Conduct of Business Prior to Closing Date. Except as ----------------------------------------- expressly contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Big Stuff shall conduct its business in the ordinary course and consistent with past practice, subject to the limitations contained in this Agreement, and Big Stuff shall use its reasonable business efforts to preserve intact its business organization, to keep available the services of its officers, agents and employees and to maintain satisfactory relationships with all Persons with whom it does business. Except as expressly contemplated by this Agreement, and it being acknowledged and agreed by each of the parties to this Agreement that Parent is in the process of a substantial reduction in workforce, and, subject to Section 5.11, Parent shall, and it shall cause the Active ------------ Parent Subsidiaries to, use its or their reasonable business efforts to preserve intact its business organization, consistent with the budget adopted by the Executive Committee of the Board of Directors of Parent, to keep available the services of only those officers, agents and employees whom Parent believes are required to maintain satisfactory relationships with all Persons with whom it does business. Without limiting the generality of the foregoing, and except as otherwise expressly provided in this Agreement, after the date of this Agreement and prior to the Closing Date, (i) Big Stuff will not, without the prior written consent of Parent (which consent shall not be unreasonably withheld or delayed); and (ii) subject to Section 5.11, neither Parent nor any Active Parent Subsidiary ------------ will, without the prior written consent of Big Stuff (which consent shall not be unreasonably withheld or delayed): (a) except as provided for in this Agreement, the Company Acquisition Agreement or the Web Acquisition Agreement, amend or propose to amend its Certificate or Articles of Incorporation or Bylaws (or comparable governing instruments) in any material respect; (b) except as set forth on Schedule 6.6(b)(i) to be ------------------ provided during the Schedule Period, with regard to Web, or Parent Common Stock to be issued pursuant to those options or warrants listed on Schedule 6.6(b)(ii) to be provided during the Schedule Period or in ------------------- Section 6.10, with regard to Parent or the Active Parent Subsidiaries, ------------ authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any shares of, or any options, warrants, commitments, subscriptions or rights of any kind to acquire or sell any shares of, the capital stock or other securities of Big Stuff, or of Parent or any Active Parent Subsidiary, as the case may be, including, but not limited to, any securities convertible into or exchangeable for shares of stock of any class of Big Stuff, or of Parent or any Active Parent Subsidiary, as the case may be; provided, however, that Big -------- ------- Stuff may issue capital stock pursuant to the exercise of options and warrants outstanding on the date of this Agreement; (c) except as provided for in this Agreement, the Company Acquisition Agreement or the Web Acquisition Agreement, split, combine or reclassify any shares of its capital stock or declare, pay or set aside any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its capital stock, other than dividends or distributions to Big Stuff Shareholders (but only if the entire amount of such dividend is paid to Web as a capital contribution), or to Parent or a Parent subsidiary, as the case may be, or redeem, purchase or otherwise acquire or offer to acquire any shares of its capital stock or other securities; (i) except for debt (including, but not limited to, obligations in respect of capital leases, but excluding obligations under the Convertible Note) not in excess of $50,000 in the aggregate for all Persons combined, create, incur or assume any short-term debt (excluding trade payables incurred in the ordinary course of business), long-term debt or obligations in respect of capital leases; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, indirectly, contingently or otherwise) for the obligations of any Person, except for obligations permitted by this Agreement of any Active Parent Subsidiary, in the ordinary course of business consistent with past practice; (iii) make any capital expenditures or make any loans, advances or capital contributions to, or investments in, any other Person (other than customary advances to employees made in the ordinary course of business consistent with past practice), provided Big Stuff will continue to make capital expenditures, maintain, upgrade and expand its facilities, and otherwise operate in the ordinary course and consistent with past practice; (iv) acquire the stock or assets of, or merge or consolidate with, any other Person or business except the contemplated merger with Web; or (v) voluntarily incur any material liability or obligation (absolute, accrued, contingent or otherwise); (e) subject to Section 5.11 hereof, sell, transfer, ------------ mortgage, pledge or otherwise dispose of, or encumber, or agree to sell, transfer, mortgage, pledge or otherwise dispose of or encumber, any material assets or properties, real, personal or mixed, except in the ordinary course of business, in the case of Parent and the Active Parent Subsidiaries; (f) increase in any manner the compensation of any of its officers, agents or employees other than any increases required pursuant to their employment agreements in accordance with their terms in effect on the date of this Agreement and increases in the ordinary course of business consistent with past practice not in excess on an individual basis of the lesser of 10% of the current compensation of such individual or $10,000 per annum; (g) enter into, establish, amend, make non-routine or material interpretations or determinations with respect to, or terminate any employment, consulting, retention, change in control, collective bargaining, bonus or other incentive compensation, profit sharing, health or other welfare, stock option, stock purchase, restricted stock, or other equity, pension, retirement, vacation, severance, deferred compensation or other compensation or benefit plan, policy, agreement, trust, fund or arrangement with, for or in respect of, any shareholder, officer, director, other employee, agent, consultant or affiliate, other than actions contemplated by this Agreement, the Company Acquisition Agreement and the Web Acquisition Agreement; (h) make any elections with respect to Taxes that are inconsistent with the prior elections reflected in the Financial Statements as of and to the period ended December 31, 1998; (i) except with regard to Xxxxxxx, compromise, settle, grant any waiver or release relating to or otherwise adjust any Litigation, except routine Litigation in the ordinary course of business consistent with past practice, involving only a payment not in excess of $50,000 individually or $100,000 when aggregated with all such payments by Big Stuff or by Parent and the Active Parent Subsidiaries combined, as the case may be; (j) take any action or omit to take any action, which action or omission would result in a breach of any of the covenants, representations and warranties of Big Stuff, the Big Stuff Shareholders or Parent or the Active Parent Subsidiaries set forth in this Agreement or would have a Big Stuff Material Adverse Effect, with regard to Big Stuff and the Big Stuff Shareholders, or a Parent Material Adverse Effect, with regard to Parent and the Active Parent Subsidiaries; (k) except in the ordinary course of business enter into any lease or other agreement, or amend any lease or other agreement, with respect to real property; (l) enter into or amend any agreement or transaction (i) pursuant to which the aggregate financial obligation of Big Stuff, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $50,000, (ii) having a term of more than twelve (12) months and pursuant to which the aggregate financial obligation of Big Stuff, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $100,000 per year, or (iii) which is not terminable by Big Stuff or Parent or the Active Parent Subsidiaries, as the case may be, upon no more than thirty (30) days' notice without penalty in excess of $50,000 individually or $100,000 when aggregated with the penalties under all such agreements or transactions; (m) take any action with respect to the indemnification of any Person; (n) change any accounting practices or policies, except as required by generally accepted accounting principles or Laws or as agreed to or requested by Big Stuff's or Parent's auditors after consultation with Parent's or Big Stuff's auditors, as the case may be; provided, -------- however, that notice and a description of any change pursuant to this ------- Section 6.6(n) shall be provided promptly after such change is effected -------------- to Big Stuff or Parent, as the case may be; (o) except in the ordinary course of business, enter into, amend, modify, terminate or waive any rights under any contract which would result in a Big Stuff Material Adverse Effect, with respect to Big Stuff, or a Parent Material Adverse Effect, with respect to Parent; (p) adopt a plan of liquidation, dissolution, merger, consolidation, share exchange, restructuring, recapitalization, or other reorganization; provided, however, that Parent may adopt such a plan -------- ------- and may cause the liquidation or dissolution of any Parent subsidiary if Parent is unable to sell such Parent subsidiary (i) at a price which Parent determines to be reasonable, and (ii) during a time period which Parent determines to be reasonable; provided, further, however, that if -------- ------- ------- Parent adopts such a plan or causes such liquidation or dissolution, Parent promptly shall provide to Big Stuff notice of such adoption, liquidation or dissolution, as the case may be; or (q) resolve, agree, commit or arrange to do any of the foregoing. Notwithstanding anything in this Section 6.6 to the contrary, it ----------- is understood that Big Stuff has been accelerating and intensifying its business activities since March 31, 1999 and will continue to do so. Accordingly, (x) "ordinary course of business" and "consistent with past practice", as used in this Section 6.6 with respect to Big Stuff, ----------- shall be interpreted to include such acceleration and intensification; and (y) in considering requests for consent from Big Stuff, Parent shall take into account such acceleration and intensification. Furthermore, Parent covenants, represents and warrants that from and after the date hereof, unless Big Stuff shall otherwise expressly consent in writing, Parent shall use its reasonable business efforts to: (1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it; (2) pay all accounts payable and other obligations, to the extent permitted by Parent's cash flow and consistent with prudent cash management strategies, and consistent with the provisions of this Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Big Stuff; and (3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Parent Permits necessary for, or otherwise material to, such business; provided, however, that Big Stuff acknowledges -------- ------- and agrees that Parent is attempting to sell its CLEC Operations, and to the extent such CLEC Operations are sold and, as a result, certain Laws or Parent Permits to which Parent is subject as of the date hereof become unnecessary, irrelevant or immaterial, Parent shall not be required to comply with such Laws or maintain such Parent Permits. Furthermore, Big Stuff covenants, represents and warrants that from and after the date hereof, unless Parent shall otherwise expressly consent in writing, Big Stuff shall use its or their reasonable business efforts to: (1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it; (2) pay all accounts payable and other obligations, when they become due and payable, in the ordinary course of business consistent with past practice and with the provisions of this Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Parent; and (3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Big Stuff Permits necessary for, or otherwise material to, such business.
Appears in 1 contract
Samples: Acquisition Agreement (Advanced Communications Group Inc/De/)
Conduct of Business Prior to Closing Date. Except as ----------------------------------------- expressly contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Big Stuff shall conduct its business in the ordinary course and consistent with past practice, subject to the limitations contained in this Agreement, and Big Stuff shall use its reasonable business efforts to preserve intact its business organization, to keep available the services of its officers, agents and employees and to maintain satisfactory relationships with all Persons with whom it does business. Except as expressly contemplated by this Agreement, and it being acknowledged and agreed by each the terms of the parties to this Agreement that Parent is or the other Transaction Documents and except as Buyer may otherwise approve in writing, between the date hereof and the Closing Date, Seller shall (i) conduct the Business in the process ordinary course consistent with past practice (including, without limitation, ordering and purchasing Inventory and making store location, sales and marketing expenditures each in the ordinary course of a substantial reduction in workforce, and, subject to Section 5.11, Parent shall, and it shall cause the Active ------------ Parent Subsidiaries to, business); (ii) use its or their commercially reasonable business efforts to maintain and preserve intact its the present business organization, consistent with organization and to maintain and preserve the budget adopted by relationships and goodwill of Seller and the Executive Committee of the Board of Directors of Parent, Business; (iii) use commercially reasonable efforts to keep available retain the services of only those officersits present officers and employees, agents and employees whom Parent believes are required (iv) continue to make capital expenditures (in amounts, timing and use of proceeds) consistent with Seller’s capital expenditures budget and maintain satisfactory relationships with all Persons with whom it does businessthe assets and properties of the Business in good condition and repair. Without in any way limiting the generality any of the foregoing, and except as otherwise expressly provided in this Agreement, after contemplated by the date terms of this Agreement or the other Transaction Documents and prior to the Closing Dateexcept as Buyer may otherwise approve in writing, (i) Big Stuff will not, without the prior written consent of Parent (which consent Seller shall not be unreasonably withheld or delayed); (and (ii) subject to Section 5.11, neither Parent nor any Active Parent Subsidiary ------------ will, without the prior written consent of Big Stuff (which consent Shareholder shall and shall cause Seller not be unreasonably withheld or delayedto):
(a) sell, assign, transfer, mortgage, lease, license, abandon, permit to lapse, encumber or otherwise dispose of any assets or release or waive any claim, except as provided for sales of Inventory in this Agreement, the Company Acquisition Agreement or the Web Acquisition Agreement, amend or propose to amend its Certificate or Articles ordinary course of Incorporation or Bylaws (or comparable governing instruments) in any material respectbusiness and consistent with past practices;
(b) except as set forth on Schedule 6.6(b)(i) to be ------------------ provided during compromise or otherwise settle or adjust any assertion or claim of a deficiency in Taxes (or interest thereon or penalties in connection therewith), extend the Schedule Period, statute of limitations with regard to Webany Taxing Authority or file any pleading in court in any Tax litigation or any appeal from an asserted deficiency, or Parent Common Stock to be issued pursuant to those options file or warrants listed on Schedule 6.6(b)(ii) to be provided during amend any Tax Return, or make any Tax election that is inconsistent with Seller’s current tax election practices, change or make any Tax elections or its Tax or accounting policies and procedures or any method or period of accounting unless required by GAAP, the Schedule Period or in ------------------- Section 6.10, with regard to Parent or the Active Parent Subsidiaries, ------------ authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any shares ofCode, or any optionsother statutory or financial accounting principles or a Governmental Entity, warrants, commitments, subscriptions or rights of fail to file all Tax Returns required to be filed with any kind to acquire or sell any shares of, the capital stock or other securities of Big StuffTaxing Authority in accordance with Legal Requirements, or of Parent fail to timely pay all Taxes due and payable whether or any Active Parent Subsidiary, as not shown in the case may be, including, but not limited to, any securities convertible into or exchangeable for shares of stock of any class of Big Stuff, or of Parent or any Active Parent Subsidiary, as the case may be; provided, however, respective Tax Returns that Big -------- ------- Stuff may issue capital stock pursuant to the exercise of options and warrants outstanding on the date of this Agreementare so filed;
(c) except as provided for grant any general or uniform increase in this Agreement, the Company Acquisition Agreement rate of pay to Business Employees or the Web Acquisition Agreement, split, combine employee benefits;
(d) adopt or reclassify enter into any shares of its capital stock or declare, pay or set aside new employment agreement with any dividend Business Employee or other distribution Employee Benefit Plan or arrangement or amend or modify any employment agreement or Employee Benefit Plan or arrangement of any such type except to comply with Legal Requirements;
(whether in cashe) enter into or amend any collective bargaining agreement, stock or property recognize any union or other labor organization as being entitled to represent any combination thereofBusiness Employee;
(f) in except with respect of its capital stockto Excluded Liabilities, settle any material claim, action or proceeding involving any material Liability for monetary Damages or enter into any settlement agreement containing material obligations;
(g) incur any Debt other than dividends Debt that shall be repaid in full on or distributions prior to Big Stuff Shareholders Closing as contemplated by Section 2.3;
(but only if the entire amount h) enter into any new line of such dividend is paid to Web as a capital contribution), or to Parent or a Parent subsidiary, as the case may be, or redeem, purchase or otherwise acquire or offer to acquire any shares of its capital stock or other securitiesbusiness;
(i) except amend, modify, or terminate any Acquired Contract or enter into any agreement or contract that would be required to be a Scheduled Contract;
(j) take any action that would or could reasonably be expected to: (i) adversely affect the ability of Buyer or Seller to obtain any necessary approval of any Governmental Entity or other Person required for debt (including, but not limited to, obligations in respect of capital leases, but excluding obligations under the Convertible Note) not in excess of $50,000 in the aggregate for all Persons combined, create, incur or assume any short-term debt (excluding trade payables incurred in the ordinary course of business), long-term debt or obligations in respect of capital leasesTransaction; (ii) assume, guarantee, endorse adversely affect Seller’s ability to perform its covenants and agreements under this Agreement; or otherwise become liable (iii) result in any of the conditions to the performance of Buyer’s or responsible Seller’s obligations hereunder not being satisfied;
(whether directly, indirectly, contingently k) engage in any material transaction or otherwise) for the obligations of incur any Person, except for obligations permitted by this Agreement of any Active Parent Subsidiary, material obligation not in the ordinary course of business consistent with past practice; ;
(iiil) make any capital expenditures or make any loans, advances or capital contributions to, or investments in, any other Person (other than customary advances to employees made deviate from past practice in the ordinary course of business consistent with past practice), provided Big Stuff will continue to make capital expenditures, maintain, upgrade and expand its facilities, and otherwise operate in the ordinary course and consistent with past practice; (iv) acquire the stock or assets of, or merge or consolidate with, any other Person or business except the contemplated merger with Web; or (v) voluntarily incur any material liability or obligation (absolute, accrued, contingent or otherwise);
(e) subject to Section 5.11 hereof, sell, transfer, ------------ mortgage, pledge or otherwise dispose of, or encumber, or agree to sell, transfer, mortgage, pledge or otherwise dispose of or encumber, any material assets or properties, real, personal or mixed, except in the ordinary course of business, in the case of Parent and the Active Parent Subsidiaries;
(f) increase in any manner the compensation of any of its officers, agents or employees other than any increases required pursuant to their employment agreements in accordance with their terms in effect on the date of this Agreement and increases in the ordinary course of business consistent with past practice not in excess on an individual basis of the lesser of 10% of the current compensation of such individual or $10,000 per annum;
(g) enter into, establish, amend, make non-routine or material interpretations or determinations with respect to, or terminate any employment, consulting, retention, change in control, collective bargaining, bonus or other incentive compensation, profit sharing, health or other welfare, stock option, stock purchase, restricted stock, or other equity, pension, retirement, vacation, severance, deferred compensation or other compensation or benefit plan, policy, agreement, trust, fund or arrangement with, for or in respect of, any shareholder, officer, director, other employee, agent, consultant or affiliate, other than actions contemplated by this Agreement, the Company Acquisition Agreement and the Web Acquisition Agreement;
(h) make any elections with respect to Taxes that are inconsistent with the prior elections reflected in the Financial Statements as ordering or maintenance of and to the period ended December 31, 1998;
(i) except with regard to Xxxxxxx, compromise, settle, grant any waiver or release relating to or otherwise adjust any Litigation, except routine Litigation in the ordinary course of business consistent with past practice, involving only a payment not in excess of $50,000 individually or $100,000 when aggregated with all such payments by Big Stuff or by Parent and the Active Parent Subsidiaries combined, as the case may be;
(j) take any action or omit to take any action, which action or omission would result in a breach of any of the covenants, representations and warranties of Big Stuff, the Big Stuff Shareholders or Parent or the Active Parent Subsidiaries set forth in this Agreement or would have a Big Stuff Material Adverse Effect, with regard to Big Stuff and the Big Stuff Shareholders, or a Parent Material Adverse Effect, with regard to Parent and the Active Parent Subsidiaries;
(k) except in the ordinary course of business enter into any lease or other agreement, or amend any lease or other agreement, with respect to real property;
(l) enter into or amend any agreement or transaction (i) pursuant to which the aggregate financial obligation of Big Stuff, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $50,000, (ii) having a term of more than twelve (12) months and pursuant to which the aggregate financial obligation of Big Stuff, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $100,000 per year, or (iii) which is not terminable by Big Stuff or Parent or the Active Parent Subsidiaries, as the case may be, upon no more than thirty (30) days' notice without penalty in excess of $50,000 individually or $100,000 when aggregated with the penalties under all such agreements or transactions;Inventory; or
(m) agree or make any commitment to take any action with respect to the indemnification of any Person;
(n) change any accounting practices or policies, except as required actions prohibited by generally accepted accounting principles or Laws or as agreed to or requested by Big Stuff's or Parent's auditors after consultation with Parent's or Big Stuff's auditors, as the case may be; provided, -------- however, that notice and a description of any change pursuant to this ------- Section 6.6(n) shall be provided promptly after such change is effected -------------- to Big Stuff or Parent, as the case may be;
(o) except in the ordinary course of business, enter into, amend, modify, terminate or waive any rights under any contract which would result in a Big Stuff Material Adverse Effect, with respect to Big Stuff, or a Parent Material Adverse Effect, with respect to Parent;
(p) adopt a plan of liquidation, dissolution, merger, consolidation, share exchange, restructuring, recapitalization, or other reorganization; provided, however, that Parent may adopt such a plan -------- ------- and may cause the liquidation or dissolution of any Parent subsidiary if Parent is unable to sell such Parent subsidiary (i) at a price which Parent determines to be reasonable, and (ii) during a time period which Parent determines to be reasonable; provided, further, however, that if -------- ------- ------- Parent adopts such a plan or causes such liquidation or dissolution, Parent promptly shall provide to Big Stuff notice of such adoption, liquidation or dissolution, as the case may be; or
(q) resolve, agree, commit or arrange to do any of the foregoing. Notwithstanding anything in this Section 6.6 to the contrary, it ----------- is understood that Big Stuff has been accelerating and intensifying its business activities since March 31, 1999 and will continue to do so. Accordingly, (x) "ordinary course of business" and "consistent with past practice", as used in this Section 6.6 with respect to Big Stuff, ----------- shall be interpreted to include such acceleration and intensification; and (y) in considering requests for consent from Big Stuff, Parent shall take into account such acceleration and intensification. Furthermore, Parent covenants, represents and warrants that from and after the date hereof, unless Big Stuff shall otherwise expressly consent in writing, Parent shall use its reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, to the extent permitted by Parent's cash flow and consistent with prudent cash management strategies, and consistent with the provisions of this Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Big Stuff; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Parent Permits necessary for, or otherwise material to, such business; provided, however, that Big Stuff acknowledges -------- ------- and agrees that Parent is attempting to sell its CLEC Operations, and to the extent such CLEC Operations are sold and, as a result, certain Laws or Parent Permits to which Parent is subject as of the date hereof become unnecessary, irrelevant or immaterial, Parent shall not be required to comply with such Laws or maintain such Parent Permits. Furthermore, Big Stuff covenants, represents and warrants that from and after the date hereof, unless Parent shall otherwise expressly consent in writing, Big Stuff shall use its or their reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, when they become due and payable, in the ordinary course of business consistent with past practice and with the provisions of this Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Parent; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Big Stuff Permits necessary for, or otherwise material to, such business6.1.
Appears in 1 contract
Conduct of Business Prior to Closing Date. Except as ----------------------------------------- expressly contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Big Stuff Web shall conduct its business in the ordinary course and consistent with past practice, subject to the limitations contained in this Agreement, and Big Stuff Web shall use its reasonable business efforts to preserve intact its business organization, to keep available the services of its officers, agents and employees and to maintain satisfactory relationships with all Persons with whom it does business. Except as expressly contemplated by this Agreement, and it being acknowledged and agreed by each of the parties to this Agreement that Parent is in the process of a substantial reduction in workforce, and, subject to Section 5.11, Parent shall, and it shall cause ------------ the Active ------------ Parent Subsidiaries to, use its or their reasonable business efforts to preserve intact its business organization, consistent with the budget adopted by the Executive Committee of the Board of Directors of Parent, to keep available the services of only those officers, agents and employees whom Parent believes are required to maintain satisfactory relationships with all Persons with whom it does business. Without limiting the generality of the foregoing, and except as otherwise expressly provided in this Agreement, after the date of this Agreement and prior to the Closing Date, (i) Big Stuff Web will not, without the prior written consent of Parent (which consent shall not be unreasonably withheld or delayed); and (ii) subject to Section 5.11, neither Parent nor any Active Parent ------------ Subsidiary ------------ will, without the prior written consent of Big Stuff Web (which consent shall not be unreasonably withheld or delayed):
(a) except as provided for in this Agreement, the Company Acquisition Agreement or the Web Big Stuff Acquisition Agreement, amend or propose to amend its Certificate or Articles of Incorporation or Bylaws (or comparable governing instruments) in any material respect;
(b) except as set forth on Schedule 6.6(b)(i) to be ------------------ provided during the Schedule Period, with regard to Web, or Parent Common Stock to be issued pursuant to those options or warrants listed on Schedule 6.6(b)(ii) to be provided during the Schedule Period or in ------------------- Section 6.10, with regard to Parent or the Active Parent Subsidiaries, ------------ authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any shares of, or any options, warrants, commitments, subscriptions or rights of any kind to acquire or sell any shares of, the capital stock or other securities of Big StuffWeb, or of Parent or any Active Parent Subsidiary, as the case may be, including, but not limited to, any securities convertible into or exchangeable for shares of stock of any class of Big StuffWeb, or of Parent or any Active Parent Subsidiary, as the case may be; provided, however, that Big -------- ------- Stuff Web may issue capital stock -------- ------- pursuant to the exercise of options and warrants outstanding on the date of this Agreement;
(c) except as provided for in this Agreement, the Company Acquisition Agreement or the Web Big Stuff Acquisition Agreement, split, combine or reclassify any shares of its capital stock or declare, pay or set aside any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its capital stock, other than dividends or distributions to Big Stuff the Web Shareholders (but only if the entire amount of such dividend is paid to Web Big Stuff as a capital contribution), or to Parent or a Parent subsidiary, as the case may be, or redeem, purchase or otherwise acquire or offer to acquire any shares of its capital stock or other securities; provided, however, that Web may -------- ------- make a dividend or distribution to the Web Shareholders in the amount of cash or other consideration received by Web on or before the Closing Date from the exercise of options and warrants to purchase Web Common Stock;
(i) except for debt (including, but not limited to, obligations in respect of capital leases, but excluding obligations under the Convertible Note) not in excess of $50,000 in the aggregate for all Persons combined, create, incur or assume any short-term debt (excluding trade payables incurred in the ordinary course of business), long-term debt or obligations in respect of capital leases; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, indirectly, contingently or otherwise) for the obligations of any Person, except for obligations permitted by this Agreement of any Active Parent Subsidiary, in the ordinary course of business consistent with past practice; (iii) make any capital expenditures or make any loans, advances or capital contributions to, or investments in, any other Person (other than customary advances to employees made in the ordinary course of business consistent with past practice), provided Big Stuff Web will continue to make capital expenditures, maintain, upgrade and expand its facilities, and otherwise operate in the ordinary course and consistent with past practice; (iv) acquire the stock or assets of, or merge or consolidate with, any other Person or business except the contemplated merger with WebBig Stuff; or (v) voluntarily incur any material liability or obligation (absolute, accrued, contingent or otherwise);
(e) subject to Section 5.11 hereof, sell, transfer, ------------ mortgage, pledge or otherwise dispose of, or encumber, or agree to sell, transfer, mortgage, pledge or otherwise dispose of or encumber, any material assets or properties, real, personal or mixed, except in the ordinary course of business, in the case of Parent and the Active Parent Subsidiaries;
(f) increase in any manner the compensation of any of its officers, agents or employees other than any increases required pursuant to their employment agreements in accordance with their terms in effect on the date of this Agreement and increases in the ordinary course of business consistent with past practice not in excess on an individual basis of the lesser of 10% of the current compensation of such individual or $10,000 per annum;
(g) enter into, establish, amend, make non-routine or material interpretations or determinations with respect to, or terminate any employment, consulting, retention, change in control, collective bargaining, bonus or other incentive compensation, profit sharing, health or other welfare, stock option, stock purchase, restricted stock, or other equity, pension, retirement, vacation, severance, deferred compensation or other compensation or benefit plan, policy, agreement, trust, fund or arrangement with, for or in respect of, any shareholder, officer, director, other employee, agent, consultant or affiliate, other than actions contemplated by this Agreement, the Company Acquisition Agreement and the Web Big Stuff Acquisition Agreement;
(h) make any elections with respect to Taxes that are inconsistent with the prior elections reflected in the Financial Statements as of and to the period ended December 31, 1998;
(i) except with regard to Xxxxxxx, compromise, settle, grant any waiver or release relating to or otherwise adjust any Litigation, except routine Litigation in the ordinary course of business consistent with past practice, involving only a payment not in excess of $50,000 individually or $100,000 when aggregated with all such payments by Big Stuff Web or by Parent and the Active Parent Subsidiaries combined, as the case may be;
(j) take any action or omit to take any action, which action or omission would result in a breach of any of the covenants, representations and warranties of Big StuffWeb, the Big Stuff Web Shareholders or Parent or the Active Parent Subsidiaries set forth in this Agreement or would have a Big Stuff Web Material Adverse Effect, with regard to Big Stuff Web and the Big Stuff Web Shareholders, or a Parent Material Adverse Effect, with regard to Parent and the Active Parent Subsidiaries;
(k) except in the ordinary course of business enter into any lease or other agreement, or amend any lease or other agreement, with respect to real property;
(l) enter into or amend any agreement or transaction (i) pursuant to which the aggregate financial obligation of Big StuffWeb, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $50,000, (ii) having a term of more than twelve (12) months and pursuant to which the aggregate financial obligation of Big StuffWeb, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $100,000 per year, or (iii) which is not terminable by Big Stuff Web or Parent or the Active Parent Subsidiaries, as the case may be, upon no more than thirty (30) days' notice without penalty in excess of $50,000 individually or $100,000 when aggregated with the penalties under all such agreements or transactions;
(m) take any action with respect to the indemnification of any Person;
(n) change any accounting practices or policies, except as required by generally accepted accounting principles or Laws or as agreed to or requested by Big StuffWeb's or Parent's auditors after consultation with Parent's or Big StuffWeb's auditors, as the case may be; provided, -------- however, that -------- ------- notice and a description of any change pursuant to this ------- Section 6.6(n) -------------- shall be provided promptly after such change is effected -------------- to Big Stuff Web or Parent, as the case may be;
(o) except in the ordinary course of business, enter into, amend, modify, terminate or waive any rights under any contract which would result in a Big Stuff Web Material Adverse Effect, with respect to Big StuffWeb, or a Parent Material Adverse Effect, with respect to Parent;
(p) adopt a plan of liquidation, dissolution, merger, consolidation, share exchange, restructuring, recapitalization, or other reorganization; provided, however, that Parent may adopt such a plan -------- ------- and may cause the liquidation or dissolution of any Parent subsidiary if Parent is unable to sell such Parent subsidiary (i) at a price which Parent determines to be reasonable, and (ii) during a time period which Parent determines to be reasonable; provided, further, however, that if -------- ------- ------- Parent adopts such a plan or causes such liquidation or dissolution, Parent promptly shall provide to Big Stuff Web notice of such adoption, liquidation or dissolution, as the case may be; or
(q) resolve, agree, commit or arrange to do any of the foregoing. Notwithstanding anything in this Section 6.6 to the contrary, it ----------- is understood that Big Stuff Web has been accelerating and intensifying its business activities since March 31, 1999 and will continue to do so. Accordingly, (x) "ordinary course of business" and "consistent with past practice", as used in this Section 6.6 with respect to Big StuffWeb, ----------- shall be ----------- interpreted to include such acceleration and intensification; and (y) in considering requests for consent from Big StuffWeb, Parent shall take into account such acceleration and intensification. Furthermore, Parent covenants, represents and warrants that from and after the date hereof, unless Big Stuff Web shall otherwise expressly consent in writing, Parent shall use its reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, to the extent permitted by Parent's cash flow and consistent with prudent cash management strategies, and consistent with the provisions of this Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Big StuffWeb; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Parent Permits necessary for, or otherwise material to, such business; provided, -------- however, that Big Stuff Web acknowledges -------- ------- and agrees that Parent is ------- attempting to sell its CLEC Operations, and to the extent such CLEC Operations are sold and, as a result, certain Laws or Parent Permits to which Parent is subject as of the date hereof become unnecessary, irrelevant or immaterial, Parent shall not be required to comply with such Laws or maintain such Parent Permits. Furthermore, Big Stuff Web covenants, represents and warrants that from and after the date hereof, unless Parent shall otherwise expressly consent in writing, Big Stuff Web shall use its or their reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, when they become due and payable, in the ordinary course of business consistent with past practice and with the provisions of this Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Parent; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Big Stuff Web Permits necessary for, or otherwise material to, such business.
Appears in 1 contract
Samples: Acquisition Agreement (Advanced Communications Group Inc/De/)
Conduct of Business Prior to Closing Date. Except as ----------------------------------------- expressly contemplated by this Restated Agreement, during the period from the date of this Restated Agreement to the Closing Date, Big Stuff Web shall conduct its business in the ordinary course and consistent with past practice, subject to the limitations contained in this Restated Agreement, and Big Stuff Web shall use its reasonable business efforts to preserve intact its business organization, to keep available the services of its officers, agents and employees and to maintain satisfactory relationships with all Persons with whom it does business. Except as expressly contemplated by this Restated Agreement, and it being acknowledged and agreed by each of the parties to this Restated Agreement that Parent is in the process of a substantial reduction in workforce, and, subject to Section 5.11the sale of the CLEC Operations, Parent shall, and it shall cause the Active ------------ Parent Subsidiaries to, use its or their reasonable business best efforts to preserve intact its business organization, organization consistent with the budget adopted by the Executive Committee of the Board of Directors of Parent, to keep available the services of only those officers, agents and employees whom Parent believes are required to maintain satisfactory relationships with all Persons with whom it does business. Without limiting the generality of the foregoing, and except as otherwise expressly provided in this Restated Agreement, after the date of this Restated Agreement and prior to the Closing Date, (i) Big Stuff Web will not, without the prior written consent of Parent (which consent shall not be unreasonably withheld or delayed); and (ii) subject to Section 5.11the sale of the CLEC Operations, neither Parent nor any Active Parent Subsidiary ------------ will, without the prior written consent of Big Stuff Web (which consent shall not be unreasonably withheld or delayed):
(a) except as provided for in this Restated Agreement, the Restated Company Acquisition Agreement or the Web Acquisition Restated Big Stuff Agreement, amend or propose to amend its Certificate or Articles of Incorporation or Bylaws (or comparable governing instruments) in any material respect;
(b) except as set forth on Schedule SCHEDULE 6.6(b)(i) to be ------------------ provided during the Schedule Period), with regard to Web, or Parent Common Stock to be issued pursuant to those options or warrants listed on Schedule SCHEDULE 6.6(b)(ii) to be provided during the Schedule Period or in ------------------- Section SECTION 6.10, with regard to Parent or the Active Parent Subsidiaries, ------------ authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any shares of, or any options, warrants, commitments, subscriptions or rights of any kind to acquire or sell any shares of, the capital stock or other securities of Big StuffWeb, or of Parent or any Active Parent Subsidiary, as the case may be, including, but not limited to, any securities convertible into or exchangeable for shares of stock of any class of Big StuffWeb, or of Parent or any Active Parent Subsidiary, as the case may be; providedPROVIDED, howeverHOWEVER, that Big -------- ------- Stuff Web may issue capital stock pursuant to the exercise of options and warrants outstanding on the date of this Restated Agreement;
(c) except as provided for in this Restated Agreement, the Restated Company Acquisition Agreement or the Web Acquisition Restated Big Stuff Agreement, split, combine or reclassify any shares of its capital stock or declare, pay or set aside any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its capital stock, other than dividends or distributions to Big Stuff the Web Shareholders (but only if the entire amount of such dividend is paid to Web Big Stuff as a capital contribution), or to Parent or a Parent subsidiary, as the case may be, or redeem, purchase or otherwise acquire or offer to acquire any shares of its capital stock or other securities; PROVIDED, HOWEVER, that Web may make a dividend or distribution to the Web Shareholders in the amount of cash or other consideration received by Web on or before the Closing Date from the exercise of options and warrants to purchase Web Common Stock;
(id) except for debt (including, but not limited to, obligations in respect of capital leases, but excluding obligations under the Convertible Note) not in excess of $50,000 in the aggregate for all Persons combined, (i) create, incur or assume any short-term debt (excluding trade payables incurred in the ordinary course of business), long-term debt or obligations in respect of capital leases, except for indebtedness contemplated by this Restated Agreement; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, indirectly, contingently or otherwise) for the obligations of any Person, except for obligations permitted by this Restated Agreement of any Active Parent Subsidiary, in the ordinary course of business consistent with past practice; (iii) except as contemplated in this Restated Agreement, make any capital expenditures or make any loans, advances or capital contributions to, or investments in, any other Person (other than customary advances to employees made in the ordinary course of business consistent with past practice), provided Big Stuff Web will continue to make capital expenditures, maintain, upgrade and expand its facilities, and otherwise operate in the ordinary course and consistent with past practice; (iv) acquire the stock or assets of, or merge or consolidate with, any other Person or business business, except as contemplated in this Restated Agreement and except the contemplated merger with WebBig Stuff or the contemplated acquisition of all of the issued and outstanding capital stock, either directly or indirectly, of the Company; or (v) voluntarily incur any material liability or obligation (absolute, accrued, contingent or otherwise), except in the ordinary course of business;
(e) subject to Section 5.11 hereofexcept for the contemplated sale of the Parent's CLEC Operations, sell, transfer, ------------ mortgage, pledge or otherwise dispose of, or encumber, or agree to sell, transfer, mortgage, pledge or otherwise dispose of or encumber, any material assets or properties, real, personal or mixed, except in the ordinary course of business, in the case of Parent and the Active Parent Subsidiaries;
(f) increase in any manner the compensation of any of its officers, agents or employees other than any increases required pursuant to their employment agreements in accordance with their terms in effect on the date of this Restated Agreement and increases in the ordinary course of business consistent with past practice not in excess on an individual basis of the lesser of 10% of the current compensation of such individual or $10,000 per annum;
(g) enter into, establish, amend, make non-routine or material interpretations or determinations with respect to, or terminate any employment, consulting, retention, change in control, collective bargaining, bonus or other incentive compensation, profit sharing, health or other welfare, stock option, stock purchase, restricted stock, or other equity, pension, retirement, vacation, severance, deferred compensation or other compensation or benefit plan, policy, agreement, trust, fund or arrangement with, for or in respect of, any shareholder, officer, director, other employee, agent, consultant or affiliate, other than actions contemplated by this Restated Agreement, the Restated Company Acquisition Agreement and the Web Acquisition Restated Big Stuff Agreement;
(h) make any elections with respect to Taxes that are inconsistent with the prior elections reflected in the Financial Statements as of and to the period ended December 31, 1998;
(i) except with regard to Xxxxxxxthe Xxxxxxx matter referenced on SCHEDULE 3.7 attached hereto, compromise, settle, grant any waiver or release relating to or otherwise adjust any Litigation, except routine Litigation in the ordinary course of business consistent with past practice, involving only a payment not in excess of $50,000 individually or $100,000 when aggregated with all such payments by Big Stuff Web or by Parent and the Active Parent Subsidiaries combined, as the case may be;
(j) take any action or omit to take any action, which action or omission would result in a breach of any of the covenants, representations and warranties of Big StuffWeb, the Big Stuff Web Shareholders or Parent or the Active Parent Subsidiaries set forth in this Restated Agreement or would have a Big Stuff Web Material Adverse Effect, with regard to Big Stuff Web and the Big Stuff Web Shareholders, or a Parent Material Adverse Effect, with regard to Parent and the Active Parent Subsidiaries;
(k) except in the ordinary course of business enter into any lease or other agreement, or amend any lease or other agreement, with respect to real property;
(li) except as set forth in SECTION 6.6(l)(ii) or SECTION 11.1 or 11.2 hereof, enter into or amend any agreement or transaction (iA) pursuant to which the aggregate financial obligation of Big StuffWeb, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $50,000, (iiB) having a term of more than twelve (12) months and pursuant to which the aggregate financial obligation of Big StuffWeb, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $100,000 per year, or (iiiC) which is not terminable by Big Stuff Web or Parent or the Active Parent Subsidiaries, as the case may be, upon no more than thirty (30) days' notice without penalty in excess of $50,000 individually or $100,000 when aggregated with the penalties under all such agreements or transactions;
(ii) The parties hereto expressly agree that, notwithstanding anything in this Restated Agreement to the contrary, Parent may modify, amend or waive its rights, including those respecting its indemnification obligations, under (A) the Ionex Agreement referenced on SCHEDULE 3.13 attached hereto; (B) the Restated Company Agreement; and (C) the Restated Big Stuff Agreement; PROVIDED, that such modifications, amendments and/or waivers do not, or would not reasonably be expected to, materially increase Parent's obligations or materially adversely affect Parent's rights under each respective agreement, or otherwise materially affect the consideration to be received under each respective agreement.
(m) except as set forth in SECTION 6.6(l)(ii) hereof, take any action with respect to the indemnification of any Person;
(n) change any accounting practices or policies, except as required by generally accepted accounting principles or Laws or as agreed to or requested by Big StuffWeb's or Parent's auditors after consultation with Parent's or Big StuffWeb's auditors, as the case may be; providedPROVIDED, -------- howeverHOWEVER, that notice and a description of any change pursuant to this ------- Section SECTION 6.6(n) shall be provided promptly after such change is effected -------------- to Big Stuff Web or Parent, as the case may be;
(o) except as set forth in SECTION 6.6(l)(ii) hereof, or except in the ordinary course of business, enter into, amend, modify, terminate or waive any rights under any contract which would result in a Big Stuff Web Material Adverse Effect, with respect to Big StuffWeb, or a Parent Material Adverse Effect, with respect to Parent;
(p) adopt a plan of liquidation, dissolution, merger, consolidation, share exchange, restructuring, recapitalization, or other reorganization; providedPROVIDED, howeverHOWEVER, that Parent may adopt such a plan -------- ------- and may cause the liquidation or dissolution of any Parent subsidiary if Parent is unable to sell such Parent subsidiary (i) at a price which Parent determines to be reasonable, and (ii) during a time period which Parent determines to be reasonable; providedPROVIDED, furtherFURTHER, howeverHOWEVER, that if -------- ------- ------- Parent adopts such a plan or causes such liquidation or dissolution, Parent promptly shall provide to Big Stuff Web notice of such adoption, liquidation or dissolution, as the case may be; or
(q) resolve, agree, commit or arrange to do any of the foregoing. Notwithstanding anything in this Section SECTION 6.6 to the contrary, it ----------- is understood that Big Stuff Web has been accelerating and intensifying its business activities since March 31, 1999 and will continue to do so. Accordingly, (x) "ordinary course of business" and "consistent with past practice", as used in this Section SECTION 6.6 with respect to Big StuffWeb, ----------- shall be interpreted to include such acceleration and intensification; and (y) in considering requests for consent from Big StuffWeb, Parent shall take into account such acceleration and intensification. Furthermore, Parent covenants, represents and warrants that from and after the date hereof, unless Big Stuff Web shall otherwise expressly consent in writing, Parent shall use its reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, to the extent permitted by Parent's cash flow and obligations consistent with prudent cash management strategies, and consistent with the provisions of this Agreementprinciples, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Big StuffWeb; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business business, except for such Laws the failure to comply with which would not have a Parent Material Adverse Effect and maintain in full force and effect all Parent Permits necessary for, or otherwise material to, such business; provided, however, that Big Stuff acknowledges -------- ------- and agrees that Parent is attempting to sell its CLEC Operations, and to the extent except for such CLEC Operations are sold and, as a result, certain Laws or Parent Permits the failure of which to which maintain in full force and effect would not have a Parent is subject as of the date hereof become unnecessary, irrelevant or immaterial, Parent shall not be required to comply with such Laws or maintain such Parent PermitsMaterial Adverse Effect. Furthermore, Big Stuff Web covenants, represents and warrants that from and after the date hereof, unless Parent shall otherwise expressly consent in writing, Big Stuff Web shall use its or their reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, when they become due and payable, in the ordinary course of business consistent with past practice and with the provisions of this Restated Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Parent; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business business, and maintain in full force and effect all Big Stuff Web Permits necessary for, or otherwise material to, such business.
Appears in 1 contract
Samples: Web Yp Acquisition Agreement (Advanced Communications Group Inc/De/)
Conduct of Business Prior to Closing Date. Except as ----------------------------------------- expressly contemplated by this Agreement, during the period from the date of this Agreement to the Closing Date, Big Stuff the Company shall conduct conduct, and it shall cause the Subsidiaries to conduct, its business or their businesses in the ordinary course and consistent with past practice, subject to the limitations contained in this Agreement, and Big Stuff the Company shall, and it shall cause the Subsidiaries to, use its or their reasonable business best efforts to preserve intact its business organization, to keep available the services of its officers, agents and employees and to maintain satisfactory relationships with all Persons with whom it does business. Except as expressly contemplated by this Agreement, and it being acknowledged and agreed by each of the parties to this Agreement that Parent is in the process of a substantial reduction in workforce, and, subject to Section 5.11-------- 5.10, Parent shall, and it shall cause the Active ------------ Parent Subsidiaries to, ---- use its or their reasonable business best efforts to preserve intact its business organization, consistent with the budget adopted by the Executive Committee of the Board of Directors of Parent, to keep available the services of only those officers, agents and employees whom Parent believes are required to maintain satisfactory relationships with all Persons with whom it does business. Without limiting the generality of the foregoing, and except as otherwise expressly provided in this Agreement, after the date of this Agreement and prior to the Closing Date, (i) Big Stuff will notneither the Company nor any Subsidiary will, without the prior written consent of Parent (which consent shall not be unreasonably withheld or delayed)Parent; and (ii) subject to Section 5.115.10, neither Parent nor any Active Parent Subsidiary ------------ will, without the prior written consent of Big Stuff (which consent shall not be unreasonably withheld or delayed):the Company:
(a) except as provided for in this Agreement, the Company Acquisition Agreement or the Web Acquisition Agreement, amend or propose to amend its Certificate or Articles of Incorporation or Bylaws (or comparable governing instruments) in any material respect;
(b) except as set forth on Schedule 6.6(b)(i) to be ------------------ provided during the Schedule Period6.7(b)(i), with regard ------------------ to Webthe Company or the Subsidiaries, or Parent Common Stock to be issued pursuant to those options or warrants listed on Schedule 6.6(b)(ii) to be provided during the Schedule Period or in ------------------- Section 6.106.7(b)(ii), with ------------------- regard to Parent or the Active Parent Subsidiariessubsidiaries, ------------ authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any shares of, or any options, warrants, commitments, subscriptions or rights of any kind to acquire or sell any shares of, the capital stock or other securities of Big Stuffthe Company or any Subsidiary, or of Parent or any Active Parent Subsidiary, as the case may besubsidiary, including, but not limited to, any securities convertible into or exchangeable for shares of stock of any class of Big Stuffthe Company or any Subsidiary, or of Parent or any Active Parent Subsidiarysubsidiary, as the case may be; provided, however, that Big -------- ------- Stuff may issue capital stock pursuant to the exercise of options and warrants outstanding on the date of this Agreement;
(c) except as provided for in this Agreement, the Company Acquisition Agreement or the Web Acquisition Agreement, split, combine or reclassify any shares of its capital stock or declare, pay or set aside any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its capital stock, other than dividends or distributions to Big Stuff Shareholders (but only if the entire amount of such dividend is paid to Web as Company or a capital contribution)Subsidiary, or to Parent or a Parent subsidiary, as the case may be, or redeem, purchase or otherwise acquire or offer to acquire any shares of its capital stock or other securities;
(i) except for debt (including, but not limited to, obligations in respect of capital leases, but excluding obligations under ) disclosed on the Convertible Note) not in excess financial statements of $50,000 the Company delivered to Parent prior to the date of this Agreement and changes thereto occurring in the aggregate for all Persons combinedordinary course of business, create, incur or assume any short-term debt (excluding trade payables incurred in the ordinary course of business)debt, long-term debt or obligations in respect of capital leases; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, indirectly, contingently or otherwise) for the obligations of any Person, except for obligations permitted by this Agreement of any Active subsidiary or Parent Subsidiarysubsidiary, as the case may be, in the ordinary course of business consistent with past practice; (iii) make any capital expenditures or make any loans, advances or capital contributions to, or investments in, any other Person (other than customary advances to employees made in the ordinary course of business consistent with past practice), provided Big Stuff the Company will continue to make capital expendituresexpenditures in accordance with its budget, maintain, upgrade and or expand its facilitiesfacilities and those of the Subsidiaries, as the case may be, and otherwise operate in the ordinary course and consistent with past practice; (iv) acquire the stock or assets of, or merge or consolidate with, any other Person or business except the contemplated merger with WebWorldPages Acquisition; or (v) voluntarily incur any material liability or obligation (absolute, accrued, contingent or otherwise), except in the ordinary course of business;
(e) subject to Section 5.11 hereofexcept in the ordinary course of business or as set forth in Schedule 6.7(e) or as otherwise permitted by this Agreement, --------------- sell, transfer, ------------ mortgage, pledge or otherwise dispose of, or encumber, or agree to sell, transfer, mortgage, pledge or otherwise dispose of or encumber, any material assets or properties, real, personal or mixed, except in the ordinary course of businesssubject to Section 5.10, in the case of Parent and the Active Parent ------------ Subsidiaries;
(f) increase in any manner the compensation of any of its officers, agents or employees other than any increases required pursuant to their employment agreements in accordance with their terms in effect on the date of this Agreement and increases in the ordinary course of business consistent with past practice not in excess on an individual basis of the lesser of 10% of the current compensation of such individual or U.S. $10,000 per annum;
(g) enter into, establish, amend, make non-routine or material interpretations or determinations with respect to, or terminate any employment, consulting, retention, change in control, collective bargaining, bonus or other incentive compensation, profit sharing, health or other welfare, stock option, stock purchase, restricted stock, or other equity, pension, retirement, vacation, severance, deferred compensation or other compensation or benefit plan, policy, agreement, trust, fund or arrangement with, for or in respect of, any shareholder, officer, director, other employee, agent, consultant or affiliate, other than actions contemplated by this Agreement, Agreement or in the Company Acquisition Agreement and ordinary course of business or those agreements in connection with the Web Acquisition Agreement;WorldPages Acquisition.
(h) make any elections with respect to Taxes that are inconsistent with the prior elections reflected in the Financial Statements as of and to the period ended December 31, 1998;
(i) except with regard to Xxxxxxx, compromise, settle, grant any waiver or release relating to or otherwise adjust any Litigation, except routine Litigation in the ordinary course of business consistent with past practice, involving only a payment not in excess of U.S. $50,000 individually or U.S. $100,000 when aggregated with all such payments by Big Stuff the Company and the Subsidiaries combined or by Parent and the Active Parent Subsidiaries combined, as the case may be;
(ji) (i) with respect to the Company or the Shareholders, take any action or omit to take any action, which action or omission would result in a breach of any of the covenants, representations and warranties of Big Stuff, the Big Stuff Company or Shareholders or Parent or the Active Parent Subsidiaries set forth in this Agreement or which would have a Big Stuff Company Material Adverse EffectEffect and (ii) with respect to Parent, with regard take any action or omit to Big Stuff take any action, which action or omission would result in a breach of any of the covenants, representations and warranties of the Big Stuff Shareholders, Parent set forth in this Agreement or which would have a Parent Material Adverse Effect, with regard to Parent and the Active Parent Subsidiaries;
(kj) except in the ordinary course of business business, enter into any lease or other agreement, or amend any lease or other agreement, with respect to real property;
(lk) except in the ordinary course of business, enter into or amend any agreement or transaction (i) pursuant to which the aggregate financial obligation of Big Stuffthe Company or a Subsidiary, or of Parent or an Active a Parent Subsidiary, Subsidiary as the case may be, or the value of the services to be provided could exceed U.S. $50,000, (ii) having a term of more than twelve (12) 12 months and pursuant to which the aggregate financial obligation of Big Stuffthe Company or a Subsidiary, or of Parent or an Active a Parent Subsidiary, Subsidiary as the case may be, or the value of the services to be provided could exceed U.S. $100,000 per year, or (iii) which is not terminable by Big Stuff or Parent or the Active Parent Subsidiaries, as the case may be, upon no more than thirty (30) 30 days' notice without penalty in excess of U.S. $50,000 individually or U.S. $100,000 when aggregated with the penalties under all such agreements or transactions;
(ml) take any action with respect to the indemnification of any Person;
(nm) change any accounting practices or policies, except as required by generally accepted accounting principles or Laws or as agreed to or requested by Big Stuffthe Company's or Parent's auditors after consultation with Parent's or Big Stuffthe Company's auditors, as the case may be; provided, -------- however, that notice and a description of any change pursuant to this ------- Section 6.6(n) shall be provided promptly after such change is effected -------------- to Big Stuff or Parent, as the case may be;
(on) except in the ordinary course of business, enter into, amend, modify, terminate or waive any rights under any contract which would result in a Big Stuff Company Material Adverse Effect, with respect to Big Stuff, Contract or a Parent Material Adverse Effect, with respect to ParentContract;
(po) adopt a plan of liquidation, dissolution, mergerexchange, consolidation, share exchange, restructuring, recapitalization, or other reorganization; provided, however, that Parent may adopt such a plan -------- ------- and may cause the liquidation or dissolution of any Parent subsidiary if Parent is unable to sell such Parent subsidiary (i) at a price which Parent determines to be reasonable, and (ii) during a time period which Parent determines to be reasonable; provided, further, however, that if -------- ------- ------- Parent adopts such a plan or causes such liquidation or dissolution, Parent promptly shall provide to Big Stuff notice of such adoption, liquidation or dissolution, as the case may be; or
(qp) resolve, agree, commit or arrange to do any of the foregoing. Notwithstanding anything in this Section 6.6 to the contrary, it ----------- is understood that Big Stuff has been accelerating and intensifying its business activities since March 31, 1999 and will continue to do so. Accordingly, (x) "ordinary course of business" and "consistent with past practice", as used in this Section 6.6 with respect to Big Stuff, ----------- shall be interpreted to include such acceleration and intensification; and (y) in considering requests for consent from Big Stuff, Parent shall take into account such acceleration and intensification. Furthermore, Parent the Company covenants, represents and warrants that from and after the date hereof, unless Big Stuff Parent shall otherwise expressly consent in writing, Parent the Company shall, and the Company shall cause each Subsidiary to, use its or their reasonable business best efforts to:
(1A) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2B) pay all accounts payable and other obligations, to the extent permitted by Parent's cash flow and consistent with prudent cash management strategies, and consistent with the provisions of this Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Big Stuff; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Parent Permits necessary for, or otherwise material to, such business; provided, however, that Big Stuff acknowledges -------- ------- and agrees that Parent is attempting to sell its CLEC Operations, and to the extent such CLEC Operations are sold and, as a result, certain Laws or Parent Permits to which Parent is subject as of the date hereof become unnecessary, irrelevant or immaterial, Parent shall not be required to comply with such Laws or maintain such Parent Permits. Furthermore, Big Stuff covenants, represents and warrants that from and after the date hereof, unless Parent shall otherwise expressly consent in writing, Big Stuff shall use its or their reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, when they become due and payable, in the ordinary course of business consistent with past practice and with the provisions of this Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Parent; and
(C) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Company Permits necessary for, or otherwise material to, such business. Furthermore, Parent covenants, represents and warrants that from and after the date hereof, unless Company shall otherwise expressly consent in writing, Parent shall, and Parent shall cause each Active Parent Subsidiary to, use its or their reasonable best efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations consistent with prudent cash management principles, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Company; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business and maintain in full force and effect all Big Stuff Parent Permits necessary for, or otherwise material to, such business; provided, however, that the Company -------- ------- and the Shareholders acknowledge and agree that Parent is attempting to sell the CLEC Operations, and to the extent such CLEC Operations are sold and, as a result, certain Laws or Parent Permits to which Parent is subject as of the date hereof become unnecessary, irrelevant or immaterial, Parent shall not be required to comply with such Laws or maintain such Parent Permits.
Appears in 1 contract
Samples: Yptel Agreement (Advanced Communications Group Inc/De/)
Conduct of Business Prior to Closing Date. Except as ----------------------------------------- expressly contemplated by this Restated Agreement, during the period from the date of this Restated Agreement to the Closing Date, Big Stuff shall conduct its business in the ordinary course and consistent with past practice, subject to the limitations contained in this Restated Agreement, and Big Stuff shall use its reasonable business efforts to preserve intact its business organization, to keep available the services of its officers, agents and employees and to maintain satisfactory relationships with all Persons with whom it does business. Except as expressly contemplated by this Restated Agreement, and it being acknowledged and agreed by each of the parties to this Restated Agreement that Parent is in the process of a substantial reduction in workforce, and, subject to Section 5.11the sale of the CLEC Operations, Parent shall, and it shall cause the Active ------------ Parent Subsidiaries to, use its or their reasonable business best efforts to preserve intact its business organization, organization consistent with the budget adopted by the Executive Committee of the Board of Directors of Parent, to keep available the services of only those officers, agents and employees whom Parent believes are required to maintain satisfactory relationships with all Persons with whom it does business. Without limiting the generality of the foregoing, and except as otherwise expressly provided in this Restated Agreement, after the date of this Restated Agreement and prior to the Closing Date, (i) Big Stuff will not, without the prior written consent of Parent (which consent shall not be unreasonably withheld or delayed); and (ii) subject to Section 5.11the sale of the CLEC Operations, neither Parent nor any Active Parent Subsidiary ------------ will, without the prior written consent of Big Stuff (which consent shall not be unreasonably withheld or delayed):
(a) except as provided for in this Restated Agreement, the Restated Company Acquisition Agreement or the Restated Web Acquisition Agreement, amend or propose to amend its Certificate or Articles of Incorporation or Bylaws (or comparable governing instruments) in any material respect;
(b) except as set forth on Schedule SCHEDULE 6.6(b)(i) to be ------------------ provided during the Schedule Period), with regard to WebBig Stuff, or Parent Common Stock to be issued pursuant to those options or warrants listed on Schedule SCHEDULE 6.6(b)(ii) to be provided during the Schedule Period or in ------------------- Section SECTION 6.10, with regard to Parent or the Active Parent Subsidiaries, ------------ authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any shares of, or any options, warrants, commitments, subscriptions or rights of any kind to acquire or sell any shares of, the capital stock or other securities of Big Stuff, or of Parent or any Active Parent Subsidiary, as the case may be, including, but not limited to, any securities convertible into or exchangeable for shares of stock of any class of Big Stuff, or of Parent or any Active Parent Subsidiary, as the case may be; providedPROVIDED, howeverHOWEVER, that Big -------- ------- Stuff may issue capital stock pursuant to the exercise of options and warrants outstanding on the date of this Restated Agreement;
(c) except as provided for in this Restated Agreement, the Restated Company Acquisition Agreement or the Restated Web Acquisition Agreement, split, combine or reclassify any shares of its capital stock or declare, pay or set aside any dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its capital stock, other than dividends or distributions to the Big Stuff Shareholders (but only if the entire amount of such dividend is paid to Web as a capital contribution), or to Parent or a Parent subsidiary, as the case may be, or redeem, purchase or otherwise acquire or offer to acquire any shares of its capital stock or other securities;
(id) except for debt (including, but not limited to, obligations in respect of capital leases, but excluding obligations under the Convertible Note) not in excess of $50,000 in the aggregate for all Persons combined, (i) create, incur or assume any short-term debt (excluding trade payables incurred in the ordinary course of business), long-term debt or obligations in respect of capital leases, except for indebtedness contemplated by this Restated Agreement; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, indirectly, contingently or otherwise) for the obligations of any Person, except for obligations permitted by this Restated Agreement of any Active Parent Subsidiary, in the ordinary course of business consistent with past practice; (iii) except as contemplated in this Restated Agreement, make any capital expenditures or make any loans, advances or capital contributions to, or investments in, any other Person (other than customary advances to employees made in the ordinary course of business consistent with past practice), provided Big Stuff will continue to make capital expenditures, maintain, upgrade and expand its facilities, and otherwise operate in the ordinary course and consistent with past practice; (iv) acquire the stock or assets of, or merge or consolidate with, any other Person or business business, except as contemplated in this Restated Agreement and except the contemplated merger with WebWeb or the contemplated acquisition of all of the issued and outstanding capital stock, either directly or indirectly, of the Company; or (v) voluntarily incur any material liability or obligation (absolute, accrued, contingent or otherwise), except in the ordinary course of business;
(e) subject to Section 5.11 hereofexcept for the contemplated sale of the Parent's CLEC Operations, sell, transfer, ------------ mortgage, pledge or otherwise dispose of, or encumber, or agree to sell, transfer, mortgage, pledge or otherwise dispose of or encumber, any material assets or properties, real, personal or mixed, except in the ordinary course of business, in the case of Parent and the Active Parent Subsidiaries;
(f) increase in any manner the compensation of any of its officers, agents or employees other than any increases required pursuant to their employment agreements in accordance with their terms in effect on the date of this Restated Agreement and increases in the ordinary course of business consistent with past practice not in excess on an individual basis of the lesser of 10% of the current compensation of such individual or $10,000 per annum;
(g) enter into, establish, amend, make non-routine or material interpretations or determinations with respect to, or terminate any employment, consulting, retention, change in control, collective bargaining, bonus or other incentive compensation, profit sharing, health or other welfare, stock option, stock purchase, restricted stock, or other equity, pension, retirement, vacation, severance, deferred compensation or other compensation or benefit plan, policy, agreement, trust, fund or arrangement with, for or in respect of, any shareholder, officer, director, other employee, agent, consultant or affiliate, other than actions contemplated by this Restated Agreement, the Restated Company Acquisition Agreement and the Restated Web Acquisition Agreement;
(h) make any elections with respect to Taxes that are inconsistent with the prior elections reflected in the Financial Statements as of and to the period ended December 31, 1998;
(i) except with regard to Xxxxxxxthe Xxxxxxx matter referenced on SCHEDULE 3.7 attached hereto, compromise, settle, grant any waiver or release relating to or otherwise adjust any Litigation, except routine Litigation in the ordinary course of business consistent with past practice, involving only a payment not in excess of $50,000 individually or $100,000 when aggregated with all such payments by Big Stuff or by Parent and the Active Parent Subsidiaries combined, as the case may be;
(j) take any action or omit to take any action, which action or omission would result in a breach of any of the covenants, representations and warranties of Big Stuff, the Big Stuff Shareholders or Parent or the Active Parent Subsidiaries set forth in this Restated Agreement or would have a Big Stuff Material Adverse Effect, with regard to Big Stuff and the Big Stuff Shareholders, or a Parent Material Adverse Effect, with regard to Parent and the Active Parent Subsidiaries;
(k) except in the ordinary course of business enter into any lease or other agreement, or amend any lease or other agreement, with respect to real property;
(li) except as set forth in SECTION 6.6(l)(ii) or SECTION 11.1 OR 11.2 hereof, enter into or amend any agreement or transaction (iA) pursuant to which the aggregate financial obligation of Big Stuff, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $50,000, (iiB) having a term of more than twelve (12) months and pursuant to which the aggregate financial obligation of Big Stuff, or of Parent or an Active Parent Subsidiary, as the case may be, or the value of the services to be provided could exceed $100,000 per year, or (iiiC) which is not terminable by Big Stuff or Parent or the Active Parent Subsidiaries, as the case may be, upon no more than thirty (30) days' notice without penalty in excess of $50,000 individually or $100,000 when aggregated with the penalties under all such agreements or transactions;
(ii) The parties hereto expressly agree that, notwithstanding anything in this Restated Agreement to the contrary, Parent may modify, amend or waive its rights, including those respecting its indemnification obligations, under (A) the Ionex Agreement referenced on SCHEDULE 3.13 attached hereto; (B) the Restated Company Agreement; and (C) the Restated Web Agreement; PROVIDED, that such modifications, amendments and/or waivers do not, or would not reasonably be expected to, materially increase Parent's obligations or materially adversely affect Parent's rights under each respective agreement, or otherwise materially affect the consideration to be received under each respective agreement.
(m) except as set forth in SECTION 6.6(l)(ii) hereof, take any action with respect to the indemnification of any Person;
(n) change any accounting practices or policies, except as required by generally accepted accounting principles or Laws or as agreed to or requested by Big Stuff's or Parent's auditors after consultation with Parent's or Big Stuff's auditors, as the case may be; providedPROVIDED, -------- howeverHOWEVER, that notice and a description of any change pursuant to this ------- Section SECTION 6.6(n) shall be provided promptly after such change is effected -------------- to Big Stuff or Parent, as the case may be;
(o) except as set forth in SECTION 6.6(l)(ii) hereof, or except in the ordinary course of business, enter into, amend, modify, terminate or waive any rights under any contract which would result in a Big Stuff Material Adverse Effect, with respect to Big Stuff, or a Parent Material Adverse Effect, with respect to Parent;
(p) adopt a plan of liquidation, dissolution, merger, consolidation, share exchange, restructuring, recapitalization, or other reorganization; providedPROVIDED, howeverHOWEVER, that Parent may adopt such a plan -------- ------- and may cause the liquidation or dissolution of any Parent subsidiary if Parent is unable to sell such Parent subsidiary (i) at a price which Parent determines to be reasonable, and (ii) during a time period which Parent determines to be reasonable; providedPROVIDED, furtherFURTHER, howeverHOWEVER, that if -------- ------- ------- Parent adopts such a plan or causes such liquidation or dissolution, Parent promptly shall provide to Big Stuff notice of such adoption, liquidation or dissolution, as the case may be; or
(q) resolve, agree, commit or arrange to do any of the foregoing. Notwithstanding anything in this Section SECTION 6.6 to the contrary, it ----------- is understood that Big Stuff has been accelerating and intensifying its business activities since March 31, 1999 and will continue to do so. Accordingly, (x) "ordinary course of business" and "consistent with past practice", as used in this Section SECTION 6.6 with respect to Big Stuff, ----------- shall be interpreted to include such acceleration and intensification; and (y) in considering requests for consent from Big Stuff, Parent shall take into account such acceleration and intensification. Furthermore, Parent covenants, represents and warrants that from and after the date hereof, unless Big Stuff shall otherwise expressly consent in writing, Parent shall use its reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, to the extent permitted by Parent's cash flow and obligations consistent with prudent cash management strategies, and consistent with the provisions of this Agreementprinciples, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Big Stuff; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business business, except for such Laws the failure to comply with which would not have a Parent Material Adverse Effect and maintain in full force and effect all Parent Permits necessary for, or otherwise material to, such business; provided, however, that Big Stuff acknowledges -------- ------- and agrees that Parent is attempting to sell its CLEC Operations, and to the extent except for such CLEC Operations are sold and, as a result, certain Laws or Parent Permits the failure of which to which maintain in full force and effect would not have a Parent is subject as of the date hereof become unnecessary, irrelevant or immaterial, Parent shall not be required to comply with such Laws or maintain such Parent PermitsMaterial Adverse Effect. Furthermore, Big Stuff covenants, represents and warrants that from and after the date hereof, unless Parent shall otherwise expressly consent in writing, Big Stuff shall use its or their reasonable business efforts to:
(1) keep in full force and effect insurance comparable in amount and scope of coverage to insurance now carried by it;
(2) pay all accounts payable and other obligations, when they become due and payable, in the ordinary course of business consistent with past practice and with the provisions of this Restated Agreement, except if the same are contested in good faith, and, in the case of the failure to pay any material accounts payable or other obligations which are contested in good faith, only after consultation with Parent; and
(3) comply in all material respects with all Laws applicable to it or any of its properties, assets or business business, and maintain in full force and effect all Big Stuff Permits necessary for, or otherwise material to, such business.
Appears in 1 contract
Samples: Big Stuff Acquisition Agreement (Advanced Communications Group Inc/De/)
