Conduct of Business of the Sale Entities. (a) From the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, Sellers shall cause each of the Sale Entities and JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted to cause such JV Companies), to (i) conduct its respective business in all material respects in the ordinary course of business, unless otherwise contemplated by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination) or with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) use its Reasonable Efforts to preserve and maintain its respective relationships with licensors, contractors, suppliers, dealers, customers, employees, Governmental Authorities and others having material business relationships with such Sale Entity or JV Company. In addition, from the Effective Date until the earlier of (i) Closing and (ii) the termination of this Agreement pursuant to Article IX, Sellers shall use Reasonable Efforts to cause each of the Sale Entities to incur capital expenditures in the aggregate in the ordinary course, consistent with past practices including for the period prior to December 31, 2020, substantially in accordance with the 2020 budgets Sellers provided to Buyer prior to the Effective Date. Except as required or permitted by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination or as permitted with respect to any Affiliate arrangements), as may be required by any Material Contract, applicable Law, any Governmental Authority or any Permit, as may be prudent under Good Industry Practice or as set forth on Schedule 5.4(a), from the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, without the consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed, Sellers shall not cause or permit any of the Sale Entities or JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted not to cause or not to permit such JV Companies) to: (i) sell, transfer, convey or otherwise dispose of any assets or properties that are material to the Sale Entities and JV Companies, taken as a whole, other than sales, transfers, conveyances or other dispositions (A) of obsolete or surplus assets, (B) in accordance with any existing Contract, or (C) that do not exceed $10,000,000 in the aggregate; (ii) enter into, modify or amend in any material respect, terminate or waive any material right under any Material Contract, except for (A) any termination or modification without material penalty to any Sale Entity, and (B) any new agreement, modification, amendment, termination or waiver in the ordinary course of business; (iii) incur any Indebtedness, except for short-term floating rate indebtedness for borrowed money or indebtedness for borrowed money incurred pursuant to any existing Contract relating to Indebtedness as in effect as of the Effective Date; (iv) make any acquisitions (including by merger) of the capital stock, equity securities, membership interests or a material portion of the assets of any other Person; (v) increase in any respect the compensation of any Company Employee (provided, that payments of bonuses and other grants and awards made in the ordinary course of business shall not constitute an increase in compensation), except (A) in the ordinary course of business consistent with past practices, (B) as required pursuant to applicable Law or the terms of any Employee Plans, the Collective Bargaining Agreement or other employee benefit plans or arrangements in effect on the Effective Date and (C) annual cost-of-living, merit, new hire, promotion or similar increases in salaries, wages and benefits of employees made in the ordinary course of business and consistent with past practices; (vi) adopt or amend any Employee Plans except as required by Law or for immaterial or ministerial amendments; (vii) make any material change to its methods of accounting, except as required by U.S. GAAP (or any interpretation thereof), as required by a Governmental Authority or as required by applicable Law; (viii) split, combine or otherwise change its capital stock, partnership interests or membership interests, as the case may be, or redeem any of its capital stock, partnership interests or membership interests, as the case may be; (ix) issue, sell, or grant any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to purchase any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for, any shares of its capital stock, partnership interests or membership interests, as applicable; (x) redeem, purchase or otherwise acquire any of its outstanding shares of capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to acquire any shares of its capital stock, partnership interests or membership interests, as applicable, except pursuant to any Contract in effect as of the Effective Date; (xi) amend the Organizational Documents of any Significant Subsidiary, except for immaterial or ministerial amendments; (xii) except as required by applicable Law or U.S. GAAP, change, in any material respect, its Tax practice or policy (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) to the extent such change or settlement would be binding on and materially adverse to the Sale Entities and JV Companies, taken as a whole, after the Closing; (xiii) waive, release, assign, settle or compromise any material claim against the Sale Entities or JV Companies, other than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (i) equal to or less than the amounts specifically reserved with respect thereto in the consolidated financial statements of the Reporting Company included in the Applicable SEC Documents (including the notes thereto) or (ii) do not exceed $10,000,000.00 in each instance, and (B) impose or require actions that would not reasonably be expected to be material and adverse to the Sale Entities and JV Companies, taken as a whole; (xiv) with respect to DECP, take any action which would require the consent of Bowie Acquisitions LLC pursuant to the Organizational Documents of DECP; (xv) adopt a plan or agreement of complete or partial liquidation or dissolution; (xvi) accelerate the collection of or discount any accounts receivable, delay the payment of accounts payable or defer expenses, reduce inventories or otherwise increase cash on hand, except in the ordinary course of business consistent with past practice; (xvii) enter into, modify, amend, assign, transfer, terminate or waive any material right under any capitalized lease (as determined in accordance with U.S. GAAP), letter of credit or similar arrangement; (xviii) (x) enter into any operating lease that provides for a remaining term of more than one (1) year or (y) modify or amend the terms of any operating lease to provide for a remaining term of more than one (1) year; (xix) declare, set aside, make or pay any extraordinary dividend or other extraordinary distribution on or with respect to any capital stock or other equity or ownership interest, except with respect to any Excluded Assets or Retained Liabilities; or (xx) enter into an agreement to do any of the things described in clauses (i) through (xix) above.
Appears in 2 contracts
Samples: Purchase and Sale Agreement (Dominion Energy, Inc), Purchase and Sale Agreement (Berkshire Hathaway Energy Co)
Conduct of Business of the Sale Entities. (a) From the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, Sellers Seller shall cause each of the Sale Entities and the JV Companies Company (and with respect to the JV CompaniesCompany, solely to the extent that Sellers Seller or their its Subsidiaries, pursuant to such the JV Company’s Organizational Documents, are permitted to cause such the JV CompaniesCompany), to (i) conduct its respective business in all material respects in the ordinary course of business, unless otherwise contemplated by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination) or with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) use its Reasonable Efforts to preserve and maintain its respective relationships with licensors, contractors, suppliers, dealers, customers, employees, Governmental Authorities and others having material business relationships with such Sale Entity or the JV Company. In addition, from the Effective Date until the earlier of (i) Closing and (ii) the termination of this Agreement pursuant to Article IX, Sellers Seller shall use Reasonable Efforts to cause each of the Sale Entities to incur capital expenditures in the aggregate in the ordinary course, consistent with past practices including for the period prior to December 31, 2020, substantially in accordance with the 2020 budgets Sellers budget Seller provided to Buyer prior to the Effective DateDate and, to the extent applicable, substantially in accordance with the 2021 budget provided pursuant to Section 5.15. Except as required or permitted by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination or as permitted with respect to any Affiliate arrangementsarrangements or the Reorganization), as may be required by any Material Contract, applicable Law, any Governmental Authority or any Permit, as may be prudent under Good Industry Practice or as set forth on Schedule 5.4(a), from the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, without the consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed, Sellers Seller shall not cause or permit any of the Sale Entities or the JV Companies Company (and with respect to the JV CompaniesCompany, solely to the extent that Sellers Seller or their its Subsidiaries, pursuant to such the JV Company’s Organizational Documents, are permitted not to cause or not to permit such the JV CompaniesCompany) to:
(i) sell, transfer, convey or otherwise dispose of any assets or properties that are material to the Sale Entities and the JV CompaniesCompany, taken as a whole, other than sales, transfers, conveyances or other dispositions (A) of obsolete or surplus assets, (B) in accordance with any existing Contract, or (C) that do not exceed $10,000,000 in the aggregate;
(ii) enter into, modify or amend in any material respect, terminate or waive any material right under any Material Contract, except for (A) any termination or modification without material penalty to any Sale Entity, and (B) any new agreement, modification, amendment, termination or waiver in the ordinary course of business;
(iii) incur any Indebtedness, except for short-term floating rate indebtedness for borrowed money or indebtedness for borrowed money incurred pursuant to any existing Contract relating to Indebtedness as in effect as of the Effective Date;
(iv) make any acquisitions (including by merger) of the capital stock, equity securities, membership interests or a material portion of the assets of any other Person;
(v) increase in any respect the compensation of any Company Employee (provided, that payments of bonuses and other grants and awards made in the ordinary course of business shall not constitute an increase in compensation), except (A) in the ordinary course of business consistent with past practices, (B) as required pursuant to applicable Law or the terms of any Employee Plans, the Collective Bargaining Agreement or other employee benefit plans or arrangements in effect on the Effective Date and (C) annual cost-of-living, merit, new hire, promotion or similar increases in salaries, wages and benefits of employees made in the ordinary course of business and consistent with past practices;
(vi) adopt or amend any Employee Plans except as required by Law or for immaterial or ministerial amendments;
(vii) make any material change to its methods of accounting, except as required by U.S. GAAP (or any interpretation thereof), as required by a Governmental Authority or as required by applicable Law;
(viii) split, combine or otherwise change its capital stock, partnership interests or membership interests, as the case may be, or redeem any of its capital stock, partnership interests or membership interests, as the case may be;
(ix) issue, sell, or grant any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to purchase any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for, any shares of its capital stock, partnership interests or membership interests, as applicable;
(x) redeem, purchase or otherwise acquire any of its outstanding shares of capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to acquire any shares of its capital stock, partnership interests or membership interests, as applicable, except pursuant to any Contract in effect as of the Effective Date;
(xi) amend the Organizational Documents of any the Significant Subsidiary, except for immaterial or ministerial amendments;
(xii) except as required by applicable Law or U.S. GAAP, change, in any material respect, its Tax practice or policy (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) to the extent such change or settlement would be binding on and materially adverse to the Sale Entities and the JV CompaniesCompany, taken as a whole, after the Closing;
(xiii) waive, release, assign, settle or compromise any material claim against the Sale Entities or the JV CompaniesCompany, other than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (i) equal to or less than the amounts specifically reserved with respect thereto in the consolidated financial statements of the Reporting Company included in the Applicable SEC Documents (including the notes thereto) or (ii) that do not exceed $10,000,000.00 in each instance, and (B) impose or require actions that would not reasonably be expected to be material and adverse to the Sale Entities and the JV CompaniesCompany, taken as a whole;
(xiv) with respect to DECP, take any action which would require the consent of Bowie Acquisitions LLC pursuant to the Organizational Documents of DECP;
(xv) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xvixv) accelerate the collection of or discount any accounts receivable, delay the payment of accounts payable or defer expenses, reduce inventories or otherwise increase cash on hand, except in the ordinary course of business consistent with past practice;
(xviixvi) enter into, modify, amend, assign, transfer, terminate or waive any material right under any capitalized lease (as determined in accordance with U.S. GAAP), letter of credit or similar arrangement;
(xviiixvii) (x) enter into any operating lease that provides for a remaining term of more than one (1) year or (y) modify or amend the terms of any operating lease to provide for a remaining term of more than one (1) year;
(xixxviii) declare, set aside, make or pay any extraordinary dividend or other extraordinary distribution on or with respect to any capital stock or other equity or ownership interest, except with respect to any Excluded Assets or Retained Liabilities; or
(xxxix) enter into an agreement to do any of the things described in clauses (i) through (xixxviii) above.
Appears in 2 contracts
Samples: Purchase and Sale Agreement (Dominion Energy, Inc), Purchase and Sale Agreement (Berkshire Hathaway Energy Co)
Conduct of Business of the Sale Entities. (a) From the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, Sellers Seller shall cause each of the Sale Entities and JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted to cause such JV Companies), Entity to (i) conduct its respective business in all material respects in the ordinary course of business, unless otherwise contemplated by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination) or with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) use its Reasonable Efforts to preserve and maintain its respective relationships with licensors, contractors, suppliers, dealers, customers, employees, Governmental Authorities and others having material business relationships with such Sale Entity or JV Company. In addition, from the Effective Date until the earlier of (i) Closing and (ii) the termination of this Agreement pursuant to Article IX, Sellers shall use Reasonable Efforts to cause each of the Sale Entities to incur capital expenditures in the aggregate in the ordinary course, consistent with past practices including for the period prior to December 31, 2020, substantially in accordance with the 2020 budgets Sellers provided to Buyer prior to the Effective DateEntity. Except as required or permitted by this Agreement (includingAgreement, if applicable, to effectuate the Q-Pipe Termination or as permitted with respect to any Affiliate arrangements), as may be required by any Material ContractContract in effect as of the Effective Date and set forth in the Schedules, applicable Law, any Governmental Authority or any Permit, as may be prudent under Good Industry Practice Permit or as set forth on Schedule 5.4(a), from the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, without the consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed, Sellers Seller shall not cause or permit any of the Sale Entities or JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted not to cause or not to permit such JV Companies) Entity to:
(i) sell, transfer, convey convey, license, abandon, let lapse or otherwise dispose of any assets or properties that are material to the Sale Entities and JV Companies, taken as a wholeproperties, other than sales, transfers, conveyances or other dispositions (A) of obsolete or surplus assets, (B) in accordance with any existing Contract, or (C) other than with respect to Intellectual Property, that do not exceed $10,000,000 5,000,000 in the aggregate, (D) with respect to Intellectual Property, the grant of non-exclusive licenses in the ordinary course of business consistent with past practice, or (E) pursuant to the Internal Reorganization;
(ii) enter into, modify or amend in any material respect, terminate or waive any material right under any Material Contract, or enter into a Contract that would have been a Material Contract had it been entered into prior to the Effective Date, except for (A) any termination renewals or modification without material penalty to any Sale Entityextensions of existing Contracts on substantially the same terms as such existing Contract, and (B) any new agreementContracts entered into in the ordinary course of business (other than the types of contracts specified in clause (d), modification(e) or (f) of the definition of “Material Contract”), amendment, termination or waiver (C) any Contracts with respect to capital expenditures in the ordinary course of business, (D) any Contract necessary or required to effect the Internal Reorganization and (E) termination of any Contracts with Affiliates pursuant to Section 5.8;
(iii) incur amend the Organizational Documents of any IndebtednessSale Entity, except for short-term floating rate indebtedness for borrowed money immaterial or indebtedness for borrowed money incurred pursuant ministerial amendments or in order to any existing Contract relating to Indebtedness as in effect as of effectuate the Effective DateInternal Reorganization;
(iv) except for any Indebtedness that will be repaid in full prior to Closing, incur any Indebtedness for borrowed money or guarantee any such Indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Sale Entities, except for Indebtedness for borrowed money incurred in the ordinary course of business consistent with past practice;
(v) create or incur any Lien material to the Company or any of its Subsidiaries, taken as a whole, other than Permitted Encumbrances incurred in the ordinary course of business consistent with past practice;
(vi) make any capital expenditures outside the ordinary course of business except in the event of an emergency situation or to address human health and safety issues;
(vii) except as may be required to effect the Internal Reorganization, make any acquisitions (including by merger) of the capital stock, equity securities, membership interests or a material portion of the assets of any other Person;
(vviii) increase in any respect the compensation of any Company Business Employee (provided, provided that payments of bonuses and other grants and awards made in the ordinary course of business shall not constitute an increase in compensation), except (A) in the ordinary course of business consistent with past practicespractice, but under no circumstances will such increase exceed three percent (3%) of a Business Employee’s annual salary or hourly rate unless Buyer agrees seven (7) days prior to such increase, (B) as required pursuant to applicable Law or the terms of any Employee Plans, the Collective Bargaining Agreement Plans or other employee benefit plans or arrangements in effect on the Effective Date and (C) annual cost-of-living, merit, new hire, promotion or similar increases in salaries, wages and benefits of employees made in the ordinary course of business and consistent with past practicespractice, but under no circumstances will such increase exceed three percent (3%) of a Business Employee’s annual salary or hourly rate without the prior written consent of Buyer, such consent not to be unreasonably withheld, delayed or condition) at least seven (7) days prior to such increase;
(viA) hire or engage any individual who would be a Business Employee and whose annual base compensation is expected to exceed $175,000, (B) terminate the employment or service provider relationship of any Business Employee other than a termination for cause, or (C) cause any Business Employee to cease providing services primarily for Seller or any of its Affiliates, in each case other than in the ordinary course of business;
(x) adopt or amend any Employee Plans (except as required by Law or for immaterial or ministerial amendments; provided, however, that if any such amendment is made, copies of such amendments are promptly provided to Buyer);
(viixi) (A) become a party to, establish, adopt or enter into any collective bargaining or other labor union Contract or (B) amend or modify any collective bargaining or other labor union Contract in effect on the Effective Date;
(xii) make any material change to its methods of accounting, except as required by U.S. GAAP (or any interpretation thereof), as required by a Governmental Authority or as required by applicable Law;
(viiixiii) split, combine or otherwise change its capital stock, partnership interests or membership interests, as the case may be, or redeem any of its capital stock, partnership interests or membership interests, as the case may be;
(ixxiv) except as may be required to effect the Internal Reorganization, issue, sell, or grant any shares of of, dispose of, transfer or create any Lien on its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to purchase any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for, any shares of its capital stock, partnership interests or membership interests, as applicable;
(xxv) redeem, purchase or otherwise acquire any of its outstanding shares of capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to acquire any shares of its capital stock, partnership interests or membership interests, as applicable, except pursuant to any Contract in effect as of the Effective Date;
(xixvi) amend (A) make any material Tax election inconsistent with past practice, (B) change or revoke any material Tax election, (C) settle or otherwise compromise any Tax claims, audits, assessments or controversies with respect to a material amount of Taxes, (D) adopt or change any material method of Tax accounting, (E) file any amended material Tax Return, (F) enter into any closing or similar agreement with any Taxing Authority with respect to a material amount of Taxes, (G) surrender any right to claim a refund with respect to a material amount of Taxes, or (H) agree to an extension or waiver of the Organizational Documents statute of limitations with respect to any Significant Subsidiary, except for immaterial or ministerial amendmentsmaterial Taxes;
(xii) except as required by applicable Law or U.S. GAAP, change, in any material respect, its Tax practice or policy (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) to the extent such change or settlement would be binding on and materially adverse to the Sale Entities and JV Companies, taken as a whole, after the Closing;
(xiiixvii) waive, release, assign, settle or compromise any material claim against the Sale Entities or JV CompaniesEntities, other than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (i) equal to or less than the amounts specifically reserved with respect thereto in the consolidated financial statements of the Reporting Company included in the Applicable SEC Documents (including the notes thereto) or (ii) that do not exceed $10,000,000.00 5,000,000 (net of insurance) in each instance, and (B) do not impose any material obligations on the business or require actions that would not reasonably be expected to be material and adverse to operations of the Sale Entities and JV CompaniesEntities, taken as a whole, and (C) do not involve any admission of wrongdoing;
(xiv) with respect to DECP, take any action which would require the consent of Bowie Acquisitions LLC pursuant to the Organizational Documents of DECP;
(xvxviii) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xvixix) accelerate the collection of or discount any accounts receivable, delay the payment of accounts payable or defer expenses, reduce inventories or otherwise increase cash Cash on hand, except except, in each case, in the ordinary course of business consistent with past practice;
(xvii) enter into, modify, amend, assign, transfer, terminate or waive any material right under any capitalized lease (as determined in accordance with U.S. GAAP), letter of credit or similar arrangement;
(xviiixx) (x) enter into any operating material lease for real personal property that provides for a remaining term of more than one (1) year or (y) modify or amend the terms of any material operating lease to provide for a remaining term of more than one (1) year, in each case other than in the ordinary course of business;
(xixxxi) declare, set aside, make or pay any extraordinary non-cash dividend or other extraordinary distribution on or with respect to any capital stock or other equity or ownership interest, except with respect to any Excluded Assets or Retained LiabilitiesLiabilities or as otherwise contemplated by this Agreement or the Internal Reorganization;
(xxii) subject any of the Sale Entities to any bankruptcy, receivership, insolvency or similar proceeding;
(xxiii) make any material modification to the Internal Reorganization; or
(xxxxiv) enter into an agreement to do any of the things described in clauses (i) through (xixxxiii) above.
(b) Between the Effective Date and the Closing, Seller shall (i) keep Buyer promptly informed of any filings, material communication or meeting with any Governmental Authority with respect to rate cases affecting any Sale Entity, including any settlements related thereto, (ii) provide copies, if requested by Buyer, of any material filings submitted to any Governmental Authority in connection with such rate cases, (iii) consult with Buyer and give Buyer a reasonable opportunity, within the time constraints imposed in such rate cases, to comment on proposed material filings submitted to any Governmental Authority in connection with such rate cases, which comments Seller shall consider in good faith and (iv) at the request of Buyer and subject to Seller’s reasonable discretion, provide Buyer or its counsel a reasonable opportunity to observe any material meeting. Buyer shall have the opportunity to review and comment to Seller on all economic aspects of any rate case filing, including any filings or settlements related thereto. Buyer shall have the right to approve (which approval shall not be unreasonably withheld, conditioned or delayed) any settlement of any base rate case only to the extent such settlement would reasonably be expected to materially and adversely affect the Sale Entities, taken as a whole, after the Closing.
Appears in 1 contract
Conduct of Business of the Sale Entities. (a) From the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, Sellers Seller shall cause each of the Sale Entities and the JV Companies Company (and with respect to the JV CompaniesCompany, solely to the extent that Sellers Seller or their its Subsidiaries, pursuant to such the JV Company’s Organizational Documents, are permitted to cause such the JV CompaniesCompany), to (i) conduct its respective business in all material respects in the ordinary course of business, unless otherwise contemplated by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination) or with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) use its Reasonable Efforts to preserve and maintain its respective relationships with licensors, contractors, suppliers, dealers, customers, employees, Governmental Authorities and others having material business relationships with such Sale Entity or the JV Company. In addition, from the Effective Date until the earlier of (i) Closing and (ii) the termination of this Agreement pursuant to Article IX, Sellers Seller shall use Reasonable Efforts to cause each of the Sale Entities to incur capital expenditures as set forth in the applicable budget for the then current fiscal year in the aggregate in the ordinary course, course consistent with past practices including for the period prior to December 31, 2020, substantially in accordance with the 2020 budgets Sellers provided to Buyer prior to the Effective Datepractices. Except as required or permitted by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination or as permitted with respect to any Affiliate arrangements), as may be required by any Material Contract, applicable Law, any Governmental Authority or any Permit, as may be prudent under Good Industry Practice or as set forth on Schedule 5.4(a), from the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, without the consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed, Sellers Seller shall not not, and shall cause or permit any of the Sale Entities or and the JV Companies Company (and with respect to the JV CompaniesCompany, solely to the extent that Sellers Seller or their its Subsidiaries, pursuant to such the JV Company’s Organizational Documents, are permitted not to cause or not to permit such the JV CompaniesCompany) not to:
(i) sell, transfer, convey or otherwise dispose of of, or pledge or permit any Lien (other than a Permitted Encumbrance) to be placed upon, any assets or properties that are material to the Sale Entities and the JV CompaniesCompany, taken as a whole, other than sales, transfers, conveyances or other dispositions (A) of obsolete or surplus assets, assets or (B) in accordance with any existing Contract, or (C) that do not exceed $10,000,000 in Contract disclosed to Buyer prior to the aggregatedate hereof as set forth on Schedule 5.4(a);
(ii) enter into, modify or amend in any material respect, terminate or waive any material right under any Material Contract, except for (A) any termination or modification without material penalty to any Sale Entity, and (B) any new agreement, modification, amendment, termination or waiver in the ordinary course of businessbusiness and consistent with past practice;
(iii) incur any Indebtedness, except for short-term floating rate indebtedness for borrowed money or indebtedness for borrowed money incurred pursuant to any existing Contract relating to Indebtedness as in effect as of the Effective DateDate so long as any such Indebtedness is repaid prior to the Closing;
(iv) make any acquisitions (including by merger) of the capital stock, equity securities, membership interests or a material portion of the assets of any other Person;
(v) (x) increase in any respect the compensation of any Company Employee (provided, that payments of bonuses and other grants and awards made in the ordinary course of business shall not constitute an increase in compensation)Employee, except (A) in the ordinary course of business consistent with past practices, (B) as required pursuant to applicable Law or the terms of any Employee Plans, the Collective Bargaining Agreement or other employee benefit plans or arrangements in effect on the Effective Date and (C) annual cost-of-living, merit, new hire, promotion or similar increases in salaries, wages and benefits of employees made in the ordinary course of business and consistent with past practicespractices or (y) terminate the employment of any Company Employee other than for cause or hire any new Company Employee, in either case, with annual base compensation in excess of $150,000, other than to replace departing employees or to fill an open position;
(vi) adopt or amend any Employee Plans except as required by Law or for immaterial or ministerial amendments;
(vii) make any material change to its methods of accounting, except as required by U.S. GAAP (or any interpretation thereof), as required by a Governmental Authority or as required by applicable Law;
(viii) split, combine or otherwise change its capital stock, partnership interests or membership interests, as the case may be, or redeem any of its capital stock, partnership interests or membership interests, as the case may be;
(ix) issue, sell, or grant any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to purchase any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for, any shares of its capital stock, partnership interests or membership interests, as applicable;
(x) redeem, purchase or otherwise acquire any of its outstanding shares of capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to acquire any shares of its capital stock, partnership interests or membership interests, as applicable, except pursuant to any Contract in effect as of the Effective Date;
(xi) amend the Organizational Documents of any Significant SubsidiarySale Entity or the JV Company, except for immaterial or ministerial amendments;
(xii) except as required by applicable Law or U.S. GAAP, change, in any material respect, its Tax practice or policy (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) to the extent such change or settlement would be binding on and materially adverse to the Sale Entities and the JV CompaniesCompany, taken as a whole, after the Closing;
(xiii) waive, release, assign, settle or compromise any material claim against the Sale Entities or the JV CompaniesCompany, other than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (i) equal to or less than the amounts specifically reserved with respect thereto in the consolidated financial statements of the Reporting Company included in the Applicable SEC Documents (including the notes thereto) or (ii) that do not exceed $10,000,000.00 in 5,000,000 each instance, and $15,000,000 in the aggregate, and (B) impose or require actions that would not reasonably be expected to be material and adverse to the Sale Entities and the JV CompaniesCompany, taken as a whole;
(xiv) with respect to DECP, take any action which would require the consent of Bowie Acquisitions LLC pursuant to the Organizational Documents of DECP;
(xv) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xvixv) accelerate the collection of or discount any accounts receivable, delay the payment of accounts payable or defer expenses, reduce inventories or otherwise increase cash on hand, except in the ordinary course of business consistent with past practice;
(xviixvi) enter into, modify, amend, assign, transfer, terminate or waive any material right under any capitalized lease (as determined in accordance with U.S. GAAP), letter of credit or similar arrangement;
(xviiixvii) (x) enter into any material operating lease that provides for a remaining term of more than one (1) year or (y) make modify or amend the terms of any material operating lease to provide for a remaining term of more than one (1) yearlease;
(xixxviii) declare, set aside, make or pay any extraordinary dividend or other extraordinary distribution on or with respect to any capital stock or other equity or ownership interest, except with respect to any Excluded Assets or Retained Liabilities; or
(xxxix) enter into an agreement to do any of the things described in clauses (i) through (xixxviii) above.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Southwest Gas Holdings, Inc.)
Conduct of Business of the Sale Entities. (a) From the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, Sellers Seller shall cause each of the Sale Entities and JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted to cause such JV Companies), Entity to (i) conduct its respective business in all material respects in the ordinary course of business, unless otherwise contemplated by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination) or with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) use its Reasonable Efforts to preserve and maintain its respective relationships with licensors, contractors, suppliers, dealers, customers, employees, Governmental Authorities and others having material business relationships with such Sale Entity or JV Company. In addition, from the Effective Date until the earlier of (i) Closing and (ii) the termination of this Agreement pursuant to Article IX, Sellers shall use Reasonable Efforts to cause each of the Sale Entities to incur capital expenditures in the aggregate in the ordinary course, consistent with past practices including for the period prior to December 31, 2020, substantially in accordance with the 2020 budgets Sellers provided to Buyer prior to the Effective DateEntity. Except as required or permitted by this Agreement (includingAgreement, if applicable, to effectuate the Q-Pipe Termination or as permitted with respect to any Affiliate arrangements), as may be required by any Material ContractContract in effect as of the Effective Date and set forth in the Schedules, applicable Law, any Governmental Authority or any Permit, as may be prudent under Good Industry Practice Permit or as set forth on Schedule 5.4(a), from the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, without the consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed, Sellers Seller shall not cause or permit any of the Sale Entities or JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted not to cause or not to permit such JV Companies) Entity to:
(i) sell, transfer, convey convey, license, abandon, let lapse or otherwise dispose of any assets or properties that are material to the Sale Entities and JV Companies, taken as a wholeproperties, other than sales, transfers, conveyances or other dispositions (A) of obsolete or surplus assets, (B) in accordance with any existing Contract, or (C) other than with respect to Intellectual Property, that do not exceed $10,000,000 5,000,000 in the aggregate, (D) with respect to Intellectual Property, the grant of non-exclusive licenses in the ordinary course of business consistent with past practice, or (E) pursuant to the Internal Reorganization;
(ii) enter into, modify or amend in any material respect, terminate or waive any material right under any Material Contract, or enter into a Contract that would have been a Material Contract had it been entered into prior to the Effective Date, except for (A) any termination renewals or modification without material penalty to any Sale Entityextensions of existing Contracts on substantially the same terms as such existing Contract, and (B) any new agreementContracts entered into in the ordinary course of business (other than the types of contracts specified in clause (d), modification(e) or (f) of the definition of “Material Contract”), amendment, termination or waiver (C) any Contracts with respect to capital expenditures in the ordinary course of business, (D) any Contract necessary or required to effect the Internal Reorganization, and (E) termination of any Contracts with Affiliates pursuant to Section 5.8;
(iii) incur amend the Organizational Documents of any IndebtednessSale Entity, except for short-term floating rate indebtedness for borrowed money immaterial or indebtedness for borrowed money incurred pursuant ministerial amendments or in order to any existing Contract relating to Indebtedness as in effect as of effectuate the Effective DateInternal Reorganization;
(iv) except for any Indebtedness that will be repaid in full prior to Closing, incur any Indebtedness for borrowed money or guarantee any such Indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Sale Entities, except for Indebtedness for borrowed money incurred in the ordinary course of business consistent with past practice;
(v) create or incur any Lien material to the Company or any of its Subsidiaries, taken as a whole, other than Permitted Encumbrances incurred in the ordinary course of business consistent with past practice;
(vi) make any capital expenditures outside the ordinary course of business except in the event of an emergency situation or to address human health and safety issues;
(vii) except as may be required to effect the Internal Reorganization, make any acquisitions (including by merger) of the capital stock, equity securities, membership interests or a material portion of the assets of any other Person;
(vviii) increase in any respect the compensation of any Company Business Employee (provided, provided that payments of bonuses and other grants and awards made in the ordinary course of business shall not constitute an increase in compensation), except (A) in the ordinary course of business consistent with past practicespractice, but under no circumstances will such increase exceed three percent (3%) of a Business Employee’s annual salary or hourly rate unless Buyer agrees seven (7) days prior to such increase, (B) as required pursuant to applicable Law or the terms of any Employee Plans, the Collective Bargaining Agreement Plans or other employee benefit plans or arrangements in effect on the Effective Date and (C) annual cost-of-living, merit, new hire, promotion or similar increases in salaries, wages and benefits of employees made in the ordinary course of business and consistent with past practicespractice, but under no circumstances will such increase exceed three percent (3%) of a Business Employee’s annual salary or hourly rate without the prior written consent of Buyer, such consent not to be unreasonably withheld, delayed or condition) at least seven (7) days prior to such increase;
(viA) hire or engage any individual who would be a Business Employee and whose annual base compensation is expected to exceed $175,000, (B) terminate the employment or service provider relationship of any Business Employee other than a termination for cause, or (C) cause any Business Employee to cease providing services primarily for Seller or any of its Affiliates, in each case other than in the ordinary course of business;
(x) adopt or amend any Employee Plans (except as required by Law or for immaterial or ministerial amendments; provided, however, that if any such amendment is made, copies of such amendments are promptly provided to Buyer);
(viixi) (A) become a party to, establish, adopt or enter into any collective bargaining or other labor union Contract or (B) amend or modify any collective bargaining or other labor union Contract in effect on the Effective Date;
(xii) make any material change to its methods of accounting, except as required by U.S. GAAP (or any interpretation thereof), as required by a Governmental Authority or as required by applicable Law;
(viiixiii) split, combine or otherwise change its capital stock, partnership interests or membership interests, as the case may be, or redeem any of its capital stock, partnership interests or membership interests, as the case may be;
(ixxiv) except as may be required to effect the Internal Reorganization, issue, sell, or grant any shares of of, dispose of, transfer or create any Lien on its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to purchase any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for, any shares of its capital stock, partnership interests or membership interests, as applicable;
(xxv) redeem, purchase or otherwise acquire any of its outstanding shares of capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to acquire any shares of its capital stock, partnership interests or membership interests, as applicable, except pursuant to any Contract in effect as of the Effective Date;
(xixvi) amend (A) make any material Tax election inconsistent with past practice, (B) change or revoke any material Tax election, (C) settle or otherwise compromise any Tax claims, audits, assessments or controversies with respect to a material amount of Taxes, (D) adopt or change any material method of Tax accounting, (E) file any amended material Tax Return, (F) enter into any closing or similar agreement with any Taxing Authority with respect to a material amount of Taxes, (G) surrender any right to claim a refund with respect to a material amount of Taxes, or (H) agree to an extension or waiver of the Organizational Documents statute of limitations with respect to any Significant Subsidiary, except for immaterial or ministerial amendmentsmaterial Taxes;
(xii) except as required by applicable Law or U.S. GAAP, change, in any material respect, its Tax practice or policy (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) to the extent such change or settlement would be binding on and materially adverse to the Sale Entities and JV Companies, taken as a whole, after the Closing;
(xiiixvii) waive, release, assign, settle or compromise any material claim against the Sale Entities or JV CompaniesEntities, other than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (i) equal to or less than the amounts specifically reserved with respect thereto in the consolidated financial statements of the Reporting Company included in the Applicable SEC Documents (including the notes thereto) or (ii) that do not exceed $10,000,000.00 5,000,000 (net of insurance) in each instance, and (B) do not impose any material obligations on the business or require actions that would not reasonably be expected to be material and adverse to operations of the Sale Entities and JV CompaniesEntities, taken as a whole, and (C) do not involve any admission of wrongdoing;
(xiv) with respect to DECP, take any action which would require the consent of Bowie Acquisitions LLC pursuant to the Organizational Documents of DECP;
(xvxviii) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xvixix) accelerate the collection of or discount any accounts receivable, delay the payment of accounts payable or defer expenses, reduce inventories or otherwise increase cash Cash on hand, except except, in each case, in the ordinary course of business consistent with past practice;
(xvii) enter into, modify, amend, assign, transfer, terminate or waive any material right under any capitalized lease (as determined in accordance with U.S. GAAP), letter of credit or similar arrangement;
(xviiixx) (x) enter into any operating material lease for real personal property that provides for a remaining term of more than one (1) year or (y) modify or amend the terms of any material operating lease to provide for a remaining term of more than one (1) year, in each case other than in the ordinary course of business;
(xixxxi) declare, set aside, make or pay any extraordinary non-cash dividend or other extraordinary distribution on or with respect to any capital stock or other equity or ownership interest, except with respect to any Excluded Assets or Retained LiabilitiesLiabilities or as otherwise contemplated by this Agreement or the Internal Reorganization;
(xxii) subject any of the Sale Entities to any bankruptcy, receivership, insolvency or similar proceeding;
(xxiii) make any material modification to the Internal Reorganization; or
(xxxxiv) enter into an agreement to do any of the things described in clauses (i) through (xixxxiii) above.
(b) Between the Effective Date and the Closing, Seller shall (i) keep Buyer promptly informed of any filings, material communication or meeting with any Governmental Authority with respect to rate cases affecting any Sale Entity, including any settlements related thereto, (ii) provide copies, if requested by Buyer, of any material filings submitted to any Governmental Authority in connection with such rate cases, (iii) consult with Buyer and give Buyer a reasonable opportunity, within the time constraints imposed in such rate cases, to comment on proposed material filings submitted to any Governmental Authority in connection with such rate cases, which comments Seller shall consider in good faith and (iv) at the request of Buyer and subject to Seller’s reasonable discretion, provide Buyer or its counsel a reasonable opportunity to observe any material meeting. Buyer shall have the opportunity to review and comment to Seller on all economic aspects of any rate case filing, including any filings or settlements related thereto. Buyer shall have the right to approve (which approval shall not be unreasonably withheld, conditioned or delayed) any settlement of any base rate case only to the extent such settlement would reasonably be expected to materially and adversely affect the Sale Entities, taken as a whole, after the Closing.
Appears in 1 contract
Conduct of Business of the Sale Entities. (a) From the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, Sellers Seller shall cause each of the Sale Entities and JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted to cause such JV Companies), Entity to (i) conduct its respective business in all material respects in the ordinary course of business, unless otherwise contemplated by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination) or with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) use its Reasonable Efforts to preserve and maintain its respective relationships with licensors, contractors, suppliers, dealers, customers, employees, Governmental Authorities and others having material business relationships with such Sale Entity or JV Company. In addition, from the Effective Date until the earlier of (i) Closing and (ii) the termination of this Agreement pursuant to Article IX, Sellers shall use Reasonable Efforts to cause each of the Sale Entities to incur capital expenditures in the aggregate in the ordinary course, consistent with past practices including for the period prior to December 31, 2020, substantially in accordance with the 2020 budgets Sellers provided to Buyer prior to the Effective DateEntity. Except as required or permitted by this Agreement (includingAgreement, if applicable, to effectuate the Q-Pipe Termination or as permitted with respect to any Affiliate arrangements), as may be required by any Material ContractContract in effect as of the Effective Date and set forth in the Schedules, applicable Law, any Governmental Authority or any Permit, as may be prudent under Good Industry Practice Permit or as set forth on Schedule 5.4(a), from the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, without the consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed, Sellers Seller shall not cause or permit any of the Sale Entities or JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted not to cause or not to permit such JV Companies) Entity to:
: (i) sell, transfer, convey convey, license, abandon, let lapse or otherwise dispose of any assets or properties that are material to the Sale Entities and JV Companies, taken as a wholeproperties, other than sales, transfers, conveyances or other dispositions (A) of obsolete or surplus assets, (B) in accordance with any existing Contract, or (C) other than with respect to Intellectual Property, that do not exceed $10,000,000 5,000,000 in the aggregate;
, (D) with respect to Intellectual Property, the grant of non-exclusive licenses in the ordinary course of business consistent with past practice, or (E) pursuant to the Internal Reorganization; (ii) enter into, modify or amend in any material respect, terminate or waive any material right under any Material Contract, or enter into a Contract that would have been a Material Contract had it been entered into prior to the Effective Date, except for (A) any termination renewals or modification without material penalty to any Sale Entityextensions of existing Contracts on substantially the same terms as such existing Contract, and (B) any new agreementContracts entered into in the ordinary course of business (other than the types of contracts specified in clause (d), modification(e) or (f) of the definition of “Material Contract”), amendment, termination or waiver (C) any Contracts with respect to capital expenditures in the ordinary course of business;
, (D) any Contract necessary or required to effect the Internal Reorganization, and (E) termination of any Contracts with Affiliates pursuant to Section 5.8; (iii) incur any Indebtedness, except for short-term floating rate indebtedness for borrowed money or indebtedness for borrowed money incurred pursuant to any existing Contract relating to Indebtedness as in effect as of the Effective Date;
(iv) make any acquisitions (including by merger) of the capital stock, equity securities, membership interests or a material portion of the assets of any other Person;
(v) increase in any respect the compensation of any Company Employee (provided, that payments of bonuses and other grants and awards made in the ordinary course of business shall not constitute an increase in compensation), except (A) in the ordinary course of business consistent with past practices, (B) as required pursuant to applicable Law or the terms of any Employee Plans, the Collective Bargaining Agreement or other employee benefit plans or arrangements in effect on the Effective Date and (C) annual cost-of-living, merit, new hire, promotion or similar increases in salaries, wages and benefits of employees made in the ordinary course of business and consistent with past practices;
(vi) adopt or amend any Employee Plans except as required by Law or for immaterial or ministerial amendments;
(vii) make any material change to its methods of accounting, except as required by U.S. GAAP (or any interpretation thereof), as required by a Governmental Authority or as required by applicable Law;
(viii) split, combine or otherwise change its capital stock, partnership interests or membership interests, as the case may be, or redeem any of its capital stock, partnership interests or membership interests, as the case may be;
(ix) issue, sell, or grant any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to purchase any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for, any shares of its capital stock, partnership interests or membership interests, as applicable;
(x) redeem, purchase or otherwise acquire any of its outstanding shares of capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to acquire any shares of its capital stock, partnership interests or membership interests, as applicable, except pursuant to any Contract in effect as of the Effective Date;
(xi) amend the Organizational Documents of any Significant SubsidiarySale Entity, except for immaterial or ministerial amendmentsamendments or in order to effectuate the Internal Reorganization;
(xii) except as required by applicable Law or U.S. GAAP, change, in any material respect, its Tax practice or policy (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) to the extent such change or settlement would be binding on and materially adverse to the Sale Entities and JV Companies, taken as a whole, after the Closing;
(xiii) waive, release, assign, settle or compromise any material claim against the Sale Entities or JV Companies, other than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (i) equal to or less than the amounts specifically reserved with respect thereto in the consolidated financial statements of the Reporting Company included in the Applicable SEC Documents (including the notes thereto) or (ii) do not exceed $10,000,000.00 in each instance, and (B) impose or require actions that would not reasonably be expected to be material and adverse to the Sale Entities and JV Companies, taken as a whole;
(xiv) with respect to DECP, take any action which would require the consent of Bowie Acquisitions LLC pursuant to the Organizational Documents of DECP;
(xv) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xvi) accelerate the collection of or discount any accounts receivable, delay the payment of accounts payable or defer expenses, reduce inventories or otherwise increase cash on hand, except in the ordinary course of business consistent with past practice;
(xvii) enter into, modify, amend, assign, transfer, terminate or waive any material right under any capitalized lease (as determined in accordance with U.S. GAAP), letter of credit or similar arrangement;
(xviii) (x) enter into any operating lease that provides for a remaining term of more than one (1) year or (y) modify or amend the terms of any operating lease to provide for a remaining term of more than one (1) year;
(xix) declare, set aside, make or pay any extraordinary dividend or other extraordinary distribution on or with respect to any capital stock or other equity or ownership interest, except with respect to any Excluded Assets or Retained Liabilities; or
(xx) enter into an agreement to do any of the things described in clauses (i) through (xix) above.
Appears in 1 contract
Conduct of Business of the Sale Entities. (a) From the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, Sellers Seller shall cause each of the Sale Entities and JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted to cause such JV Companies), Entity to (i) conduct its respective business in all material respects in the ordinary course of business, unless otherwise contemplated by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination) or with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) use its Reasonable Efforts to preserve and maintain its respective relationships with licensors, contractors, suppliers, dealers, customers, employees, Governmental Authorities and others having material business relationships with such Sale Entity or JV Company. In addition, from the Effective Date until the earlier of (i) Closing and (ii) the termination of this Agreement pursuant to Article IX, Sellers shall use Reasonable Efforts to cause each of the Sale Entities to incur capital expenditures in the aggregate in the ordinary course, consistent with past practices including for the period prior to December 31, 2020, substantially in accordance with the 2020 budgets Sellers provided to Buyer prior to the Effective DateEntity. Except as required or permitted by this Agreement (includingAgreement, if applicable, to effectuate the Q-Pipe Termination or as permitted with respect to any Affiliate arrangements), as may be required by any Material ContractContract in effect as of the Effective Date and set forth in the Schedules, applicable Law, any Governmental Authority or any Permit, as may be prudent under Good Industry Practice Permit or as set forth on Schedule 5.4(a), from the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article IX, without the consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed, Sellers Seller shall not cause or permit any of the Sale Entities or JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted not to cause or not to permit such JV Companies) Entity to:
: (i) sell, transfer, convey convey, license, abandon, let lapse or otherwise dispose of any assets or properties that are material to the Sale Entities and JV Companies, taken as a wholeproperties, other than sales, transfers, conveyances or other dispositions (A) of obsolete or surplus assets, (B) in accordance with any existing Contract, or (C) other than with respect to Intellectual Property, that do not exceed $10,000,000 5,000,000 in the aggregate;
, (D) with respect to Intellectual Property, the grant of non-exclusive licenses in the ordinary course of business consistent with past practice, or (E) pursuant to the Internal Reorganization; (ii) enter into, modify or amend in any material respect, terminate or waive any material right under any Material Contract, or enter into a Contract that would have been a Material Contract had it been entered into prior to the Effective Date, except for (A) any termination renewals or modification without material penalty to any Sale Entityextensions of existing Contracts on substantially the same terms as such existing Contract, and (B) any new agreementContracts entered into in the ordinary course of business (other than the types of contracts specified in clause (d), modification(e) or (f) of the definition of “Material Contract”), amendment, termination or waiver (C) any Contracts with respect to capital expenditures in the ordinary course of business;
, (D) any Contract necessary or required to effect the Internal Reorganization and (E) termination of any Contracts with Affiliates pursuant to Section 5.8; (iii) incur amend the Organizational Documents of any IndebtednessSale Entity, except for shortimmaterial or ministerial amendments or in order to effectuate the Internal Reorganization; 48 4894-term floating rate indebtedness 6761-6617 v.11
(iv) except for any Indebtedness that will be repaid in full prior to Closing, incur any Indebtedness for borrowed money or indebtedness guarantee any such Indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Sale Entities, except for Indebtedness for borrowed money incurred pursuant in the ordinary course of business consistent with past practice; (v) create or incur any Lien material to the Company or any existing Contract relating of its Subsidiaries, taken as a whole, other than Permitted Encumbrances incurred in the ordinary course of business consistent with past practice; (vi) make any capital expenditures outside the ordinary course of business except in the event of an emergency situation or to Indebtedness address human health and safety issues; (vii) except as in may be required to effect as of the Effective Date;
(iv) Internal Reorganization, make any acquisitions (including by merger) of the capital stock, equity securities, membership interests or a material portion of the assets of any other Person;
; (vviii) increase in any respect the compensation of any Company Business Employee (provided, provided that payments of bonuses and other grants and awards made in the ordinary course of business shall not constitute an increase in compensation), except (A) in the ordinary course of business consistent with past practicespractice, but under no circumstances will such increase exceed three percent (3%) of a Business Employee’s annual salary or hourly rate unless Buyer agrees seven (7) days prior to such increase, (B) as required pursuant to applicable Law or the terms of any Employee Plans, the Collective Bargaining Agreement Plans or other employee benefit plans or arrangements in effect on the Effective Date and (C) annual cost-of-living, merit, new hire, promotion or similar increases in salaries, wages and benefits of employees made in the ordinary course of business and consistent with past practices;practice, but under no circumstances will such increase exceed three percent (3%) of a Business Employee’s annual salary or hourly rate without the prior written consent of Buyer, such consent not to be unreasonably withheld, delayed or condition) at least seven (7) days prior to such increase; (ix)
(viA) hire or engage any individual who would be a Business Employee and whose annual base compensation is expected to exceed $175,000, (B) terminate the employment or service provider relationship of any Business Employee other than a termination for cause, or (C) cause any Business Employee to cease providing services primarily for Seller or any of its Affiliates, in each case other than in the ordinary course of business; (x) adopt or amend any Employee Plans (except as required by Law or for immaterial or ministerial amendments;; provided, however, that if any such amendment is made, copies of such amendments are promptly provided to Buyer); (xi)
(viiA) make become a party to, establish, adopt or enter into any material change to its methods of accounting, except as required by U.S. GAAP collective bargaining or other labor union Contract or (B) amend or modify any interpretation thereof), as required by a Governmental Authority collective bargaining or as required by applicable Law;
(viii) split, combine or otherwise change its capital stock, partnership interests or membership interests, as the case may be, or redeem any of its capital stock, partnership interests or membership interests, as the case may be;
(ix) issue, sell, or grant any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to purchase any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for, any shares of its capital stock, partnership interests or membership interests, as applicable;
(x) redeem, purchase or otherwise acquire any of its outstanding shares of capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to acquire any shares of its capital stock, partnership interests or membership interests, as applicable, except pursuant to any other labor union Contract in effect as of on the Effective Date;
(xi) amend the Organizational Documents of any Significant Subsidiary, except for immaterial or ministerial amendments;
(xii) except as required by applicable Law or U.S. GAAP, change, in any material respect, its Tax practice or policy (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) to the extent such change or settlement would be binding on and materially adverse to the Sale Entities and JV Companies, taken as a whole, after the Closing;
(xiii) waive, release, assign, settle or compromise any material claim against the Sale Entities or JV Companies, other than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (i) equal to or less than the amounts specifically reserved with respect thereto in the consolidated financial statements of the Reporting Company included in the Applicable SEC Documents (including the notes thereto) or (ii) do not exceed $10,000,000.00 in each instance, and (B) impose or require actions that would not reasonably be expected to be material and adverse to the Sale Entities and JV Companies, taken as a whole;
(xiv) with respect to DECP, take any action which would require the consent of Bowie Acquisitions LLC pursuant to the Organizational Documents of DECP;
(xv) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xvi) accelerate the collection of or discount any accounts receivable, delay the payment of accounts payable or defer expenses, reduce inventories or otherwise increase cash on hand, except in the ordinary course of business consistent with past practice;
(xvii) enter into, modify, amend, assign, transfer, terminate or waive any material right under any capitalized lease (as determined in accordance with U.S. GAAP), letter of credit or similar arrangement;
(xviii) (x) enter into any operating lease that provides for a remaining term of more than one (1) year or (y) modify or amend the terms of any operating lease to provide for a remaining term of more than one (1) year;
(xix) declare, set aside, make or pay any extraordinary dividend or other extraordinary distribution on or with respect to any capital stock or other equity or ownership interest, except with respect to any Excluded Assets or Retained Liabilities; or
(xx) enter into an agreement to do any of the things described in clauses (i) through (xix) above.
Appears in 1 contract
Conduct of Business of the Sale Entities. (a) From the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article ARTICLE IX, Sellers Seller shall cause each of the Sale Entities and JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted to cause such JV Companies), Entity to (i) conduct its respective business in all material respects in the ordinary course of business, unless otherwise contemplated by this Agreement (including, if applicable, to effectuate the Q-Pipe Termination) or with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed) and (ii) use its Reasonable Efforts to preserve and maintain its respective relationships with licensors, contractors, suppliers, dealers, customers, employees, Governmental Authorities and others having material business relationships with such Sale Entity or JV Company. In addition, from the Effective Date until the earlier of (i) Closing and (ii) the termination of this Agreement pursuant to Article IX, Sellers shall use Reasonable Efforts to cause each of the Sale Entities to incur capital expenditures in the aggregate in the ordinary course, consistent with past practices including for the period prior to December 31, 2020, substantially in accordance with the 2020 budgets Sellers provided to Buyer prior to the Effective DateEntity. Except as required or permitted by this Agreement (includingAgreement, if applicable, to effectuate the Q-Pipe Termination or as permitted with respect to any Affiliate arrangements), as may be required by any Material ContractContract in effect as of the Effective Date and set forth in the Schedules, applicable Law, any Governmental Authority or any Permit, as may be prudent under Good Industry Practice Permit or as set forth on Schedule 5.4(a), from the Effective Date until the earlier of the Closing and the termination of this Agreement pursuant to Article ARTICLE IX, without the consent of Buyer, which consent will not be unreasonably withheld, conditioned or delayed, Sellers Seller shall not cause or permit any of the Sale Entities or JV Companies (and with respect to the JV Companies, solely to the extent that Sellers or their Subsidiaries, pursuant to such JV Company’s Organizational Documents, are permitted not to cause or not to permit such JV Companies) Entity to:
(i) sell, transfer, convey convey, license, abandon, let lapse or otherwise dispose of any assets or properties that are material to the Sale Entities and JV Companies, taken as a wholeproperties, other than sales, transfers, conveyances or other dispositions (A) of obsolete or surplus assets, (B) in accordance with any existing Contract, or (C) other than with respect to Intellectual Property, that do not exceed $10,000,000 5,000,000 in the aggregate, (D) with respect to Intellectual Property, the grant of non-exclusive licenses in the ordinary course of business consistent with past practice, or (E) pursuant to the Internal Reorganization;
(ii) enter into, modify or amend in any material respect, terminate or waive any material right under any Material Contract, or enter into a Contract that would have been a Material Contract had it been entered into prior to the Effective Date, except for (A) any termination renewals or modification without material penalty to any Sale Entityextensions of existing Contracts on substantially the same terms as such existing Contract, and (B) any new agreementContracts entered into in the ordinary course of business (other than the types of contracts specified in clause (d), modification(e) or (f) of the definition of “Material Contract”), amendment, termination or waiver (C) any Contracts with respect to capital expenditures in the ordinary course of business, (D) any Contract necessary or required to effect the Internal Reorganization, and (E) termination of any Contracts with Affiliates pursuant to Section 5.8;
(iii) incur amend the Organizational Documents of any IndebtednessSale Entity, except for short-term floating rate indebtedness for borrowed money immaterial or indebtedness for borrowed money incurred pursuant ministerial amendments or in order to any existing Contract relating to Indebtedness as in effect as of effectuate the Effective DateInternal Reorganization;
(iv) except for any Indebtedness that will be repaid in full prior to Closing, incur any Indebtedness for borrowed money or guarantee any such Indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Sale Entities, except for Indebtedness for borrowed money incurred in the ordinary course of business consistent with past practice;
(v) create or incur any Lien material to the Company or any of its Subsidiaries, taken as a whole, other than Permitted Encumbrances incurred in the ordinary course of business consistent with past practice;
(vi) make any capital expenditures outside the ordinary course of business except in the event of an emergency situation or to address human health and safety issues;
(vii) except as may be required to effect the Internal Reorganization, make any acquisitions (including by merger) of the capital stock, equity securities, membership interests or a material portion of the assets of any other Person;
(vviii) increase in any respect the compensation of any Company Business Employee (provided, provided that payments of bonuses and other grants and awards made in the ordinary course of business shall not constitute an increase in compensation), except (A) in the ordinary course of business consistent with past practicespractice, but under no circumstances will such increase exceed three percent (3%) of a Business Employee’s annual salary or hourly rate unless Buyer agrees seven (7) days prior to such increase, (B) as required pursuant to applicable Law or the terms of any Employee Plans, the Collective Bargaining Agreement Plans or other employee benefit plans or arrangements in effect on the Effective Date and (C) annual cost-of-living, merit, new hire, promotion or similar increases in salaries, wages and benefits of employees made in the ordinary course of business and consistent with past practicespractice, but under no circumstances will such increase exceed three percent (3%) of a Business Employee’s annual salary or hourly rate without the prior written consent of Buyer, (such consent not to be unreasonably withheld, delayed or condition) at least seven (7) days prior to such increase;
(viA) hire or engage any individual who would be a Business Employee and whose annual base compensation is expected to exceed $175,000, (B) terminate the employment or service provider relationship of any Business Employee other than a termination for cause, or (C) cause any Business Employee to cease providing services primarily for Seller or any of its Affiliates, in each case other than in the ordinary course of business;
(x) adopt or amend any Employee Plans (except as required by Law or for immaterial or ministerial amendments; provided, however, that if any such amendment is made, copies of such amendments are promptly provided to Buyer);
(viixi) (A) become a party to, establish, adopt or enter into any collective bargaining or other labor union Contract or (B) amend or modify any collective bargaining or other labor union Contract in effect on the Effective Date;
(xii) make any material change to its methods of accounting, except as required by U.S. GAAP (or any interpretation thereof), as required by a Governmental Authority or as required by applicable Law;
(viiixiii) split, combine or otherwise change its capital stock, partnership interests or membership interests, as the case may be, or redeem any of its capital stock, partnership interests or membership interests, as the case may be;
(ixxiv) except as may be required to effect the Internal Reorganization, issue, sell, or grant any shares of of, dispose of, transfer or create any Lien on its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of its capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to purchase any shares of its capital stock, partnership interests or membership interests, as applicable, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for, any shares of its capital stock, partnership interests or membership interests, as applicable;
(xxv) redeem, purchase or otherwise acquire any of its outstanding shares of capital stock, partnership interests or membership interests, as applicable, or any rights, warrants or options to acquire any shares of its capital stock, partnership interests or membership interests, as applicable, except pursuant to any Contract in effect as of the Effective Date;
(xixvi) amend (A) make any material Tax election inconsistent with past practice, (B) change or revoke any material Tax election, (C) settle or otherwise compromise any Tax claims, audits, assessments or controversies with respect to a material amount of Taxes, (D) adopt or change any material method of Tax accounting, (E) file any amended material Tax Return, (F) enter into any closing or similar agreement with any Taxing Authority with respect to a material amount of Taxes, (G) surrender any right to claim a refund with respect to a material amount of Taxes, or (H) agree to an extension or waiver of the Organizational Documents statute of limitations with respect to any Significant Subsidiary, except for immaterial or ministerial amendmentsmaterial Taxes;
(xii) except as required by applicable Law or U.S. GAAP, change, in any material respect, its Tax practice or policy (including making new Tax elections or changing Tax elections and settling Tax controversies not in the ordinary course of business) to the extent such change or settlement would be binding on and materially adverse to the Sale Entities and JV Companies, taken as a whole, after the Closing;
(xiiixvii) waive, release, assign, settle or compromise any material claim against the Sale Entities or JV CompaniesEntities, other than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (i) equal to or less than the amounts specifically reserved with respect thereto in the consolidated financial statements of the Reporting Company included in the Applicable SEC Documents (including the notes thereto) or (ii) that do not exceed $10,000,000.00 5,000,000 (net of insurance) in each instance, and (B) do not impose any material obligations on the business or require actions that would not reasonably be expected to be material and adverse to operations of the Sale Entities and JV CompaniesEntities, taken as a whole, and (C) do not involve any admission of wrongdoing;
(xiv) with respect to DECP, take any action which would require the consent of Bowie Acquisitions LLC pursuant to the Organizational Documents of DECP;
(xvxviii) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xvixix) accelerate the collection of or discount any accounts receivable, delay the payment of accounts payable or defer expenses, reduce inventories or otherwise increase cash Cash on hand, except except, in each case, in the ordinary course of business consistent with past practice;
(xvii) enter into, modify, amend, assign, transfer, terminate or waive any material right under any capitalized lease (as determined in accordance with U.S. GAAP), letter of credit or similar arrangement;
(xviiixx) (x) enter into any operating material lease for real personal property that provides for a remaining term of more than one (1) year or (y) modify or amend the terms of any material operating lease to provide for a remaining term of more than one (1) year, in each case other than in the ordinary course of business;
(xixxxi) declare, set aside, make or pay any extraordinary non-cash dividend or other extraordinary distribution on or with respect to any capital stock or other equity or ownership interest, except with respect to any Excluded Assets or Retained LiabilitiesLiabilities or as otherwise contemplated by this Agreement or the Internal Reorganization;
(xxii) subject any of the Sale Entities to any bankruptcy, receivership, insolvency or similar proceeding;
(xxiii) make any material modification to the Internal Reorganization; or
(xxxxiv) enter into an agreement to do any of the things described in clauses (i) through (xixxxiii) above.
(b) Between the Effective Date and the Closing, Seller shall (i) keep Buyer promptly informed of any filings, material communication or meeting with any Governmental Authority with respect to rate cases affecting any Sale Entity, including any settlements related thereto, (ii) provide copies, if requested by Buyer, of any material filings submitted to any Governmental Authority in connection with such rate cases, (iii) consult with Buyer and give Buyer a reasonable opportunity, within the time constraints imposed in such rate cases, to comment on proposed material filings submitted to any Governmental Authority in connection with such rate cases, which comments Seller shall consider in good faith and (iv) at the request of Buyer and subject to Seller’s reasonable discretion, provide Buyer or its counsel a reasonable opportunity to observe any material meeting. Buyer shall have the opportunity to review and comment to Seller on all economic aspects of any rate case filing, including any filings or settlements related thereto. Buyer shall have the right to approve (which approval shall not be unreasonably withheld, conditioned or delayed) any settlement of any base rate case only to the extent such settlement would reasonably be expected to materially and adversely affect the Sale Entities, taken as a whole, after the Closing.
Appears in 1 contract
