent with past practices, or create any security interest in such assets or properties other than security interests granted in favor of Amp Capital as security for the Amp Capital Note;
(m) Grant any loan to any Person or entity, incur any indebtedness or guarantee any indebtedness, issue or sell any debt securities, guarantee any debt securities of others, purchase any debt securities of others or amend the terms of any outstanding agreements related to borrowed money, except for (i) advances to employees for travel and business expenses in the ordinary course of business consistent with past practices (ii) the Amp Capital note and (iii) up to $5,000,000 of indebtedness incurred to finance the ongoing operations of the Company and its Subsidiaries;
(n) Grant or pay, or enter into any agreement, arrangement or amendment to an existing agreement or arrangement providing for any severance or termination pay (whether in cash, stock, equity securities, or property) or the acceleration of vesting or other benefits (i) to any director, officer or manager (ii) to any employee or consultant, except (A) payments made pursuant to standard written agreements outstanding as of the date hereof and disclosed on Schedule 4.1(n) or (B) the acceleration of vesting contained in any option agreement entered into pursuant to Section 4.1(i) above after the date hereof, or increase in the salary or other compensation payable or to become payable by Target to any of its officers, directors, managers, employees or advisors, other than increases in the ordinary course of business and consistent with past practice, or declare, pay or make any commitment or obligation of any kind for the payment by Target or any of its subsidiaries of a bonus or other additional salary or compensation to any such Person, other than in the ordinary course of business and consistent with past practice, or adopt or amend any employee benefit plan or enter into any employment contract other than offer letters issued to employees hired after the date hereof in the ordinary course of business;
(o) Enter into or amend any Contract pursuant to which any other party is granted exclusive rights or “most favored party” rights of any type or scope with respect to any Target Intellectual Property, products, services or business, or containing any non-competition covenants or other material restrictions relating to its business activities or the effect of which would be to grant to a third party following the Merger the actual or potential right to license any Target Intellectual Property;
(p) Adopt, terminate or amend any Target Employee Plan or enter into any Target Employee Plan, or amend any compensation, bonus, commission, insurance coverage (except as contemplated by this Agreement), benefit, entitlement, grant or award provided or made under any Target Employee Plan; or enter into any collective bargaining agreement; pay any special bonus, commission or special remuneration to any Employee (cash, equity or otherwise); increase the salaries, bonuses, commissions or wage rates or fringe benefits (including rights to severance or indemnification) of its Employees, other than increases in the ordinary course of business and consistent with past practice; pay any benefit not provided for as of the date of this Agreement under any Target Employee Plan; or add any new members to the Board of Managers of Target;
(q) Revalue 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 and consistent with past practice;
(r) Take any action to accelerate, amend or change the vesting schedule of any Target Equity Securities or securities convertible or exchangeable into any Target Equity Securities, waive any repurchase rights, accelerate, amend any Target Equity Securities or securities convertible or exchangeable into any Target Equity Securities other than as required by existing agreements outstanding on the date hereof;
(s) Amend or change any other terms of Target Equity Securities or securities convertible or exchangeable into any Target Equity Securities except as may be required to give effect to the Redemption;
(t) Pay, discharge or satisfy, in an amount in excess of $50,000 (in the aggregate) any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Target Financial Statements;
(u) Enter into any closing agreement, settle any claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(v) Enter into any strategic alliance, joint development or joint marketing arrangement or agreement;
(w) Fail to pay or otherwise satisfy its monetary obligations as they become due, except such as are being contested in good faith;
(x) Waive or commit to waive any rights with a value in excess of $50,000 (in the aggregate);
(y) Cancel, materially amend or renew any insurance policy other than in the ordinary course of business;
(z) Alter, or enter into any commitment to alter, its interest in any corporation, association, joint venture, partnership or business entity in which it directly or indirectly holds any interest on the date hereof; or
(aa) Take, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through (z) above, or any other action that could reasonably be expected to prevent Target from performing or cause Target not to perform its covenants hereunder.
Appears in 1 contract