Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall, and shall cause its Subsidiaries to: (i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business; (ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries; (iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement; (iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and (v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement. (b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to: (i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options; (ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent; (iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries; (iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries; (v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries; (vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi)); (vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries; (viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries; (ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options; (x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business; (xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate; (xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries; (xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect; (xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries; (xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time; (xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect; (xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect; (xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and (xix) agree to do anything prohibited by this Section 7.2.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement in connection with, or in furtherance of, the consummation of the transactions contemplated hereby (including, without limitation, the amendment, replacement or termination of the Credit Facilities), or (iv) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) each Company Subsidiary to conduct the their respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;
(ii) . Without limiting the foregoing, from the date hereof until the earlier of the termination of this Agreement or the Closing Date, the Company shall use its commercially reasonable efforts to, and shall take commercially reasonable efforts to cause its Subsidiaries to: (A1) maintain and preserve its intact the present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company PEP Companies; and its Subsidiaries (2) maintain insurance coverage in such amounts and of such kinds reasonably comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreementhereof.
(b) Except Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement in connection with, or in furtherance of, the consummation of the transactions contemplated hereby (including, without limitation, the amendment, replacement or termination of the Credit Facilities and the PEP Companies’ efforts to reduce the amount of Closing Cash in anticipation of Closing), or (iv) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall not not, and shall cause each Company Subsidiary not permit its Subsidiaries to:
(iA) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of or otherwise subject to any Lien (other than Permitted Liens) any shares of capital stock or other securities of the any PEP Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentPEP Company;
(iiiB) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its SubsidiariesPEP Company;
(ivC) amend the certificate of incorporation or by-laws or similar governance documents of the Company or any of its SubsidiariesPEP Company;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with knowingly subject any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties Real Property or assets (whether tangible or intangible) of any PEP Company to any Lien, except for Permitted Liens and Liens that will be released at or in connection with the Closing (including those related to Company Indebtedness), or any shares of capital stock of the Company or any of its Subsidiaries;
(viiiE) other than in the Ordinary Course of Business, and except with respect to matters addressed in subsection (G) below, acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties Real Property or assets of any PEP Company (except for the Company and its Subsidiariespurpose of disposing of obsolete or worthless assets or to the extent such assets are replaced with like assets of equivalent value);
(ixF) except as set forth on Schedule 7.2(b)(ix)other than in the Ordinary Course of Business, enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of BusinessPEP Company;
(xiG) enter into any commitment for capital expenditures of the any PEP Company and its Subsidiaries in excess of $20,000 500,000 for any individual commitment and project or $100,000 for all commitments 1,000,000 in the aggregate, other than (i) as contemplated by the PEP Companies’ current budget, as provided to Purchaser on April 30, 2015 or (ii) related to Material Contracts with customers;
(xiiH) other than in the Ordinary Course of Business, enter into, modify or terminate any labor or collective bargaining agreement of the any PEP Company or any of its Subsidiaries or, through negotiation negotiations or otherwise, make any commitment or incur any liability to any labor organizations;
(I) declare, set aside, make, or pay any dividend or other distribution, payable in cash, stock, property, or otherwise, or make any other payment on or with respect to any of its capital stock, except for (A) dividends by any PEP Company to the Company and (B) any cash dividend or other cash distribution to the stockholders of the Company prior to the Closing Date;
(J) acquire any corporation, partnership, limited liability company, or other business organization or any material amount of assets, or enter into any joint venture, strategic alliance, exclusive dealing, noncompetition or similar contract or arrangement;
(K) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any PEP Company;
(L) incur any indebtedness for borrowed money or issue any debt securities or enter into a guarantee with respect to the indebtedness any Person, or make any loans (other than (v) Company Indebtedness that will be paid off on or prior to Closing, (w) Ordinary Course of Business borrowings under any Company Indebtedness, (x) performance bonds, surety bonds, letters of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company credit or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if similar instruments entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit (y) intercompany indebtedness between the Company PEP Companies, and (z) advances for travel and other normal business expenses to officers and employees of the PEP Companies in the Ordinary Course of Business);
(M) increase in any manner the rate or terms of compensation payable or to become payable or the benefits (including equity or equity based grants) provided to, grant any of its Subsidiaries to make severance or termination pay to, establish, adopt, enter into, or amend any investments in or loans toindemnification arrangement with, or pay any fees bonus to its directors, officers or expenses to (employees, or establish, adopt, enter into or amend any Company Benefit Plan, other than pursuant as may be required by any Governmental Body, as required by the terms of any Company Benefit Plan (including the SERP), to existing Contracts)comply with any applicable Laws, Company Transaction Expenses to be paid at Closing, or in the Ordinary Course of Business;
(N) amend, cancel or modify any Material Contract, except for amendments, cancellations and renewals in the Ordinary Course of Business, or enter into or materially modify any Contract with any Affiliate agreement that would constitute a Material Contract, except in the Ordinary Course of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its SubsidiariesBusiness;
(xvO) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any material accounting method, make, change or rescind any material tax election, which election, change, or rescission is required to be attached in writing to any Tax Return or otherwise separately filed with any Taxing Authority, file any material amended Tax Return, enter into any closing agreement with respect related to Taxes, settle any material Tax claim Claim or assessment relating to the PEP Companies, or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective TimeTaxes;
(xviP) enter into permit the lapse of any Contractright relating to any material Company Intellectual Property; or
(Q) permit the Assumed Indebtedness (other than Net Tax Liabilities), understanding or commitment that restrainsincluding those items set forth on Schedule 7.2(Q), restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effectexceed $5,000,000;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xixR) agree to do anything prohibited by this Section 7.2.
Appears in 1 contract
Samples: Stock Purchase Agreement (Nn Inc)
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (I) as set forth on Schedule 8.2, (II) as required by applicable Law, (III) as otherwise expressly provided in contemplated by this Agreement or (IV) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and shall cause each of its Subsidiaries to:
: (i) use its commercially reasonable efforts to conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Business;
; and (ii) use its commercially reasonable efforts to (A) preserve its the present business operations, organization and goodwill of the Company and its Subsidiaries the Subsidiaries, and (B) preserve its the present relationship relationships with Persons having material employees, customers, suppliers and other business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties relationships of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this AgreementSubsidiaries.
(b) Except (I) as set forth on Schedule 8.2, (II) as required by applicable Law, (III) as otherwise expressly provided in contemplated by this Agreement or (IV) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall not not, and shall not permit any of its Subsidiaries to:
: (i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its the Subsidiaries; provided, except in connection with the exercise of repurchase rights or rights of first refusal in favor of however, that (A) nothing herein shall prohibit the Company with respect and its Subsidiaries from paying regularly scheduled management fees pursuant to the Investment Banking Agreement, (B) a Subsidiary may take any such actions to the extent that such dividend or other distribution or such repurchase, redemption or other acquisition of outstanding shares issued upon exercise relates solely to the capital stock or other securities of such Subsidiary that are held by the Company, and (C) 54 the Company Stock Options;
and the Subsidiaries shall be permitted to make cash dividends in the Ordinary Course of Business or as otherwise permitted by the Company’s senior credit agreement; (ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its the Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its the Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
; (iii) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its the Subsidiaries;
; (iv) amend the certificate of incorporation or by-laws or comparable organizational documents of the Company or any of its the Subsidiaries;
; (v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Companyas required by Law or Contract, (A) increase modify the annual level of compensation of any director or officer of the Company or any of the Subsidiaries, (B) materially modify the annual level of compensation of any non-officer employee of the Company or any of its the Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any bonus or any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantemployee (other than such bonuses both (x) included as Transaction Expenses, and (y) described on Schedule 8.2(b)(v)(B)), (D) increase materially modify the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend new or terminate any such plan or arrangement any) Company Benefit or (E) enter into any collective bargaining, employment, employment or consulting agreement or any deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its the Subsidiaries is a party or involving a director, officer director or employee of the Company or any of its Subsidiaries the Subsidiaries, except, in his each case, as required by applicable Law from time to time in effect or her capacity as a directorby the terms of any Company Benefit Plans; provided, officer or however, that notwithstanding the foregoing, the Company may: (i) modify the annual level of compensation of any employee of the Company or any of its Subsidiaries;
the Subsidiaries to the extent that the amount of all such modifications do not exceed $350,000 in the aggregate; and (ii) grant or award any bonus or any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any director or employee to the extent that the amount of all such grants and awards do not exceed $300,000 in the aggregate; (vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock ) of the Company or any of its the Subsidiaries;
, except for Permitted Exceptions; (viiivii) acquire any material equity interests, properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its the Subsidiaries;
, other than (ixA) except as set forth on Schedule 7.2(b)(ix), enter into for fair consideration in the Ordinary Course of Business or agree to enter into any merger (B) the purpose of disposing of obsolete or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except worthless assets in the Ordinary Course of Business;
; (xiviii) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify abandon or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability fail to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change maintain any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective TimeIntellectual Property;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2.
Appears in 1 contract
Samples: Merger Agreement (Schweitzer Mauduit International Inc)
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as set forth on Schedule 7.2, (ii) as required by applicable Law, (iii) as otherwise expressly provided set forth in this Agreement or (iv) with the prior written consent of ParentParent (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;; and
(ii) use its commercially reasonable efforts to (A) preserve its the present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except (i) as set forth on Schedule 7.2, (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement or (iv) with the prior written consent of ParentParent (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall not not, and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of equity interests in the Company or repurchase, redeem or otherwise acquire any outstanding shares units of the capital stock or other securities of, membership interest or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, issue or sell or dispose of any shares of capital stock equity interest or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock equity interests or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation formation or by-laws LLC Agreement or comparable organizational documents of the Company or any of its Subsidiaries, or the terms of any equity security;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Companyas required by Law, (A) increase the annual level of compensation of any employee executive officer of the Company or any of its Subsidiaries, (B) increase other than in the annual level Ordinary Course of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officersBusiness, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantexecutive officer, (DC) materially increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives executive officers of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (ED) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, an executive officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries, except, in each case, as required by applicable Law from time to time in effect or by the terms of any Company Benefit Plans;
(vi) incur acquire in one or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire more transactions any material properties or assets with a value greater than $5,000,000 in the aggregate, or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of in one or more transactions any of the material properties or assets of the Company and or any of its Subsidiaries with a value greater than $5,000,000 in the aggregate;
(vii) cancel or compromise any material debt or claim of the Company or its Subsidiaries;
(viii) make an election to be treated as a corporation for U.S. federal income tax purposes, make any other material Tax election, change its method of Tax accounting or settle any claim for material Taxes;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, with any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;; or
(x) cancel grant or compromise permit any material debt or claim or waive or release Liens (except Permitted Exceptions) on any material right assets of the Company or any Subsidiary other than pursuant to any refinancing or similar transaction with respect to existing Indebtedness;
(xi) materially amend or waive, terminate or extend, or exercise any material option or give any material consent under, any Real Property Lease other than in the Ordinary Course of its Subsidiaries Business or any Material Contract referred to in Sections 5.12(a)(i), (ii), (vi), (vii) and (viii) hereof, except for the modification of the Contract described on Schedule 5.12(a)(vi)(a);
(xii) incur or assume any indebtedness or make any loan to any Person, except for any of the following made in the Ordinary Course of Business: drawdowns under existing financing arrangements, dealer loans or the extension of credit evidenced by accounts receivable, purchase money security interests and accounts payable;
(xixiii) enter into other than as required by GAAP, revalue in any commitment for capital expenditures material respect any of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement assets of the Company or any Subsidiary, including any material write-off of its Subsidiaries or, through negotiation notes or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effectaccounts receivable;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Businessother than as required by GAAP, permit the Company or any of its Subsidiaries to make any investments change in any method of accounting or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiariesaccounting practice;
(xv) make or change fail to pay when due any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Timeobligation;
(xvi) enter into any Material Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;; or
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.27.2(b).
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except (I) as set forth on Schedule 7.1, (II) as required by applicable Law, (III) as otherwise expressly provided in contemplated by this Agreement or (IV) with the prior written consent of Parentthe Purchasers (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, Seller Parent and the Seller shall cause its Subsidiaries the Companies not to:
(i) conduct sell, transfer or encumber any Equity Interests;
(ii) increase the respective businesses benefits, compensation, bonus or bonus opportunity of the any employee, officer or director of any Company and its Subsidiaries only other than in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current conditioncancel or compromise any debt or claim or amend, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary cancel, terminate, relinquish, waive or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take release any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement Material Contract or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) right except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business);
(iv) mortgage, pledge or subject to any Lien (other than Permitted Exceptions) any of its material assets;
(v) acquire any material asset or sell, assign, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the any Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix)for such assets acquired, enter into or agree to enter into any merger or consolidation withsold, any corporation or other entityassigned, and not invest intransferred conveyed, make a loan, material advance or capital contribution to, leased or otherwise acquire the securities disposed of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xivi) enter into other than this Agreement, not issue, sell or otherwise dispose of, any commitment equity interests or any other security of any Company or grant any option, warrant or other right to subscribe for or to purchase any capital expenditures stock or any equity interests of the Company and its Subsidiaries any Company;
(vii) obligate itself to pay in excess of $20,000 for any individual commitment and $100,000 for all commitments 50,000 in the aggregateaggregate to purchase any new fixed assets (other than replacements);
(xiiviii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its SubsidiariesCompany;
(xiiiix) except as set forth on Schedule 7.2(b)(xiv), permit the Company enter into or any of its Subsidiaries agree to enter into any transaction merger or to enter into, modify or renew consolidation with any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse EffectPerson;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xvx) make or change rescind any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect relating to Taxes, settle or compromise any Tax claim claim, action, suit, litigation, proceeding, arbitration, investigation, audit controversy relating to Taxes, or assessment except as required by applicable law or surrender GAAP, make any right material change to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after methods of accounting or methods of reporting income or deductions for Tax or accounting practice or policy from those employed in the Effective Time;preparation of its most recent Tax Return; or
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xixxi) agree to do anything prohibited by this Section 7.27.1.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in this From the Agreement or Date until the Closing, except with the prior written consent of Parent, during the period from the date of Buyer or as otherwise expressly permitted or required by this Agreement to the Effective TimeAgreement, the Company shall, and Shareholder shall cause its Subsidiaries the Company to:
(i) conduct carry on its business in substantially the respective businesses same manner as it has heretofore and not introduce any new method of management, operation or accounting (except as required by GAAP or any applicable law or Order and except for actions taken to file PPP Applications to facilitate the forgiveness of the Company and its Subsidiaries only in the Ordinary Course of BusinessPPP Loans);
(ii) use its commercially reasonable efforts to (A) preserve comply with the terms and conditions of, and not cancel, its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiariesinsurance policies;
(iii) use its commercially reasonable efforts to maintain (A) all material assets maintain and properties of the Company and preserve its Subsidiaries in their current conditionbusiness organization intact, ordinary wear and tear excepted and (B) insurance upon all retain the services of its present employees and (C) not hire any additional employees except for hires in the properties and assets ordinary course of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreementbusiness consistent with past practices;
(iv) give comply with all required notices applicable laws and provide notice to Buyer of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary any governmental inquiry, notice or advisable in order to consummate the transactions contemplated by this Agreementinvestigation; and
(v) maintain the instruments and agreements governing its outstanding Indebtedness and leases on their present terms and not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreementincur new Indebtedness or enter into new lease instruments or agreements.
(b) Except as otherwise expressly provided in this From the Agreement or Date until the Closing, except with the prior written consent of Parent, during the period from the date of Buyer or as otherwise expressly permitted or required by this Agreement to the Effective TimeAgreement, the Shareholder shall ensure that neither the Shareholder nor the Company shall not and shall not permit its Subsidiaries towill:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether change in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsCharter Documents;
(ii) except as set forth on Schedule 7.2(b)(ii)issue any additional Equity Interests or issue or otherwise create any options, transfer, issue, sell warrants or dispose of any shares of capital stock or other securities of the Company or rights to acquire any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentEquity Interests;
(iii) effect increase or agree to increase the compensation payable to the Shareholder, member of the board of directors or any recapitalizationofficers, reclassificationdirectors, stock split managers, consultants or like change employees except for increases in the capitalization of the Company or any of its Subsidiaries;ordinary course consistent with past practice.
(iv) amend make any investments (other than short-term certificates of deposit of a commercial bank or trust company) in the certificate Equity Interests (or options, warrants or rights to acquire the Equity Interests) or Indebtedness of incorporation or by-laws of the Company or any of its SubsidiariesPerson;
(v) except as set forth on Schedule 7.2(b)(v) enter into any contract to incur, or otherwise agree to incur any liability or make any capital payment or expenditure of any kind in excess of $25,000.00, other than in the Ordinary Course ordinary course of Business its business and consistent with respect to employees other than officers of its past practice (it being agreed that the Company, (A) increase foregoing restriction shall not prohibit or limit the annual level of compensation ability of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries enter into contractual obligations or otherwise modify or amend or terminate incur liabilities in respect of any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) existing projects pursuant to which the Company or any terms and conditions of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiariesthis Agreement);
(vi) incur or assume prepay any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi))in the ordinary course of business consistent with past practices, or (B) create, assume or permit to be created or imposed any liens or encumbrances, upon any of its assets or properties, whether now owned or hereafter acquired other than in the ordinary course of business consistent with past practice;
(vii) subject to except as required by any Lien applicable law or otherwise encumber orOrder, except for Permitted Exceptions(A) adopt, permitestablish, allow amend or suffer to be encumbered, terminate any of the properties or assets (whether tangible or intangible)its Employee Benefit Plans, or any shares other compensation plans or employee policies and procedures or (B) take any discretionary action, or omit to take any contractually required action, if that action or omission could either (y) deplete the assets of capital stock of the Company or any of its SubsidiariesEmployee Benefit Plans, or (z) increase the liabilities or obligations under any such plan;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise transfer or dispose of any of its owned or leased property or equipment other than in the material properties ordinary course of its business and consistent with its past practice, or assets to dispose of the Company and its Subsidiariesexcess or obsolete inventory or equipment other than for appropriate value;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire negotiate for the securities acquisition of any other Person, except in connection with business or entity or the exercise start-up of repurchase rights or rights any new line of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Optionsbusiness;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except rights or claims, provided that it may negotiate and adjust bills and Accounts Receivables in the Ordinary Course course of Businessgood faith disputes with customers in a manner consistent with past practice;
(xi) enter into effect any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments other transaction that is not in the aggregate;ordinary course of its business and consistent with its past practice or that is prohibited hereby; or
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract contract or agreement to which if so entered into, modified, amended or terminated would be reasonably be expected to have it is a Material Adverse Effect;party that is not in the ordinary course of its business.
(xviic) terminateFrom the Agreement Date until the Closing, amend, restate, supplement except with the prior written consent of the Buyer or waive any rights under any Material Contract, as otherwise expressly permitted or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited required by this Section 7.2Agreement, the Shareholder shall not make or revoke any tax election respecting the Company that affects the Company, the Buyer, TLSS or the Shares.
Appears in 1 contract
Samples: Stock Purchase and Sale Agreement (Transportation & Logistics Systems, Inc.)
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Closing, except as otherwise expressly permitted or required by this Agreement, Seller agrees to cause the Effective TimeCompany, and the Company agrees, to carry on its business and the business of the Company’s Subsidiaries in the Ordinary Course of Business and to use commercially reasonable efforts to preserve intact its present business organization and preserve its relationships with customers, suppliers, distributors, licensors, licensees and others having business dealings with it. By way of amplification and not limitation, except as expressly permitted or required by this Agreement or as expressly set forth in Schedule 4.01, Seller, the Company shalland the Company’s Subsidiaries shall not, between the date of this Agreement and the Closing Date, directly or indirectly, do any of the following without the prior written consent of Buyer (which consent shall cause its Subsidiaries to:not be unreasonably withheld, conditioned or delayed):
(ia) conduct amend or otherwise change the respective businesses LLC Agreement or any equivalent organizational documents of any of the Company’s Subsidiaries;
(b) issue, sell, pledge, dispose of, grant, encumber or authorize the issuance, sale, pledge, disposition, grant or encumbrance of, any equity securities of any class, or any options, warrants, convertible securities or other rights of any kind to acquire any equity securities or any other ownership interest (including any membership interest, profits interest or phantom interest) of the Company or of any of its Subsidiaries;
(c) sell, lease, license, pledge, grant, encumber or otherwise dispose of any material properties or material assets of the Company and its Subsidiaries only Subsidiaries, other than (A) Permitted Liens or (B) sales or transfers of inventory in the Ordinary Course of Business;
(iid) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend distribution, payable in any form, with respect to any of its equity securities, except for (A) distributions of cash or other distribution (whether in cash, stock or propertyB) in respect of the capital stock distributions between any of the Company or repurchaseand its Subsidiaries;
(e) split, combine, subdivide, redeem or otherwise acquire reclassify any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other equity securities of the Company or any of its Subsidiaries or grant optionsissue or authorize the issuance of any other securities in respect of, warrantsin lieu of or in substitution for their equity securities;
(f) acquire (including by merger, calls consolidation, or acquisition of stock or assets) any equity interest in or material assets of any Person or any business or division thereof;
(g) enter into any joint venture, strategic alliance, exclusive dealing agreement or similar contract or arrangement;
(h) incur any Indebtedness or issue any debt securities in excess of $1,000,000 or make any loans or advances in excess of $250,000, in each case other rights to than trade accounts payable and short-term working capital financing;
(i) enter into any lease or Contract for the purchase or otherwise acquire shares sale of any property, real or personal, or any renewals thereof, except in the Ordinary Course of Business for consideration of not more than $50,000 individually or in the aggregate;
(j) terminate any Material Contract, other than by allowing any Material Contract to terminate due to the expiration of the capital stock term provided therein;
(k) other than as required by applicable Law, pursuant to the terms of a Benefit Plan, in the ordinary course of business and consistent with past practice or other securities to the extent no liability would result on the part of Buyer or the Company following the Closing, (i) increase the compensation payable or the benefits provided to any of the Company Company’s or any of its Subsidiaries’ officers or other employees, except pursuant for normal merit and cost-of-living increases in accordance with past practice in salaries or wages of its employees who are not its officers, (ii) grant any severance or termination pay to, or enter into any employment or severance agreement with, any of the Company’s or any of its Subsidiaries’ officers or other employees, or (iii) establish, adopt, enter into or amend any collective bargaining, bonus, profit sharing, thrift, compensation, equity option, restricted equity interest, profits interest, pension, retirement, deferred compensation, employment, termination, severance, loan or advance plan or other agreement, trust, fund, policy or arrangement for the benefit of any manager, officer, employee or consultant;
(l) extend any offers of employment to obligations existing potential employees other than to fill the open positions set forth on Schedule 4.01(l), or to fill any position that becomes open following the date of this Agreement and previously disclosed to Parentby reason of a termination of employment of an officer or employee;
(iiim) effect make, change or rescind any recapitalizationmaterial Tax election, reclassificationadopt or change any Tax accounting method, stock split amend any income or like change other material Tax Return or file any claims for material Tax refunds, enter into any material closing agreement as described in Section 7121 of the capitalization Code, settle any material Tax audit, claim or assessment or consent to any extension or waiver of the limitation period applicable to any such Tax audit, claim or assessment, in each case with respect to Taxes imposed on or payable by or with respect to the ownership, operation or management of the business or assets of the Company or any of its Subsidiaries;
(ivn) amend the certificate adopt a plan of incorporation complete or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Companypartial liquidation, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiariesdissolution, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officersmerger, (C) grant any unusual or extraordinary bonusconsolidation, benefit restructuring, recapitalization or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate reorganization of the Company or any of its Subsidiaries, or otherwise alter the Company’s or one of its Subsidiaries’ legal structure;
(o) with respect to the Company and its Subsidiaries only, enter into any directorContract with any Related Party for goods or services to be delivered or performed following the Closing Date;
(p) make any material change in any method of accounting or accounting practice or policy, officer except as required by GAAP;
(q) mortgage, pledge or employee subject to any Lien any material properties or material assets of the Company and its Subsidiaries, other than Permitted Liens;
(r) cancel any material Indebtedness owed to the Company or any of its Subsidiaries, or waive, release, assign, settle or compromise any material rights or claims, or any litigation, claim, action, suit, proceeding or investigation;
(s) enter into any line of business other than the lines of business in which the Company and its Subsidiaries are engaged as of the date hereof;
(t) other than in the Ordinary Course of Business, abandon or permit the lapse of any Registered IP that is material to the business of the Company and its Subsidiaries;
(u) grant any rights under any Registered IP other than in the Ordinary Course of Business;
(v) write up, write down or write off the book value of any assets, individually or in the aggregate, for the Company and its Subsidiaries taken as a whole, in excess of $100,000, except for depreciation and amortization in accordance with GAAP;
(w) enter into any Contract that would constitute a Material Contract;
(x) fail to take any actions necessary to maintain in full force and effect any Money Transmitter Licenses required to operate the business of the Company or any of its Subsidiaries;Subsidiaries as currently conducted; or
(xvy) make take, or change any material election concerning Taxes agree in writing or Tax Returnsotherwise to take, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
actions described in subsections (xvia) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
through (xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2x).
Appears in 1 contract
Conduct of the Business Pending the Closing. From the date hereof until the earlier of the Closing Date and the termination of this Agreement, except (aA) Except as set forth on Schedule 5.1, (B) as required by applicable Law, (C) as otherwise expressly provided in contemplated by this Agreement or the other Transaction Documents or (D) with the prior written consent of ParentBuyer (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and each Seller (1) shall cause its Subsidiaries to:
(i) the Acquired Companies to use their Best Efforts to conduct the respective businesses of the Company and its Subsidiaries only Business, in all material respects, in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B2) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current conditionshall not, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries tocause each Acquired Company to not:
(ia) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell, authorize, sell encumber or dispose of any shares equity interests of capital stock or other securities of the any Acquired Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares equity securities of the capital or any stock appreciation, phantom stock or other similar right with respect to any Acquired Company, provided that the foregoing restrictions shall not apply to any securities of the Company a joint venture formed on or any of its Subsidiaries, except pursuant to obligations existing on after the date of this Agreement and previously disclosed to Parenthereof;
(iiib) effect any recapitalization, reclassification, stock split reclassification or like any other change in the capitalization of the Company or any of its SubsidiariesAcquired Company;
(ivc) amend the certificate adopt a plan of incorporation complete or by-laws of the Company partial liquidation, dissolution or other reorganization with respect to any of its SubsidiariesAcquired Company;
(vd) except as set forth on Schedule 7.2(b)(v) or otherwise in required by applicable Law, amend the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation Organizational Documents of any employee of the Acquired Company (whether by merger, consolidation or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi)otherwise);
(viie) subject make any material change in any method of accounting or accounting practice of any Acquired Company, except as required by concurrent changes in GAAP, as agreed to by its independent public accountants, or as required by applicable Law;
(f) permit any Lien Acquired Company to acquire by merging or consolidating with, or purchasing substantially all the assets of, any corporation, partnership, association or other business organization or division thereof, provided that the foregoing restrictions shall not apply to the formation of a joint venture, or the transfer of assets to a joint venture (whether now or hereafter existing), with any protégé firm for which an Acquired Company is a mentor under the Small Business Administration’s Mentor-Protégé program;
(g) sell, lease, sublease, mortgage, pledge or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix)Acquired Companies, enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of BusinessBusiness or as described in the exception set forth in clause (f) above;
(xih) enter into any commitment for capital expenditures Contract materially limiting in any way the ability of the Company and its Subsidiaries Acquired Companies to compete with any Person in excess any geographic location or any line of $20,000 for any individual commitment and $100,000 for all commitments in the aggregatebusiness;
(xiii) enter intosubject to Section 11.12, modify implement any plant closing or terminate any labor or collective bargaining agreement layoff of employees of the Company Acquired Companies that would be reasonably expected to implicate the WARN Act (or any of its Subsidiaries orsimilar state, through negotiation local or otherwise, make any commitment or incur any liability to any labor organization foreign Law) with respect to the Company or any of its SubsidiariesAcquired Companies;
(xiiij) except as set forth on Schedule 7.2(b)(xiv), permit the Company make any loan or any of its Subsidiaries to enter into any transaction with any of its officers, directors, partners or Affiliates other (i) than arms length transactions consistent with past practice, (ii) cash dividends or (iii) pursuant to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse EffectContracts listed on Schedule 3.13;
(xivk) except for transfers of cash pursuant to normal cash management practices terminate or modify in any material and adverse respect any Material Contract, or any government license, permit or other authorization, other than, in each case, (i) in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to(ii) as required by applicable Law, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify iii) as required by the terms of any Contract to which an Acquired Company is a party (to the extent such Contract is set forth on the Disclosure Schedule or is entered into in accordance with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiariesthis Agreement);
(xvl) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement new, or amend any existing, Material Contracts (including, without limitation, any real property lease agreements, other than project or client-paid offices or permanent offices where the annual base rent is less than $1,000,000, and collective bargaining agreements), except (i) any of the foregoing in the Ordinary Course of Business and consistent in all material respects with respect past practice, (ii) for commitments relating to Taxescapital expenditures consistent with the budget provided to Buyer prior to the date hereof), settle (iii) as required by applicable Law, or (iv) as required by the terms of any Tax claim Contract to which an Acquired Company is a party (to the extent such Contract is set forth on the Disclosure Schedule or assessment is entered into in accordance with this Agreement);
(m) establish or surrender amend any right pension, retirement, profit sharing or stock bonus plan or Multiemployer Plan covering the employees of the Acquired Companies;
(n) increase the compensation, incentive arrangements or other benefits of any officers or employees of the Acquired Companies, except for annual increases made in the Ordinary Course of Business consistent with past practice;
(o) discharge or hire any Person as an officer of an Acquired Company or to claim a refund of Taxes or obtain or enter into serve in any Tax rulingexecutive capacity with the Acquired Companies, other than, in each case, if taking such action would materially affect (i) in the amount Ordinary Course of Taxes Business and on terms and conditions consistent in all material respects with past practice, (ii) as required to be paid by applicable Law, or (iii) as required by the terms of any Contract to which an Acquired Company is a party (to the extent such Contract is set forth on the Disclosure Schedule or any of its Subsidiaries after the Effective Time;is entered into in accordance with this Agreement); or
(xvip) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.25.1; provided, however, that, the foregoing notwithstanding, Sellers and/or the Acquired Companies may, prior to the Closing, use all or any portion of available cash or cash equivalents to, prior to the Closing, (A) repay any Indebtedness of the Acquired Companies or (B) declare and pay cash dividends with respect to the capital stock of the Acquired Companies.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in contemplated by this Agreement or with the prior written consent of ParentPurchasers or except as described on Schedule 6.3, during the period from the date of this Agreement to hereof until the Effective TimeClosing Date, Sellers and the Company shall, and shall cause its Subsidiaries toForeign Subsidiaries:
(a) shall not sell, transfer, abandon, permit to lapse or otherwise dispose of any of the assets of such Seller or Foreign Subsidiary (including any Permitted Disposition) except (i) conduct Excluded Assets and (ii) the respective businesses sale of equipment not in excess of ₤100,000 individually or ₤500,000 in the Company aggregate and its Subsidiaries only Inventory, in each case, in the Ordinary Course of Business;
(iib) shall conduct the Business in the Ordinary Course of Business (including payment of accounts payable, purchasing and maintaining appropriate levels of Inventory, performing all maintenance and repairs consistent with past practice, making authorized capital expenditures and collecting accounts receivable);
(c) shall pay all amounts of fees, costs and expenses outstanding to the U.K. Trustees and advisers to the U.K. Trustees as of immediately prior to Closing;
(d) shall not authorize, declare or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock (whether in cash, assets, stock or other securities) other than to another Seller or Foreign Subsidiary;
(e) shall not reclassify, combine, split, subdivide, redeem, or purchase or otherwise acquire, directly or indirectly, any of its capital stock or membership interests, or make any other change with respect to its capital structure;
(f) shall not issue, sell, pledge, dispose of or encumber, or authorize the issuance, sale, pledge, disposition or encumbrance of, any shares of its capital stock or other ownership interest in any Seller or Foreign Subsidiary or any securities convertible into or exchangeable for any such shares or ownership interest, or any rights, warrants or options to acquire or with respect to any such shares of capital stock, ownership interest or convertible or exchangeable securities or take any action to cause to be exercisable any otherwise unexercisable option under any existing stock option plan;
(g) shall use its commercially reasonable efforts (taking into account the condition of the Business and the transactions contemplated by this Agreement) to (A) preserve intact the Business, to keep available the services of its present business operations, organization current employees and agents and to maintain its relations and goodwill of the Company with its suppliers, customers, distributors and its Subsidiaries and (B) preserve its present relationship any others with Persons having material whom or with which it has business dealings with the Company and its Subsidiariesrelations;
(h) shall not, directly or indirectly, cause or permit any state of affairs, action or omission that constitutes, or could lead to, a Material Adverse Effect;
(i) shall not (i) grant or announce any stock option, equity or incentive awards or the increase in the salaries, bonuses or other compensation and benefits payable by any Seller to any of the employees, directors or other service providers of the Business; (ii) hire any new management employees to the Business, (iii) use its commercially reasonable efforts pay or agree to maintain pay any pension, retirement allowance, retention, termination or severance pay, bonus or other employee benefit (Aincluding the amounts included in the Disclosed Severance Agreements or the Retention Agreements) all material assets and properties not required by any existing Employee Benefit Plan to any employee, director or other service provider of the Company Business, whether past or present, (iv) enter into or amend any management contracts of employment or any management consulting, bonus, severance, retention, retirement or similar agreement (including the Disclosed Severance Agreements and the Retention Agreements prior to the payment dates in accordance with their respective terms), or (v) except as required to ensure that any Employee Benefit Plan is not then out of compliance with applicable Law, enter into or adopt any new, or materially increase benefits under or renew, amend or terminate any existing, Employee Benefit Plan or any Collective Bargaining Agreement, Foreign Pension Scheme or Foreign Employee Benefit Plan;
(j) shall not change in any material respects any financial accounting policies or procedures or any of its Subsidiaries methods of reporting income, deductions or other material items for financial accounting purposes, except as required by GAAP, SEC rule or policy or applicable Law;
(k) shall not adopt any amendments to its articles of incorporation or bylaws or similar applicable charter documents;
(l) shall not create any new Subsidiary;
(m) shall not incur, assume, guarantee, prepay or otherwise become liable for, or modify in their current conditionany material respect the terms of, ordinary wear any Indebtedness or incur Contingent Obligations and tear excepted and not to sell, lease, license, transfer, exchange or swap, mortgage or otherwise encumber (Bincluding securitizations), or subject to any Lien or otherwise dispose of (whether by merger, consolidation or acquisition of stock or assets, license or otherwise), any material portion of its or its Affiliates’ properties or assets, including the capital stock or other equity interest of Foreign Subsidiaries, other than (i) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable pursuant to that existing agreements in effect on prior to the date execution of this Agreement;
, (ivii) give all as may be required notices by applicable Law or any Governmental Entity in order to permit or facilitate the consummation of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization dispositions of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except obsolete equipment in the Ordinary Course of Business;
(xin) enter into shall not fail to pay any commitment for capital expenditures of the Company Tax (other than Taxes disputed in good faith) when it becomes due and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregatepayable;
(xiio) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, shall not modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement terminate or waive any rights under any Material Contract, or Permit any Contract that would be a Material Contract if in effect on the date of this Agreement, in any material respect in a manner which is adverse to any Seller or Foreign Subsidiary;
(p) shall not enter into any Material Contracts other than in the Ordinary Course of Business consistent with past practice;
(q) shall not enter into, amend, waive or terminate (other than terminations in accordance with their terms) any transaction with any Insider of such Seller or Foreign Subsidiary;
(r) shall not enter into any new line of business or discontinue any line of business;
(s) (i) shall not settle, pay or discharge, any claim, Liability, obligation litigation, investigation, arbitration or Proceeding against such Person, except in the Ordinary Course of Business not in excess of $50,000 individually or $200,000 in the aggregate, excluding any amounts which may be paid under existing insurance policies and (ii) shall not waive its rights to, discharge, settle or satisfy any claim, Liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than in the Ordinary Course of Business;
(t) shall not (i) take, or fail to take, any action that could reasonably be expected to have a Material Adverse Effectresult in, any loss, lapse, abandonment, invalidity or unenforceability of any material Intellectual Property; or (ii) enter into any agreement with any other person that materially limits or restricts the ability of any Seller or Foreign Subsidiary to conduct certain activities or use certain assets (including any Intellectual Property);
(xviiiu) shall make the capital expenditures with respect to the commitments on Schedule 6.3(u) in the period specified in Schedule 6.3(u);
(v) shall not authorize, or make any commitment with respect thereto, any capital expenditure in excess of $100,000 individually or $300,000 in the aggregate or as set forth on Schedule 6.3(u);
(w) shall make the expenditures with respect to (i) the planned closure of the Madrid facility and related costs associated with the sale of real estate and assets and severance and other facility closure costs (the “Madrid Sale”), (ii) the sale or disposal of the plant, facilities, and real property in Brussels and severance and other facility closure costs (the “Brussels Sale”) and (iii) the work force reduction and related social plan costs and costs to close or downsize the pharmaceutical packaging business (the “Pharmaceutical Rationalization”);
(x) shall not fail to promptly pay maintain in full force and discharge current liabilities expect where disputed effect material insurance policies covering any Seller or Foreign Subsidiary and their respective properties, assets and businesses in good faith a form and amount consistent with past practice;
(y) shall not acquire (including by appropriate proceedingsmerger, consolidation, or accelerate acquisition of stock or assets) or make any investment in any interest in any corporation, partnership, limited liability company, association, trust or any other entity, group (as such term is used in Section 13 of the collection of Exchange Act) or organization (including, a Governmental Entity), or any accounts receivabledivision thereof or any assets thereof;
(z) shall cause the Other U.S. Subsidiaries to not engage in any transaction related to the Business; and
(xixaa) agree shall not agree, in writing or otherwise, or announce an intention, to do anything prohibited by this Section 7.2take any of the foregoing actions.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as set forth on Schedule 7.2, (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement (including Section 7.13), or (iv) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Seller and the Company shallshall conduct, and shall cause its Subsidiaries to:
(i) conduct DSTC to conduct, the respective businesses of the Business, the Company and its Subsidiaries DSTC only in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except Without limiting Section 7.2(a), except (i) as set forth on Schedule 7.2, (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement (including Section 7.13), or (iv) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during delayed or conditioned), the period Seller and the Company shall not, and shall not permit DSTC to, directly or indirectly from and after the date of this Agreement to and until the Effective Time, the Company shall not and shall not permit its Subsidiaries toClosing Date:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsDSTC;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, issue or sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries DSTC or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentDSTC;
(iii) except for the transfer by the Company to the Seller or other affiliate of the Seller of shares of the Excluded Subsidiaries, effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its SubsidiariesDSTC;
(iv) amend the certificate of incorporation or by-laws organizational documents of the Company or DSTC in any of its Subsidiariesrespect which would be material to the Purchaser;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the CompanyBusiness, (A) increase the annual level of compensation of any employee of the Company or any of its SubsidiariesEmployee, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantEmployee, (DC) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries Employees or otherwise modify or amend or terminate any such plan or arrangement or (ED) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries DSTC is a party or involving a directorany Employee, officer or employee except, in each case, as required by the terms of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its SubsidiariesSeller Benefit Plans;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiariesor DSTC, except for fair consideration in the Ordinary Course of Business or for the purpose of disposing of obsolete assets or assets no longer used in or required for the operation of the Business;
(ixvii) except as set forth on Schedule 7.2(b)(ix)other than in the Ordinary Course of Business, enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of BusinessDSTC;
(xiviii) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries agree to enter into any transaction merger or to enter intoconsolidation with any corporation or other entity, modify or renew acquire any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effectmaterial amount of equity securities of any other Person;
(xivix) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with the Seller or any Affiliate of the Company Seller;
(x) except in the Ordinary Course of Business or as otherwise required by Law, make or rescind any material election relating to Taxes, settle or otherwise compromise any claim, investigation, audit or controversy relating to a material amount of its SubsidiariesTaxes, if it would affect in any material way the Tax liability or any director, officer or employee Tax reporting requirements of the Company or the Purchaser following the Closing;
(xi) except to the extent required by Law or GAAP, as applicable, make any material change to any of its Subsidiariesmethods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvxii) make or take any action reasonably likely to result in a material change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability relationship of the Company or DSTC with any Subsidiary to compete with of its material suppliers, customers, distributors, lessors, licensors, licensees or conduct other third parties, other than any business such changes generally affecting the material suppliers, customers, distributors, lessors, licensors, licensees or line other third parties of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effectthe Seller’s U.S. operations (including operations other than the Business);
(xviixiii) terminatesell, amend, restate, supplement license or waive transfer any rights under Intellectual Property included in the Stoneville Package or any Material Contract, or Permit that would reasonably be expected to have a Material Adverse EffectExclusive Company Technology;
(xviiixiv) fail make any capital expenditure or commitment pertaining to promptly pay and discharge current liabilities expect where disputed the Business, other than (i) in good faith by appropriate proceedings, the Ordinary Course of Business or accelerate the collection of any accounts receivable(ii) pursuant to existing commitments or business plans; andor
(xixxv) agree to do anything prohibited by this Section 7.2.
(c) Prior to the Closing, the Seller shall use, and shall cause the Company and DSTC to use, its reasonable best efforts to preserve intact the Business’ business organization and goodwill, keep available the services of its officers and employees and maintain satisfactory relationships with suppliers, distributors, customers and others having business relationships with the Business, the Company or DSTC; and the Seller and the Company will promptly notify Purchaser of any event or occurrence or emergency, not in the Ordinary Course of Business, that could reasonably be expected to result in a Material Adverse Effect.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided contemplated by this Agreement and the schedules attached hereto or with the prior written consent of Purchaser, the Company shall and Seller shall cause the Transfer Group Companies to (subject to the limitations imposed on Seller as a result of having filed petitions for relief under the Bankruptcy Code) use their reasonable best efforts to conduct their respective businesses in all material respects in the Ordinary Course of Business, and preserve and maintain in all material respects the present business operations, organization and goodwill of the Transfer Group Companies. For the avoidance of doubt, the foregoing shall not require Seller or any of the Transfer Group Companies to make any payments, incur any costs or enter into or amend any contractual arrangements, agreements or understandings, unless such payment, incurrence or other action is required by Applicable Law, by contractual obligation with such third parties or to operate such business in the Ordinary Course of Business.
(b) Except as otherwise expressly contemplated by this Agreement or with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during conditioned or delayed), each of Seller and the period from Company shall not, in the date case of this Agreement Seller, subject to the Effective Time, limitations imposed on Seller as a result of having filed petitions for relief under the Company shallBankruptcy Code, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the each Transfer Group Company and its Subsidiaries only in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(iotherwise permitted under Section 6.2(c), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company Transfer Group Companies or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsTransfer Group Companies;
(ii) except as set forth on Schedule 7.2(b)(iiotherwise permitted under Section 6.2(c), transfer, issue, sell or dispose of any shares of capital stock or other equity securities of the Company or any of its Subsidiaries Transfer Group Companies or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other equity securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentTransfer Group Companies;
(iii) except as otherwise permitted under Section 6.2(c), effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its SubsidiariesTransfer Group Companies;
(iv) amend the certificate of incorporation or by-laws bylaws of any Transfer Group Company in any way; provided, however, that the Company or may (i) restate its articles of incorporation in a manner that does not effect any of substantive modifications to the provisions thereof and (ii) effect amendments to its Subsidiaries;bylaws that are not material and that are intended to reflect changes in Applicable Law.
(v) except as provided under the Portland General Holdings, Inc. Involuntary Severance Plan, as set forth on Schedule 7.2(b)(v6.2(b)(v) or otherwise in as would not create or increase any Liability of any Transfer Group Company beyond any amount reflected on the Ordinary Course of Business with respect to employees other than officers of the CompanyBalance Sheet, (A) increase the annual level of compensation of any employee of a Transfer Group Company (other than increases in the Company or any Ordinary Course of its SubsidiariesBusiness), (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantconsultant of the Transfer Group Companies, (DC) other than in the Ordinary Course of Business, increase the coverage or benefits available under any any, or, except as permitted under clause (or D), create any new) , severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any employee, director or officer of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries Transfer Group Companies or otherwise materially modify or amend or terminate any such plan or arrangement arrangement, or (ED) other than in the Ordinary Course of Business, enter into into, or amend any collective bargainingexisting, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the any Transfer Group Company is or any of its Subsidiaries is would be a party or involving a director, officer or employee of the Company Transfer Group Companies; provided that no such agreement (i) shall provide for a term in excess of one (1) year, or in the case of an amendment to any such agreement, increase an existing term by more than one (1) year, or (ii) increase compensation or other payments in excess of its Subsidiaries $300,000, or, in his or her capacity as a directorthe case of an amendment to any such agreement, officer or employee of the Company or any of its Subsidiariesmaterially increase compensation if such compensation exceeds $300,000 per year;
(vi) except as set forth on Schedule 6.2(b)(vi), and except for (A) trade payables, (B) indebtedness under any line of credit existing as of the date hereof or any new line of credit established to refinance any such existing line of credit (provided that the aggregate principal amount at any time outstanding under all lines of credit shall not be greater than the aggregate principal amount that could be borrowed under all lines of credit as of the date hereof plus $50 million, and provided further that with respect to any such refinanced line of credit, the expiration of the line of credit refinanced thereunder shall not be materially shorter than the expiration of the line of credit so refinanced), (C) long-term indebtedness for borrowed money incurred after the date hereof in an aggregate principal amount outstanding at any time not to exceed $150 million (provided that, to the extent such indebtedness is used to refinance outstanding indebtedness, the scheduled maturities of amounts borrowed shall not be materially shorter than the scheduled maturities of the indebtedness so refinanced), (D) other indebtedness for borrowed money and guarantees incurred after the date hereof in an aggregate principal amount not to exceed $5 million at any time, and (E) indebtedness incurred to refinance indebtedness outstanding on the date hereof or otherwise permitted under this Section 6.2(b)(vi) (provided that, except as provided in clause (B) and (C) above, the aggregate principal amount of such refinancing indebtedness shall not be greater than the aggregate principal amount of the indebtedness so refinanced, and provided further that with respect to any such refinancing indebtedness, the scheduled maturities of amounts borrowed shall not be materially shorter than the scheduled maturities of the indebtedness so refinanced), (1) incur or assume any Indebtedness long-term or short-term indebtedness (other than trade payables), (2) issue any debt securities, (3) issue or assume any obligations as the deferred purchase price of property, conditional sale obligations or any obligations under any title retention agreement (other than trade accounts payable in the Ordinary Course of Business), (4) enter into any capital leases, operating leases, or any synthetic or off-balance sheet leases or any agreement for the use or possession of property creating obligations that, in the case of any item covered by this clause (4), do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the indebtedness of such Person, or (5) become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any Person other than a Transfer Group Company in connection with obligations otherwise permitted hereunder (obligations of the types referred to in clauses (1) through (5) above are referred to herein collectively as "Restricted Indebtedness"); provided that, notwithstanding anything in this Agreement to the contrary (including anything in the foregoing clauses or the schedules hereto), as of the Closing, the sum of (w) the aggregate amount of all Restricted Indebtedness set forth of the Transfer Group Companies then outstanding, plus (x) the stated value of the Company's preferred stock and all accrued and unpaid dividends thereon, less (y) the Transfer Group Companies' cash on Schedule 7.2(b)(vi))hand, less (z) the amount of cash dividends paid by the Company to Seller from and after the date hereof, shall not exceed $900 million in the aggregate;
(vii) except as set forth on Schedule 6.2(b)(vii), (x) subject the Shares to any Lien Lien, or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, (y) subject any of the material properties or assets (whether tangible or intangible) of the Transfer Group Companies to any Lien other than, in the case of this clause (y), or Permitted Exceptions; provided that notwithstanding anything in this Section 6.2 to the contrary, at the Closing, the Shares shall be delivered to Purchaser free and clear of any shares of capital stock and all Liens (other than Liens created by Purchaser) in accordance with Section 363 of the Company or any of its SubsidiariesBankruptcy Code;
(viii) except as set forth on Schedule 6.2(b)(viii) or as otherwise permitted pursuant to this Section 6.2(b), (A) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), except for such acquisitions of properties or assets with a fair market value of up to $10 million in the aggregate or (B) sell, assign, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its SubsidiariesTransfer Group Companies other than in the Ordinary Course of Business, except for any such dispositions of properties or assets with a fair market value of up to $10 million in the aggregate;
(ix) enter into or terminate prior to its stated expiration any labor or collective bargaining agreement of the Transfer Group Companies; provided that nothing in this Section 6.2(b)(ix) shall prohibit any of the Transfer Group Companies from extending any collective bargaining agreement that otherwise would expire, or from entering into a new collective bargaining agreement in connection with any such expiration; provided that any such agreements do not have, and would not reasonably be expected to have, individually or in the aggregate, a Transfer Xxxxx Xxxxxxxx Adverse Effect;
(x) except as set forth on Schedule 7.2(b)(ix6.2(b)(x), as provided in Section 6.13 or Section 6.14 or with respect to refinancings contemplated in Section 6.2(b)(vi), repurchase, discharge or satisfy any claim, debt or obligation (or group of related claims, debts or obligations) of any of the Transfer Group Companies in an amount in excess of $5 million, other than (A) in the Ordinary Course of Business or (B) pursuant to the terms of any Contract as in effect on the date hereof or permitted to be entered into hereafter;
(xi) subject to Section 6.4(b), permit any of the Transfer Group Companies to enter into into, or agree to enter into into, any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify except as set forth on Schedule 6.2(b)(xii) or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwiseas required under GAAP, make any commitment or incur change in any liability to any labor organization with respect to the Company or any method of its Subsidiariesaccounting for financial reporting purposes;
(xiii) except as set forth on Schedule 7.2(b)(xiv)6.2(b)(xiii) in the Ordinary Course of Business or as expressly contemplated hereby, permit the Company make any filings with or commence any of its Subsidiaries to enter into any transaction proceedings against or to enter into, modify or renew any Contract which would be before a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse EffectGovernmental Authority;
(xiv) pursuant to or within the meaning of the Bankruptcy Code or any similar federal, state or foreign law for the relief of debtors, commence a voluntary case, consent to the entry of an Order for relief against the Company or any other Transfer Group Company in an involuntary case, consent to the appointment of a receiver, trustee, assignee, liquidator or similar official of it or for all or any material portion of its property or assets, or make a general assignment for the benefit of Seller's creditors;
(xv) except as set forth on Schedule 6.2(b)(xv), make any material Tax elections with respect to the Transfer Group Companies (other than elections that must be made periodically which are consistent with past practice);
(xvi) except as set forth on Schedule 6.2(b)(xvi), enter into any agreement or settlement with any Taxing Authority with respect to any material Tax item directly related to a Transfer Group Company;
(xvii) except as disclosed on Schedule 6.2(b)(xvii), make or agree to make any capital expenditure; provided that disclosure on Schedule 6.2(b)(xvii) notwithstanding, no expenditure shall be made, construction undertaken or obligation entered into with respect to the Company's planned Port Westward project (other than expenditures or obligations that in the aggregate would not exceed $5,000,000) until such time as an Integrated Resource Plan (or any Action Plan related to such Integrated Resource Plan) contemplating such expenditure, construction or obligation has been filed by the Company and been the subject of an acknowledgement order by OPUC;
(xviii) except as disclosed on Schedule 6.2(b)(xviii), enter into any power, capacity, fuel, transmission or transportation purchase, forward, option, swap or futures contract, including any derivative contract (in any case, whether for non-trading or trading purposes), except for transfers any contract (i) contemplated by an Integrated Resource Plan (or any Action Plan related to such Integrated Resource Plan) that has been filed by the Company and been the subject of cash an acknowledgement order by OPUC or (ii) that does not exceed twenty-four months in duration and does not cause the Company's Value at Risk to exceed the Company's maximum Value at Risk guidelines as authorized by the Board of Directors of the Company and in effect on the date hereof. Seller will cause the Company to use its reasonable best efforts to cause any such new agreements entered into by any Transfer Group Company pursuant to normal cash management practices this clause (xviii) to contain provisions permitting assignment to wholly owned subsidiaries. Specific transactions executed under enabling agreements will not themselves constitute "agreements" for the purposes of the immediately preceding sentence.
(c) The restrictions contained in subsections (a) and (b) of this Section 6.2 shall not in any way prohibit, limit or restrict, any of the following: (i) dividends by a direct or indirect wholly-owned subsidiary of the Company to the Company, or another direct or indirect wholly-owned subsidiary of the Company, (ii) dividends on the Preferred Stock outstanding on the date hereof; (iii) dividends on or repurchases of Shares to the extent that (x) such dividends or repurchases result in a reduction in the Purchase Price (or such distributions are made pursuant to Section 6.9(i) in a case in which the Purchase Price is not reduced due to the fact that the relevant intercompany account has been written down to zero) and (y) such dividends or repurchases are permissible under Order No. 97-196 entered by the Commission on June 4, 1997 in OPUC Docket 814 and the stipulation related thereto; (iv) redemptions of Preferred Stock pursuant to its terms, including any sinking fund requirements; (v) payments by any Transfer Group Company to Seller or its Affiliates in respect of intercompany payables or accounts or their liability to Seller or its Affiliates on account of such Transfer Group Company being a member of Seller's affiliated group for federal income tax purposes and, if applicable, any similar consolidated, combined or unitary group for state income tax purposes; or (vi) any actions by the Company to close any open Merchant Book trading position in accordance with Section 6.18 or to close, in the Ordinary Course of Business, permit any position maintained in the Company or any Company's retail (non-trading) electric utility business.
(d) Prior to the Closing, Seller shall keep Purchaser reasonably apprised of its Subsidiaries to make any investments in or loans the status of, and all other material matters relating to, the construction and operation of new generation or pay transmission facilities by any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract Transfer Group Company and shall consult with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed Purchaser in good faith by appropriate proceedingsregarding all such material matters, or accelerate including, without limitation, regulatory matters relating to, and material agreements and expenditures in connection with, such construction and operation; provided that Seller shall not be required to take any such action to the collection of any accounts receivable; and
(xix) agree extent it would be excused from doing so pursuant to do anything prohibited by this the proviso to Section 7.26.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as required by applicable Law, (ii) as contemplated by Section 8.2 of the Disclosure Schedule, (iii) as otherwise expressly provided contemplated by this Agreement, (iv) as reasonably necessary to comply with the terms of the Xxxxxxx Agreement in this Agreement the event of an exercise by Amconstruct Corporation of the Optional Put or (v) with the prior written consent of ParentPurchaser (which, during the period from the date of this Agreement with respect to the Effective TimeLimited Covenants only, the Company such consent shall not be unreasonably withheld, delayed or conditioned), Holdings shall, and shall cause its Subsidiaries to:
the other Companies to (iA) conduct the respective businesses business of the Company and its Subsidiaries only Companies in the Ordinary Course of Business;
; and (iiB) use its their commercially reasonable efforts to (A1) preserve its the present business operations, organization and goodwill operations of the Companies, (2) preserve the present relationships with customers, suppliers and employees of the Companies and any other Persons with whom any Company and its Subsidiaries has significant business relations and (B3) preserve its present relationship with Persons having material business dealings with the Company keep and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material their assets and properties of the Company in reasonable repair and its Subsidiaries in their current normal operating condition, excluding ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreementtear.
(b) Except (i) as required by applicable Law, (ii) as otherwise expressly provided contemplated by this Agreement, (iii) as set forth in this Agreement Section 8.2 of the Disclosure Schedule or (iv) with the prior written consent of ParentPurchaser (which, during the period from the date of this Agreement respect to the Effective TimeLimited Covenants only, the Company consent shall not be unreasonably withheld), Holdings shall not, and shall cause the other Companies not permit its Subsidiaries to, directly or indirectly:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or sell, pledge, dispose of or encumber any shares of capital stock Shares or other securities of the Company or any of its Subsidiaries Companies or grant options, warrants, calls or other rights to purchase or, otherwise acquire Shares or other securities of any Company;
(ii) except as reasonably necessary to comply with the terms of the Xxxxxxx Agreement in the event of an exercise by Amconstruct Corporation of the Optional Put, amend the Governing Documents of the Companies;
(iii) reclassify, combine, split, subdivide or redeem, or purchase or otherwise acquire shares (other than the acquisition of an ownership interest in Xxxxxxx in the event of an exercise by Amconstruct Corporation of the Optional Put), directly or indirectly, any of the capital stock or other securities equity or ownership interest, or make any other change with respect to the capital structure, of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its SubsidiariesCompany;
(iv) amend adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of any Company or otherwise alter any Company’s corporate or organizational structure (other than the certificate acquisition of incorporation or by-laws an ownership interest in Xxxxxxx in the event of an exercise by Amconstruct Corporation of the Company or any of its SubsidiariesOptional Put);
(v) except as reasonably necessary to comply with the terms of the Xxxxxxx Agreement in the event of an exercise by Amconstruct Corporation of the Optional Put, incur any Indebtedness or issue any debt securities or assume, guarantee or endorse, or otherwise become responsible for, the obligations of any Person, or make any loans or advances, except in the Ordinary Course of Business; provided, that in no event shall any Company (i) incur, assume or guarantee any long-term indebtedness for borrowed money or (ii) make any optional repayment of any indebtedness for borrowed money;
(vi) declare, set aside, make or pay any non-cash dividend or other distribution on or with respect to any of its capital stock or other equity or ownership interest;
(vii) acquire any corporation, partnership, limited liability company, other business organization or division or material assets thereof, or enter into any binding or non-binding letter of intent, joint venture, strategic alliance, exclusive dealing, noncompetition or similar contract or arrangement (other than the acquisition of an ownership interest in Xxxxxxx in the event of an exercise by Amconstruct Corporation of the Optional Put);
(viii) other than in accordance with the Companies’ capital expenditure budget, which is set forth on Schedule 7.2(b)(vin Section 8.2(b)(viii) of the Disclosure Schedule, or for sales to customers in the Ordinary Course of Business, acquire or lease any Real Property, properties or assets or sell, assign, license, transfer, convey, lease or otherwise dispose of or subject to any Liens any Real Property, properties or assets of any Company with a value greater than $5,000,000 in the aggregate for all such items of Real Property, properties or assets;
(ix) (i) enter into any Lease of real property or any renewal thereof, or (ii) fail to exercise any rights of renewal with respect to any Leased Real Property that by its terms would otherwise expire;
(x) other than in the Ordinary Course of Business and other than inter-company Contracts between the Companies, (i) amend, waive, modify or consent to the termination of any Material Contract or any Company’s rights thereunder, or (ii) enter into any Contract that would constitute a Material Contract;
(xi) except as reasonably necessary to comply with the terms of the Xxxxxxx Agreement in the event of an exercise by Amconstruct Corporation of the Optional Put, pay, discharge or satisfy any Claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), or cancel, compromise, waive or release any right or Claim, in each case other than in the Ordinary Course of Business;
(xii) commence any Legal Proceeding;
(xiii) enter into any Contract with any Related Party of any of the Companies, excluding: a) any arm’s-length Contracts entered into in the Ordinary Course of Business with portfolio companies of any Seller Funds and b) for clarity, any arm’s-length Contract entered into in the Ordinary Course of Business with limited partners of any Seller Fund and/or any of such limited partners’ respective portfolio companies;
(xiv) except as required to ensure that any Company Benefit Plan is not then out of compliance with applicable Law, or as required by the terms of any Collective Bargaining Agreement disclosed to the Purchaser, (A) increase the compensation payable or to become payable or the benefits provided to its directors, officers, employees or consultants, except in the Ordinary Course of Business with respect to employees other than who are not directors or officers of any Company and who receive less than $100,000 in annual base cash compensation from the Company, (A) increase the annual level of compensation of any employee of the Company or any of its SubsidiariesCompanies, (B) increase the annual level of compensation payable grant any severance or to become payable by the Company termination payment to, or loan or advance any of its Subsidiaries to amount to, any of their respective executive officersdirector, officer, employee or consultant, or (C) grant any unusual or extraordinary bonusestablish, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix)adopt, enter into or agree to enter into amend any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its SubsidiariesBenefit Plan;
(xv) make make, change, or change rescind any material election concerning Taxes or Tax Returnselection, change an annual accounting periodfile any material amended Tax Return, adopt or change any material accounting methodmethod in respect of Taxes, file change any amended accounting period or commence, settle or otherwise compromise any material Tax Returnclaim, consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of a material amount of Taxes or enter into any a closing agreement or other agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the material amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective TimeTaxes;
(xvi) enter into make any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business material changes in any geographic area method of accounting or enter into, modify, amend accounting practice or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;policy other than as required by GAAP; or
(xvii) terminateannounce an intention, amend, restate, supplement enter into any formal or waive any rights under any Material Contractinformal agreement, or Permit that would reasonably be expected to have otherwise make a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree commitment to do anything prohibited by this Section 7.28.2.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (w) as set forth on Schedule 6.1, (x) as required by applicable Law, (y) as otherwise expressly provided in contemplated by this Agreement or the terms of the ASA Transactions, or (z) with the prior written consent of ParentParent (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timeconditioned or delayed), the Company shall, and shall cause its Subsidiaries to:
each of the Acquired Companies to use their respective reasonable efforts to (i) conduct the respective businesses of the Company and its Subsidiaries Business only in the Ordinary Course of Business;
, (ii) use its commercially reasonable efforts to (A) preserve its the present business operations, organization and goodwill operations of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
Business, (iii) use its commercially reasonable efforts preserve the present relationships with customers, suppliers and key employees of the Business and (iv) maintain or cause to maintain (A) be maintained in full force and effect all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that policies in effect on as of the date of this Agreement;
Agreement (ivor comparable replacement coverage) give all required notices with respect to the properties, assets or business of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this AgreementBusiness.
(b) Except Prior to the Closing, except (w) as set forth on Schedule 6.1, (x) as required by applicable Law, (y) as otherwise expressly provided in contemplated by this Agreement or the terms of the ASA Transactions, or (z) with the prior written consent of ParentParent (which consent shall not be unreasonably withheld, during the period from the date of this Agreement conditioned or delayed), with respect to the Effective TimeAcquired Companies and the Business, the Company shall not not, and shall cause each of the Acquired Companies not permit its Subsidiaries to:
(i) issue, sell, or dispose of (or authorize the issuance, sale or disposition of), any shares of capital stock, ownership interests or voting securities, or any options, warrants, convertible securities or other rights of any kind to acquire or receive any shares of capital stock, any other ownership interests or any voting securities (including stock appreciation rights, phantom stock or similar instruments), of any Acquired Company (except in each case in conformity with the Company’s representations or as set forth on Schedule 7.2(b)(iin this Agreement for any (a) issuance of Shares upon the vesting of RSUs outstanding as of the date of this Agreement in accordance with the terms of any RSU Agreements, (b) vesting of Phantom Shares under the Deferred Compensation Plan, outstanding as of the date of this Agreement in each case, in accordance with the terms of any Benefit Plan or any applicable award agreement thereunder, or (c) issuance, sale or disposition to any Acquired Company by any other Acquired Company);
(ii) adopt any amendment to the Organizational Documents of the Acquired Companies, declare, set aside, make change the authorized or pay any dividend issued capital stock or other distribution (whether in cash, stock or property) in respect equity interest of the capital stock of the Company or repurchaseAcquired Companies, redeem or otherwise acquire any outstanding shares of reclassify combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose equity interest of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentAcquired Company;
(iii) effect pay or distribute any recapitalization, reclassification, stock split amounts or like change in the capitalization of the Company or take any of its Subsidiariesaction that would constitute Leakage;
(iv) amend the certificate adopt a plan or agreement of incorporation complete or by-laws partial liquidation dissolution, restructuring, merger, consolidation, recapitalization or other reorganization of the Company or any of its SubsidiariesAcquired Company;
(v) sell, assign, license, transfer, convey or lease (whether by merger, consolidation or disposition of stock or assets) any material portion of any Material Assets, except as set forth on Schedule 7.2(b)(v) or otherwise in each case in the Ordinary Course of Business with respect to employees other than officers or for the purpose of the Companydisposing of obsolete, (A) increase the annual level of compensation of any employee of the Company worthless or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiariesdamaged assets;
(vi) incur settle or assume compromise any Indebtedness material claim, action, suit, proceeding or investigation with respect to the Business or any Acquired Company in excess of One Million Dollars (other than Indebtedness set forth on Schedule 7.2(b)(vi)$1,000,000);
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix)contemplated under a Material Contract, enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries Business in excess of Twenty-Five Million Dollars ($20,000 for any individual commitment and $100,000 25,000,000) for all commitments in the aggregate, other than to replace or repair obsolete, worthless or damaged assets;
(xiiviii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices other than in the Ordinary Course of Business, permit the Company or any of its Subsidiaries enter into, materially amend, fail to make any investments perform in or loans toa material respect, or pay terminate, any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its SubsidiariesMaterial Contract;
(xvix) make (A) incur any Funded Indebtedness except to the extent permitted pursuant to Section 6.01 of the XX Xxxxxx Credit Agreement, (B) repay any Funded Indebtedness other than Permitted Payments, and (C) other than in the Ordinary Course of Business, modify in any material respect in a manner adverse to the Company the terms of any indebtedness for borrowed money, or assume, guarantee or endorse the obligations of any Person other than any Acquired Company; (x) make, change or revoke any material Tax election or settle or compromise any material Liability for Taxes, change any annual Tax accounting period, change any material election concerning Taxes or method of Tax Returns, change an annual accounting period, adopt or change any accounting methodaccounting, file any material amended Tax Return, enter into or consent in writing to any closing agreement with respect extension or waiver of the statute of limitations period applicable to Taxes, settle any material Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Timeassessment;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2.
Appears in 1 contract
Samples: Merger Agreement (Affinia Group Intermediate Holdings Inc.)
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing or earlier termination of this Agreement, except: (i) as required by applicable Law; (ii) as otherwise expressly provided in contemplated by this Agreement or Agreement; (iii) with the prior written consent of ParentBuyer (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned); or (iv) as set forth on Schedule 6.2, the Company shall, and shall cause its the Subsidiaries to:
(i) , conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Business;.
(b) Prior to the Closing or earlier termination of this Agreement, except: (i) as required by applicable Law; (ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions as otherwise contemplated by this Agreement; and
(viii) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of ParentBuyer (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned); or (iv) as set forth on Schedule 6.2, the Company shall not not, and shall cause the Subsidiaries not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its the Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its the Subsidiaries, except pursuant to obligations existing on for the date exercise of this Agreement and previously disclosed to ParentOptions or, in the Ordinary Course of Business, the grant of options under the Option Plan;
(iiiii) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its the Subsidiaries or pay any dividends;
(iii) amend the Certificate of Incorporation, the Bylaws, or comparable organizational documents of any of the Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise other than in the Ordinary Course of Business with respect to employees other than officers of the Companyor as required by Law or Contract, (A) increase the annual level of compensation of any director or employee of the Company or any of its the Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit bonus or other direct or indirect compensation to any director or employee, director or consultant, (DC) materially increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement Benefit Plan or (ED) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(viiv) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock ) of the Company or any of its Subsidiariesthe Subsidiaries to any material Lien, except for Permitted Exceptions;
(viiivi) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its the Subsidiaries, taken as a whole, (except pursuant to an existing Contract for fair consideration in the Ordinary Course of Business or for the purpose of disposing of obsolete or worthless assets);
(ixvii) except as set forth on Schedule 7.2(b)(ix)other than in the Ordinary Course of Business, enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of owing to the Company or any of its Subsidiaries except in the Ordinary Course of BusinessCompany;
(xiviii) enter into any commitment for capital expenditures of the Company and its the Subsidiaries in excess of $20,000 100,000 for any individual commitment and $100,000 500,000 for all commitments in the aggregate;
(xiiix) other than in the Ordinary Course of Business, enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiiix) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its the Subsidiaries to enter into any transaction or agree to enter into, modify into any merger or renew consolidation with any Contract which would be Person (other than a Material Contract if entered merger of any wholly-owned Subsidiary of the Company into prior to the date hereof Company or that would reasonably be expected to have a Material Adverse Effectone of the Company’s Subsidiaries);
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xvxi) make or change rescind any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect relating to Taxes, settle or compromise any Tax claim claim, action, suit, litigation, proceeding, arbitration, investigation, audit or assessment or surrender any right controversy relating to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the material amount of Taxes required Taxes, or make any material change to be paid by the Company or any of its Subsidiaries after methods of accounting for Tax purposes from those employed in the Effective Time;preparation of its most recent Tax Return; or
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xixxii) agree to do anything prohibited by this Section 7.26.2(a).
(c) Notwithstanding the foregoing, during the period from the date hereof until the Effective Time, the Company and the Subsidiaries shall be permitted to utilize any and all available Cash (i) to pay Company Transaction Expenses; and (ii) to repay outstanding Debt (including amounts owing under the Management Agreement).
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Subject to Section 6.2(b), prior to the Closing or earlier termination of this Agreement, except (i) as required by applicable Law, (ii) as otherwise expressly provided in contemplated by this Agreement or (iii) with the prior written consent of ParentBuyer (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and shall cause its the Subsidiaries to:
(i) , conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement Prior to the Closing or with the prior written consent of Parent, during the period from the date earlier termination of this Agreement to the Effective TimeAgreement, the Company shall not not, and shall cause the Subsidiaries not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its the Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its the Subsidiaries, except pursuant to obligations existing for the exercise of Options outstanding on the date hereof or, in the Ordinary Course of this Agreement Business, the grant of options under the Option Plan and previously disclosed except for any transfer, sale, disposition or distribution of any shares of capital stock or other securities of any of the Subsidiaries to Parentthe Company or one of the Company’s Subsidiaries;
(iiiii) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its the Subsidiaries;
(iii) incur any Debt (other than the Debt outstanding as of the date hereof and any additional Debt incurred under the Existing ABL Agreement in the Ordinary Course of Business), make any Guarantees, or enter into any other Material Contract (except, in the case of Material Contracts, in the Ordinary Course of Business);
(iv) amend the certificate Certificate of incorporation Incorporation, the Bylaws, or by-laws comparable organizational documents of any of the Subsidiaries;
(v) other than as required by Law or a Contract in effect on the date of this Agreement, (A) increase the level of compensation or benefits of, or grant any unusual or extraordinary bonus or other direct or indirect compensation to, any director, executive officer, employee or consultant of the Company or any of its the Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise , other than increases in base salary in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its SubsidiariesBusiness, (B) increase the annual level of compensation payable amend, modify or to become payable terminate any Company Benefit Plan, except as required by the Company Law or any of its Subsidiaries to any of their respective executive officers, (C) grant adopt any unusual or extraordinary bonusplan, benefit or other direct or indirect compensation to any employeepolicy, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan agreement or arrangement made to, for, or with any that would have constituted a Company Benefit Plan if it had been in effect on the date of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiariesthis Agreement;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock ) of the Company or any of its Subsidiariesthe Subsidiaries to any Lien, except for Permitted Exceptions;
(viiivii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of (a) any of the Owned Real Property or (b) any of the other material properties or assets of the Company and its the Subsidiaries, taken as a whole (except in the Ordinary Course of Business (including without limitation the sale or other disposition of inventory in the Ordinary Course of Business) or for the purpose of disposing of obsolete or worthless assets);
(viii) abandon, let lapse, fail to renew, fail to pay any required maintenance or other similar fees or otherwise fail to take any actions required to maintain and further prosecute any material Intellectual Property of the Company or any Subsidiary;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of owing to the Company or any of its Subsidiaries except in the Ordinary Course of BusinessCompany;
(xix) enter into any commitment for capital expenditures of the Company and its the Subsidiaries in excess of $20,000 1,000,000 for any individual commitment and $100,000 5,000,000 for all commitments in the aggregateaggregate (other than with respect to the opening of new stores for which capital expenditures have been allocated prior to the date hereof as reflected in the Company’s operating plan);
(xi) mortgage, pledge or otherwise subject to a Lien any property or assets owned, used or occupied by the Company or any of the Subsidiaries;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its the Subsidiaries to enter into any transaction or agree to enter into, modify into any merger or renew consolidation with any Contract which would be Person (other than a Material Contract if entered merger of any wholly-owned Subsidiary of the Company into prior to the date hereof Company or that would reasonably be expected to have a Material Adverse Effectone of the Company’s Subsidiaries);
(xiv) except for transfers settle or compromise any pending or threatened material suit, action or claim in excess of cash pursuant the greater of (A) $250,000 or (B) $250,000 in excess of any reserve with respect to normal cash management practices such suit, action or claim that is set forth on the balance sheet of the Company and the Subsidiaries as at April 30, 2012; provided, that in the Ordinary Course of Business, permit no event shall the Company or any of its the Subsidiaries be entitled to make settle or compromise any investments such suit, action or claim in such settlement or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate compromise would require the admission of liability on the part of the Company or any of its Subsidiaries, such Subsidiary or any director, officer otherwise materially impair or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes otherwise the ability of the Company or any Subsidiary the Subsidiaries to compete with or conduct any business or line of operate their business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effectmaterial respect;
(xviixv) terminate, amend, restate, supplement or waive enter into any rights under transactions with any Material Contract, or Permit that would reasonably be expected Person who to have a Material Adverse Effectthe Knowledge of the Company is an Affiliate of the Company (other than as contemplated by this Agreement);
(xviiixvi) fail make or rescind any election relating to promptly pay and discharge current liabilities expect where disputed Taxes; settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to a Taxes; make any change to any of its methods of accounting for Tax purposes, except insofar as may be required by a change in good faith by appropriate proceedingsGAAP (or any interpretation thereof) or applicable Law; or waive or extend, in respect of Taxes (other than in connection with customary extensions of time within which to file Tax Returns), (i) any statute of limitations or accelerate the collection of (ii) any accounts receivableperiod within which an assessment or reassessment may be issued; andor
(xixxvii) agree to do anything prohibited by this Section 7.26.2(b).
(c) Notwithstanding anything to the contrary contained herein, during the period from the date hereof until the Effective Time, the Company and the Subsidiaries shall be permitted to utilize any and all available Cash (i) to pay Company Transaction Expenses; (ii) to repay outstanding Debt (including amounts owing under the Management Agreement); and (iii) to declare and pay one or more dividends or other distributions to the Stockholders out of funds legally available for that purpose, in each case at such times and in such amounts as the Company or the applicable Subsidiary shall deem necessary, appropriate or desirable.
Appears in 1 contract
Samples: Merger Agreement (Am-Source, LLC)
Conduct of the Business Pending the Closing. (a) The Company will not, and the Company will not permit any of its Subsidiaries to, take any action with the purpose of causing any of the conditions to the Purchaser's obligations set forth in Article VII hereof to not be satisfied. Except as otherwise expressly provided in contemplated by this Agreement Agreement, as set forth on Schedule 6.1 or with the prior written consent of Parentthe Purchaser, during the period from the date of this Agreement to the Effective TimeClosing, the Company shallwill, and shall will cause each of its Subsidiaries to:
(i) , conduct the their respective businesses according to their ordinary and usual course of the Company business and its Subsidiaries only in the Ordinary Course of Business;
(ii) to use its all commercially reasonable efforts consistent therewith (x) to (A) preserve its present intact their respective material properties, assets and business operations, organization and goodwill of the Company and its Subsidiaries organizations and (By) preserve its present relationship to maintain satisfactory relationships with Persons material customers, suppliers, distributors, regulators, creditors and others having material business dealings relationships with the Company and its Subsidiaries, in each case in the ordinary course of business; provided, however, that none of the Company or its Subsidiaries shall be required to incur any costs or expenses or otherwise expend any monies out of the ordinary course of business in connection with such efforts. Without limiting the generality of the foregoing, and except as otherwise provided in this Agreement, the Company will not, and will not permit any of its Subsidiaries to, without the prior written consent of the Purchaser (such consent not to be unreasonably withheld or delayed):
(i) except for the issuance of Common Stock upon the exercise of currently outstanding Options, issue, sell or pledge, or authorize or propose the issuance, sale or pledge, of additional shares of capital stock of any class, or securities convertible into or exchangeable for shares of capital stock, or any rights, warrants or options to acquire any such shares, or other convertible securities of the Company or its Subsidiaries;
(ii) split, combine or reclassify any shares of the Capital Stock of the Company or its Subsidiaries or declare, set aside for payment or pay any dividend or distribution, payable in cash, stock, property or otherwise, with respect to any of the Capital Stock of the Company or its Subsidiaries, other than, with respect to dividends or distributions, cash dividends and distributions by a direct or indirect wholly-owned Subsidiary to the Company or another direct or indirect wholly-owned Subsidiary;
(iii) use its commercially reasonable efforts enter into an agreement with respect to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current conditionany merger, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s consolidation, liquidation or business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, combination involving the Company or any of its Subsidiaries, except in connection with the exercise or any acquisition or disposition of repurchase rights all or rights of first refusal in favor substantially all of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell assets or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) amend propose or adopt any amendment to the certificate of incorporation or by-laws or other organizational documents of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level acquire (by merger, consolidation or acquisition of compensation stock or assets) any corporation, partnership or other business organization or division or line of any employee of the Company business thereof or any of its Subsidiaries, (B) increase make any investment, either by purchase of stock or securities, contributions to capital (other than to a Subsidiary), property transfer or purchase of any property or assets of any Person, except pursuant to Contracts in effect on the annual level date of compensation payable this Agreement and disclosed on Schedule 6.1(v) hereto;
(vi) except for borrowings under existing lines of credit in the ordinary course of business, incur any long-term Indebtedness or issue any debt securities or assume, guarantee or endorse the obligations of any other Person in excess of Fifty Thousand Dollars ($50,000) in the aggregate;
(vii) cancel any material third party Indebtedness owed to become payable by the Company or any of its Subsidiaries (other than Indebtedness owed to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its wholly-owned Subsidiaries by another wholly-owned Subsidiary);
(viii) (A) increase in any manner the rate or otherwise modify terms of compensation or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or benefits of any of its Subsidiaries is a party directors, officers or involving a other employees, except as may be required under existing employment agreements or such increases as are granted in the ordinary course of business consistent with past practice, (B) hire any new employees except in the ordinary course of business consistent with past practice, (C) pay or agree to pay any pension, retirement allowance or other employee benefit not required or permitted by any existing Benefit Plan or other agreement or arrangement to any such director, officer or employee employee, whether past or present, or (C) enter into or amend any employment, bonus, severance or retirement contract or adopt or amend any Benefit Plan, except in the ordinary course of business consistent with past practice;
(A) except for the Company sale of inventory in the ordinary course of business consistent with past practice, sell, lease, transfer or otherwise dispose of any of its Subsidiaries material property or assets, or (B) create Encumbrances on any of its material property or assets, in his each case described in this clause (B) in excess of Fifty Thousand Dollars ($50,000) per transaction or her capacity One Hundred Thousand Dollars ($100,000) in the aggregate;
(x) sell, assign, lease, license, transfer or otherwise dispose of, mortgage, pledge or encumber, any Owned Real Property, or amend, terminate, modify or renew any Real Property Lease except as disclosed on Schedule 6.1;
(xi) make any loans, advances or capital contributions (other than advances for travel and other normal business expenses to officers and employees), except in the ordinary course of business and in an aggregate amount outstanding at any one time not to exceed One Hundred Thousand Dollars ($100,000);
(xii) commit to make any capital expenditure not set forth on Schedule 6.1(xii) (unless consistent with subsection (xiii) following) or fail to make capital expenditures consistent with past practices (even in excess of amounts set forth on Schedule 6.1(xii)) or fail to expend aggregate cash amounts in any month in respect of commitments made between the date hereof and the Closing Date less than the amount set forth on Schedule 6.1(xii) hereto with respect to such month (unless such amounts may be avoided or deferred consistent with past practices);
(xiii) fail to maintain all its assets in good repair and condition, except to the extent of wear or use in the ordinary course of business or damage by fire or other unavoidable casualty;
(xiv) make or change any Tax election, release, assign, settle or compromise any material Tax liability, or waive or consent to the extension of any statute of limitations for the assessment and collection of any Tax, except in the ordinary course of business consistent with past practice, or fail to make timely any estimated payment for Taxes in accordance with Applicable Law;
(xv) except as may be required as a directorresult of a change in Applicable Law or GAAP, officer change any accounting principles or employee of practices used by the Company or any of its Subsidiaries;
(vixvi) incur institute, settle or assume dismiss any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject action, claim, demand, lawsuit, proceeding, arbitration or grievance by or before any court, arbitrator or governmental or regulatory body threatened against, relating to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of involving the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract connection with any Affiliate business, asset or property of the Company or any of its Subsidiaries, other than in the ordinary course of business but not, in any individual case, in excess of One Hundred Thousand Dollars ($100,000) ;
(xvii) enter into any Contract with a term of more than thirty six (36) months or involving the payment, or provision of goods or services, in excess of One Million Dollars ($1,000,000) or enter into any director, officer Contract outside of the ordinary course of business consistent with past practices;
(xviii) fail to pay the accounts payable or employee other liabilities of the Company or any of its Subsidiaries;
(xv) make Subsidiaries in a manner consistent with the practices of the Company and its Subsidiaries prior to the date hereof or change take any material election concerning Taxes action not consistent with the past practices of the Company and its Subsidiaries that is designed to accelerate or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund has the effect of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect accelerating the amount of Taxes required to be paid receipt by the Company or any of its Subsidiaries after of any amounts of cash earlier than such cash would have been realized consistent with the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability past practices of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivableits Subsidiaries; andor
(xix) agree in writing to do anything prohibited by this Section 7.2take any of the foregoing actions.
Appears in 1 contract
Conduct of the Business Pending the Closing. From and after the date hereof until the Closing Date:
(a) Seller shall carry on its business relating to the Assets and the Program in the ordinary course consistent with past practice, including, without limitation, the prosecution of any pending patent applications, and the payment of any maintenance fees upon the earliest date due on any patents, included in the Assets or related thereto, shall preserve its ownership in the Assets, and shall not engage in any transaction or activity relating to the Assets, enter into any agreement, or make any commitment relating to the Assets;
(b) Seller shall preserve and keep intact its business organization relating to the Assets;
(c) Except as otherwise expressly provided in permitted by this Agreement or with Agreement, without the prior written consent of ParentBuyer, during the period from the date of this Agreement to the Effective Time, the Company shall, and shall cause its Subsidiaries toSeller will not:
(i) conduct the respective businesses permit or allow any of the Company and its Subsidiaries only in the Ordinary Course Assets to be subjected to any mortgages, liens, pledges, charges, security interests, encumbrances or encroachments, or to any rights of Businessothers of any kind of nature whatsoever;
(ii) use its commercially reasonable efforts take any actions to (A) preserve its present business operationsmodify, organization and goodwill terminate or amend any of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with documents comprising the Company and its SubsidiariesAssets;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties engage in the sale, license, assignment, transfer, conveyance, lease, mortgage, pledge or other disposition of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this AgreementAssets;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material incur any liability relating to the Company’s business that are necessary Assets other than the fees set forth in Section 2.3 which Seller has agreed to pay and Buyer has (or advisable in order Synthetic and Buyer, if Buyer is a wholly owned subsidiary of Synthetic have) agreed to consummate the transactions contemplated by this Agreementreimburse; andor
(v) not take agree, whether in writing or otherwise, to do any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreementforegoing.
(bd) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company Seller shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i)do any act or omit to do any act, declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose which will cause a breach of any shares contract or commitment of capital stock Seller or other securities of which would cause the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation breach of any employee of the Company representation, warranty or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement covenant made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2hereunder.
Appears in 1 contract
Samples: Asset Purchase Agreement (Synthetic Biologics, Inc.)
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in contemplated by this Agreement or with the prior written consent of Parentthe Purchaser, during the period from the date of this Agreement prior to the Effective Time, Closing the Company Sellers shall, and shall cause its Subsidiaries Enhance to:
(i) conduct Conduct the respective businesses business of the Company and its Subsidiaries Enhance only in the Ordinary Course of Businessordinary course consistent with past practice;
(ii) use Use its commercially reasonable best efforts to (A) preserve its present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and its Subsidiaries Enhance and (B) preserve its present relationship with Persons parties having material business dealings with the Company and its Subsidiaries;Enhance; and
(iii) use its commercially reasonable efforts to maintain (A) Comply in all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreementrespects with applicable laws.
(b) Except as otherwise expressly provided in contemplated by this Agreement or with the prior written consent of Parentthe Purchaser, during the period from the date of this Agreement prior to the Effective TimeClosing the Sellers shall not, the Company shall not and shall cause Enhance not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transferTransfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries Enhance or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of Enhance;
(ii) Amend the Company Certificate of Incorporation or any Bylaws of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentEnhance;
(iii) effect Subject to any recapitalization, reclassification, stock split or like change in lien (except for leases that do not materially impair the capitalization use of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise property subject thereto in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity businesses as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vipresently conducted));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares ) of capital stock of the Company or any of its SubsidiariesEnhance;
(viiiiv) acquire Acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets (except for fair consideration in the ordinary course of the Company and its Subsidiariesbusiness consistent with past practice) of Enhance;
(ixv) except as set forth on Schedule 7.2(b)(ix), Enter into any commitment for capital expenditures out of the ordinary course;
(vi) Permit Enhance to enter into any transaction or to make or enter into any Contract which by reason of its size or otherwise is not in the ordinary course of business consistent with past practice;
(vii) Permit Enhance to enter into or agree to enter into any merger or consolidation with, with any corporation or other entity, and not engage in any new business or invest in, make a loan, material advance or capital contribution to, to or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Optionsparty;
(xviii) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree Agree to do anything prohibited by this Section 7.26.2 or anything which would make any of the representations and warranties of the Sellers in this Agreement or any other agreement referenced herein untrue or incorrect in any material respect as of any time through and including the Closing.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during During the period from the date of this Agreement to and continuing until the Effective TimeClosing, each of the Stockholder and the Company agrees, that neither the Stockholder nor the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only not to, engage in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present any business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings whatsoever other than in connection with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices consummation of the transactions contemplated by this Agreement and the Merger Agreement, and shall use its commercially reasonable best efforts to obtain all third party preserve intact its business and assets, maintain its assets in good operating condition and repair (ordinary wear and tear excepted), retain the services of its officers, employees and independent contractors and use reasonable commercial efforts to keep in full force and effect liability insurance and bonds comparable in amount and scope of coverage to that currently maintained with respect to its business, unless, in any case, BBI consents material to the Company’s business that are necessary or advisable otherwise in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreementwriting.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during During the period from the date of this Agreement and continuing until the Closing, each of the Stockholder and the Company agrees as to itself and, with respect to the Effective TimeCompany, the Company Subsidiaries, that except as expressly contemplated or permitted by this Agreement, or to the extent that the other party shall not and shall not permit its Subsidiaries tootherwise consent in writing:
(i) It shall not amend or propose to amend its certificate of incorporation or by-laws or equivalent organizational documents except as set forth on Schedule 7.2(b)(i)contemplated in this Agreement.
(ii) It shall not, nor in the case of the Company shall it permit the Company Subsidiaries to, issue, deliver, sell, redeem, acquire, authorize or propose to issue, deliver, sell, redeem, acquire or authorize, any shares of its capital stock of any class or any securities convertible into, or any rights, warrants or options to acquire, any such shares or convertible securities or other ownership interest and, in the case of the Stockholder, shall not sell or otherwise transfer the Shares, provided that the Company shall be permitted to issue the shares of its Common Stock to be issued to the stockholders of BBI under the terms of the Merger Agreement.
(iii) It shall not, nor in the case of the Company shall it permit any of the Company Subsidiaries to, nor shall it propose to: (i) declare, set aside, make or pay any dividend or other distribution (whether distribution, payable in cash, stock stock, property or property) in otherwise, with respect to any of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the its capital stock or other securities (ii) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock.
(iv) Other than dispositions in the ordinary course of business consistent with past practice which would not cause a Material Adverse Effect, individually or in the aggregate, to it and its subsidiaries, taken as a whole, it shall not, nor shall it permit any of its subsidiaries to, sell, lease, encumber or otherwise dispose of, or agree to sell, lease (whether such lease is an operating or capital lease), encumber or otherwise dispose of its assets.
(v) It shall promptly advise the other ownership interests inparty hereto in writing of any change in the condition (financial or otherwise), the Company operations or properties, businesses or business prospects of such party or any of its Subsidiariessubsidiaries which would result in a Material Adverse Effect.
(vi) It shall not permit to occur any (1) change in accounting principles, methods or practices, investment practices, claims, payment and processing practices or policies regarding intercompany transactions, (2) incurrence of Indebtedness or any commitment to incur Indebtedness, any incurrence of a contingent liability, Contingent Obligation or other liability of any type, (3) cancellation of any debt or waiver or release of any contract, right or claim, except for cancellations, waivers and releases in connection the ordinary course of business consistent with its past practice which do not exceed $10,000 in the exercise of repurchase rights aggregate, (4) amendment, termination or rights of first refusal in favor of revocation of, or a failure to perform obligations or the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose occurrence of any shares default under, (Y) any contract or agreement (including, without limitation, leases) to which it is or, as of capital stock December 31, 2006, was a party, other than in the ordinary course of business consistent with past practice, or other securities (Z) any License, (5) execution of the Company termination, severance or similar agreements with any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement independent contractors or (E6) enter entering into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition leases of real property or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));acquire real property.
(vii) subject to any Lien or otherwise encumber orIt shall not, except for Permitted Exceptions, permit, allow or suffer to be encumbered, and the Company shall not permit any of the properties Company Subsidiaries to, take or assets agree or commit to take any action, (whether tangible or intangible), or any shares of capital stock of the Company or i) that is reasonably likely to make any of its Subsidiaries;
representations or warranties hereunder inaccurate; or (viiiii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect that is prohibited pursuant to the Company or any provisions of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2Article VI.
Appears in 1 contract
Samples: Stock Purchase Agreement (Captech Financial Group, Inc)
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in contemplated by this Agreement or with the prior written consent of Parentthe Purchaser (which shall not be unreasonably withheld, during conditioned or delayed), until the period from the date of this Agreement to the Effective Time, Closing Date the Company shall, shall and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course ordinary course of Businessbusiness consistent with past practice;
(ii) not declare, set aside, make or pay any dividend or other distribution in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other profit participations or proprietary or equity interests in, the Company or any of its Subsidiaries; not transfer, issue, sell or dispose of any shares of capital stock or profit participations or other proprietary or equity interests in, or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to directly or indirectly purchase or otherwise acquire profit participations or proprietary or equity interests in the Company or any of its Subsidiaries or shares of capital stock of the Company or any of its Subsidiaries or other securities (except as to any of the foregoing as set forth on SCHEDULE 6F);
(iii) not effect any recapitalization, reclassification, stock split or like change in the capital ization of the Company or its Subsidiaries;
(iv) not amend the Articles of Incorporation or By-laws of the Company or its Subsidiaries;
(v) use its commercially reasonable best efforts to (A) preserve its present business operations, organization (including, without limitation, management) and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iiivi) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this AgreementAgreement (with insurers of substantially the same or better financial condition);
(ivA) give all required notices of maintain the transactions contemplated by this Agreement books, accounts and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock records of the Company and its Subsidiaries in the ordinary course of business consistent with past practices, (B) continue to collect accounts receivable and pay accounts payable utilizing historical procedures and without discounting or repurchaseaccelerating payment of such accounts, redeem or otherwise acquire any outstanding shares of and (C) comply with all contractual and other obligations applicable to the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor operations of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(ivviii) amend not, other than in the certificate ordinary course of incorporation business consistent with past practice and without materially increasing the benefits or by-laws of the Company or any of its Subsidiaries;
costs thereof (v) except as set forth described on Schedule 7.2(b)(vSCHEDULE 6F) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive directors, officers, (C) grant any unusual employees, agents or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantrepresentatives, (DB) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan plan, payment or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (EC) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(viix) incur or assume not introduce any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject material change with respect to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock operations of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ixx) except as set forth on Schedule 7.2(b)(ix)SCHEDULE 6F, enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to make or enter into, modify or renew into any Contract which would be a Material Contract if entered into prior by reason of its size, subject matter or otherwise is not in the ordinary course of business ;
(xi) promptly notify the Purchaser of (A) any one or more or Extraordinary Losses suffered by the Company or any of its Subsidiaries, (B) any casualty losses or damages suffered by the Company or any of its Subsidiaries with respect to the date hereof property and assets having an individual replacement cost of more than $100,000 or that would reasonably be expected to have aggregate replacement cost of more than $500,000 or which could cause a Material Adverse EffectChange, whether or not such losses or damages are covered by insurance, and (C) (i) any material Legal Proceeding commenced by or against the Company or any of its Subsidiaries or (ii) any Legal Proceeding commenced or threatened against the Company, any of its Subsidiaries or the Shareholders relating to the transactions contemplated by this Agreement;
(xivxii) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, not permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts)except in the Ordinary Course of Business) to, or enter into or materially modify any Contract with with, the Shareholders or any Affiliate of their respective Affiliates;
(xiii) promptly and accurately record in the appropriate records and books of account of the Company or any of and its Subsidiaries, as applicable, all material corporate action taken on or any director, officer after the date hereof by the shareholders or employee the boards of directors (including committees thereof) of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of and its Subsidiaries after the Effective Timeand promptly following such recordation deliver true, correct and complete copies thereof to Purchaser;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in contemplated by this Agreement or with the prior written consent of Parentthe Purchaser, during through the period from Closing Date the date of this Agreement to the Effective Time, Seller shall cause the Company shall, and shall cause its the Subsidiaries to:
(i) to conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Business;
ordinary course, consistent with past practice; provided, however, that the Seller shall (iii) use discharge, in whole or in part, any loans by the Seller or its commercially reasonable efforts Affiliates to (A) preserve its present business operations, organization and goodwill of the Company and or its Subsidiaries and (Bii) preserve its present relationship with Persons having material business dealings with terminate any keep well letters and similar instruments from the Company Seller and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties Affiliates in favour of the Company and or its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this AgreementAffiliates.
(b) Except as otherwise expressly provided in contemplated by this Agreement or with the prior written consent of Parentthe Purchaser, during through the period from Closing Date the date of this Agreement to the Effective Time, Seller shall cause the Company shall and the Subsidiaries not and shall not permit its Subsidiaries to:
(i) except other than as set forth on Schedule 7.2(b)(i)5.2(b) hereto with respect to permitted dividends by the Company, declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any of their outstanding shares of the capital stock or stock, other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Optionsinterests;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities or material assets of the Company or any of its the Subsidiaries or grant optionsany option, warrants, calls call or other rights right to purchase or otherwise acquire shares of the capital stock or other securities or material assets of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentSub- sidiary;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization amend their respective certificates of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation in- corporation or by-laws of the Company or any of its Subsidiaries;similar constitutional docu- ments; or
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xixiv) agree to do anything prohibited by this Section 7.25.2 or anything which would make any of the rep- resentations and warranties of the Seller in this Agree- ment untrue or incorrect as of any time through and in- cluding the Closing Date.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement or (iv) with the prior written consent of ParentParent (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;, including with respect to capital expenditures, and not enter into a new line of business outside the Company's and its Subsidiaries' existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve its the present business operations, organization and goodwill of the Company and its Subsidiaries and Subsidiaries, (B) preserve its the present relationship relationships with Persons having material business dealings with the Company customers and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties suppliers of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (BC) insurance upon all keep available the services of the properties and assets current executive officers of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement or (iv) with the prior written consent of ParentParent (except with respect to Section 7.2(b)(x), during the period from the date of this Agreement to the Effective Timewhich consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not not, and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, issue or sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or by-laws bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in required by the Ordinary Course terms of Business with respect to employees other than officers any Company Benefit Plan as of the Companydate of this Agreement or by applicable Law, (A) increase the annual level of cash compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries paid to any of their respective executive officersdirector, (C) grant any unusual officer, employee or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives consultant of the Company or any of its Subsidiaries (except increases in salaries or otherwise modify wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or terminate any additional severance payments made outside of Company Benefit Plans so long as such plan or arrangement payments do not exceed $300,000 in the aggregate) or (ED) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a directorany employee, officer consultant or employee director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in his existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or her capacity as a directoramend employment and consulting arrangements with officers, officer or employee employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or any engagements in the Ordinary Course of its SubsidiariesBusiness);
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company's rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its Subsidiariesbusiness or the loss of a material right);
(ix) except as set forth on Schedule 7.2(b)(ix)enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with, with any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company's headquarters), and shall not enter into any commitment new lease, sublease, license or other agreement for capital expenditures the use or occupancy of the Company any real property requiring rental and its Subsidiaries other payments in excess of $20,000 for any individual commitment and $100,000 for all commitments in 25,000 annually as averaged over the aggregateterm thereof;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of its Subsidiaries, or Business on arm's length terms with any director, officer or employee portfolio company of a stockholder of the Company or of an Affiliate of any of its Subsidiariessuch stockholder;
(xvxiii) make implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting methodTaxes, file any amended Tax ReturnReturn in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to Taxes, settle any material Tax claim or assessment or surrender any right to claim a refund of Taxes material Tax refund;
(xv) except to the extent required by Law or obtain or enter into GAAP, make any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required material change to be paid by the Company or any of its Subsidiaries after the Effective Timemethods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any Contractjoint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company's existing revolving credit facility), understanding (B) incur any letter of credit, performance bond, cash collateral or commitment that restrains, restricts, limits escrow requirement or impedes similar credit support other than in the ability Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any Subsidiary to compete of its Subsidiaries (other than purchase money security interests in connection with or conduct any business or line the acquisition of business equipment in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effectthe Ordinary Course of Business);
(xviii) fail to promptly pay make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and discharge current liabilities expect where disputed its Subsidiaries as in good faith by appropriate proceedings, or accelerate effect on the collection date of any accounts receivablethis Agreement; andor
(xix) agree or commit to do anything prohibited by this Section 7.27.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries' respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company's counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as required by applicable Law or GAAP, (ii) as otherwise expressly provided in contemplated or required by this Agreement or (iii) with the prior written consent of ParentPurchaser, during the period from the date of this Agreement to the Effective Time, Sellers shall cause the Company shall, and shall cause its Subsidiaries to:
to (iA) conduct the respective businesses of the Company and its Subsidiaries only Business in the Ordinary Course of Business;
Business in all material respects; and (iiB) use its commercially reasonable efforts to (A1) preserve its the present business operations, organization and goodwill of the Company and its Subsidiaries Company, and (B2) preserve its the present relationship relationships with Persons having material business dealings with the Company customers and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties suppliers of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except Prior to the Closing, except (i) as required by applicable Law or GAAP, (ii) as otherwise expressly provided in contemplated or required by this Agreement or (iii) with the prior written consent of ParentPurchaser, during the period from the date of this Agreement to the Effective TimeSellers shall not, the Company shall not and shall not permit its Subsidiaries the Company to:
(iA) except as set forth on Schedule 7.2(b)(i)other than in the Ordinary Course of Business, declare, set aside, make (1) grant any new or pay any dividend increase existing compensation or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose benefits of any shares of capital stock officer or other securities Employee of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights individual who is a service provider to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D2) increase the coverage or benefits available under any (or create create, commence participation in or become liable with respect to any new) severance payEmployee Benefit Plan or amend, termination paymodify, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend suspend or terminate any such plan Employee Benefit Plan, (3) take any action to accelerate the vesting, funding or arrangement payment of any compensation or benefit for any individual who is a service provider to the Company, or (E4) enter into any collective bargaining, employment, deferred compensation, severance, change in control, retention, consulting, non-competition non‑competition or similar agreement (or amend any such agreement) to which the Company is party or involving an executive officer of the Company;
(B) (1) terminate (other than for cause as determined by the Company in good faith) or hire any executive officer of the Company or (2) other than in the Ordinary Course of Business, terminate or hire any Employee who is not an executive officer of the Company;
(C) make or rescind any material election relating to Taxes, settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to Taxes or make any material change to any of its Subsidiaries is a party methods of accounting or involving a directormethods of reporting income or deductions for Tax or accounting practice or policy from those employed in the preparation of its most recent Tax Returns;
(D) subject the assets or properties of the Company to any Lien to which they are not subject as of the date of this Agreement, officer in each case except in the Ordinary Course of Business or employee for Permitted Liens;
(E) sell, transfer, dispose of or subject to any Lien any of the Equity Interests held by the Sellers in the Company;
(F) cause or permit the Company to issue any additional Equity Interests of the Company or any of its Subsidiaries in his securities convertible into or her capacity as a director, officer or employee exchangeable for Equity Interests of the Company or any of its SubsidiariesCompany;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viiiG) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties or assets asset of the Company and its Subsidiaries(except pursuant to an existing Contract for fair consideration, for the purpose of disposing of obsolete or worthless assets or otherwise in the Ordinary Course of Business);
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(xH) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xiiI) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiariesorganization;
(xiiiJ) except as set forth on Schedule 7.2(b)(xiv), permit the Company enter into or any of its Subsidiaries agree to enter into any transaction merger or to enter into, modify or renew consolidation with any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse EffectPerson;
(xivK) amend or propose to amend the Company’s Governing Documents or split, subdivide, combine or reclassify its outstanding equity interests;
(L) enter into any transaction for, or make any material acquisition of or investment in any businesses, product lines, business units, business operations or stock except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xvM) make any single capital expenditure or change any material election concerning Taxes commitment in excess of $50,000, or Tax Returnsaggregate capital expenditures and commitments in excess of $150,000, change an annual accounting period, adopt including such capital expenditures for additions to property or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Timeequipment;
(xviN) enter into terminate or waive any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modifymaterial provision of, amend or terminate otherwise modify any Contract which if so entered intomaterial provision of, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xixO) agree to do anything prohibited by this Section 7.25.2(b).
(c) Nothing contained in this Agreement, including this Section 5.2, shall give Purchaser, directly or indirectly, any right to control or direct the operations of the Company prior to the Closing. Prior to the Closing, the Company and Purchaser shall each exercise, consistent with the other terms and conditions of this Agreement, complete control and supervision over their respective businesses.
Appears in 1 contract
Samples: Equity Interest Purchase Agreement (Tetra Technologies Inc)
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (w) as set forth on Schedule 6.2(a), (x) as required by applicable Law, (y) as otherwise expressly provided in specifically contemplated by this Agreement Agreement, any of the Seller Documents or the Company Documents, or (z) with the prior written consent of ParentBuyer (provided, during the period from the date that Buyer shall respond (i.e., consent or withhold its consent) as soon as reasonably practicable but in no event later than five (5) Business Days of this Agreement any receipt of any written request therefor delivered to the Effective TimeBuyer in accordance with Section 8.9), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its the Subsidiaries only in the Ordinary Course of Business, including making capital expenditures in amounts and in a timely manner consistent with past practices;
(ii) use its commercially reasonable efforts to (A) preserve its the present business operations, organization and goodwill of the Company and its Subsidiaries Subsidiaries, and (B) preserve its the present relationship relationships with Persons having material business dealings with the customers and suppliers of the Company and its Subsidiaries;; and
(iii) use its commercially reasonable efforts in the event that, to maintain (A) all material assets and properties the Knowledge of the Company, the Company and or its Subsidiaries is or becomes in their current conditionviolation of any anti-corruption or anti-money laundering Laws, ordinary wear or any European Union and tear excepted and (B) insurance upon all of the properties and assets of U.S. export control Laws or custom Laws, in each case, applicable by the Company and or its Subsidiaries in Subsidiaries, the Company shall promptly cause such amounts and of such kinds comparable violation to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreementremedied.
(b) Except Other than (v) as set forth on Schedule 6.2(b), (w) as required by applicable Law, (x) as otherwise expressly provided specifically contemplated by this Agreement, any of the Seller Documents or the Company Documents, (y) in this Agreement the Ordinary Course of Business, or (z) with the prior written consent of ParentBuyer (which consent shall not be unreasonably withheld, during conditioned or delayed, in the period from the date case of this Agreement Section 6.2(b)(vi)) (provided, that Buyer shall respond (i.e., consent or withhold its consent) as soon as reasonably practicable but in no event later than five (5) Business Days of any receipt of any written request therefor delivered to the Effective TimeBuyer in accordance with Section 8.9), the Company shall not not, and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell sell, purchase, redeem, retire or dispose of grant any shares of capital stock or other securities equity interests of the Company or any of its Subsidiaries or grant any options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities equity interests of the Company or any of its Subsidiaries;
(ii) reclassify, except pursuant to obligations existing on combine, split, subdivide or amend the date terms of this Agreement and previously disclosed to Parentany of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of, or in substitution for, shares of its capital stock;
(iii) effect amend in any recapitalizationmaterial respect the certificate of incorporation, reclassification, stock split bylaws or like change comparable organizational documents of the Company or any of its Subsidiaries or amend in the capitalization any material respect or enter into (other than with respect to new hires permitted hereunder) any indemnification agreement or arrangement with any present or former director or officer of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth specifically required under applicable Law or the terms of any existing CBA or Company Benefit Plan in effect on Schedule 7.2(b)(v) or otherwise in the Ordinary Course date of Business with respect to employees other than officers of the Companythis Agreement, (A) materially increase the annual level of compensation amount of any employee of the Company bonus, salary or any of its Subsidiaries, (B) increase the annual level of other compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officersofficer or director, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director independent contractor or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, fordirector, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition competition, indemnification or similar agreement (or amend any such agreement) with any member of the Global Lead Team or any director-level employee; provided, however, that for the avoidance of doubt, the Company shall be able to which make annual bonus payments and annual salary increases in the Ordinary Course of Business;
(v) (x) adopt or create any new Company Benefit Plan or increase the coverage, payments to or benefits under any existing Company Benefit Plan, except as specifically required under applicable Law or the terms of any existing CBA or Company Benefit Plan in effect on the date of this Agreement; or (y) terminate the employment of any salaried employee exercising management responsibilities for the Company or any of its Subsidiaries is a party having annual salary in excess of $200,000 (except if for cause);
(vi) adopt, enter into or involving a director, officer materially modify or employee amend any CBA;
(vii) enter into any commitment for capital expenditures of the Company or any of its Subsidiaries that will not be complete prior to the Closing in his or her capacity as a director, officer or employee excess of the aggregate amount set forth in the budget of the Company or any of and its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except Subsidiaries for Permitted Exceptions, permit, allow or suffer to be encumbered, any such portion of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiariesapplicable fiscal year;
(viii) without duplication of subsection (vii), acquire any material properties (by lease, purchase or otherwise) or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its SubsidiariesSubsidiaries with a value in excess of $1,000,000 individually, or $5,000,000 in the aggregate; provided, however, that the Company may sell, transfer and convey the UK Land in an “as is, where is” transaction in which the Company has no future obligations or liabilities relating to the UK Land;
(ix) change its present accounting methods or principles in any material respect, except as set forth required by GAAP;
(x) other than with respect to any items listed on Schedule 7.2(b)(ix4.8, (v) make, revoke or change any Tax election, (w) settle or compromise any Tax claim or Liability, (x) change any method of accounting or annual accounting period for Tax purposes, (y) file or surrender any claim for a refund of an amount of Taxes or (z) waive or extend the statute of limitations in respect of any Tax (other than pursuant to extensions of time to file Tax Returns obtained in the Ordinary Course of Business);
(xi) incur any Indebtedness in excess of $5,000,000; provided, that, for the avoidance of doubt, borrowings under the Credit Facilities shall not require the consent of Buyer;
(xii) create or permit the creation of any Lien, except Permitted Exceptions or such other Liens as may arise in the Ordinary Course of Business or by operation of applicable Law;
(xiii) permit the Company to settle or compromise any pending or threatened Legal Proceeding or claim or pay, discharge or satisfy or agree to pay, discharge or satisfy any Liability in connection with any pending or threatened Legal Proceeding that would be a Liability of the Company after the Closing, other than the settlement, compromise, payment, discharge or satisfaction of Legal Proceedings and Liabilities (A) covered by existing insurance policies or indemnities, (B) involving no consideration other than (i) the payment of cash prior to Closing, or (ii) the payment of cash following Closing in an amount not to exceed $200,000;
(xiv) cancel any material debts owed to, or waive any material claims or rights of, the Company and its Subsidiaries;
(xv) permit the Company’s insurance policies listed on Schedule 4.20 or comparable insurance coverage applicable to the Company to lapse;
(xvi) permit the Company or any of its Subsidiaries to enter into or agree to enter into any merger or consolidation with, with any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except except, in connection with each case for transactions between the exercise Company and/or any of repurchase rights its Subsidiaries; or
(xvii) terminate, or rights of first refusal materially modify or amend, any Company Contract.
(c) Notwithstanding anything contained in favor this Agreement to the contrary, the Company and its Subsidiaries shall be permitted to maintain through the Closing Date the cash management systems of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of and its Subsidiaries, maintain the cash management procedures as currently conducted by the Company or any of and its Subsidiaries, and periodically settle intercompany balances consistent with past practices (including through dividends and capital contributions and all such intercompany balances shall be settled at the Closing in accordance with their terms). The Company and its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures are allowed to dividend all Cash and Cash Equivalents of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into Seller immediately prior to the Adjustment Time.
(d) Between the date hereof or that would reasonably and the Closing Date, all Tax Returns shall be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning prepared and all Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to shall be paid by consistent with past practices and on a timely basis, to the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete extent such past practices comply with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2applicable Law.
Appears in 1 contract
Samples: Stock Purchase Agreement (Kraton Performance Polymers, Inc.)
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as set forth on Schedule 7.3(a), (ii) as required by applicable Law (including COVID-19 Measures) or Contract to which the Company or its Subsidiaries is bound, (iii) as otherwise expressly provided in contemplated by this Agreement or any of the Company Documents, (iv) with the prior written consent of ParentPurchaser (such consent not to be unreasonably withheld, during conditioned or delayed; provided, that the period consent of Purchaser shall be deemed to have been given if Purchaser does not object in writing within five (5) Business Days from the date of this Agreement on which written request for such consent is provided by the Company to the Effective TimePurchaser), the Company shallshall use its commercially reasonable efforts to conduct, and shall cause its Subsidiaries to:
(i) conduct the to conduct, in all material respects, their respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except Other than (i) as set forth on Schedule 7.3(b), (ii) as required by applicable Law (including COVID-19 Measures), (iii) as otherwise expressly provided in contemplated or permitted by this Agreement or any of the Company Documents, or (iv) with the prior written consent of ParentPurchaser (such consent not to be unreasonably withheld, during conditioned or delayed; provided, that the period consent of Purchaser shall be deemed to have been given if Purchaser does not object in writing within five (5) Business Days from the date of this Agreement on which written request for such consent is provided by the Company to the Effective TimePurchaser), the Company shall not not, and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make transfer or pay issue to any dividend or Person (other distribution (whether in cash, stock or property) in respect of the capital stock of than the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any another of its Subsidiaries, except in connection with the exercise ) any Equity Interests of repurchase rights or rights of first refusal in favor any of the Company with respect to shares issued upon exercise Company’s Subsidiaries or issue any Equity Interests of Company Stock Optionsthe Company;
(ii) except as set forth on Schedule 7.2(b)(ii)amend in any material respect the certificate of incorporation, transfer, issue, sell bylaws or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization comparable organizational documents of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(viii) except as set forth (A) pursuant to any Contract or Plan or Benefit Program existing on Schedule 7.2(b)(vthe date hereof, (B) or otherwise in the Ordinary Course of Business with respect to employees other than officers or (C) as would otherwise be included in the calculation of the CompanyTransaction Expenses, (A) materially increase the annual level amount of compensation of any bonus or salary to any employee of the Company or any of its Subsidiaries, or enter into any employment or severance agreement (Bother than “at-will” offer letters or employment agreements that may be terminated on thirty (30) days’ or less notice without severance) with any such employee with annual base compensation exceeding $200,000, or materially increase the annual level benefits under any material Plan or Benefit Program;
(iv) enter into any commitment for capital expenditures of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase be made following the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any Closing in excess of the directors, officers, employees, agents or representatives aggregate amount set forth in the budget of the Company or any of and its Subsidiaries or otherwise modify or amend or terminate any for such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee portion of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiariesapplicable fiscal year;
(viv) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(viiA) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease convey or otherwise dispose of any of the material properties or assets (other than Intellectual Property) of the Company and its SubsidiariesSubsidiaries with a value in excess of $500,000 individually or (B) sell, assign, license, transfer, convey or otherwise dispose of any material Company Intellectual Property, in each case, other than in the Ordinary Course of Business;
(ixvi) change its present accounting methods or principles in any material respect, except as set forth on Schedule 7.2(b)(ixrequired by GAAP or by the Company’s auditors;
(vii) (A) make, change or revoke any material Tax election, (B) settle or compromise any material Tax claim or liability, (C) change any material method of accounting or annual accounting period for Tax purposes, (D) surrender any claim for a refund of a material amount of Taxes or (E) waive or extend the statute of limitations in respect of any amount of Taxes (other than pursuant to extensions of time to file Tax Returns obtained in the Ordinary Course of Business), ; or
(viii) enter into or agree to enter into any merger or consolidation with, with any corporation or other entity, and not invest in, make a loan, material advance or capital contribution toPerson, or otherwise acquire the securities of any other Person, except except, in connection with the exercise of repurchase rights or rights of first refusal in favor of each case, for transactions involving only the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or and/or any of its Subsidiaries except in the Ordinary Course of Business;Subsidiaries.
(xic) enter into any commitment for capital expenditures Notwithstanding anything contained in this Agreement to the contrary, the Company and its Subsidiaries shall be permitted to (i) operate the business of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit (ii) take (or not take) actions reasonably and in good faith to respond to any extraordinary event that was not reasonably foreseeable as of the date of this Agreement and occurring after the date of this Agreement that is outside the control of the Company or any of its Subsidiaries Affiliates, to make any investments the extent such actions taken (or not taken) are substantially consistent with those taken (or not taken) by other industry participants operating in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate the business of the Company or any of its Subsidiaries, (iii) maintain through the Closing Date the cash management systems of the Company and its Subsidiaries, maintain the cash management procedures as currently conducted by the Company and its Subsidiaries and periodically settle intercompany balances consistent with past practices (including through dividends and capital contributions) and (iv) (A) dividend all Cash and Cash Equivalents of the Company and its Subsidiaries to Seller or any director(B) repay or satisfy Company Debt or pay Transaction Expenses of the Company and its Subsidiaries, officer in either case, prior to the Measurement Time.
(d) Nothing contained in this Agreement shall give Purchaser, directly or employee indirectly, rights to control or direct the operations of the Company or any its Subsidiaries before the Closing Date. Before the Closing Date, the Company shall, consistent with the terms and conditions of this Agreement, exercise complete control and supervision over the operations of the Company and its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns. If the Company desires to take an action which would be prohibited pursuant to this Section 7.3 without the written consent of Purchaser, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect prior to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability may request such written consent by sending an e-mail to all of the Company or individuals set forth on Annex 1. Any of the individuals set forth on Annex 1 may grant consent on behalf of Purchaser to the taking of any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit action that would reasonably otherwise be expected prohibited pursuant to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.27.3 by e-mail or such other notice that complies with the provisions of Section 13.6.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except During the Interim Period, except (i) as set forth on Schedule 6.1(a), (ii) as required by applicable Law or Contract, (iii) as otherwise expressly provided in explicitly contemplated or required by this Agreement (including any actions taken in furtherance of the Restructuring, the Refinancing or the acquisition of the Arizona Property) or (iv) with the prior written consent of ParentBuyer (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, shall (and shall cause its Subsidiaries to:
(i) conduct the respective businesses each of the Company Subsidiaries to) and its the Sellers shall cause the Sterling Company, the Company and each of the Company Subsidiaries only to: (A) conduct their respective businesses in the Ordinary Course ordinary course of Business;
business consistent with past practice and (iiB) use its commercially reasonable efforts to (A1) preserve its intact in all material respects the present business operations, organization and goodwill organizations of the members of the Company and its Subsidiaries Group and (B2) preserve its in all material respects their present relationship relationships with Persons having their material business dealings with customers and suppliers; provided, that, for the avoidance of doubt, neither the Sellers nor the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts shall be obligated to maintain (A) all material assets and properties cause any member of the Company Group or the Sterling Company to take, and its Subsidiaries shall not be deemed to be in their current condition, ordinary wear and tear excepted and (B) insurance upon all breach of the properties and assets of foregoing for failing to cause the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
Group (iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to other than the Company’s business that are necessary ) or advisable in order the Sterling Company to consummate the transactions contemplated by this Agreement; and
(v) not take take, any action which that would reasonably not be expected to adversely affect the ability of the parties to consummate the transactions contemplated permitted by this AgreementSection 6.1(b).
(b) Except During the Interim Period, except (i) as set forth on Schedule 6.1(b), (ii) as required by applicable Law or Contract, (iii) as otherwise expressly provided in explicitly contemplated or required by this Agreement (including any actions taken in furtherance of the Restructuring, the Refinancing or the acquisition of the Arizona Property) or (iv) with the prior written consent of ParentBuyer (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company Sellers shall not and shall not permit its Subsidiaries tocause or permit:
(i) except other than as set forth on Schedule 7.2(b)(ipart of the Restructuring (including the repurchase of the Series A Preferred Units (as defined in the Company LLC Agreement)), declarethe repurchase, set aside, make or pay any dividend redemption or other distribution (whether in cashacquisition of, stock or property) in respect of the capital stock of the Company entrance into any Contracts or commitments to repurchase, redeem or otherwise acquire acquire, any outstanding shares of the capital stock beneficial interests in or other securities of, or other ownership interests in, the Company Group or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsSterling Company;
(ii) except other than as set forth on Schedule 7.2(b)(ii)part of the Restructuring, transfer, issue, sell the issuance or dispose sale of any shares of capital stock beneficial interests in or other securities equity interests of the Company Group or the Sterling Company or the grant of any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities equity interests of the Company Group or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentSterling Company;
(iii) effect other than as part of the Restructuring, any recapitalizationsplits, reclassificationcombinations, subdivisions or reclassifications of any shares of the beneficial interests, capital stock split or like change in the capitalization other equity interests of any member of the Company Group or any of its Subsidiariesthe Sterling Company;
(iv) amend other than (1) as part of the certificate Restructuring, (2) the transfer of incorporation or by-laws the two Xxxxx Fargo accounts referred to in Schedule 4.21 outside of the Company Group and (3) the distribution or dividend of the note receivable from IO Singapore DCaaS Pte. Ltd., the authorization or payment of any dividends or the making of its Subsidiariesany distribution with respect to the outstanding beneficial interests, shares of capital stock or other equity interests of the members of the Company Group and the Sterling Company (whether in cash, assets, stock or other securities of the Company Group or the Sterling Company), except for (A) dividends and distributions made by the Company’ Subsidiaries to the Company or a Subsidiary of the Company; and (B) cash dividends or distributions paid or made by the Company or the Sterling Company at any time prior to the Closing;
(v) other than as part of the Restructuring, the adoption of a plan or agreement of complete or partial liquidation or dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company Group or the Sterling Company;
(vi) except as set forth on Schedule 7.2(b)(v) required by applicable Law, as required by any Benefit Plan, or otherwise in the Ordinary Course ordinary course of Business business consistent with respect to employees other than officers of the Companypast practice, (A) any increase in any material respect of the annual level of compensation of or benefits payable or provided (or to become payable or provided) to any employee of the Company Group (except for increases in salaries, wages, commissions and bonuses in the ordinary course of business) or any of its Subsidiaries, (B) increase the annual level establishment, entrance into, adoption, material amendment or termination of compensation payable or to become payable by the any Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi))Benefit Plan;
(vii) subject the making of any loan, advance or capital contribution to or investment in any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any Person by the members of the properties Company Group or assets the Sterling Company (whether tangible other than (A) loans, advances or intangible), capital contributions to or any shares of capital stock investments in a Subsidiary of the Company or in the Company from the Sterling Company, (B) transactions in the ordinary course of business consistent with past practice to provide advances or financing to customers in connection with the sale of products and services and/or the leasing of any Company Real Property by the Company Group, including tenant improvement obligations, and (C) advances to employees for business expenses in the ordinary course of its Subsidiariesbusiness consistent with past practice);
(viii) acquire any material properties the settlement or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose compromise of any of the material properties Legal Proceeding that (A) requires payment to or assets by any member of the Company and its SubsidiariesGroup in excess of $1,000,000 individually, (B) imposes material restrictions on the business of the Company Group, or (C) involves relief other than money damages which could be materially adverse to the business of the Company Group;
(ix) except other than as set forth on Schedule 7.2(b)(ix)part of the Refinancing, enter into the material modification or agree amendment, termination or waiver of any material rights under any Material Contract (other than in the ordinary course of business or for terminations that occurs due to enter the expiration of the terms of such Material Contract) or the entrance into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any new Contract which that would be a Material Contract if entered into prior to the date hereof (in each case other than in the ordinary course of business consistent with past practice in a manner that is not materially adverse to Company or that would reasonably be expected to have a Material Adverse Effectthe Company Subsidiaries);
(xivx) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts)as part of the Restructuring, or enter the entrance into or materially modify modification of any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee (other than a member of the Company Group and other than as otherwise permitted by Section 6.1(b)(vii)), in each case by the Sterling Company or any member of its the Company Group; except for commercial customer Contracts entered into with any such Affiliates on an arms’ length basis in the ordinary course of business consistent with past practice in a manner that is not materially adverse to Company or the Company Subsidiaries;
(xvxi) make the making or the change of any material election concerning Taxes or Tax Returnselection, change an annual accounting period, adopt or change the filing of any accounting method, file amendment to any amended Tax Return, enter the settlement or compromise of any Tax Liability, the agreement to any extension or waiver of the statute of limitations with respect to the assessment or determination of Taxes, the entrance into any closing agreement with respect to Taxes, settle or the taking of any Tax claim or assessment or action to surrender any right to claim a refund material Tax refund, in each case by the Sterling Company or any member of Taxes the Company Group;
(xii) except as may be required by Law or obtain GAAP, the making of any material change in the financial or enter into Tax accounting methods, principles or practices of the Company (or change in an annual accounting period);
(xiii) the incurrence, redemption, prepayment, defeasance, cancelation, assumption, guarantee or, in any Tax rulingmaterial respect, the modification of any Indebtedness, in each case by the Sterling Company or any member of the Company Group, other than, prior to the Closing, with respect to (A) any intercompany Indebtedness among members of the Company Group, (B) incurrence of Indebtedness under the Credit Agreement or the Interim Financing Agreement, (C) letters of credit, bankers’ acceptances and similar facilities issued and maintained by the Company Group in the ordinary course of business and reimbursement obligations in respect thereof, (D) any Indebtedness that will be discharged prior to the Closing, (E) prepayments of Indebtedness in the ordinary course of business, (F) the incurrence of Indebtedness as consideration for the repurchase of the Series A Preferred Units (as defined in the Company LLC Agreement) or (G) if the Closing has not occurred on or prior to January 10, 2018, the incurrence of the Interim Financing and payoff of Indebtedness under the Credit Agreement as part of the Refinancing.
(xiv) (A) the sale, lease, licensing, mortgage or the taking of any other action that would subject to a Lien (other than Permitted Liens) or the disposal of any material personal property, equipment or assets of the Company Group with a value or purchase price in the aggregate for such properties, assets or rights in excess of $2,500,000, other than (1) the execution of easements, covenants, rights of way, restrictions and other similar instruments that, individually or in the aggregate, would not reasonably be expected to materially impair the existing use and operation of the property or asset affected by the applicable instrument, (2) pursuant to Contracts in force on the date of this Agreement, (3) dispositions of obsolete or immaterial assets in the ordinary course of business, (4) transfers among the Company Group, (5) the transfer of the two Xxxxx Fargo accounts referred to in Schedule 4.21 outside of the Company Group or (6) the distribution or dividend of the note receivable from IO Singapore DCaaS Pte. Ltd. or (B) the sale, lease, licensing, mortgage or the taking of any other action that would subject to a Lien (other than Permitted Liens) of any real property of the Company Group (including Company Real Property); in each case, other than (1) the execution of easements, covenants, rights of way, restrictions and other similar instruments that, individually or in the aggregate, would not reasonably be expected to materially impair the existing or planned use and operation of the property or asset affected by the applicable instrument, (2) in connection with the incurrence of any Indebtedness permitted to be incurred by the Company pursuant to Section 6.1(b)(xiii), and (3) the execution of leases and licenses in the ordinary course of business consistent with past practices and (4) pursuant to Contracts in force on the date of this Agreement, in each case, if taking other than (x) sales, leases, licenses and dispositions (including of modules, data center space, or any products or services offered in the Business as of the date hereof) in the ordinary course of business and (y) any Liens that may be imposed in the Business (as of the date hereof) that is done in the ordinary course of business;
(xv) the making of any acquisitions, in each case by the Sterling Company or any member of the Company Group, of (including by merger, consolidation or acquisition of stock or assets or any other business combination) (A) any Person or business including by acquiring the equity interests of such action would materially affect Person or a material portion of the amount assets of Taxes such Person or (B) any real property, in each case, for consideration in excess of $1,000,000 individually, other than the Arizona Property;
(xvi) the making of any capital expenditures, in each case by the Sterling Company or any member of the Company Group, except in (a) the ordinary course of business, (b) for capital expenditures required pursuant to be paid any customer Contract or (c) substantially in accordance with the capital expenditure budget attached hereto as Schedule 7;
(xvii) allow any material Company Registered Intellectual Property to become abandoned, expire or otherwise lapse, or allow any material Confidential Information owned by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete become public, other than (a) in accordance with their terms or conduct any business or line (b) in the ordinary course of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;business; or
(xviii) fail the agreement or commitment to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate take any of the collection of any accounts receivable; and
(xix) agree to do anything foregoing actions prohibited by this Section 7.26.1(b).
(c) Buyer acknowledges and agrees that: (i) nothing contained in this Agreement shall give Buyer, directly or indirectly, the right to control or direct the operations of the Company Group or the Sterling Company prior to the Closing, (ii) prior to the Closing, the Company Group and the Sterling Company shall each exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over their respective operations and (iii) notwithstanding anything to the contrary set forth in this Agreement, no consent of Buyer shall be required with respect to any matter set forth in this Section 6.1 or elsewhere in this Agreement to the extent the requirement of such consent would violate any Law.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (x) as otherwise expressly provided in contemplated by this Agreement or (y) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Seller and Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;; and
(ii) use its their commercially reasonable efforts to (A) preserve its the present business operationsoperations (including, without limitation, customer and supplier relationships), organization (including, without limitation, employee relationships) and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except (x) as otherwise expressly provided in contemplated by this Agreement or (y) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall not and shall not permit its Subsidiaries tonot:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make amend its certificate or pay any dividend articles of incorporation or other distribution by-laws;
(whether in cash, stock or propertyii) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the its capital stock or other securities of, issue or other ownership interests in, the Company pledge any capital stock or any of its Subsidiariesoption, except in connection with the exercise of repurchase rights warrant or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell right relating thereto or dispose of any securities convertible into or exchangeable for any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parentstock;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv1) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise other than in the Ordinary Course of Business with respect to employees other than officers of the Companyor as required by Law or Contract, (A) increase the annual level of compensation of any employee of the Company or any of its SubsidiariesEmployee, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C2) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantEmployee, (D3) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement Employee Plan or (E4) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition competition, retention or similar agreement with any Employee, (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee any Employee except in the Ordinary Course of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its SubsidiariesBusiness;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(viiiv) subject Company to any Lien or otherwise encumber orEncumbrance, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its SubsidiariesEncumbrances;
(viiiv) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties or assets portion of the Company and its SubsidiariesMaterial Assets (except pursuant to an existing Contract for fair consideration or a non-exclusive license of Intellectual Property in the Ordinary Course of Business or for the purpose of disposing of obsolete or worthless assets);
(ixvi) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into disclose any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, of its material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Optionstrade secrets;
(xvii) make any change in any method of accounting or accounting practice or policy other than those required by GAAP;
(viii) other than in the Ordinary Course of Business, cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of BusinessCompany;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xiiix) enter into, modify modify, extend or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiariesemployment agreement;
(xiiix) except as set forth on Schedule 7.2(b)(xiv), permit the Company enter into or any of its Subsidiaries agree to enter into any transaction merger or to enter into, modify or renew consolidation with any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effectother Person;
(xivxi) except for transfers of cash pursuant to normal cash management practices other than in the Ordinary Course of Business, permit the Company cancel or compromise any material debt or claim or waive or release any material right of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its SubsidiariesCompany;
(xvxii) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund other than in the Ordinary Course of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or Business enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;Contract; or
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xixxiii) agree to do anything prohibited by this Section 7.26.2(b).
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (I) as set forth on Schedule 7.3, (II) as required by applicable Law, (III) as otherwise expressly provided in permitted or contemplated by this Agreement or (IV) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and Selling Stockholder shall cause its Subsidiaries the Companies to use commercially reasonable efforts to:
(i) conduct the respective businesses of the Company and its Subsidiaries only Companies in the Ordinary Course of Business;Business or otherwise in a manner permissible under this Agreement, including this Section 7.3; and
(ii) use its commercially reasonable efforts to (A) preserve its present the business operations, organization and goodwill of the Company Companies, and its Subsidiaries their relationships with customers and (B) preserve its present relationship with Persons having material business dealings with suppliers of the Company and its SubsidiariesCompanies;
(iii) use its commercially reasonable efforts it being agreed, however, that subject to maintain (A) all material Schedule 7.3(a)(iii), any transaction consummated or proposed providing for a third party to acquire any assets and properties or securities of the Company and Selling Stockholder or any of its Subsidiaries in their current condition, ordinary wear and tear excepted and direct or indirect subsidiaries (Bother than the Companies) insurance upon all shall not constitute a breach or violation of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except Prior to the Closing, except (I) as set forth on Schedule 7.3(b), (II) as required by applicable Law, (III) as otherwise expressly provided in permitted or contemplated by this Agreement or (IV) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during delayed or conditioned and shall be deemed given if Purchaser does not respond to any written request of a Company or the period from the date Selling Stockholder within two (2) Business Days after delivery of this Agreement such request to the Effective TimePurchaser in accordance with Section 10.6), the Company Selling Stockholder shall cause the Companies not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of Theatre Direct (other than cash dividends or other distributions paid to the Company Selling Stockholder consistent with past practice) or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsCompanies;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries Companies or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentCompanies;
(iii) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its SubsidiariesCompanies;
(iv) amend the certificate of incorporation or by-laws or comparable organizational documents of the Company or any of its SubsidiariesCompanies;
(v) hire employees whose annual compensation equals or exceeds $100,000 per year, except for any hiring to replace the loss or departure of any existing employees if made on substantially similar terms;
(vi) enter into any employee retention bonus plan which could have payments due after the Closing
(vii) enter into any agreement with employees, or agree to make any payment to employees, which would be triggered by the consummation of the Transactions and would be payable after the Closing;
(viii) other than as set forth required by Law, a Contract listed on Schedule 7.2(b)(v) 5.14 or otherwise in the Ordinary Course terms of Business with respect to employees other than officers of the Company, any Seller Benefit Plan or Company Benefit Plan (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries Companies to any of their respective executive officersdirectors or employees by more than $5,000 per year, (CB) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantexecutive officer of the Companies which is payable after the Closing, (DC) except as required by any existing Company Benefit Plan, and other than any incentive or bonus compensation paid prior to the Closing, increase the coverage or benefits available under any (Company Benefit Plan which would apply after the Closing and which would increase the overall costs of such Company Benefit Plans or create any new) severance paybonus, termination pay, vacation pay, company awards, salary continuation for disability, sick leaveincentive compensation, deferred compensation, bonus or other incentive compensationseverance, insuranceprofit sharing, pension stock option, stock purchase, pension, retirement or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (ED) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or materially amend any such agreement) to which the Company or any of its Subsidiaries the Companies is a party or involving a director, director or executive officer or employee of any of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its SubsidiariesCompanies;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(viiix) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumberedLien, any of the properties or assets (whether tangible or intangible), or any shares of capital stock ) of the Company or any of its SubsidiariesCompanies, except for Permitted Exceptions;
(viiix) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company Companies (except acquisitions or dispositions of properties or assets which are not material to the Companies, (A) pursuant to an existing Contract for fair consideration or (B) in the Ordinary Course of Business or (C) for the purpose of disposing of obsolete or worthless assets); it being agreed for purposes of clarity that this Section 7.3 does not prohibit intercompany transfers of cash among the Companies, the Selling Stockholder and its Subsidiariessubsidiaries in the Ordinary Course of Business consistent with past practice;
(ixxi) except as set forth on Schedule 7.2(b)(ix)other than in the Ordinary Course of Business, enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company Companies; it being agreed for purposes of clarity that this Section 7.3 does not prohibit intercompany transfers of cash among the Companies, the Selling Stockholder and its subsidiaries in the Ordinary Course of Business consistent with past practice, or the settlement of any intercompany accounts or debt prior to Closing;
(xii) within 75 days after the date hereof enter into any commitment for capital expenditures of its Subsidiaries except the Companies in excess of $50,000 for all commitments in the aggregate or after 75 days after the date hereof enter into any commitment for capital expenditures of the Companies in excess of $100,000 for all commitments in the aggregate (including commitments entered into prior to such 75th day); provided, however, that the Companies may enter into any commitment for capital expenditures without the consent of the Purchaser (i) in order to make emergency repairs, or (ii) to replace equipment and assets in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xiixiii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse EffectCompanies;
(xiv) permit the Companies to enter into or agree to enter into any merger or consolidation with any Person or to adopt or agree to adopt a plan of complete or partial liquidation, dissolution, restructuring or other material reorganization of any of the Companies;
(xv) make or rescind any election relating to Taxes, settle or compromise any claim, action, suit, litigation, proceeding, arbitration, investigation, audit controversy relating to Taxes, or except as required by applicable law or GAAP, make any material change to any of its methods of accounting or methods of reporting income or deductions for Tax or accounting practice or policy from those employed in the preparation of its most recent Tax Return;
(xvi) except for transfers the replacement or substitution of cash pursuant existing insurance policies with similar or comparable policies, permit any insurance policy naming any of the Companies as a beneficiary or a loss payable payee to normal cash management practices be cancelled or terminated or, except as required by any existing Company Benefit Plan, create an employee insurance benefit plan or arrangement;
(xvii) within 75 days after the date hereof enter into any Contract relating to the Companies’ purchase, lease or maintenance of equipment, vehicles, inventory, materials, supplies, machinery, equipment, parts or any other property or services which involves expenditures of more than $50,000 annually, except for expenditures made (i) in order to make emergency repairs, or (ii) to replace equipment and assets in the Ordinary Course of Business;
(xviii) after 75 days after the date hereof enter into any Contract relating to the Companies’ purchase, lease or maintenance of equipment, vehicles, inventory, materials, supplies, machinery, equipment, parts or any other property or services which involves expenditures of more than $100,000 annually except for expenditures made (i) in order to make emergency repairs, or (ii) to replace equipment and assets in the Ordinary Course of Business;
(xix) other than in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xviA) enter into any Contract, understanding or commitment Contract that restrains, restricts, limits or impedes if existing on the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated date hereof would be reasonably be expected to have a “Material Adverse Effect;
Contract” (xviiother than contracts described in Section 5.14(vii) or (viii)), (B) terminate, amend, restate, supplement or waive modify in any respect any Material Contract, (C) waive, release, cancel, allow to lapse, convey, encumber or otherwise transfer any rights or claims under any Material Contract, or Permit that would reasonably be expected to have a (D) change incentive policies or payments under any Material Adverse EffectContract existing on the date hereof or entered into after the date hereof;
(xviiixx) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedingsincur any Indebtedness for borrowed money, enter into any guarantees of Indebtedness of other Persons (other than one of the Companies) or make any loans, advances or capital contributions to, or accelerate the collection of investments in, any accounts receivable; andother Person;
(xixxxi) enter into any Contract that obligates the Companies not to compete with any business;
(xxii) enter into any Contract that is a joint venture or partnership contract or a limited liability company operating agreement; or
(xxiii) agree to do anything prohibited by this Section 7.27.3.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except as required by applicable Law, as otherwise expressly provided in this Agreement contemplated hereby or with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during delayed or conditioned), the period from Sellers shall conduct the date Business only in the Ordinary Course of this Agreement Business.
(b) Prior to the Effective TimeClosing, except as set forth on Schedule 8.2(b), as required by applicable Law, as otherwise expressly contemplated hereby or with the prior written consent of Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shallSellers shall not take any of the following actions, and shall cause its Subsidiaries towith respect to the Business:
(i) conduct incur any Indebtedness in excess of $100,000, other than debtor-in-possession financing to be obtained by the respective businesses Sellers in their sole discretion, provided that such financing shall not (A) be provided by any Person that has submitted an indication of interest or proposal to the Sellers for an Alternative Transaction as of the Company date hereof (excluding for purposes hereof any lender to a Seller as of the date hereof), or (B) contain any terms that would impair the Sellers’ ability to consummate the transaction contemplated herein;
(ii) purchase or sell any material assets, including any Purchased Assets;
(iii) make any material capital expenditure or perform any material construction on any Owned Real Property or Leased Real Property, other than routine maintenance and its Subsidiaries only repairs in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its SubsidiariesPurchased Assets;
(v) except as set forth on Schedule 7.2(b)(v) make any loan or otherwise in the Ordinary Course of Business with respect advance to employees any Person, other than officers of intercompany loans among one or more Sellers;
(vi) except for the CompanyManagement Incentive Plan, (A) materially increase the annual level of compensation of for any employee of the Company or any of its SubsidiariesSeller, (B) materially increase the annual level of compensation payable or to become payable by the Company or any Seller to any of its Subsidiaries to any of their respective executive officers, (C) other than in the Ordinary Course of Business or as contemplated by the Sellers’ existing bonus plans, grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) other than in the Ordinary Course of Business, increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, for or with any of the directors, officers, employees, agents or representatives employees of the Company or any of its Subsidiaries Seller or otherwise modify or modify, amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries Seller is a party or involving a director, officer or employee of the Company or any of its Subsidiaries Seller in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (Seller, other than Indebtedness set forth on Schedule 7.2(b)(vi))renewals of existing employment agreements with any director, officer or employee of any Seller;
(vii) subject to enter into, amend or terminate any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its SubsidiariesCollective Bargaining Agreement;
(viii) acquire subject any material properties Purchased Asset to any Lien (provided, however, the foregoing shall not be construed to prohibit any Lien recorded against the Owned Real Property or assets or sellthe Leased Real Property without the consent of any Seller, assign, license (other than non-exclusive licenses received from or granted subject to customers and Technology Partners in the Ordinary Course of BusinessSection 8.10(c) hereof), transferexcept (A) in connection with any order authorizing the Permitted DIP Financing and (B) the Sellers may grant easements in favor of a utility company to install, conveymaintain and repair lines, lease poles, pipes and related equipment on, over and under any Owned Real Property or otherwise dispose Leased Real Property which services such property; provided, however, that the same do not impose any monetary obligation on the owner of any such property, materially interfere with the current use of such property, or materially affect the material properties or assets fair market value of the Company and its Subsidiariessuch property (each, a “Permitted New Utility Easement”);
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger merger, consolidation or consolidation withsimilar transaction with any Person except as expressly permitted by this Agreement, any corporation or other entity, subject to all relevant covenants and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Optionsconditions;
(x) cancel or compromise any material debt owed to any Seller, or any claim of any Seller against any Person, or waive or release any material right of relating to the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of material amendment, modification or supplement to the Company and its Subsidiaries Purchased Contracts or lease, assign, sublease, terminate, fail to make any payment in excess of $20,000 for any individual commitment and $100,000 for all commitments in respect of, or reject the aggregatePurchased Contracts;
(xii) enter into, modify amend or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability Material Contracts other than pursuant to any labor organization with respect to the Company or any of its Subsidiariesclauses (vi) and (vii) above;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or take any action of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract kind which would be a Material Contract if entered into prior to impair or reduce the date hereof or that would reasonably be expected to have a Material Adverse Effectvalue of the Purchased Assets;
(xiv) except for transfers of cash pursuant to normal cash management practices enter into any transaction not in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;; or
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect or otherwise agree to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or do any of its Subsidiaries after the Effective Timeforegoing.
(c) Without limiting the generality of the foregoing, from the date of this Agreement until the Closing and taking into consideration the Bankruptcy Case and all effects relating thereto, each Seller shall use commercially reasonable efforts to:
(i) maintain itself as an entity of the type set forth on the signatures pages hereof, duly organized, validly existing, and in good standing under the laws of the jurisdiction of incorporation, formation, or organization of such Seller;
(xviii) enter into any Contractmaintain the Purchased Assets in accordance with good and prudent business practices and in good operating condition and repair, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary subject only to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effectordinary wear and tear;
(xviiiii) terminateconduct its businesses, amendoperations, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effectand affairs consistent with past practice;
(xviiiiv) fail to promptly pay preserve intact its business organization;
(v) preserve its current relationships with its employees, consultants, suppliers, licensors, distributors, customers, and discharge current liabilities expect where disputed licensees, and any other Persons with which it has any material business relationship;
(vi) continue in good faith by appropriate proceedings, full force and effect without material modification all policies or accelerate binders of insurance that it currently maintains;
(vii) maintain the collection length of any accounts receivablethe payment cycles for its payables and receivables in accordance its past practices; and
(xixviii) agree exercise, but only after notice to do anything prohibited Purchaser and receipt of Purchaser’s prior written agreement thereto, all rights of renewal pursuant to the terms of any Purchased Contract that by this Section 7.2its terms would otherwise expire.
Appears in 1 contract
Samples: Asset Purchase Agreement (Macquarie Infrastructure CO LLC)
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during During the period from the date hereof until the earlier of the Effective Time and the termination of this Agreement to the Effective Timein accordance with Article VII, the Company shall, and shall cause its Subsidiaries to:
except (i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;
as required by applicable Law, (ii) use its commercially reasonable efforts to (A) preserve its present business operationsas instructed or required by a Governmental Authority, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of as expressly required or contemplated by the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date terms of this Agreement;
, or (iv) give all required notices to the extent Purchaser otherwise provides its prior consent in writing (such consent not to be unreasonably withheld, delayed or conditioned), Parent and Seller shall cause the Company to comply with this Agreement, and otherwise ensure that (x) the Company shall conduct its business in the ordinary course of business consistent with past practice and, to the transactions contemplated by this Agreement and extent consistent therewith, use its reasonable best efforts to obtain all third party consents material to the Company’s preserve its business that are necessary or advisable organization intact and maintain existing relations and goodwill with Governmental Authorities, rating agencies, customers, reinsurers, producers, insureds, suppliers, service providers and employees, and (y) except as set forth in order to consummate the transactions contemplated by this Agreement; and
(vSection 5.01(a) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective TimeParent Disclosure Schedule, the Company shall not and (it being understood that no act or omission with respect to the matters specifically addressed by any provision of this clause (y) shall not permit its Subsidiaries to:be deemed to be a breach of clause (x)):
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or propertyA) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transferauthorize for issuance, issue, sell sell, grant or dispose subject to any Lien any shares of capital stock, or any securities or rights convertible into, exchangeable or exercisable for, or evidencing the right to subscribe for any shares of capital stock, or any rights, warrants or options to purchase any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options(B) redeem, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiariesshares of capital stock, except pursuant or any rights, warrants or options to obligations existing on the date acquire any shares of this Agreement and previously disclosed to Parentcapital stock;
(ii) split, combine, subdivide, reclassify, redeem, purchase or otherwise acquire, directly or indirectly, any shares of capital stock;
(iii) effect other than this Agreement and any recapitalizationAncillary Agreements, reclassificationadopt a plan or agreement of complete or partial liquidation or dissolution, stock split merger, consolidation, restructuring, recapitalization or like change in the capitalization other reorganization of the Company or any of its SubsidiariesCompany;
(iv) amend (A) except for the certificate payment of incorporation the Closing Dividend, declare, make, set aside, authorize or by-laws pay any dividends or make any distribution with respect to its outstanding shares of capital stock (whether in cash, assets, stock or other securities or otherwise) or (B) incur, issue, assume, guarantee or otherwise become liable for any Indebtedness (other than (1) all obligations with respect to the net current Tax liabilities of the Company that are allocable to any taxable year (or portion thereof) ending on (and including), or prior to, the Closing Date (treating for purposes of this Agreement the taxable year of the Company that includes the Closing Date as closing on (and including) the Closing Date); (2) all Liabilities with respect to accrued but unpaid bonus payments, accrued or owed by the Company as of the Closing in respect of any performance period (or portion thereof) prior to and up to the Closing, together with the employer portion of its Subsidiariesany Taxes arising therefrom; and (3) all Liabilities with respect to accrued but unused vacation time, flexible time-off and sick pay to which any Business Employee is entitled pursuant to the policies applicable to such Business Employee immediately prior to the Closing) or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Companyamend, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiariesrestate, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries supplement or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its SubsidiariesOrganizational Documents;
(vi) incur or assume any Indebtedness (A) other than Indebtedness set forth on Schedule 7.2(b)(vi))in the ordinary course of business consistent with past practice, amend, modify, extend, cancel, rescind, waive any rights under, assign, fail to renew or terminate any operating leases or subleases (or group of related operating leases or subleases with respect to a single transaction or series of related transactions) under which the Company leases or occupies Leased Real Property or (B) enter into any new operating leases or subleases (or group of related operating leases or subleases with respect to a single transaction or series of related transactions) for leased real property;
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assignlease, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the its material properties (other than Intellectual Property), rights, licenses, operations, product lines, businesses or assets with a purchase price for such material properties, rights, licenses, operations, product lines, businesses or assets, except (A) sales and licenses of products and services of the Company in the ordinary course of business consistent with past practice, (B) sales and its Subsidiariesdispositions of investment assets by the Company in the ordinary course of business consistent with past practice, (C) pursuant to any insurance or reinsurance Contracts in the ordinary course of business consistent with past practice or (D) pursuant to Material Contracts in force on the date hereof;
(viii) make any loan, advance, guarantee or capital contribution to or investment in any Person, except advances to employees for expenses not to exceed $1,000 in any single instance or in excess of $20,000 in the aggregate in the ordinary course of business consistent with past practice;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into engage in any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company transactions with respect to shares issued upon exercise investment assets by the Company outside the ordinary course of Company Stock Optionsbusiness consistent with past practice, other than with respect to the liquidation of investment assets pursuant to Section 5.14 or to the extent otherwise agreed by Purchaser in writing as to any particular investment asset;
(x) cancel make or compromise authorize any material debt capital expenditures in excess of $2,500 in any single instance or claim or waive or release any material right in excess of the Company or any of its Subsidiaries except $50,000 in the Ordinary Course of Businessaggregate during any twelve (12) month period;
(xi) enter into sell, transfer, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any commitment for capital expenditures material Company Intellectual Property or material Company IT Assets, other than (A) in the ordinary course of business consistent with past practice, (B) pursuant to Contracts in force on the date hereof and made available to Purchaser on or prior to the date hereof, and (C) dispositions of obsolete or worn-out IT Assets;
(xii) make any changes to how the Company Processes Personal Information, other than non-material changes made in the ordinary course of business consistent with past practice;
(xiii) make any acquisitions of (including by merger, consolidation or acquisition of stock or assets or any other business combination) assets, any corporation, partnership, other business organization or any division thereof or equity interests therein or a substantial portion of the assets thereof;
(xiv) pay, discharge, settle or compromise any pending or threatened Action which (A) requires payment to or by the Company and its Subsidiaries (exclusive of attorneys’ fees) in excess of $20,000 for in any individual commitment and single instance or in excess of $100,000 for all commitments 200,000 in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to aggregate (other than pursuant to existing Contracts), ordinary course payments or enter into settlements under insurance or materially modify any Contract with any Affiliate of reinsurance Contracts that are within the Company applicable policy limits under such insurance or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xvreinsurance Contract) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2.or
Appears in 1 contract
Samples: Stock Purchase Agreement
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in this From the Agreement or Date until the Closing, except with the prior written consent of Parent, during the period from the date of Buyer or as otherwise expressly permitted or required by this Agreement to the Effective TimeAgreement, the Company shall, and Shareholder shall cause its Subsidiaries the Company to:
(i) conduct carry on its business in substantially the respective businesses same manner as it has heretofore and not introduce any new method of management, operation or accounting (except as required by GAAP or any applicable law or Order and except for actions taken to file PPP Applications to facilitate the forgiveness of the Company and its Subsidiaries only in the Ordinary Course of BusinessPPP Loans);
(ii) use its commercially reasonable efforts to (A) preserve comply with the terms and conditions of, and not cancel, its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiariesinsurance policies;
(iii) use its commercially reasonable efforts to maintain (A) all material assets maintain and properties of the Company and preserve its Subsidiaries in their current conditionbusiness organization intact, ordinary wear and tear excepted and (B) insurance upon all retain the services of its present employees and (C) not hire any additional employees except for hires in the properties and assets ordinary course of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreementbusiness consistent with past practices;
(iv) give comply with all required notices applicable laws and provide notice to Buyer of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary any governmental inquiry, notice or advisable in order to consummate the transactions contemplated by this Agreementinvestigation; and
(v) maintain the instruments and agreements governing its outstanding Indebtedness and leases on their present terms and not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreementincur new Indebtedness or enter into new lease instruments or agreements.
(b) Except as otherwise expressly provided in this From the Agreement or Date until the Closing, except with the prior written consent of Parent, during the period from the date of Buyer or as otherwise expressly permitted or required by this Agreement to the Effective TimeAgreement, the Shareholder shall ensure that neither the Shareholder nor the Company shall not and shall not permit its Subsidiaries towill:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether change in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsCharter Documents;
(ii) except as set forth on Schedule 7.2(b)(ii)issue any additional Equity Interests or issue or otherwise create any options, transfer, issue, sell warrants or dispose of any shares of capital stock or other securities of the Company or rights to acquire any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentEquity Interests;
(iii) effect increase or agree to increase the compensation payable to the Shareholder, member of the board of directors or any recapitalizationofficers, reclassificationdirectors, stock split managers, consultants or like change employees except for increases in the capitalization of the Company or any of its Subsidiaries;ordinary course consistent with past practice.
(iv) amend make any investments (other than short-term certificates of deposit of a commercial bank or trust company) in the certificate Equity Interests (or options, warrants or rights to acquire the Equity Interests) or Indebtedness of incorporation or by-laws of the Company or any of its SubsidiariesPerson;
(v) except as set forth on Schedule 7.2(b)(v) enter into any contract to incur, or otherwise agree to incur any liability or make any capital payment or expenditure of any kind in excess of $25,000.00, other than in the Ordinary Course ordinary course of Business its business and consistent with respect to employees other than officers of its past practice (it being agreed that the Company, (A) increase foregoing restriction shall not prohibit or limit the annual level of compensation ability of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries enter into contractual obligations or otherwise modify or amend or terminate incur liabilities in respect of any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) existing projects pursuant to which the Company or any terms and conditions of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiariesthis Agreement);
(vi) incur or assume prepay any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi))in the ordinary course of business consistent with past practices, or (B) create, assume or permit to be created or imposed any liens or encumbrances, upon any of its assets or properties, whether now owned or hereafter acquired other than in the ordinary course of business consistent with past practice;
(vii) subject to except as required by any Lien applicable law or otherwise encumber orOrder, except for Permitted Exceptions(A) adopt, permitestablish, allow amend or suffer to be encumbered, terminate any of the properties or assets (whether tangible or intangible)its Employee Benefit Plans, or any shares other compensation plans or employee policies and procedures or (B) take any discretionary action, or omit to take any contractually required action, if that action or omission could either (y) deplete the assets of capital stock of the Company or any of its SubsidiariesEmployee Benefit Plans, or (z) increase the liabilities or obligations under any such plan;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise transfer or dispose of any of its owned or leased property or equipment other than in the material properties ordinary course of its business and consistent with its past practice, or assets to dispose of the Company and its Subsidiariesexcess or obsolete inventory or equipment other than for appropriate value;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire negotiate for the securities acquisition of any other Person, except in connection with business or entity or the exercise start-up of repurchase rights or rights any new line of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Optionsbusiness;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except rights or claims, provided that it may negotiate and adjust bills and Accounts Receivables in the Ordinary Course course of Businessgood faith disputes with customers in a manner consistent with past practice;
(xi) enter into effect any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments other transaction that is not in the aggregate;ordinary course of its business and consistent with its past practice or that is prohibited hereby; or
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract contract or agreement to which if so entered into, modified, amended or terminated would be reasonably be expected to have it is a Material Adverse Effect;party that is not in the ordinary course of its business.
(xviic) terminateFrom the Agreement Date until the Closing, amend, restate, supplement except with the prior written consent of the Buyer or waive any rights under any Material Contract, as otherwise expressly permitted or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited required by this Section 7.2Agreement, the Shareholder shall not make or revoke any tax election respecting the Company that affects the Company or the Buyer.
Appears in 1 contract
Samples: Stock Purchase and Sale Agreement (Transportation & Logistics Systems, Inc.)
Conduct of the Business Pending the Closing. During the Interim Period, except (a) Except as set forth in the corresponding section of Section 6.02 of the Company Disclosure Schedules; (b) as required by applicable Law; (c) as otherwise expressly provided in required by this Agreement (including the Internal Restructuring) or the other Transaction Documents; or (d) with the prior written consent of ParentBuyer (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shallAcquired Companies shall not, and Seller and the Company shall cause its Subsidiaries tothe Acquired Companies to not:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell grant, deliver, sell, authorize, encumber, propose, enter into or dispose of (i) any shares Equity Interests of capital stock or other securities of the Company or any of its Subsidiaries or grant Acquired Company, (ii) any options, warrants, calls or other rights to purchase or otherwise acquire shares Equity Interests of any Acquired Company, or any rights or other securities or instruments convertible into, or exchangeable or exercisable for, any of the capital foregoing, (iii) any stock appreciation, phantom stock or other securities of the similar right with respect to any Acquired Company or (iv) any Contracts obligating an Acquired Company to issue any Equity Interests of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parentany Acquired Company;
(iiiii) effect any recapitalization, reclassification, stock equity split or like any other similar change in the capitalization of any Acquired Company;
(iii) declare, set aside or pay any dividend or other distribution in respect of its Equity Interests, or redeem or purchase any of its Equity Interests or change any rights, preferences or privileges of any of its outstanding Equity Interests, except for cash distributions required by the Organizational Documents of the Company or any Subsidiary of the Company that is wholly owned by the Company that are paid in full prior to the time at which Closing Cash is measured.
(iv) (A) adopt a plan of complete or partial liquidation, dissolution, consolidation, reorganization, restructuring, merger or other reorganization with respect to any Acquired Company, or allow any of the foregoing to occur, or (B) file a petition in bankruptcy under any provisions of any applicable bankruptcy Law on behalf of any Acquired Company or consent to the filing of any bankruptcy petition against any Acquired Company under any similar Law;
(v) amend the Organizational Documents of any Acquired Company (including by merger, consolidation or otherwise);
(vi) (A) make any change in the accounting period or any method, principles or practices of the accounting of any Acquired Company (including any change in depreciation, amortization, cash management policies or the collection and treatment of accounts receivable as generally applied to the Company’s customers) or (B) revalue any of its assets or change in any material respect the policies or practices regarding accounts receivables or accounts payable or fail to manage working capital in accordance with past practices (including writing down the value of inventory, if applicable, or writing off notes or accounts receivable otherwise than in the Ordinary Course of Business), except, in each case, as required by changes in GAAP or by applicable Law;
(vii) make any material Tax election, file any material amended Tax Return, settle or compromise any material Tax liability, enter into any closing agreement with respect to any material Tax, surrender any right to claim a material Tax refund or incur any material Tax liability, or consent to any extension or waiver of the statute of limitations period applicable to any material Tax, Tax Return or claim for Tax;
(viii) (A) acquire or agree to acquire, directly or indirectly by merging or consolidating with, or by purchasing or licensing a substantial portion of the assets of, or by any other manner, (x) any business or any corporation, partnership, association or other business organization or division thereof or (y) any Equity Interests in any Person or (B) otherwise acquire or agree to acquire any assets other than (1) inventory acquired in the Ordinary Course of Business and (2) capital assets acquired in accordance with the capital expenditure budget set forth in Section 6.01(c) of the Company Disclosure Schedules;
(ix) enter into any Contract with respect to a joint venture, strategic alliance or partnership;
(x) sell, lease, sublease, license, mortgage, pledge or otherwise encumber or dispose of any of the tangible properties or assets of the Acquired Companies, including the Leased Premises, except sales of assets or inventory in the Ordinary Course of Business;
(xi) (i) sell, transfer, assign, or otherwise dispose of, (ii) abandon, cancel, forfeit, permit to lapse, fail to renew or fail to continue to prosecute, protect or defend, (iii) grant any license (other than non-exclusive licenses of Intellectual Property granted to customers or end users for the use by such customers or end users of the Acquired Companies’ services, in each case, entered into in the Ordinary Course of Business), or (iv) subject to any Lien (other than a Permitted Lien or Liens that will be extinguished in connection with the Closing pursuant to a Payoff Letter), in each case of (i)-(iv), any Company Intellectual Property;
(xii) enter into any Contract to lease, license, use, own or operate any real property that is or would be material to the Business, taken as a whole, except in the Ordinary Course of Business;
(xiii) hire or terminate (other than for cause) the employment of any employee of the Acquired Companies with a base salary above $175,000;
(A) modify, extend, or enter into any labor agreement, collective bargaining agreement or any other labor-related agreements or arrangements with any labor union, labor organization or works council (collectively, a “Union”), (B) recognize or certify any Union or group of employees as the bargaining representative of any of the employees of the Acquired Companies, (C) enter into any neutrality agreement or remain neutral in any Union organizing campaign, or (D) settle any labor grievances regarding any labor agreement, collective bargaining agreement or any other labor-related agreements or arrangements with any Union or unfair labor practice charges, file any unfair labor practice charges, or any other action similar to the foregoing (except to the extent that (I) Seller would be solely responsible for any settlement costs and expenses of grievances arising from acts or omissions that occurred prior to the Closing, including attorneys’ fees and expenses, or (II) such settlement is equal to or less than $150,000, in each case, with respect to any Acquired Company or any of their current or former employees, directors, independent contractors, consultants or other service providers);
(xv) except in the Ordinary Course of Business or as required by an Employee Benefit Plan listed on Section 3.15(a) of the Company Disclosure Schedules, (A) establish, adopt, enter into, terminate or materially amend any Employee Benefit Plan or plan, program, policy, practice, agreement or arrangement that would be an Employee Benefit Plan if it had been in effect on the date of this Agreement; (B) grant or pay, or commit to grant or pay, any (I) bonus, incentive or other similar payment or benefit, or (II) equity or equity-related award or profit-sharing award or other similar payment or benefit; (C) increase, or commit to increase, the amount of wages, salary, bonuses, commissions, fringe benefits, severance or other compensation, benefits or remuneration payable to any current or former employee or director of, or individual service provider to, any of the Acquired Companies; or (D) take any action to accelerate any payment or benefit, the vesting or payment of any equity, equity-based or non-equity based award or the funding of any payment or benefit, payable or to become payable to any current or former employee or director of, or individual service provider to, any Acquired Company;
(xvi) materially change the amount of, or terminate or fail to maintain or materially amend or modify, Insurance Policy to lapse, in each case, unless such Insurance Policy is replaced by a substantially comparable policy;
(xvii) materially change the manner in which it extends warranties, discounts or credits to customers;
(xviii) except for Indebtedness that is repaid prior to the Closing or will otherwise be reflected in the Closing Indebtedness Amount, incur any Indebtedness (or issue any debt securities) or assume, guarantee or endorse any Indebtedness of (or any debt securities issued by);
(xix) (A) amend, violate, terminate, cancel, fail to exercise an expiring renewal option or materially modify or accelerate or waive any material term or right of any Material Contract (other than termination upon any expiration of any Material Contract in accordance with its terms where no renewal option was available), or (B) enter into any a Material Contract other than in the Ordinary Course of Business;
(xx) enter into any transaction with Seller or any Affiliate of Seller or any Company Related Party that, if entered into prior to the date hereof, would be required to be disclosed in Section 3.12(a)(xv) or Section 3.19 of the Company Disclosure Schedules;
(xxi) defer payment of any accounts payable (other than in the Ordinary Course of Business) or make any discount, accommodation or other concession (other than in the Ordinary Course of Business) in order to accelerate or induce the collection of any receivable;
(xxii) create, subject to or place any Lien (other than a Permitted Lien or Liens that will be extinguished in connection with the Closing pursuant to a Payoff Letter) on any of its assets, rights or properties;
(xxiii) (A) lend any money, other than reasonable and normal advances to employees for bona fide expenses, (B) make any investments in or capital contributions to, any Person or (C) forgive or discharge in whole or in part any outstanding loans or advances;
(xxiv) cancel, release or assign any material Indebtedness owed to any Person except pursuant to a Payoff Letter;
(xxv) implement any employee layoffs that would reasonably be expected trigger the WARN Act;
(xxvi) enter into a new line of business or abandon or discontinue any existing line of business;
(xxvii) create any Subsidiary of the Company or any of its Subsidiaries;
(ivxxviii) amend the certificate of incorporation compromise, settle or by-laws agree to compromise or settle any Proceeding or investigation other than any settlement that (i) provides solely for money damages payable by any of the Company Acquired Companies that are paid in full prior to the time at which Closing Cash is measured and (ii) does not involve any injunctive or other non-monetary relief or impose restrictions on the Acquired Companies that would be binding on Buyer or any of its Subsidiaries;the Acquired Companies following the Closing; or
(vxxix) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Companyresolve, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiariesannounce an intention, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officersauthorize, (C) grant any unusual or extraordinary bonuscommit, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.26.02. For purposes of this Section 6.02, “Material Contract” includes any Contract arising subsequent to the date hereof that would have been required to be listed on the Company Disclosure Schedules pursuant to Section 3.12 had such Contract been in effect on the date hereof.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Apogee Enterprises, Inc.)
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided contemplated by this Agreement, as set forth in this Agreement Section 6.2 of the Company Disclosure Schedule and except for the Permitted Transactions, or with the prior written consent of ParentPurchaser, during the period which consent shall not be unreasonably withheld, from the date of this Agreement to hereof until the Effective Time, Closing Date:
(a) the Company shall, and shall cause its Subsidiaries each Subsidiary to:
(i) conduct the respective businesses of the Company and its Subsidiaries Business only in the Ordinary Course of Businessordinary course consistent with past practice;
(ii) use its commercially reasonable commercial efforts to (A) preserve its the present business operations, organization (including, without limitation, management and the sales force) and goodwill of the Company and its Subsidiaries Business and (B) preserve its the present relationship relationships with suppliers, customers and other Persons having material business dealings with the Company and its Subsidiaries;the Subsidiaries relating to the Business; and
(iii) use its commercially reasonable efforts to maintain (A) all confer with Purchaser concerning operational matters of a material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreementnature;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not not, and shall not cause or permit its Subsidiaries any Subsidiary to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether other than any dividend or distribution in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or effect any of its Subsidiariesrecapitalization, except split or like change in connection with the exercise of repurchase rights or rights of first refusal in favor capitalization of the Company with respect to shares issued upon exercise of Company Stock Optionsor any Subsidiary;
(ii) except as set forth on Schedule 7.2(b)(ii)transfer, transferauthorize for issuance, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries Subsidiary or grant options, warrants, calls options or other rights to purchase or otherwise acquire shares of the Company's or any Subsidiary's capital stock or other securities securities;
(iii) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentSubsidiary;
(iiiiv) effect incur, assume or guarantee any recapitalizationindebtedness for borrowed money, reclassification, stock split or like change other than (A) in the capitalization ordinary course of its business consistent with past practice, (B) borrowings under existing lines of credit in the ordinary course of business, or (C) guarantees by the Company or any Subsidiary of indebtedness of the Company or any of its SubsidiariesSubsidiary;
(ivv) amend the certificate of incorporation or by-laws of the Company or any of its SubsidiariesSubsidiary;
(vvi) except as set forth on Schedule 7.2(b)(v) or otherwise other than in the Ordinary Course ordinary course of Business business consistent with respect to employees other than officers of the Companypast practice, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries Subsidiary to any of their its respective executive officersdirectors, officers or employees; (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (DB) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan plan, payment or arrangement made to, for, for or with any of the directors, officers, employees, agents officers or representatives employees of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement Subsidiary; or (EC) enter into any collective bargaining, employment, deferred compensation, severance, consultingconsulting (in which a Person is acting as a consultant to the Company or any of its Subsidiaries), non-competition or similar agreement (or amend any such agreement) existing agreement to which the Company or any of its Subsidiaries a Subsidiary is a party or party) involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi))Subsidiary;
(vii) subject to any Lien or otherwise encumber or, except for (other than Liens set forth in any section of the Company Disclosure Schedule and other than Permitted Exceptions, permit, allow or suffer to be encumbered, Encumbrances) any of the material properties or assets (whether tangible or intangible), or any shares of capital stock ) of the Company or any of its SubsidiariesSubsidiary, other than the Excluded Assets;
(viii) (i) acquire (except for purchases of inventory and supplies in the ordinary course of business) any material properties or material assets or (ii) sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease lease, license or otherwise dispose of any of the material properties or material assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line (except for the transfer of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effectthe Excluded Assets);
(xviiix) terminateother than as required by GAAP or by Law, amendmake any material alteration with respect to accounting policies, restateprocedures and practices; (x) enter into any contract or agreement with Seller, supplement WPS or waive any rights under Affiliate of WPS, other than in the ordinary course of business, consistent with past practice, and on terms that are, in all material respects, no less favorable, in the aggregate, to the Company or any Material Contract, or Permit that would reasonably Subsidiary party thereto than could be expected to have a Material Adverse Effectobtained in arm's-length negotiations with an unaffiliated third party;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as set forth on Schedule 9.2, (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement or (iv) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and the LLC shall cause its Subsidiaries toeach:
(i) conduct the respective businesses of the Company and its Subsidiaries the LLC only in the Ordinary Course of BusinessBusiness and not make or institute any material changes in its method of purchase, sale, management, accounting or operation;
(ii) use its commercially reasonable efforts to (A) maintain and preserve its the present business operations, organization and goodwill of the Company and its Subsidiaries and the LLC respectively, (B) preserve its the present relationship relationships with Persons customers, suppliers and others having material business dealings relations with the Company and its Subsidiaries;the LLC respectively and (C) to keep available to the Company the employees of the Company; and
(iii) use its commercially reasonable efforts pay all Taxes before such Taxes become delinquent unless contested in good faith by appropriate proceedings and notice is provided to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this AgreementPurchaser.
(b) Except (i) as set forth on Schedule 9.2, (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement or (iv) with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date delayed or conditioned), each of this Agreement to the Effective Time, the Company and the LLC shall not, and the Selling Holders shall cause the Company and the LLC not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or the LLC, as applicable, or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsLLC;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries the LLC or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentLLC;
(iii) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its Subsidiariesthe LLC;
(iv) amend the certificate of incorporation or by-laws organizational documents of the Company or any of its Subsidiariesthe LLC;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any director or employee of the Company or any the LLC, except for increases at such times and in such amounts as are consistent with the past practices of its Subsidiariesthe Company or the LLC, as the case may be; (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantemployee of the Company or the LLC except in the Ordinary Course of Business consistent with past practice, (DC) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents current or representatives former director or employee of the Company or any of its Subsidiaries the LLC or otherwise modify or amend or terminate any such plan or arrangement or (ED) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries the LLC is a party or involving a director, officer director or employee of the Company or the LLC, except, in each case, as required by applicable Law from time to time in effect or by the terms of any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its SubsidiariesBenefit Plans;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien Lien, any Company Property or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the other properties or assets (whether tangible or intangible), or any shares of capital stock ) of the Company or any of its Subsidiariesthe LLC, except for Permitted Exceptions;
(viiivii) acquire any material properties or assets outside of the Ordinary Course of Business or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiariesor the LLC (except pursuant to an existing Contract for fair consideration in the Ordinary Course of Business or for the purpose of disposing of obsolete or worthless assets);
(ixviii) except as set forth on Schedule 7.2(b)(ix)other than in the Ordinary Course of Business, enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of BusinessLLC;
(xiix) commence or enter into any commitment for capital expenditures of the Company and its Subsidiaries or the LLC in excess of fifty thousand dollars ($20,000 50,000) for any individual commitment and four hundred thousand dollars ($100,000 400,000) for all commitments in the aggregate;
(xiix) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries the LLC or, through negotiation negotiations or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiariesorganizations;
(xiiixi) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries the LLC to enter into or agree to enter into any transaction merger or to enter intoconsolidation with any corporation or other entity, modify or renew acquire the securities of any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effectother Person;
(xivxii) except for transfers of cash pursuant to normal cash management practices other than in the Ordinary Course of Business, permit the Company or any of its Subsidiaries the LLC to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Selling Holder or any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its SubsidiariesSelling Holder;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvixiii) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability other Contract outside of the Company Ordinary Course of Business or which requires a payment or other obligation in excess of twenty five thousand dollars ($25,000) or amend, supplement or modify any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effectlease for real property;
(xviixiv) terminate, amend, restate, supplement make any Tax election or waive settle or compromise any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;material Tax liability; or
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xixxv) agree to do anything prohibited by this Section 7.29.2.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (w) as set forth on Schedule 5.2(a), (x) as required by applicable Law, (y) as otherwise expressly provided in contemplated by this Agreement or, in the case of the Company, the Stock Purchase Agreement or the Company Stockholders Agreement or, in the case of Buyer, the Common Stock Purchase Agreements, or (z) with the prior written consent of Parentthe other (which consent shall not be unreasonably withheld, during the period from the date conditioned or delayed), each of this Agreement to the Effective Time, Buyer and the Company shall, and shall cause each of its Subsidiaries to, (i) conduct its business in the Ordinary Course of Business, or in the ordinary course of business consistent with past practice in Buyer’s case; (ii) use commercially reasonable efforts to preserve substantially intact its corporate existence and business organization; (iii) use commercially reasonable efforts to preserve the goodwill and present business relationships (contractual or otherwise) with material franchisees, suppliers, licensors, distributors and others having material business relationships with it; and (iv) use commercially reasonable efforts to keep available the services of its current officers and employees.
(b) Without limiting the generality of the foregoing Section 5.2(a), except (w) as set forth on Schedule 5.2(b), (x) as required by applicable Law, (y) as otherwise contemplated by this Agreement, the Stock Purchase Agreement or the Company Stockholders Agreement or (z) with the prior written consent of Buyer (which consent shall not be unreasonably withheld, conditioned or delayed), the Company shall not, and shall not permit any of its Subsidiaries to:
(i) conduct the respective businesses authorize or reserve for issuance, issue or sell any shares of the Company and Company’s or any of its Subsidiaries only in the Ordinary Course of BusinessSubsidiaries’ capital stock or other equity securities;
(ii) use its commercially reasonable efforts authorize or reserve for issuance, issue or sell any securities convertible into, or options with respect to, warrants to (A) preserve its present business operationspurchase, organization and goodwill or rights to subscribe for, any shares of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of ’ capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parentequity securities;
(iii) effect any recapitalization, reclassification, stock dividend, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) declare, set aside or make any payment or distribution of property (or cash) with respect to any security of the Company or its Subsidiaries or purchase, redeem or otherwise acquire any securities of the Company or its Subsidiaries (including any warrants, options or other rights to acquire any securities);
(v) amend in any material respect the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee comparable organizational documents of the Company or any of its Subsidiaries, except (A) to increase the number of authorized shares of capital stock of the Company so to permit the Levy Subscription and (B) increase to effect the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any intent of the directors, officers, employees, agents or representatives last sentence of Section 7.1(a) of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its SubsidiariesStockholders Agreement;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock ) of the Company or any of its Subsidiaries, except (A) in the Ordinary Course of Business or (B) for Permitted Exceptions;
(vii) become legally committed to make any capital expenditures, except for (A) capital expenditures pursuant to projects for which work has already been commenced or committed and is contemplated in the capital expenditure budget provided to Buyer or (B) capital expenditures related to any Emergency or Force Majeure;
(viii) enter into any merger or consolidation with any Person, or acquire the securities or a substantial portion of the assets of any material properties Person;
(ix) incur or assets assume any Indebtedness in excess of $750,000 or sellguarantee any such Indebtedness, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)Business or pursuant to the Credit Agreement;
(x) loan or advance any funds to any Person such that the amount of principal of loan advances owed by such Person shall be in excess of $50,000;
(xi) sell, assign, license, transfer, convey, convey or lease or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xixii) enter into make or rescind any commitment for capital expenditures material election relating to Taxes, settle or compromise any material Proceeding relating to Taxes, or, except as required by applicable Law, make any material change to any of its methods of Tax accounting;
(xiii) make any material change to the terms of the Company’s or any of its Subsidiaries’ policies or procedures with respect to its relationships with any Company Franchisees, including (A) any material change to the terms of policies relating to franchisee rent, royalty, or advertising funds, or (B) any material modification to any existing program or plan providing any franchisee incentives or franchisee economic assistance;
(xiv) discharge or satisfy any material Lien or pay any material obligation or liability, other than in the Ordinary Course of Business;
(xv) delay, postpone or cancel the payment of accounts payable, the purchase of inventory, or the replacement of inoperable, worn-out or obsolete assets with assets of comparable quality, in each case in any material respect other than in the Ordinary Course of Business;
(xvi) sell, assign, transfer, lease, license, permit to lapse, fail to maintain or abandon any material real property interest of the Company and or its Subsidiaries in excess Subsidiaries, or take any action that could reasonably be expected to cause the loss, lapse or abandonment of $20,000 for any individual commitment and $100,000 for all commitments in material real property interest of the aggregateCompany or its Subsidiaries;
(xiixvii) enter intoother than in the Ordinary Course of Business, take or fail to take any action that could reasonably be expected to cause the loss, lapse or abandonment of any material Company Intellectual Property;
(xviii) form any Subsidiary or make a material investment in any other entity (other than the Company or a Subsidiary of the Company);
(xix) terminate or cancel, or amend or modify or terminate in any labor or collective bargaining agreement material adverse respect any material insurance policy of the Company or any of its Subsidiaries which is not replaced by a comparable amount of insurance with premiums at a comparable price;
(xx) cancel or waive any right or claim (or series of related rights and claims) either involving more than $1,000,000 or outside the Ordinary Course of Business;
(xxi) terminate, materially modify or cancel any Material Contract, or any Leased Real Property Lease, Company Leased Real Property Lease, Licensed Intellectual Property Contract, Company Benefit Plan, Company Employee Agreement or Company Specified Agreement that meets any of the descriptions set forth in clauses (i) through (xii) of the definition of “Material Contract” in Section 3.13(a), or enter into any Material Contract or any such Leased Real Property Lease, Company Leased Real Property Lease, Licensed Intellectual Property Contract, Company Benefit Plan, Company Employee Agreement or Company Specified Agreement outside the Ordinary Course of Business, except in the case of a Company Benefit Plan as required by Law; or
(xxii) authorize, through negotiation or otherwisecommit or agree to do, make anything prohibited by this Section 5.2(b).
(c) Without limiting the generality of the foregoing Section 5.2(a), except (w) as set forth on Schedule 5.2(c), (x) as required by applicable Law, (y) as otherwise contemplated by this Agreement or the Common Stock Purchase Agreements or (z) with the prior written consent of the Company (which consent shall not be unreasonably withheld, conditioned or delayed), Buyer shall not, and shall not permit any commitment of its Subsidiaries to:
(i) authorize or incur reserve for issuance, issue or sell any liability to shares of Buyer’s or any labor organization of its Subsidiaries’ capital stock or other equity securities;
(ii) authorize or reserve for issuance, issue or sell any securities convertible into, or options with respect to, warrants to purchase, or rights to subscribe for, any shares of Buyer’s or any of its Subsidiaries’ capital stock or other equity securities;
(iii) effect any recapitalization, reclassification, stock dividend, stock split or like change in the Company capitalization of Buyer or any of its Subsidiaries;
(xiiiiv) except as declare, set forth on Schedule 7.2(b)(xiv), permit the Company aside or make any payment or distribution of property (or cash) with respect to any security of Buyer or its Subsidiaries or purchase, redeem or otherwise acquire any securities of Buyer or its Subsidiaries (including any warrants, options or other rights to enter into acquire any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effectsecurities);
(xivv) except for transfers amend the certificate of cash pursuant to normal cash management practices in the Ordinary Course incorporation or by-laws or comparable organizational documents of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company Buyer or any of its Subsidiaries;
(xvvi) (A) other than in the ordinary course of business consistent with past practice or as contemplated by an existing Buyer Benefit Plan or Buyer Employee Agreement, agreement, policy or arrangement (including any collective bargaining agreement) increase the compensation or benefits of any employee, (B) materially increase the annual level of compensation of any executive officer of Buyer, (C) modify or amend any Buyer Benefit Plan or Buyer Employee Agreement in any manner that materially increases the amount of the liability attributable to Buyer or any of its Subsidiaries in respect of such Buyer Benefit Plan or Buyer Employee Agreement, (D) enter into, adopt, terminate, establish or materially modify or amend any Buyer Benefit Plans, except as required by Law, or (E) accelerate the vesting or payment of any compensation or benefits under any Buyer Benefit Plan (other than as required under any Buyer Benefit Plan or this Agreement);
(vii) subject to any Lien any of the properties or assets (whether tangible or intangible) of Buyer or any of its Subsidiaries, except (A) in the ordinary course of business consistent with past practice or (B) for Permitted Exceptions;
(viii) become legally committed to make any capital expenditures;
(ix) enter into any merger or consolidation with any Person, or acquire the securities or a substantial portion of the assets of any Person;
(x) incur or assume any Indebtedness or guarantee any Indebtedness other than to fund Approved Transaction Expenses;
(xi) loan or advance any funds to any Person;
(xii) sell, assign, license, transfer, convey or lease or otherwise dispose of any material properties or assets of Buyer or any of its Subsidiaries except in the ordinary course of business consistent with past practice;
(xiii) make or change rescind any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect relating to Taxes, settle or compromise any material Proceeding relating to Taxes, or, except as required by applicable Law, make any material change to any of its methods of Tax claim accounting;
(xiv) discharge or assessment satisfy any material Lien or surrender pay any right material obligation or liability, other than in the ordinary course of business consistent with past practice;
(xv) delay, postpone or cancel the payment of accounts payable in any material respect other than in the ordinary course of business consistent with past practice;
(xvi) sell, assign, transfer, lease, license, permit to claim a refund lapse, fail to maintain or abandon any material real property interest of Taxes Buyer or obtain its Subsidiaries, or enter into take any Tax rulingaction that could reasonably be expected to cause the loss, lapse or abandonment of any material real property interest of Buyer or its Subsidiaries;
(xvii) take or fail to take any action that could reasonably be expected to cause the loss, lapse or abandonment of any patents, patent applications, trademarks, service marks, copyright registrations or applications for registration, in each case, if taking such action would materially affect the amount of Taxes required to be paid that are owned by the Company Buyer or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary and material to compete with or conduct any their business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effectas currently conducted;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed form any Subsidiary or make a material investment in good faith by appropriate proceedings, any other entity (other than Buyer or accelerate the collection a Subsidiary of any accounts receivable; andBuyer);
(xix) terminate or cancel, or amend or modify in any material adverse respect any material insurance policy of Buyer or any of its Subsidiaries which is not replaced by a comparable amount of insurance with premiums at a comparable price;
(xx) cancel or waive any right or claim (or series of related rights and claims) outside the ordinary course of business consistent with past practice;
(xxi) terminate, materially modify or cancel any material Contract, or enter into any material Contract outside the ordinary course of business consistent with past practice;
(xxii) initiate, compromise or settle any Proceeding;
(xxiii) use any portion of the Trust Account to acquire any shares of Buyer’s or any of its Subsidiaries’ capital stock or other equity securities, other than acquisitions of shares of Buyer Common Stock from holders of Buyer Common Stock who properly exercise their redemption rights in accordance with Buyer’s certificate of incorporation; or
(xxiv) authorize, or commit or agree to do do, anything prohibited by this Section 7.25.2(c).
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during During the period from the date of this Agreement to and continuing until the Effective TimeClosing, each of the Stockholder and the Company agrees, that neither the Stockholder nor the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only not to, engage in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present any business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings whatsoever other than in connection with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties consummation of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during During the period from the date of this Agreement and continuing until the Closing, each of the Stockholder and the Company agrees as to itself and, with respect to the Effective TimeCompany, the Company Subsidiaries, that except as expressly contemplated or permitted by this Agreement, or to the extent that the other party shall not and shall not permit its Subsidiaries tootherwise consent in writing:
(i) It shall not amend or propose to amend its certificate of incorporation or by-laws or equivalent organizational documents except as set forth on Schedule 7.2(b)(i)contemplated in this Agreement.
(ii) It shall not, nor in the case of the Company shall it permit the Company Subsidiaries to, issue, deliver, sell, redeem, acquire, authorize or propose to issue, deliver, sell, redeem, acquire or authorize, any shares of its capital stock of any class or any securities convertible into, or any rights, warrants or options to acquire, any such shares or convertible securities or other ownership interest and, in the case of the Stockholder, shall not sell or otherwise transfer the Shares, provided that the Company shall be permitted to issue the shares of its Common Stock to be issued to the stockholders of CSA.
(iii) It shall not, nor in the case of the Company shall it permit any of the Company Subsidiaries to, nor shall it propose to: (i) declare, set aside, make or pay any dividend or other distribution (whether distribution, payable in cash, stock stock, property or property) in otherwise, with respect to any of the capital stock of the Company or repurchase, redeem or otherwise acquire any outstanding shares of the its capital stock or other securities (ii) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock.
(iv) Other than dispositions in the ordinary course of business consistent with past practice which would not cause a Material Adverse Effect, individually or in the aggregate, to it and its subsidiaries, taken as a whole, it shall not, nor shall it permit any of its subsidiaries to, sell, lease, encumber or otherwise dispose of, or agree to sell, lease (whether such lease is an operating or capital lease), encumber or otherwise dispose of its assets, excluding lien foreclosures on assets by creditors.
(v) It shall promptly advise the other ownership interests inparty hereto in writing of any change in the condition (financial or otherwise), the Company operations or properties, businesses or business prospects of such party or any of its Subsidiaries, except subsidiaries which would result in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiaries;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;Material Adverse Effect.
(vi) It shall not permit to occur any (1) change in accounting principles, methods or practices, investment practices, claims, payment and processing practices or policies regarding intercompany transactions and (2) incurrence of Indebtedness or any commitment to incur Indebtedness, any incurrence of a contingent liability, Contingent Obligation or assume other liability of any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));type.
(vii) subject to any Lien or otherwise encumber orIt shall not, except for Permitted Exceptions, permit, allow or suffer to be encumbered, and the Company shall not permit any of the properties Company Subsidiaries to, take or assets agree or commit to take any action, (whether tangible or intangible), or any shares of capital stock of the Company or i) that is reasonably likely to make any of its Subsidiaries;representations or warranties hereunder inaccurate; or (ii) that is prohibited pursuant to the provisions of this Article VI.
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose It shall obtain releases of any claim whatsoever, including compensation claims, by all officers, directors and the Estate of the material properties or assets of the Company and its Subsidiaries;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2Xxxxxxx Xxxxx.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly provided in contemplated by this Agreement and the schedules attached hereto or with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, delayed or conditioned), during the period from the date of this Agreement to and through the Effective TimeClosing Date, pursuant to the Company shallEnron Purchase Agreement, Seller shall request, and shall cause its Subsidiaries to:
use commercially reasonable efforts to have such request honored, that the Transfer Group Companies (iA) conduct the their respective businesses of the Company and its Subsidiaries only in all material respects in the Ordinary Course of Business;
, and (ii) use its commercially reasonable efforts to (AB) preserve its in all material respects the present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with Transfer Group Companies. For the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties avoidance of doubt, the foregoing shall not require Seller or any of the Company and its Subsidiaries Transfer Group Companies to make any payments, incur any costs or enter into or amend any contractual arrangements, agreements or understandings, unless such payment, incurrence or other action is required by Applicable Law, by contractual obligation with such third parties or to operate in their current condition, ordinary wear and tear excepted and (B) insurance upon all the Ordinary Course of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this AgreementBusiness.
(b) Except as otherwise expressly provided in contemplated by this Agreement or with the prior written consent of ParentPurchaser (which consent shall not be unreasonably withheld, during the period from the date of this Agreement delayed or conditioned), pursuant to the Effective TimeEnron Purchase Agreement, the Company Seller shall not request, and shall not permit its Subsidiaries touse commercially reasonable efforts to have such request honored, that none of the Transfer Group Companies shall:
(i) except as set forth on Schedule 7.2(b)(i)SCHEDULE 6.2(B)(I) or as contemplated by the Contribution Agreement or in the schedules thereto, declare, set aside, make or pay any non-cash dividend or other non-cash distribution (whether in cash, stock or property) in respect of the capital stock of the any Transfer Group Company or repurchase, redeem or otherwise acquire for non-cash consideration any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsTransfer Group Company;
(ii) except as set forth on Schedule 7.2(b)(iiSCHEDULE 6.2(B)(II), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries the Transfer Group Companies or the 500,000 common units of Northern Border beneficially owned by Northern Plains as of the date of this Agreement or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company Transfer Group Companies or any the 500,000 common units of its Subsidiaries, except pursuant to obligations existing on Northern Border beneficially owned by Northern Plains as of the date of this Agreement and previously disclosed to ParentAgreement;
(iii) effect any recapitalization, reclassification, stock split split, or like change in the capitalization of the Company or any of its SubsidiariesTransfer Group Company;
(iv) except as set forth on SCHEDULE 6.2(B)(IV), amend the certificate of incorporation incorporation, bylaws or by-laws other organizational documents of any of the Company or any of its SubsidiariesTransfer Group Companies;
(v) except as set forth provided under the severance and retention plans and other employment arrangements listed on Schedule 7.2(b)(vSCHEDULE 6.2(B)(V) and except as would not create or otherwise in increase any liability of any Northern Plains Group Company beyond any amount reflected on the Ordinary Course of Business with respect to employees other than officers of the CompanyBalance Sheets, (A) materially increase the annual level of compensation of any employee of the Company Transfer Group Companies (other than increases in the Ordinary Course of Business and that in the aggregate will not result in a material increase in the benefits or any compensation expense of its Subsidiariesthe Transfer Group Companies taken as a whole), (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultantconsultant of the Transfer Group Companies, other than in the Ordinary Course of Business, (DC) materially increase the coverage or benefits available under any (or, except as permitted under clause (D) or as provided on SCHEDULE 6.2(B)(V), create or adopt any new) severance payBenefit Arrangement, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan Employee Benefit Plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries Transfer Group Companies or otherwise materially modify or amend or terminate any such arrangement or plan or arrangement (D) other than in the Ordinary Course of Business, hire any person or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the any Transfer Group Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries Transfer Group Companies in his or her capacity as a director, officer or employee of the Company Transfer Group Companies, other than (1) with respect to any Person who fills a vacant position or (2) with respect to a technical consulting engagement; PROVIDED that any such agreement or amendment (x) has a term of its Subsidiaries;one year or less, and in the case of (1), provides for no increase in compensation other than in the Ordinary Course of Business and, (y) in the case of (2), will not provide the technical consultant with more than $200,000 of base annual salary, or (z) in the case of hirings, agreements and amendments that do not meet the requirements of subclauses (x) or (y) will not, when aggregated with all other such hirings, agreements and amendments that do not meet the requirements of subclauses (x) or (y), require total payments of base annual salary in excess of $2,000,000 or payments to any individual in excess of $350,000.
(vi) incur except as set forth on SCHEDULE 6.2(B)(VI) and except for (A) trade payables, (B) indebtedness under existing lines of credit, (C) any extension, renewal or assume refinancing of existing indebtedness, (D) indebtedness for borrowed money incurred or guarantees issued in the Ordinary Course of Business and (E) indebtedness in an amount sufficient to allow the Transfer Group Companies to make any Indebtedness required capital contributions in accordance with the terms of the Northern Border Partnership Agreement, borrow monies for any reason, draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other Person (other than Indebtedness set forth on Schedule 7.2(b)(vi)another Transfer Group Company or any Northern Border Company);
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the material properties or assets (whether tangible or intangible)) of the Transfer Group Companies to any Lien, except for (A) Permitted Exceptions or (B) Liens arising in the Ordinary Course of Business or by operation of Law, or subject the Equity Interest to any shares of capital stock of the Company or any of its SubsidiariesLien;
(viii) except as set forth on SCHEDULE 6.2(B)(VIII), (A) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), except for any such acquisitions of properties or assets with a fair market value of up to $5,000,000 in the aggregate or (B) sell, assign, transfer, convey, lease or otherwise dispose of any of the material properties or assets of the Company and its SubsidiariesTransfer Group Companies other than in the Ordinary Course of Business, except for any such dispositions of properties or assets with a fair market value of up to $5,000,000 in the aggregate;
(ix) until written notice is provided to Purchaser, enter into any labor or collective bargaining agreement of the Transfer Group Companies, through negotiation or otherwise, or make any material commitment or incur any material liability to any labor organization with respect to the Transfer Group Companies;
(x) except as set forth on Schedule 7.2(b)(ixSCHEDULE 6.2(B)(X), repurchase, discharge or satisfy any claim, debt or obligation of any of the Transfer Group Companies in an amount in excess of $2,000,000 in the aggregate, other than (A) in the Ordinary Course of Business, (B) pursuant to the terms of any Contract as in effect on the date of this Agreement or permitted to be entered into hereafter or (C) in the pursuit, prosecution or resolution of any pending FERC proceedings;
(xi) permit any of the Transfer Group Companies to enter into into, or agree to enter into into, any merger or consolidation with, any corporation or other entity;
(xii) pursuant to or within the meaning of the Bankruptcy Code or any similar federal, and not invest instate or foreign law for the relief of debtors, commence a voluntary case, consent to the entry of an Order for relief against any of them in an involuntary case, consent to the appointment of a receiver, trustee, assignee, liquidator or similar official of them or for all or substantially all of its property or assets, or make a general assignment for the benefit of its creditors;
(xiii) fail to maintain, in full force and effect, to the extent commercially reasonably available, insurance coverage that is equivalent in all material respects to the insurance coverage currently in effect for the Transfer Group Companies under the Insurance Policies or comparable insurance; PROVIDED, HOWEVER, that Seller shall not be in breach of this Section 6.2(b)(xiii) if any current insurer refuses to renew or continue to extend insurance coverage to the Transfer Group Companies so long as Seller uses commercially reasonable efforts to obtain equivalent insurance coverage from another reputable insurer and nothing herein shall prevent Seller from replacing any existing insurance from a current insurer with substantially equivalent insurance from another reputable insurer;
(xiv) amend, modify or change the Principal Contribution Transaction Documents ( other than with respect to the Sublease and Tax Sharing Agreement and amendments contemplated in the Enron Purchase Agreement, including as provided in Section 8.1(g)of the Enron Purchase Agreement);
(xv) except as set forth on SCHEDULE 6.2(B) (XV) make any single loan, material advance or capital contribution to, or otherwise acquire investment in, any Person who is not a Transfer Group Company or Northern Border Company (or any entity in which a Northern Border Company has an ownership interest) in excess of $5,000,000 or a series of such loans, advances and capital contributions to, or investments in, any such Person in excess of $15,000,000 in the securities aggregate, except for loans, advances, capital contributions and investments (A) pursuant to and in accordance with the terms of any other PersonMaterial Contract, except in connection with the exercise of repurchase rights or rights of first refusal in favor each case existing as of the Company with respect to shares issued upon exercise date of Company Stock Options;
this Agreement, or (xB) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in the aggregate;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiiixvi) except as set forth on Schedule 7.2(b)(xivSCHEDULE 6.2(B)(XVI), permit the Company make or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries commit to make any investments single capital expenditure in excess of $5,000,000 or loans to, or pay any fees or expenses commit to make a series of capital expenditures in excess of $15,000,000 in the aggregate (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries;
(xv) make or change any material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect other than capital expenditures included in the amount of Taxes required capital forecast previously provided to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xvi) enter into any Contract, understanding or commitment that restrains, restricts, limits or impedes the ability of the Company or any Subsidiary to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;Purchaser); or
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contractauthorize, or Permit that would reasonably be expected to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, commit or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2take, any of the actions referred to in paragraphs (i) through (xvi) above.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as set forth on Schedule 7.3(a), (ii) as required by applicable Law or Contract to which the Company or its Subsidiaries is bound, (iii) as otherwise expressly provided in contemplated by this Agreement or any of the Company Documents, (iv) with the prior written consent of ParentPurchaser (such consent not to be unreasonably withheld, during the period from the date of this Agreement to the Effective Timeconditioned or delayed), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain conduct, and cause its Subsidiaries to conduct, in all third party consents material to respects, their respective businesses in the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability ordinary course of the parties to consummate the transactions contemplated by this Agreementbusiness.
(b) Except Other than (i) as set forth on Schedule 7.3(b), (ii) as required by applicable Law or Contract to which the Company or its Subsidiaries is bound, (iii) as otherwise expressly provided in contemplated or permitted by this Agreement (including Section 8.3(c)) or any of the Company Documents, or (iv) with the prior written consent of ParentPurchaser (such consent not to be unreasonably withheld, during the period from the date of this Agreement to the Effective Timeconditioned or delayed), the Company shall not not, and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i)transfer, declare, set aside, make issue or pay sell to any dividend Person (other than the Company or other distribution (whether in cash, stock or propertyanother of its Subsidiaries) in respect any Equity Interests of any of the capital stock Company’s Subsidiaries or transfer, issue, or sell any Equity Interests of the Company (except for issuances as may result from the exercise of Options in accordance with the terms and conditions of the Equity Incentive Plans and the applicable award agreements thereunder as long as the recipient of any such Equity Interests executes a joinder to this Agreement as a Seller with respect to such Equity Interests in a form reasonably acceptable to Purchaser);
(ii) amend the certificate of incorporation, bylaws or comparable organizational documents of the Company or repurchaseany of its Subsidiaries, redeem or form any Subsidiary or joint venture entity;
(iii) except (A) pursuant to any Law or Contract or Plan or Benefit Program existing on the date hereof, (B) in the ordinary course of business consistent with past practice or (C) as would otherwise be included in the calculation of Transaction Expenses, (x) increase the amount of base salary, bonus opportunity or other remuneration of any employee or other service provider of the Company or any of its Subsidiaries, or enter into any employment or severance agreement (other than “at-will” offer letters or employment agreements that may be terminated on thirty (30) days’ or less notice and without severance or similar payments) with any employee, in either case with annual base salary exceeding $350,000, (y) take any action to accelerate the vesting or otherwise acquire fund or secure the payment of any outstanding shares compensation or benefits payable to any employee or other individual service provider of the capital stock Company or other securities ofany of its Subsidiaries under any Plan or Benefit Program, or other ownership interests in(z) except as otherwise permitted under the foregoing clause (x), amend, terminate or establish any Plan or Benefit Program that would have a material financial impact on the Company or any of its Subsidiaries, except in connection with the exercise for annual renewals of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its Subsidiarieswelfare benefits;
(iv) amend the certificate of incorporation or by-laws of the Company or any of its Subsidiaries;
(vx) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) increase the annual level of compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries to any of their respective executive officers, (C) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (E) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a director, officer or employee of the Company or any of its Subsidiaries in his or her capacity as a director, officer or employee of the Company or any of its Subsidiaries;
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease convey or otherwise dispose of any of the material properties or assets of the Company and its Subsidiaries;
(ixother than Intellectual Property) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments other than in the aggregate;
ordinary course of business, or (xiiy) enter intosell, modify assign, transfer, abandon, or terminate let lapse any labor or collective bargaining agreement of material Intellectual Property owned by the Company or any of and its Subsidiaries or, through negotiation (except in accordance with its statutory term or otherwise, make any commitment or incur any liability to any labor organization with respect to within the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate reasonable business judgment of the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its Subsidiaries);
(xvv) change its present accounting methods or principles, except as required by GAAP or by the Company’s auditors;
(vi) (A) make or change any material Tax election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any annual Tax accounting method, file any amended Tax Return, enter into any closing agreement period or method of accounting (other than in the ordinary course of business or routine elections with respect to TaxesTax Returns), settle any Tax claim or assessment or surrender any right to claim a refund of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective Time;
(xviB) enter into any “closing agreement” as described in Section 7121 of the Code (or any similar agreement under state, local or non-U.S. Law) with a Taxing Authority, (C) file any amended income or other material Tax Return, (D) waive or extend any statute of limitations relating to any income or other material Tax or Tax Return, (E) enter into any voluntary disclosure agreement or program with any Taxing Authority, or (F) settle or compromise (other than in the ordinary course of business) any material Tax claim, audit or assessment;
(vii) enter into or adopt a plan of complete or partial liquidation or dissolution;
(viii) purchase or otherwise acquire any real property or, except in the ordinary course of business, enter into, or amend or modify, and Lease;
(ix) except in the ordinary course of business, enter into, terminate (other than expirations in accordance with the terms thereof), materially amend or modify (in a manner adverse to the Group Companies) any Company Material Contract;
(x) provide a loan or advance to any Person, other than advances to employees for business expenses to be incurred in the ordinary course of business or transactions with customers on credit in the ordinary course of business;
(xi) (A) incur any indebtedness for borrowed money or issue any securities evidencing indebtedness, other than (1) Indebtedness between the Company and its wholly owned Subsidiaries, (2) Indebtedness that will be repaid, redeemed or satisfied and discharged at or prior to the Closing, (3) letters of credit issued in the ordinary course of business, or (B) make any capital contributions to, or equity investments in, any Person (other than any investments between the Company and its Subsidiaries);
(xii) initiate, settle or compromise any Legal Proceeding above $1,000,000;
(xiii) enter into any contract, understanding or commitment that contains any restrictive covenant binding the Company or its Subsidiaries or otherwise restrains, restricts, limits or impedes the ability of the Company or any Subsidiary its Subsidiaries to compete with or conduct any business or line of business in any geographic area or enter into, modify, amend or terminate solicit the employment of any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse EffectPersons;
(xviixiv) terminate, amend, restate, supplement enter into or waive agree to enter into any rights under merger or consolidation with any Material ContractPerson, or Permit acquire the securities of any other Person, except, in each case, for transactions involving only the Company and/or any of its Subsidiaries; or
(xv) authorize or enter into any agreement in furtherance of the foregoing.
(c) Notwithstanding anything contained in this Agreement to the contrary (including Section 7.3(b)), the Company and its Subsidiaries shall be permitted to (i) (A) pay or distribute as a dividend all Cash and Cash Equivalents of the Company and its Subsidiaries to the Equityholders and/or (B) (1) enter into arrangements that would, to the extent not paid or satisfied as of the Measurement Time, constitute Transaction Expenses, or (2) repay or satisfy Company Debt or pay Transaction Expenses of the Company and its Subsidiaries, in all cases, prior to the Measurement Time; and (ii) take any Cybersecurity Measures.
(d) Nothing contained in this Agreement shall give Purchaser, directly or indirectly, rights to control or direct the operations of the Company or its Subsidiaries before the Closing Date. Before the Closing Date, the Company shall, consistent with the terms and conditions of this Agreement, exercise complete control and supervision over the operations of the Company and its Subsidiaries. If the Company desires to take an action which would be prohibited pursuant to this Section 7.3 without the written consent of Purchaser, prior to taking such action the Company may request such written consent by sending an e-mail to all of the individuals set forth on Annex 1. Any of the individuals set forth on Annex 1 may grant consent on behalf of Purchaser to the taking of any action that would reasonably otherwise be expected prohibited pursuant to have a Material Adverse Effect;
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.27.3 by e-mail or such other notice that complies with the provisions of Section 13.16.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except Prior to the Closing, except (i) as set forth on Schedule 7.2(a), (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement or (iv) with the prior written consent of ParentParent (which consent shall not be unreasonably withheld, during the period from the date of this Agreement to the Effective Timedelayed or conditioned), the Company shall, and shall cause its Subsidiaries to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;, including with respect to capital expenditures, and not enter into a new line of business outside the Company’s and its Subsidiaries’ existing business segment; and
(ii) use its commercially reasonable efforts to (A) preserve its the present business operations, organization and goodwill of the Company and its Subsidiaries and Subsidiaries, (B) preserve its the present relationship relationships with Persons having material business dealings with the Company customers and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties suppliers of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (BC) insurance upon all keep available the services of the properties and assets current executive officers of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except Prior to the Closing, except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly provided in contemplated by this Agreement or (iv) with the prior written consent of ParentParent (except with respect to Section 7.2(b)(x), during the period from the date of this Agreement to the Effective Timewhich consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not not, and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or repurchase, redeem or otherwise acquire acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, issue or sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of Common Options) or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or any of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to Parent;
(iii) effect any recapitalization, reclassification, stock split reclassification or like change in the capitalization of the Company or any of its Subsidiaries, or adopt a plan of complete or partial liquidation, dissolution, restructuring or other reorganization;
(iv) amend the certificate of incorporation or by-laws bylaws or comparable organizational documents of the Company or any of its Subsidiaries;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in required by the Ordinary Course terms of Business with respect to employees other than officers any Company Benefit Plan as of the Companydate of this Agreement or by applicable Law, (A) increase the annual level of cash compensation of any employee of the Company or any of its Subsidiaries, (B) increase the annual level of compensation payable or to become payable by the Company or any of its Subsidiaries paid to any of their respective executive officersdirector, (C) grant any unusual officer, employee or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, (D) increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives consultant of the Company or any of its Subsidiaries (except increases in salaries or otherwise modify wages and commission and bonus opportunities of non-officer employees in the Ordinary Course of Business), (B) grant or accelerate the vesting or payment of any equity or equity-based compensation or severance to any director, executive officer, employee or consultant (other than severance consistent with any Company Benefit Plan as in effect on the date hereof), (C) adopt or amend any Company Benefit Plan (other than to provide severance consistent with any Company Benefit Plan or terminate any additional severance payments made outside of Company Benefit Plans so long as such plan or arrangement payments do not exceed $300,000 in the aggregate) or (ED) enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition consulting or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries is a party or involving a directorany employee, officer consultant or employee director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in his existence as of the date of this Agreement (provided, however, that the Company and its Subsidiaries may enter into or her capacity as a directoramend employment and consulting arrangements with officers, officer or employee employees and consultants (other than the Chief Executive Officer of the Company and his direct reports) in connection with promotions and new hires or any engagements in the Ordinary Course of its SubsidiariesBusiness);
(vi) incur or assume any Indebtedness (other than Indebtedness set forth on Schedule 7.2(b)(vi));
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock of the Company or any of its Subsidiaries;
(viii) acquire any material properties or assets or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business)license, transfer, convey, lease abandon or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except acquisitions of inventory, equipment and supplies and capital expenditures in the Ordinary Course of Business or sales and non-exclusive licenses of products and services in the Ordinary Course of Business or the disposal of obsolete or worthless assets);
(vii) make any loan, advance or capital contribution to or investment in any Person (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company and (B) routine advances to employees for business expenses in the Ordinary Course of Business in an amount not exceeding $25,000 to any individual employee, or $100,000 in the aggregate);
(viii) initiate, compromise or settle any Legal Proceeding (other than (A) in connection with the enforcement of the Company’s rights under this Agreement, (B) settlements that are individually less than $100,000, (C) for the collection of bills and the protection of Intellectual Property rights in the Ordinary Course of Business and (D) in such other circumstances where the Company in good faith determines that the failure to commence a Legal Proceeding would result in the material impairment of its Subsidiariesbusiness or the loss of a material right);
(ix) except as set forth on Schedule 7.2(b)(ix)enter into, materially modify or terminate any labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any material Liability to any labor organizations;
(x) enter into or agree to enter into any merger or consolidation with, with any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities or any division, business or all or substantially all of the assets of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries except in the Ordinary Course of Business;
(xi) amend, modify, extend, renew or terminate any Real Property Lease (other than renewals of any Real Property Lease entered into in good faith and on market terms, with the exception of the Real Property Lease for the Company’s headquarters), and shall not enter into any commitment new lease, sublease, license or other agreement for capital expenditures the use or occupancy of the Company any real property requiring rental and its Subsidiaries other payments in excess of $20,000 for any individual commitment and $100,000 for all commitments in 25,000 annually as averaged over the aggregateterm thereof;
(xii) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or any of its Subsidiaries;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or to enter into, modify or renew any Contract which would be a Material Contract if entered into prior to the date hereof or that would reasonably be expected to have a Material Adverse Effect;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts), or enter into or materially modify any Contract with any Affiliate of the Company or (other than a Subsidiary), other than any Contract entered into in the Ordinary Course of its Subsidiaries, or Business on arm’s length terms with any director, officer or employee portfolio company of a stockholder of the Company or of an Affiliate of any of its Subsidiariessuch stockholder;
(xvxiii) make implement any employee layoffs implicating the WARN Act;
(xiv) except to the extent required by Law, make, change or rescind any election relating to material Taxes, change any method of Tax accounting in respect of material election concerning Taxes or Tax Returns, change an annual accounting period, adopt or change any accounting methodTaxes, file any amended Tax ReturnReturn in respect of material Taxes, or settle or compromise any claim, investigation, audit or controversy relating to a material amount of Taxes, enter into any closing agreement with respect to Taxes, settle any material Tax claim or assessment or surrender any right to claim a refund of Taxes material Tax refund;
(xv) except to the extent required by Law or obtain or enter into GAAP, make any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required material change to be paid by the Company or any of its Subsidiaries after the Effective Timemethods of accounting or methods of reporting revenue and expenses or accounting practices;
(xvi) enter into any Contractjoint venture or similar agreement;
(xvii) (A) incur any Indebtedness (other than borrowings in the Ordinary Course of Business under the Company’s existing revolving credit facility), understanding (B) incur any letter of credit, performance bond, cash collateral or commitment that restrains, restricts, limits escrow requirement or impedes similar credit support other than in the ability Ordinary Course of Business or (C) grant any Lien (other than Permitted Liens) on any asset or properties (whether tangible or intangible) of the Company or any Subsidiary to compete of its Subsidiaries (other than purchase money security interests in connection with or conduct any business or line the acquisition of business equipment in any geographic area or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effectthe Ordinary Course of Business);
(xviii) fail to promptly pay make any individual capital expenditure in excess of $100,000 that is not included in the budget of the Company and discharge current liabilities expect where disputed its Subsidiaries as in good faith by appropriate proceedings, or accelerate effect on the collection date of any accounts receivablethis Agreement; andor
(xix) agree or commit to do anything prohibited by this Section 7.27.2(b). Parent acknowledges and agrees that: (a) nothing contained in this Agreement shall give Parent, directly or indirectly, the right to control or direct the operations of Company or Company Subsidiaries prior to the Effective Time, (b) prior to the Effective Time, Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations, and (c) notwithstanding anything to the contrary set forth in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.2 or elsewhere in this Agreement to the extent the requirement of such consent would, upon advice of Company’s counsel, violate any Law.
(c) Each of Parent and Merger Sub agrees that, between the date of this Agreement and the Effective Time, it shall not, directly or indirectly, engage in any business activities or incur any liabilities or obligations other than (i) as expressly contemplated by this Agreement, the Epicor Merger Agreement, the Commitment Letters and the equity commitment letters issued to Epicor in connection with the Epicor Merger Agreement, or (ii) for purposes of consummating the transactions contemplated hereby and thereby.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) Except as otherwise expressly contemplated by this Agreement (including under Section 7.2(b) below), or with the prior written consent of the Purchaser, between the date hereof and the Closing Date, the Sellers and Parent shall, and shall cause the Company and OTI to, conduct the respective businesses of the Company and OTI only in the ordinary course consistent with past practice and use their commercially reasonable efforts to preserve its present business operations, organization (including management and the sales force) and goodwill and act in a manner consistent with the business plan of the Company and OTI previously provided to the Purchaser, including the product qualification schedule contemplated by such business plan. Any new employees hired after the date hereof by the Company or OTI will be recommended for hire by management of the Company or OTI and the Sellers agree to consult with Purchaser regarding significant hiring decisions; provided, however, that all hiring decisions will be made by the Company or OTI.
(b) Except as set forth in Section 7.2(b) of the Disclosure Schedule, as provided for in the business plan referred to in Section 7.2(a) hereof, or as otherwise expressly contemplated by this Agreement or with the prior written consent of Parentthe Purchaser (which consent will not be unreasonably withheld), during the period from between the date of this Agreement to hereof and the Effective TimeClosing Date, the Company shallSellers and the Parent shall not, and shall cause its Subsidiaries the Company and OTI not to:
(i) conduct the respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;
(ii) use its commercially reasonable efforts to (A) preserve its present business operations, organization and goodwill of the Company and its Subsidiaries and (B) preserve its present relationship with Persons having material business dealings with the Company and its Subsidiaries;
(iii) use its commercially reasonable efforts to maintain (A) all material assets and properties of the Company and its Subsidiaries in their current condition, ordinary wear and tear excepted and (B) insurance upon all of the properties and assets of the Company and its Subsidiaries in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(iv) give all required notices of the transactions contemplated by this Agreement and use its reasonable best efforts to obtain all third party consents material to the Company’s business that are necessary or advisable in order to consummate the transactions contemplated by this Agreement; and
(v) not take any action which would reasonably be expected to adversely affect the ability of the parties to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise expressly provided in this Agreement or with the prior written consent of Parent, during the period from the date of this Agreement to the Effective Time, the Company shall not and shall not permit its Subsidiaries to:
(i) except as set forth on Schedule 7.2(b)(i), declare, set aside, make or pay any dividend or other distribution (whether in cash, stock or property) in respect of the capital stock of the Company or OTI or repurchase, redeem or otherwise acquire any outstanding shares of the capital stock or other securities of, or other ownership interests in, the Company or any of its Subsidiaries, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock OptionsOTI;
(ii) except as set forth on Schedule 7.2(b)(ii), transfer, issue, sell or dispose of any shares of capital stock or other securities of the Company or any of its Subsidiaries OTI or grant options, warrants, calls or other rights to purchase or otherwise acquire shares of the capital stock or other securities of the Company or OTI, other than the conversion of any Series A Preferred Stock into common stock of its Subsidiaries, except pursuant to obligations existing on the date of this Agreement and previously disclosed to ParentCompany;
(iii) effect any recapitalization, reclassification, stock split or like change in the capitalization of the Company or any of its SubsidiariesOTI;
(iv) amend the certificate Certificate of incorporation Incorporation, the By-Laws or by-laws of the Company or any of its SubsidiariesOTI Organizational Documents;
(v) except as set forth on Schedule 7.2(b)(v) or otherwise in the Ordinary Course of Business with respect to employees other than officers of the Company, (A) materially increase the annual level of compensation of any employee of the Company or any of its SubsidiariesOTI, (B) increase the annual level of compensation payable or to become payable by the grant at Company or any of its Subsidiaries to any of their respective executive officers, (C) grant OTI cost any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee, director or consultant, other than in the ordinary course, (DC) materially increase the coverage or benefits available under any (or create any new) severance pay, termination pay, vacation pay, company awards, salary continuation for disability, sick leave, deferred compensation, bonus or other incentive compensation, insurance, pension or other employee benefit plan or arrangement made to, for, or with any of the directors, officers, employees, agents or representatives of the Company or any of its Subsidiaries OTI or otherwise modify or amend or terminate any such plan or arrangement arrangement, or (ED) other than those agreements entered into or contemplated in Section 4.21, enter into any collective bargaining, employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or any of its Subsidiaries OTI is a party or involving a director, officer or employee of the Company or any of its Subsidiaries OTI in his or her capacity as a director, officer or employee of the Company or any of its SubsidiariesOTI;
(vi) incur except for trade payables and intercompany investments incurred in the ordinary course of business, borrow monies (from Affiliates or assume third parties) for which the Company or OTI becomes liable to repay for any Indebtedness reason or draw down on any line of credit or debt obligation, or become the guarantor, surety, endorser or otherwise liable for any debt, obligation or liability (contingent or otherwise) of any other than Indebtedness set forth on Schedule 7.2(b)(vi))Person;
(vii) subject to any Lien or otherwise encumber or, except for Permitted Exceptions, permit, allow or suffer to be encumbered, any of the properties or assets (whether tangible or intangible), or any shares of capital stock ) of the Company or any of its SubsidiariesOTI;
(viii) acquire any material properties or assets (other than acquisitions of supplies in the ordinary course of business) or sell, assign, license (other than non-exclusive licenses received from or granted to customers and Technology Partners in the Ordinary Course of Business), transfer, convey, lease or otherwise dispose of any of the material properties or assets (except for the sale of Company or OTI produced Components or Devices for fair consideration in the ordinary course of business) of the Company and its SubsidiariesOTI;
(ix) except as set forth on Schedule 7.2(b)(ix), enter into or agree to enter into any merger or consolidation with, any corporation or other entity, and not invest in, make a loan, material advance or capital contribution to, or otherwise acquire the securities of any other Person, except in connection with the exercise of repurchase rights or rights of first refusal in favor of the Company with respect to shares issued upon exercise of Company Stock Options;
(x) cancel or compromise any material debt or claim or waive or release any material right of the Company or any of its Subsidiaries OTI except in the Ordinary Course ordinary course of Businessbusiness;
(xix) enter into any commitment for capital expenditures of the Company and its Subsidiaries in excess of $20,000 for any individual commitment and $100,000 for all commitments in or OTI that will not be satisfied on or before the aggregateClosing Date;
(xiixi) enter into, modify or terminate any labor or collective bargaining agreement of the Company or any of its Subsidiaries OTI or, through negotiation or otherwise, make any commitment or incur any liability to any labor organization with respect to the Company or OTI;
(xii) introduce any material change with respect to the operation of the Company or OTI, including any material change in the types, nature, composition or quality of its Subsidiariesproducts or services, experience any material change in any contribution of its product lines to its revenues or net income;
(xiii) except as set forth on Schedule 7.2(b)(xiv), permit the Company or any of its Subsidiaries to enter into any transaction or OTI to enter into, modify or renew agree to enter into, any Contract which would be a Material Contract if entered into prior to the date hereof merger or that would reasonably be expected to have a Material Adverse Effectconsolidation with any corporation or other entity;
(xiv) except for transfers of cash pursuant to normal cash management practices in the Ordinary Course of Business, permit the Company or any of its Subsidiaries OTI to make any investments in or loans to, or pay any fees or expenses to (other than pursuant to existing Contracts)to, or enter into or materially modify any Contract with with, either Seller or any Affiliate of either Seller (other than payments obligating accrual prior to the Company or any of its Subsidiaries, or any director, officer or employee of the Company or any of its SubsidiariesClosing Date);
(xv) make sell, transfer or change dispose of, or grant, modify, waive or terminate any material election concerning Taxes license agreement, development agreement or Tax Returns, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing other agreement with respect to Taxes, settle any Tax claim or assessment or surrender any right to claim a refund Intellectual Property of Taxes or obtain or enter into any Tax ruling, in each case, if taking such action would materially affect the amount of Taxes required to be paid by the Company or any of its Subsidiaries after the Effective TimeOTI;
(xvi) revalue any assets of the Company or OTI;
(xvii) enter into any Contract, understanding Permit or commitment Order that restrains, restricts, limits would have the effect of materially impairing or impedes the ability of prohibiting the Company or OTI from engaging in any Subsidiary to compete with or conduct any business or line of business in any geographic area conducted as of the date hereof by the Company or enter into, modify, amend or terminate any Contract which if so entered into, modified, amended or terminated would be reasonably be expected to have a Material Adverse Effect;
(xvii) terminate, amend, restate, supplement or waive any rights under any Material Contract, or Permit that would reasonably be expected to have a Material Adverse Effect;OTI; or
(xviii) fail to promptly pay and discharge current liabilities expect where disputed in good faith by appropriate proceedings, negotiate or accelerate the collection of any accounts receivable; and
(xix) agree to do anything prohibited by this Section 7.2any of the things described in the preceding clauses (i) through (xvii) (other than as expressly contemplated hereby).
Appears in 1 contract
