Conduct of the Business Pending the Closing. (a) From the date hereof and until the Closing (the “Pre-Closing Period”), except (A) as set forth on Schedule 7.2(a), (B) as required by applicable Law, including any Applicable Competition Laws, (C) as otherwise expressly contemplated by this Agreement (including as set forth on Schedule 7.21), (D) as the Acquired Company reasonably determines to be necessary or appropriate to address the COVID-19 pandemic (provided that Seller gives reasonable advance notice of such action to Purchaser and that, subject to requirements imposed by Law applicable for a particular business location, such action is taken in a manner consistent with policies and procedures applicable to all similarly situated businesses of Seller Parent and its Subsidiaries), (E) with the prior written consent of Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned): (i) Seller shall, and shall cause the Acquired Company and if applicable with respect to the Business, its Affiliates, to: (A) conduct the Business only in the Ordinary Course of Business; (B) use their respective commercially reasonable efforts to preserve their current operations, organization and goodwill, including their Intellectual Property and current relationships with customers, suppliers and key employees, in each case, to the extent related to the Business (it being understood that such efforts will not include any requirement or obligation to pay any consideration not otherwise required to be paid by the terms of an existing Contract or to offer or grant any financial accommodation or other benefit not otherwise required to be made by the terms of an existing Contract); and (C) use their commercially reasonable efforts to implement the capital projects listed on Schedule 7.2(a)(i)(C) substantially in accordance with the quarterly capital expenditure forecast set forth on such Schedule 7.2(a)(i)(C), subject to such changes and delays that ordinarily arise in connection with projects of such nature; and (ii) Seller shall not, and shall cause the Acquired Company and, if applicable with respect to the Business, its Affiliates not to: (A) declare, set aside, make or ay any dividend or other distribution (including any constructive dividend) in respect of the Acquired Company Equity Interests or repurchase, redeem or otherwise acquire any outstanding Equity Securities in the Acquired Company (other than cash dividends or distributions declared and paid prior to 11:59 pm ET prior to the Closing Date; (B) issue or sell any Equity Securities of the Acquired Company or grant options, warrants, calls or other rights to purchase or otherwise acquire any Equity Securities of the Acquired Company; (C) effect any recapitalization, reclassification or like change in the capitalization of the Acquired Company; (D) amend the Organizational Documents of the Acquired Company; (E) solely with respect to the Acquired Company: (I) make any change (or file any such change) in any method of Tax accounting, (II) make, change or rescind any Tax election; (III) settle or compromise any Tax liability or consent to any claim or assessment relating to Taxes; (IV) file any amended Tax Return or claim for refund; (V) enter into any closing or similar agreement with a Tax Authority; or (VI) waive or extend the statute of limitations in respect of Taxes, but in each case, if such action relates to a Tax group which includes the Acquired Company, then the Acquired Company shall be restricted only to the extent reasonably expected to increase the Tax Liability of Purchaser or its Affiliates (including the Acquired Company and any Purchaser Designated Subsidiaries) for a taxable period (or portion thereof) that begins after the Closing Date; (F) (I) increase the annual level of compensation of any employee of the Business other than in the Ordinary Course of Business, (II) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee of the Business, (III) materially increase the coverage or benefits available under any (or create any new) Benefit Plan, (IV) enter into any agreements or commitments (or amend any such agreements or commitments) of the type that provide for special benefits or incentives in case of a change-of-control of the Acquired Company or the Business or impose limitations on Seller’s or any of its Affiliate’s ability to terminate Business Employees, including by providing for severance payments, or (V) other than in the Ordinary Course of Business, enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Acquired Company is a party or, other than as contemplated in Section 7.12(a), transfer any employee from a different business unit into the Business, except, in each case, as required by applicable Law or the terms of any Benefit Plan; (G) (I) other than as may be necessary to fill vacant positions in the Ordinary Course of Business, hire or offer to hire any new employee of the Business or the Acquired Company, (II) other than for cause, terminate the employment of any Business Employee, or (III) institute any general layoff of employees or implement any early retirement plan of the Business or the Acquired Company or announce the planning of any such action; (H) subject any of the properties or assets (whether tangible or intangible) of the Business to any Lien, except for Permitted Exceptions; (I) (I) other than in the Ordinary Course of Business, acquire any properties or assets or sell, assign, license, transfer, convey, encumber, lease, abandon, cancel, allow to lapse or otherwise dispose of any of the properties or assets of the Business or, (II) acquire any ownership interest in real property; (J) other than in the Ordinary Course of Business, cancel or compromise any material claim or right of the Business; (K) enter into any commitment for capital expenditures of the Business or the Acquired Company in excess of $1,000,000 (the “CapEx Threshold”) for all commitments in the aggregate, other than (I) reasonable capital expenditures in connection with any emergency or force majeure events affecting the Business or the Acquired Company or (II) capital expenditures otherwise listed on Schedule 7.2(a)(i)(C) or Schedule 7.2(a)(ii)(K); provided that the CapEx Threshold shall be $2,000,000 in the event Closing has not occurred within six (6) months of the date of this Agreement; (L) (I) modify or terminate the Ground Lease, (II) other than in the Ordinary Course of Business, modify or terminate any Personal Property Lease or Material Contract or (III) other than in the Ordinary Course of Business, enter into, modify or terminate any Contract that if in effect on the date of this Agreement would have been required to be listed on Schedule 5.10(a), Schedule 5.11(b) or Schedule 5.13(a); (M) permit the Acquired Company to enter into or agree to enter into any merger, consolidation, joint venture or similar business combination transaction with any Person, or acquire the Equity Securities of any other Person; (N) permit the creation of any new Business Guarantee; or (O) agree to do anything prohibited by this Section 7.2(a)(ii). (b) Nothing contained in this Section 7.2 or elsewhere in this Agreement is intended to give Purchaser, directly or indirectly, the right to control or direct the Business or any portion thereof prior to the Closing. Prior to the Closing, the Acquired Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over the Business.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) From Prior to the date hereof and until the Closing (the “Pre-Closing Period”)Closing, except (Ai) as set forth on Schedule 7.2(a)8.2, (Bii) as required by applicable Law, including any Applicable Competition Laws, (Ciii) as otherwise expressly contemplated by this Agreement or (including as set forth on Schedule 7.21), (D) as the Acquired Company reasonably determines to be necessary or appropriate to address the COVID-19 pandemic (provided that Seller gives reasonable advance notice of such action to Purchaser and that, subject to requirements imposed by Law applicable for a particular business location, such action is taken in a manner consistent with policies and procedures applicable to all similarly situated businesses of Seller Parent and its Subsidiaries), (Eiv) with the prior written consent of Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned):), Parent, Seller and the Company shall:
(i) Seller shall, and shall cause the Acquired Company and if applicable with respect the Subsidiaries to the Business, its Affiliates, to:
(A) conduct the Business their business only in the Ordinary Course of Business;
(Bii) use their respective its commercially reasonable efforts to (A) preserve their current the present business operations, organization and goodwill, including their Intellectual Property goodwill of the Company and current the Subsidiaries and (B) preserve the present relationships with customerscustomers and suppliers of the Company and the Subsidiaries;
(iii) confer on a regular basis with one or more designated representatives of Purchaser to report material operational matters and to report the general status of ongoing operations;
(iv) cause the Company and the Subsidiaries to conduct their working capital and cash management practices, suppliers the collection of accounts receivable, the payment of accounts payable (including the writing and key employees, mailing of checks with respect thereto) and the maintenance of inventories in each case, to the extent related to the Business (it being understood that such efforts will not include any requirement or obligation to pay any consideration not otherwise required to be paid by the terms Ordinary Course of an existing Contract or to offer or grant any financial accommodation or other benefit not otherwise required to be made by the terms of an existing Contract)Business; and
(Cv) use their commercially reasonable efforts cause the Company and the Subsidiaries to implement pay, prior to the capital projects listed Closing Date, all Rebates due and payable on Schedule 7.2(a)(i)(Cor prior to the Closing Date.
(b) substantially in accordance with the quarterly capital expenditure forecast Except (i) as set forth on such Schedule 7.2(a)(i)(C)8.2, subject to such changes and delays that ordinarily arise in connection with projects of such nature; and
(ii) as required by applicable Law, (iii) as otherwise contemplated by this Agreement or (iv) with the prior written consent of Purchaser, Seller and the Company shall not, and shall cause the Acquired Company and, if applicable with respect to and the Business, its Affiliates Subsidiaries not to:
(Ai) declare, pay or set aside, make or ay aside any dividend or other make any distribution (including whether in cash, stock or property or any constructive dividendcombination thereof) in with respect of the Acquired Company Equity Interests to, or repurchase, redeem or otherwise acquire acquire, any outstanding Equity Securities in equity interests or other securities of the Acquired Company or the Subsidiaries; provided, that Purchaser acknowledges and agrees that Parent and its Affiliates (other than the Company and the Subsidiaries) shall be permitted to continue daily cash dividends or distributions declared and paid prior to 11:59 pm ET prior sweeps effected in the Ordinary Course of Business to the Closing Dateextent that such sweeps do not prevent the satisfaction of the condition set forth in Section 9.1(k);
(ii) transfer, issue, sell or dispose of any equity interests of the Company or the Subsidiaries or grant options, warrants, calls or other rights to purchase or otherwise acquire equity interests or other securities of the Company or the Subsidiaries;
(iii) effect any recapitalization, reclassification or like change in the capitalization of the Company or the Subsidiaries;
(iv) amend the organizational documents of the Company or the Subsidiaries;
(v) (A) increase the annual level of compensation payable or to become payable by the Company or the Subsidiaries to any of their respective directors, executive officers or employees, (B) issue grant any bonus, benefit or sell other direct or indirect compensation to any Equity Securities director, executive officer or employee, (C) 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 Acquired directors, executive officers or employees of the Company or the Subsidiaries or otherwise modify or amend or terminate any such plan or arrangement or (D) enter into any employment, deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Company or the Subsidiaries are a party and involving a director, executive officer or employee of the Company or the Subsidiaries, except, in each case, as required by applicable Law from time to time in effect or by the terms of any Employee Benefit Plans or Employee Pension Plans or with respect to employees who are not directors or executive officers or senior management, in the Ordinary Course of Business consistent with past practice;
(vi) subject to any Lien any of the properties or assets (whether tangible or intangible, and including the Owned Properties and the properties subject to a Real Property Lease) of the Company or the Subsidiaries, except for Permitted Exceptions;
(vii) sell, lease, license, transfer or otherwise dispose of any properties or assets which, individually, has a book value in excess of One Million Dollars ($1,000,000), or will result in receipt of gross proceeds in excess of One Million Dollars ($1,000,000), except for sales or other dispositions of inventory and obsolete assets in the Ordinary Course of Business;
(viii) make any material change in any method of accounting or accounting practice, other than in accordance with GAAP or as required by applicable Law;
(ix) cancel, amend or allow to terminate any insurance policy currently maintained by the Company or any Subsidiary, except to the extent that any of Parent’s insurance policies expire by their terms and are renewed or replaced with an insurance policy with substantially similar terms;
(x) other than intercompany debt, incur any indebtedness for borrowed money, guarantee any such indebtedness of another Person or issue any debt securities or grant options, warrants, calls or other rights to purchase or otherwise acquire any Equity Securities debt securities of the Acquired CompanyCompany or the Subsidiaries;
(Cxi) effect any recapitalization, reclassification or like change in the capitalization of the Acquired Company;
(D) amend the Organizational Documents of the Acquired Company;
(E) solely with respect to the Acquired Company: (I) make any change (or file any such change) in any method of Tax accounting, (II) make, change or rescind any Tax election; (III) settle or compromise any Tax liability or consent to any claim or assessment relating to Taxes; (IV) file any amended Tax Return or claim for refund; (V) enter into any closing or similar agreement with a Tax Authority; or (VI) waive or extend the statute of limitations in respect of Taxes, but in each case, if such action relates to a Tax group which includes the Acquired Company, then the Acquired Company shall be restricted only to the extent reasonably expected to increase the Tax Liability of Purchaser or its Affiliates (including the Acquired Company and any Purchaser Designated Subsidiaries) for a taxable period (or portion thereof) that begins after the Closing Date;
(F) (I) increase the annual level of compensation of any employee of the Business other than in the Ordinary Course of Business, (II) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee of the Business, (III) materially increase the coverage or benefits available under any (or create any new) Benefit Plan, (IV) enter into any agreements or commitments (or amend any such agreements or commitments) of the type that provide for special benefits or incentives in case of a change-of-control of the Acquired Company or the Business or impose limitations on Seller’s or any of its Affiliate’s ability to terminate Business Employees, including by providing for severance payments, or (V) other than in the Ordinary Course of Business, enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Acquired Company is a party or, other than as contemplated in Section 7.12(a), transfer any employee from a different business unit into the Business, except, in each case, as required by applicable Law or the terms of any Benefit Plan;
(G) (I) other than as may be necessary to fill vacant positions in the Ordinary Course of Business, hire or offer to hire any new employee of the Business or the Acquired Company, (II) other than for cause, terminate the employment of any Business Employee, or (III) institute any general layoff of employees or implement any early retirement plan of the Business or the Acquired Company or announce the planning of any such action;
(H) subject any of the properties or assets (whether tangible or intangible) of the Business to any Lien, except for Permitted Exceptions;
(I) (I) other than in the Ordinary Course of Business, acquire any properties or assets or sell, assign, license, transfer, convey, encumber, lease, abandon, cancel, allow to lapse or otherwise dispose of any of the properties or assets of the Business or, (II) acquire any ownership interest in real property;
(J) 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 BusinessCompany and the Subsidiaries;
(Kxii) enter into any commitment for capital expenditures labor or collective bargaining agreement of the Business Company or the Acquired Company in excess of $1,000,000 (the “CapEx Threshold”) for all commitments in the aggregateSubsidiaries or, other than (I) reasonable capital expenditures in connection with through negotiations or otherwise, make any emergency commitment or force majeure events affecting the Business or the Acquired Company or (II) capital expenditures otherwise listed on Schedule 7.2(a)(i)(C) or Schedule 7.2(a)(ii)(K); provided that the CapEx Threshold shall be $2,000,000 in the event Closing has not occurred within six (6) months of the date of this Agreementincur any liability to any labor organizations;
(L) (I) modify or terminate the Ground Lease, (II) other than in the Ordinary Course of Business, modify or terminate any Personal Property Lease or Material Contract or (III) other than in the Ordinary Course of Business, enter into, modify or terminate any Contract that if in effect on the date of this Agreement would have been required to be listed on Schedule 5.10(a), Schedule 5.11(b) or Schedule 5.13(a);
(Mxiii) permit the Acquired Company or the Subsidiaries to enter into or agree to enter into any merger, consolidation, joint venture merger or similar business combination transaction consolidation with any Personcorporation or other entity, or acquire the Equity Securities securities or assets of any other Person;
(Nxiv) permit the creation Company or the Subsidiaries to enter into, amend, terminate or modify any Material Contract;
(xv) propose or consent to any change to the pricing of any new Business Guaranteeproducts sold by the Company or any of the Subsidiaries, or offer any discounts or Rebates to any customers of the Company or any of the Subsidiaries, except any such changes that would result in a decrease of no more than 5% of the annual revenue attributable to any such customer on an individual basis;
(xvi) (A) make, amend or change any material Tax election; (B) make a request for a tax ruling or enter into a closing agreement; (C) settle or compromise any material Tax liability or material Tax claims; or (D) surrender any right to claim a material amount of refund of any Taxes; or
(Oxvii) agree enter into any Contract or letter of intent to do anything prohibited by this Section 7.2(a)(ii)8.2.
(b) Nothing contained in this Section 7.2 or elsewhere in this Agreement is intended to give Purchaser, directly or indirectly, the right to control or direct the Business or any portion thereof prior to the Closing. Prior to the Closing, the Acquired Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over the Business.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) From Prior to the date hereof and until the Closing (the “Pre-Closing Period”)Closing, except (Ai) as set forth on Schedule 7.2(a), (Bii) as required by applicable Law, including any Applicable Competition Laws, (Ciii) as otherwise expressly contemplated by this Agreement or (including as set forth on Schedule 7.21), (D) as the Acquired Company reasonably determines to be necessary or appropriate to address the COVID-19 pandemic (provided that Seller gives reasonable advance notice of such action to Purchaser and that, subject to requirements imposed by Law applicable for a particular business location, such action is taken in a manner consistent with policies and procedures applicable to all similarly situated businesses of Seller Parent and its Subsidiaries), (Eiv) with the prior written consent of Purchaser Parent (which consent shall not be unreasonably withheld, delayed or conditioned):
(i) Seller ), the Company shall, and shall cause the Acquired Company and if applicable with respect to the Business, its Affiliates, Subsidiaries to:
(Ai) conduct the Business respective businesses of the Company and its Subsidiaries only in the Ordinary Course of Business;
(B) use their respective commercially reasonable efforts to preserve their current operations, organization and goodwill, including their Intellectual Property and current relationships with customers, suppliers and key employees, in each case, to the extent related to the Business (it being understood that such efforts will not include any requirement or obligation to pay any consideration not otherwise required to be paid by the terms of an existing Contract or to offer or grant any financial accommodation or other benefit not otherwise required to be made by the terms of an existing Contract); and
(C) use their commercially reasonable efforts to implement the capital projects listed on Schedule 7.2(a)(i)(C) substantially in accordance with the quarterly capital expenditure forecast set forth on such Schedule 7.2(a)(i)(C), subject to such changes and delays that ordinarily arise in connection with projects of such nature; and
(ii) Seller use its commercially reasonable efforts to (A) preserve the present business operations, organization and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries, (C) maintain insurance coverage on such terms and in such amounts substantially as maintained on the date of this Agreement and (D) keep available the services of the current officers and key employees of the Company and its Subsidiaries.
(b) Except (i) as set forth on Schedule 7.2(b), (ii) as required by applicable Law, (iii) as otherwise expressly contemplated by this Agreement or (iv) with the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall cause the Acquired Company and, if applicable with respect to the Business, not permit its Affiliates not Subsidiaries to:
(Ai) declare, set aside, make or ay pay any dividend or other distribution (including any constructive dividend) in respect of the Acquired capital stock of the Company Equity Interests 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 Equity Securities in shares of the Acquired capital stock or other securities of, or other ownership interests in, the Company (other than cash dividends or distributions declared and paid prior to 11:59 pm ET prior to the Closing Dateany of its Subsidiaries;
(Bii) issue or sell any Equity Securities shares of capital stock or other securities of the Acquired Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise of any Option) or grant options, warrants, calls or other rights to purchase or otherwise acquire any Equity Securities shares of the Acquired Companycapital stock or other securities of the Company or any of its Subsidiaries;
(Ciii) effect any recapitalization, reclassification or like change in the capitalization of the Acquired CompanyCompany or any of its Subsidiaries;
(Div) amend the Organizational Documents certificate of incorporation or bylaws or comparable organizational documents of the Acquired CompanyCompany or any of its Subsidiaries;
(Ev) solely with respect to the Acquired Company: (I) make any change (or file any such change) except as set forth in any method of Tax accountingSchedule 7.2(b), (II) make, change or rescind any Tax election; (III) settle or compromise any Tax liability or consent to any claim or assessment relating to Taxes; (IV) file any amended Tax Return or claim for refund; (V) enter into any closing or similar agreement with a Tax Authority; or (VI) waive or extend the statute of limitations in respect of Taxes, but in each case, if such action relates to a Tax group which includes the Acquired Company, then the Acquired Company shall be restricted only to the extent reasonably expected to increase the Tax Liability of Purchaser or its Affiliates (including the Acquired Company and any Purchaser Designated Subsidiaries) for a taxable period (or portion thereof) that begins after the Closing Date;
(F) (IA) increase the annual level of compensation of any director, officer, employee or consultant of the Business other than Company or any of its Subsidiaries (except increases in salaries and wages of non-officer employees and consultants in the Ordinary Course of Business), (IIB) grant any unusual bonus, equity or extraordinary bonusequity-based compensation, severance, benefit or other direct or indirect compensation to any director, executive officer, employee of the Businessor consultant, (IIIC) 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 Company Benefit Plan or otherwise modify or amend or terminate any such Company Benefit Plan, (IVD) enter into any agreements or commitments (or amend any such agreements or commitments) of the type that provide for special benefits or incentives in case of a change-of-control of the Acquired Company or the Business or impose limitations on Seller’s or any of its Affiliate’s ability to terminate Business Employees, including by providing for severance payments, or (V) other than in the Ordinary Course of Business, enter into any employment, consulting deferred compensation, severance, consulting, non-competition or similar agreement (or amend any such agreement) to which the Acquired Company or any of its Subsidiaries is a party oror involving any employee, other than consultant or director of the Company or any of its Subsidiaries that would be a Company Benefit Plan if it were in existence as contemplated in Section 7.12(a)of the date of this Agreement, transfer or (E) hire or terminate any employee from a different business unit into executive officer or vice president of the BusinessCompany or any of its Subsidiaries, except, in each case, as required as of the date of this Agreement by applicable Law or the terms of any Company Benefit PlanPlans;
(Gvi) (I) other than as may be necessary to fill vacant positions in the Ordinary Course of Business, hire or offer to hire any new employee of the Business or the Acquired Company, (II) other than for cause, terminate the employment of any Business Employee, or (III) institute any general layoff of employees or implement any early retirement plan of the Business or the Acquired Company or announce the planning of any such action;
(H) subject any of the properties or assets (whether tangible or intangible) of the Business to any Lien, except for Permitted Exceptions;
(I) (I) other than in the Ordinary Course of Business, acquire any material properties or assets or sell, assign, license, transfer, convey, encumber, lease, abandon, cancel, allow to lapse lease or otherwise dispose of any of the material properties or assets of the Company or any of its Subsidiaries (except sales and non-exclusive licenses of products and sales in the Ordinary Course of Business or, (II) acquire any ownership interest in real propertyor the disposal of obsolete or worthless assets);
(Jvii) 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);
(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 BusinessCompany or any of its Subsidiaries or permit any such right to lapse;
(Kix) enter into initiate, compromise or settle (A) any commitment for capital expenditures Legal Proceeding (other than in connection with the enforcement of the Business or the Acquired Company in excess of $1,000,000 (the “CapEx Threshold”) for all commitments in the aggregateCompany's rights under this Agreement), other than non-material Legal Proceedings, or (IB) reasonable capital expenditures in connection with any emergency or force majeure events affecting material claim under any insurance policy for the Business or benefit of the Acquired Company or (II) capital expenditures otherwise listed on Schedule 7.2(a)(i)(C) or Schedule 7.2(a)(ii)(K); provided that the CapEx Threshold shall be $2,000,000 in the event Closing has not occurred within six (6) months any of the date of this Agreementits Subsidiaries;
(Lx) (I) modify or terminate the Ground Lease, (II) other than in the Ordinary Course of Business, modify or terminate any Personal Property Lease or Material Contract or (III) other than in the Ordinary Course of Business, enter into, modify or terminate any Contract that if in effect on the date of this Agreement would have been required labor or collective bargaining agreement or, through negotiations or otherwise, make any commitment or incur any Liability to be listed on Schedule 5.10(a), Schedule 5.11(b) or Schedule 5.13(a)any labor organizations;
(Mxi) permit the Acquired Company to enter into or agree to enter into any merger, consolidation, joint venture merger or similar business combination transaction consolidation with any Personcorporation or other entity, or acquire the Equity Securities securities or any division, business or all or substantially all of the assets of any other Person;
(Nxii) permit the creation enter into or modify any Contract with any Stockholder or any Affiliate of any Stockholder;
(xiii) except to the extent required by Law, make, change or rescind any election relating to Taxes, change any method of Tax accounting, file any amended Tax Return, or settle or compromise any claim, investigation, audit or controversy relating to an amount of Taxes, agree to an extension or waiver of the statute of limitations with respect to the assessment or determination of Taxes, enter into any closing agreement with respect to any Tax or surrender any right to claim a Tax refund;
(xiv) except to the extent required by Law or GAAP, make any material change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xv) grant any licenses under any Intellectual Property of the Company and its Subsidiaries (other than non-exclusive licenses granted in the Ordinary Course of Business);
(xvi) enter into any joint venture, general or limited partnership agreement, limited liability company agreement or other similar agreement or any material joint development agreement;
(xvii) enter into any new Contract that would be a Material Contract if entered into on or prior to the date hereof or, except as required by their terms, terminate or amend, or modify any Material Contract or any such new Contract;
(xviii) incur (A) any Indebtedness (other than borrowings in the Ordinary Course of Business Guaranteeunder the Company's existing revolving credit facility) or (B) any Lien (other than Permitted Exceptions) on any asset or properties (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the Ordinary Course of Business);
(xix) amend, extend, renew or permit to lapse existing insurance policies or enter into new insurance policies, except in either case on such terms and for such amounts as is consistent with past practice;
(xx) enter into any Contract with any Person which provides such Person rights or entitlements in connection with a change of control of the Company or any of its Subsidiaries; or
(Oxxi) agree or commit to do anything prohibited by this Section 7.2(a)(ii7.2(b).
(b) Nothing contained in this Section 7.2 or elsewhere in this Agreement is intended to give Purchaser, directly or indirectly, the right to control or direct the Business or any portion thereof prior to the Closing. Prior to the Closing, the Acquired Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over the Business.
Appears in 1 contract
Conduct of the Business Pending the Closing. (a) From Prior to the date hereof and until the Closing (the “Pre-Closing Period”)Effective Time, except (Ai) as set forth on Schedule 7.2(a8.2(a), (Bii) as required by applicable Law, including any Applicable Competition Laws, (Ciii) as otherwise expressly contemplated by this Agreement (including as set forth on Schedule 7.21including, for the avoidance of doubt, the Restructuring), (Div) as reasonably necessary to enable the Acquired Company reasonably determines to be necessary avoid or appropriate to address the COVID-19 pandemic mitigate a Data Compromise (provided that Seller gives reasonable advance the Company shall promptly provide notice to Buyer following any use of such action to Purchaser and that, subject to requirements imposed by Law applicable for a particular business location, such action is taken the exception set forth in a manner consistent with policies and procedures applicable to all similarly situated businesses of Seller Parent and its Subsidiariesthis clause (iv), ) or (Ev) with the prior written consent of Purchaser Buyer Corp (which consent shall not be unreasonably withheld, delayed or conditioned):
(i) Seller ), the Company shall, and shall cause the Acquired Company and if applicable with respect to the Business, its Affiliates, Subsidiaries to:
(Ai) conduct the Business only respective businesses of the Company and its Subsidiaries in all respects in the Ordinary Course ordinary course of Business;
(B) use their respective commercially reasonable efforts to preserve their current operations, organization and goodwill, including their Intellectual Property and current relationships business consistent with customers, suppliers and key employees, in each case, to the extent related to the Business (it being understood that such efforts will not include any requirement or obligation to pay any consideration not otherwise required to be paid by the terms of an existing Contract or to offer or grant any financial accommodation or other benefit not otherwise required to be made by the terms of an existing Contract); and
(C) use their commercially reasonable efforts to implement the capital projects listed on Schedule 7.2(a)(i)(C) substantially in accordance with the quarterly capital expenditure forecast set forth on such Schedule 7.2(a)(i)(C), subject to such changes and delays that ordinarily arise in connection with projects of such naturepast practice; and
(ii) Seller subject to the restrictions applicable to the Company as set forth in Section 8.2(b) below, use its commercially reasonable efforts to (A) preserve the present business operations, organization, assets, rights, properties and goodwill of the Company and its Subsidiaries, (B) preserve the present relationships with customers and suppliers of the Company and its Subsidiaries and (C) keep available the services of key personnel.
(b) Prior to the Effective Time, except (i) as set forth on Schedule 8.2(b), (ii) as required by applicable Law, (iii) as expressly contemplated by this Agreement (including, for the avoidance of doubt, the Restructuring), (iv) as reasonably necessary to enable the Company to avoid or mitigate a Data Compromise (provided that the Company shall promptly provide notice to Buyer following any use of the exception set forth in this clause (iv)) or (v) with the prior written consent of Buyer Corp (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall cause the Acquired Company and, if applicable with respect to the Business, not permit its Affiliates not Subsidiaries to:
(i) (A) effect any recapitalization, reclassification, restructuring or like change in the capitalization of the Company or any of its Subsidiaries; (B) declare, set aside, make aside or ay pay any dividend or other distribution of any kind with respect to its capital stock or other equity securities other than a dividend or distribution payable entirely in cash, (including any constructive dividendC) in respect of the Acquired Company Equity Interests or repurchaseredeem, redeem purchase or otherwise acquire acquire, directly or indirectly, any outstanding Equity Securities in the Acquired Company of its capital stock or other equity securities (other than cash dividends or distributions declared and paid prior (x) in connection with the withholding of Class C Units to 11:59 pm ET prior satisfy Tax obligations with respect to the Closing Date;
exercise of any Company Options or (By) issue repurchases from directors, employees or sell consultants in connection with the termination of their employment or service), or (D) issue, sell, split, combine, reclassify, encumber or dispose of any Equity Securities Units, shares of capital stock or other equity securities of the Acquired Company or any of its Subsidiaries (except for any issuance made pursuant to the exercise or vesting of any Company Options outstanding as of the date hereof) or grant options, warrants, calls or other rights to purchase or otherwise acquire any Equity Securities Units, shares of the Acquired Companycapital stock or other equity securities of the Company or any of its Subsidiaries;
(C) effect any recapitalization, reclassification or like change in the capitalization of the Acquired Company;
(Dii) amend the Organizational Documents of the Acquired CompanyCompany or its Subsidiaries;
(Eiii) solely with respect to the Acquired Company: (I) make any change (or file any such change) in any method of Tax accounting, (II) make, change or rescind any Tax election; (III) settle or compromise any Tax liability or consent to any claim or assessment relating to Taxes; (IV) file any amended Tax Return or claim for refund; (V) enter into any closing or similar agreement with a Tax Authority; or (VI) waive or extend the statute of limitations in respect of Taxes, but in each case, if such action relates to a Tax group which includes the Acquired Company, then the Acquired Company shall be restricted only to the extent reasonably expected to increase the Tax Liability of Purchaser or its Affiliates (including the Acquired Company and any Purchaser Designated Subsidiaries) for a taxable period (or portion thereof) that begins after the Closing Date;
(F) (I) increase the annual level of compensation of any employee of the Business other than in the Ordinary Course of Business, (II) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee of the Business, (III) materially increase the coverage or benefits available under any (or create any new) Benefit Plan, (IV) enter into any agreements or commitments (or amend any such agreements or commitments) of the type that provide for special benefits or incentives in case of a change-of-control of the Acquired Company or the Business or impose limitations on Seller’s or any of its Affiliate’s ability to terminate Business Employees, including by providing for severance payments, or (V) other than in the Ordinary Course of Business, enter into any employment, consulting or similar agreement (or amend any such agreement) to which the Acquired Company is a party or, other than as contemplated in Section 7.12(a), transfer any employee from a different business unit into the Business, except, in each case, except as required by applicable Law or the terms of any Company Benefit Plan;
(G) (I) other than Plan as may be necessary to fill vacant positions in the Ordinary Course of Business, hire or offer to hire any new employee of the Business or the Acquired Company, (II) other than for cause, terminate the employment of any Business Employee, or (III) institute any general layoff of employees or implement any early retirement plan of the Business or the Acquired Company or announce the planning of any such action;
(H) subject any of the properties or assets (whether tangible or intangible) of the Business to any Lien, except for Permitted Exceptions;
(I) (I) other than in the Ordinary Course of Business, acquire any properties or assets or sell, assign, license, transfer, convey, encumber, lease, abandon, cancel, allow to lapse or otherwise dispose of any of the properties or assets of the Business or, (II) acquire any ownership interest in real property;
(J) other than in the Ordinary Course of Business, cancel or compromise any material claim or right of the Business;
(K) enter into any commitment for capital expenditures of the Business or the Acquired Company in excess of $1,000,000 (the “CapEx Threshold”) for all commitments in the aggregate, other than (I) reasonable capital expenditures in connection with any emergency or force majeure events affecting the Business or the Acquired Company or (II) capital expenditures otherwise listed effect on Schedule 7.2(a)(i)(C) or Schedule 7.2(a)(ii)(K); provided that the CapEx Threshold shall be $2,000,000 in the event Closing has not occurred within six (6) months of the date of this Agreement;
, the terms of this Agreement or any applicable Law, (LA) increase the level of compensation payable or to become payable to any Service Provider (except for increases in annual base salaries or wage rate for employees other than executive officers of the Company or any of its Subsidiaries that are in connection with promotions in the ordinary course of business consistent with past practice and do not exceed (x) 10% for any employee and (y) $100,000 in the aggregate on an annualized basis), (B) grant any additional rights to change in control, severance or termination pay to any Service Provider (except for the payment of cash severance or termination pay in the ordinary course of business for employees other than executive officers of the Company or any of its Subsidiaries consistent with the cash severance level described on Schedule 8.10(a) (I) modify and contingent upon an effective release of claims in favor of the Company), with any such cash severance or terminate termination pay to be satisfied in full prior to the Ground LeaseClosing Date so that there are no continuing obligations to be satisfied following the Closing Date), (IIC) other than in the Ordinary Course of Business, modify or terminate any Personal Property Lease or Material Contract or (III) other than in the Ordinary Course of Businessestablish, enter into, adopt, modify or terminate amend any Contract Company Benefit Plan or any plan, program, policy, practice, contract, agreement or other arrangement that would be a Company Benefit Plan if in effect on the date of this Agreement would have been required (other than (x) to be listed on replace or amend any Company Benefit Plan if the cost of providing benefits thereunder is not increased, (y) to conduct its annual renewal and reenrollment of its health and welfare plans in the ordinary course of business) or (z) to approve performance metrics under its annual bonus plans for the current fiscal year of the Company consistent with Schedule 5.10(a8.2(b)(iii)), Schedule 5.11(b(D) grant or pay to any Service Provider or former Service Provider any bonus or other incentive compensation or retention compensation, or (E) terminate, other than for cause or due to permanent disability, or hire, any employee who has an annual base compensation greater than $150,000;
(iv) acquire any Person or any division or business of any Person or any material assets from another Person or sell, assign, transfer, convey or otherwise dispose of any Subsidiary, division or business of the Company or any of its Subsidiaries or incorporate or otherwise create any new Subsidiary or sell, assign, transfer, convey or pledge any material assets;
(v) merge with or into or consolidate with any other Person; adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization; or liquidate or dissolve;
(vi) 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 travel expenses and/or sales commissions in the ordinary course of business consistent with past practice) or Schedule 5.13(aincur any Indebtedness (other than revolving borrowings in the ordinary course of business pursuant to the Senior Secured Credit Facilities or Intercompany Indebtedness);
(Mvii) permit compromise, waive or settle any claim or Legal Proceeding (other than any Tax matters which are exclusively covered by Section 8.2(b)(x)), provided that the Acquired Company and any of its Subsidiaries may enter into such compromises or settlements involving solely monetary damages of an amount not in excess of $1,000,000 in the aggregate (with any such settlements being paid prior to 11:59 p.m. (New York time) on the Business Day immediately preceding the Closing or otherwise being a Specified Current Liability) following consultation with Buyer;
(viii) 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;
(ix) enter into or agree modify any Contract with any Affiliate of the Company (other than a Subsidiary), other than as otherwise permitted by Section 8.2(b)(iii);
(x) make, change or rescind any election relating to Taxes, change any method of Tax accounting in respect of Taxes, file any amended Tax Return in respect of Taxes, or settle or compromise any proceeding, claim, investigation, audit or controversy relating to Taxes;
(xi) except to the extent required by changes in GAAP, make any change to any of its methods of accounting or methods of reporting revenue and expenses or accounting practices;
(xii) enter into any merger, consolidation, joint venture or similar agreement;
(xiii) encumber or grant any Lien (other than Permitted Liens) on any asset, right or property (whether tangible or intangible) of the Company or any of its Subsidiaries (other than purchase money security interests in connection with the acquisition of equipment in the ordinary course of business combination transaction consistent with past practice); or
(A) other than in the ordinary course of business consistent with past practice, amend, terminate or waive any Personrights under any Material Contract in any material respect or enter into any new Contract that would be a Material Contract if entered into prior to the date hereof or (B) enter into any new Contract that contains a change in control provision in favor of the other party or parties thereto or would otherwise require a payment to or give rise to any rights to such other party or parties in connection with the Transactions contemplated hereby;
(xv) enter into any new line of business;
(xvi) fail to use commercially reasonable efforts to maintain in full force and effect insurance policies providing coverage and amounts of coverage substantially comparable to that provided by the insurance policies as in effect on the day prior to the date of this Agreement;
(xvii) except in the ordinary course of business consistent with past practice, guarantee or acquire the Equity Securities otherwise become liable or responsible for any Liability of any other Person;
(Nxviii) permit make or incur any capital expenditures requiring payments in excess of $2,500,000 in the creation of aggregate (with any new such payments being paid prior to 11:59 p.m. (New York time) on the Business GuaranteeDay immediately preceding the Closing or otherwise being a Specified Current Liability); or
or (Oxix) agree agree, authorize or commit to do anything prohibited by this Section 7.2(a)(ii8.2(b).
. Buyer acknowledges and agrees that: (ba) Nothing nothing contained in this Section 7.2 or elsewhere in this Agreement is intended to shall give PurchaserBuyer, directly or indirectly, the right to control or direct the Business operations of Company or any portion thereof Company Subsidiaries prior to the Closing. Prior Effective Time and (b) prior to the ClosingEffective Time, the Acquired Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over the Businessits and its Subsidiaries’ respective operations.
Appears in 1 contract
Samples: Transaction Agreement (Vantiv, Inc.)
Conduct of the Business Pending the Closing. (a) From During the date hereof and until the Closing (the “Pre-Closing Interim Period”), except (Ai) as set forth on Schedule 7.2(a6.1(a), (Bii) as required by applicable Law, including any Applicable Competition LawsLaw or Contract, (Ciii) as otherwise expressly explicitly contemplated or required by this Agreement (including as set forth on Schedule 7.21), (D) as the Acquired Company reasonably determines to be necessary or appropriate to address the COVID-19 pandemic (provided that Seller gives reasonable advance notice of such action to Purchaser and that, subject to requirements imposed by Law applicable for a particular business location, such action is any actions taken in a manner consistent with policies and procedures applicable to all similarly situated businesses furtherance of Seller Parent and its Subsidiaries)the Restructuring, the Refinancing or the acquisition of the Arizona Property) or (Eiv) with the prior written consent of Purchaser Buyer (which consent shall not be unreasonably withheld, delayed or conditioned):), the Company shall (and shall cause each of the Company Subsidiaries to) and the Sellers shall cause the Sterling Company, the Company and each of the Company Subsidiaries to: (A) conduct their respective businesses in the ordinary course of business consistent with past practice and (B) use commercially reasonable efforts to (1) preserve intact in all material respects the present business organizations of the members of the Company Group and (2) preserve in all material respects their present relationships with their material customers and suppliers; provided, that, for the avoidance of doubt, neither the Sellers nor the Company shall be obligated to cause any member of the Company Group or the Sterling Company to take, and shall not be deemed to be in breach of the foregoing for failing to cause the Company Group (other than the Company) or the Sterling Company to take, any action that would not be permitted by Section 6.1(b).
(b) 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 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 Buyer (which consent shall not be unreasonably withheld, delayed or conditioned), the Sellers shall not cause or permit:
(i) Seller shall, and shall cause other than as part of the Acquired Company and if applicable with respect to Restructuring (including the Business, its Affiliates, to:
repurchase of the Series A Preferred Units (A) conduct the Business only as defined in the Ordinary Course of Business;
(B) use their respective commercially reasonable efforts to preserve their current operationsCompany LLC Agreement)), organization and goodwillthe repurchase, including their Intellectual Property and current relationships with customers, suppliers and key employees, in each case, to the extent related to the Business (it being understood that such efforts will not include any requirement or obligation to pay any consideration not otherwise required to be paid by the terms of an existing Contract or to offer or grant any financial accommodation redemption or other benefit not otherwise required acquisition of, or entrance into any Contracts or commitments to be made by the terms of an existing Contract); and
(C) use their commercially reasonable efforts to implement the capital projects listed on Schedule 7.2(a)(i)(C) substantially in accordance with the quarterly capital expenditure forecast set forth on such Schedule 7.2(a)(i)(C), subject to such changes and delays that ordinarily arise in connection with projects of such nature; and
(ii) Seller shall not, and shall cause the Acquired Company and, if applicable with respect to the Business, its Affiliates not to:
(A) declare, set aside, make or ay any dividend or other distribution (including any constructive dividend) in respect of the Acquired Company Equity Interests or repurchase, redeem or otherwise acquire acquire, any outstanding Equity Securities beneficial interests in or other securities of, or other ownership interests in, the Acquired Company (other than cash dividends Group or distributions declared and paid prior to 11:59 pm ET prior to the Closing DateSterling Company;
(Bii) issue or sell any Equity Securities other than as part of the Acquired Restructuring, the issuance or sale of any beneficial interests in or other equity interests of the Company Group or the Sterling Company or the grant of any options, warrants, calls or other rights to purchase or otherwise acquire any Equity Securities shares of the Acquired capital stock or other equity interests of the Company Group or the Sterling Company;
(Ciii) effect any recapitalization, reclassification or like change in the capitalization other than as part of the Acquired Restructuring, any splits, combinations, subdivisions or reclassifications of any shares of the beneficial interests, capital stock or other equity interests of any member of the Company Group or the Sterling Company;
(Div) amend the Organizational Documents other than (1) as part of the Acquired Restructuring, (2) the transfer of 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 any 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;
(Evi) solely except as required by applicable Law, as required by any Benefit Plan, or in the ordinary course of business consistent with respect to the Acquired Company: past practice, (IA) make any change (or file any such change) increase in any method of Tax accounting, (II) make, change or rescind any Tax election; (III) settle or compromise any Tax liability or consent to any claim or assessment relating to Taxes; (IV) file any amended Tax Return or claim for refund; (V) enter into any closing or similar agreement with a Tax Authority; or (VI) waive or extend the statute of limitations in material respect of Taxes, but in each case, if such action relates to a Tax group which includes the Acquired Company, then the Acquired Company shall be restricted only to the extent reasonably expected to increase the Tax Liability of Purchaser or its Affiliates (including the Acquired Company and any Purchaser Designated Subsidiaries) for a taxable period (or portion thereof) that begins after the Closing Date;
(F) (I) increase the annual level of compensation of any employee of the Business other than in the Ordinary Course of Business, or benefits payable or provided (IIor to become payable or provided) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee of the BusinessCompany Group (except for increases in salaries, wages, commissions and bonuses in the ordinary course of business) or (B) the establishment, entrance into, adoption, material amendment or termination of any Company Benefit Plan;
(vii) the making of any loan, advance or capital contribution to or investment in any Person by the members of the Company Group or the Sterling Company (other than (A) loans, advances or capital contributions to or investments in a Subsidiary of the Company or in the Company from the Sterling Company, (IIIB) materially increase transactions in the coverage ordinary course of business consistent with past practice to provide advances or benefits available under 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 business consistent with past practice);
(viii) the settlement or create compromise of any newLegal Proceeding that (A) Benefit Planrequires payment to or by any member of the Company Group in excess of $1,000,000 individually, (IVB) enter into any agreements or commitments (or amend any such agreements or commitments) imposes material restrictions on the business of the type that provide for special benefits or incentives in case of a change-of-control of the Acquired Company or the Business or impose limitations on Seller’s or any of its Affiliate’s ability to terminate Business Employees, including by providing for severance paymentsGroup, or (VC) involves relief other than money damages which could be materially adverse to the business of the Company Group;
(ix) other than as part of the Refinancing, the material modification or amendment, termination or waiver of any material rights under any Material Contract (other than in the Ordinary Course ordinary course of Business, enter business or for terminations that occurs due to the expiration of the terms of such Material Contract) or the entrance into any employmentnew Contract 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 the Company Subsidiaries);
(x) other than as part of the Restructuring, consulting the entrance into or similar modification of any Contract with any Affiliate of the Company (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 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;
(xi) the making or the change of any Tax election, the filing of any amendment to any Tax Return, 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, or the taking of any action to surrender any right to claim a material Tax refund, in each case by the Sterling Company or any member of the Company Group;
(xii) except as may be required by Law or GAAP, the making of any material change in the financial or Tax accounting methods, principles or practices of the Company (or amend change in an annual accounting period);
(xiii) the incurrence, redemption, prepayment, defeasance, cancelation, assumption, guarantee or, in any material 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 agreement) to which the Acquired Company is a party orproperties, assets or rights in excess of $2,500,000, other than as contemplated (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 7.12(a6.1(b)(xiii), transfer any employee from a different and (3) the execution of leases and licenses in the ordinary course of business unit into consistent with past practices and (4) pursuant to Contracts in force on the Business, exceptdate of this Agreement, in each case, other than (x) sales, leases, licenses and dispositions (including of modules, data center space, or any products or services offered in the Business as required by applicable Law or of the terms date hereof) in the ordinary course of business and (y) any Benefit PlanLiens that may be imposed in the Business (as of the date hereof) that is done in the ordinary course of business;
(Gxv) (I) other than as may be necessary to fill vacant positions the making of any acquisitions, in each case by the Ordinary Course of Business, hire Sterling Company or offer to hire any new employee member of the Business Company Group, of (including by merger, consolidation or the Acquired Company, (II) other than for cause, terminate the employment acquisition of any Business Employee, or (III) institute any general layoff of employees or implement any early retirement plan of the Business or the Acquired Company or announce the planning of any such action;
(H) subject any of the properties or assets (whether tangible or intangible) of the Business to any Lien, except for Permitted Exceptions;
(I) (I) other than in the Ordinary Course of Business, acquire any properties stock or assets or sell, assign, license, transfer, convey, encumber, lease, abandon, cancel, allow to lapse any other business combination) (A) any Person or otherwise dispose business including by acquiring the equity interests of any such Person or a material portion of the properties or assets of the Business or, such Person or (IIB) acquire any ownership interest in real property;
(J) other than , in the Ordinary Course of Businesseach case, cancel or compromise any material claim or right of the Business;
(K) enter into any commitment for capital expenditures of the Business or the Acquired Company consideration in excess of $1,000,000 individually, other than the Arizona Property;
(xvi) the “CapEx Threshold”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 all commitments capital expenditures required pursuant to any customer Contract or (c) substantially in accordance with the aggregatecapital 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 Company Subsidiary to become public, other than (Ia) reasonable capital expenditures in connection accordance with any emergency or force majeure events affecting the Business or the Acquired Company their terms or (IIb) capital expenditures otherwise listed on Schedule 7.2(a)(i)(C) or Schedule 7.2(a)(ii)(K); provided that the CapEx Threshold shall be $2,000,000 in the event Closing has not occurred within six (6) months ordinary course of the date of this Agreement;
(L) (I) modify or terminate the Ground Lease, (II) other than in the Ordinary Course of Business, modify or terminate any Personal Property Lease or Material Contract or (III) other than in the Ordinary Course of Business, enter into, modify or terminate any Contract that if in effect on the date of this Agreement would have been required to be listed on Schedule 5.10(a), Schedule 5.11(b) or Schedule 5.13(a);
(M) permit the Acquired Company to enter into or agree to enter into any merger, consolidation, joint venture or similar business combination transaction with any Person, or acquire the Equity Securities of any other Person;
(N) permit the creation of any new Business Guaranteebusiness; or
(Oxviii) agree the agreement or commitment to do anything take any of the foregoing actions prohibited by this Section 7.2(a)(ii6.1(b).
(bc) Nothing Buyer acknowledges and agrees that: (i) nothing contained in this Section 7.2 or elsewhere in this Agreement is intended to shall give PurchaserBuyer, directly or indirectly, the right to control or direct the Business operations of the Company Group or any portion thereof the Sterling Company prior to the Closing. Prior , (ii) prior to the Closing, the Acquired 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 Businesscontrary 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) From Prior to the date hereof and until the Closing (the “Pre-Closing Period”)Closing, except (Ai) as set forth on Schedule 7.2(a), (Bii) as required by applicable Law, including any Applicable Competition Laws, (Ciii) as otherwise expressly contemplated by this Agreement in connection with, or in furtherance of, the consummation of the transactions contemplated hereby (including as set forth on Schedule 7.21including, without limitation, the amendment, replacement or termination of the Credit Facilities), or (D) as the Acquired Company reasonably determines to be necessary or appropriate to address the COVID-19 pandemic (provided that Seller gives reasonable advance notice of such action to Purchaser and that, subject to requirements imposed by Law applicable for a particular business location, such action is taken in a manner consistent with policies and procedures applicable to all similarly situated businesses of Seller Parent and its Subsidiaries), (Eiv) with the prior written consent of Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned):
(i) Seller ), the Company shall, and shall cause the Acquired each Company and if applicable with respect Subsidiary to the Business, its Affiliates, to:
(A) conduct the Business only their respective businesses in the Ordinary Course of Business;
(B) . 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 their respective commercially reasonable efforts to, and shall take commercially reasonable efforts to cause its Subsidiaries to: (1) maintain and preserve their current intact the present business operations, organization and goodwill, including their Intellectual Property assets of the PEP Companies; and current relationships with customers, suppliers (2) maintain insurance coverage in such amounts and key employees, of such kinds reasonably comparable to that in each case, effect on the date hereof.
(b) Prior to the extent related to the Business Closing, except (it being understood that such efforts will not include any requirement or obligation to pay any consideration not otherwise required to be paid by the terms of an existing Contract or to offer or grant any financial accommodation or other benefit not otherwise required to be made by the terms of an existing Contract); and
(Ci) use their commercially reasonable efforts to implement the capital projects listed on Schedule 7.2(a)(i)(C) substantially in accordance with the quarterly capital expenditure forecast as set forth on such Schedule 7.2(a)(i)(C7.2(b), subject to such changes and delays that ordinarily arise in connection with projects of such nature; and
(ii) Seller as required by applicable Law, (iii) as otherwise 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 Purchaser (which consent shall not be unreasonably withheld, delayed or conditioned), the Company shall not, and shall cause the Acquired each Company and, if applicable with respect to the Business, its Affiliates Subsidiary not to:
(A) declaretransfer, set asideissue, make sell or ay any dividend or other distribution (including any constructive dividend) in respect dispose of the Acquired Company Equity Interests or repurchase, redeem or otherwise acquire subject to any outstanding Equity Securities in the Acquired Company Lien (other than cash dividends Permitted Liens) any shares of capital stock or distributions declared and paid prior to 11:59 pm ET prior to the Closing Date;
(B) issue or sell other securities of any Equity Securities of the Acquired PEP Company or grant options, warrants, calls or other rights to purchase or otherwise acquire any Equity Securities shares of the Acquired capital stock or other securities of any PEP Company;
(CB) effect any recapitalization, reclassification or like change in the capitalization of any PEP Company;
(C) amend the Acquired certificate of incorporation or by-laws or similar governance documents of any PEP Company;
(D) amend the Organizational Documents knowingly subject any of the Acquired CompanyReal 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);
(E) solely with respect to the Acquired Company: (I) make any change (or file any such change) in any method of Tax accounting, (II) make, change or rescind any Tax election; (III) settle or compromise any Tax liability or consent to any claim or assessment relating to Taxes; (IV) file any amended Tax Return or claim for refund; (V) enter into any closing or similar agreement with a Tax Authority; or (VI) waive or extend the statute of limitations in respect of Taxes, but in each case, if such action relates to a Tax group which includes the Acquired Company, then the Acquired Company shall be restricted only to the extent reasonably expected to increase the Tax Liability of Purchaser or its Affiliates (including the Acquired Company and any Purchaser Designated Subsidiaries) for a taxable period (or portion thereof) that begins after the Closing Date;
(F) (I) increase the annual level of compensation of any employee of the Business other than in the Ordinary Course of Business, (II) grant any unusual or extraordinary bonus, benefit or other direct or indirect compensation to any employee of the Business, (III) materially increase the coverage or benefits available under any (or create any new) Benefit Plan, (IV) enter into any agreements or commitments (or amend any such agreements or commitments) of the type that provide for special benefits or incentives in case of a change-of-control of the Acquired Company or the Business or impose limitations on Seller’s or any of its Affiliate’s ability to terminate Business Employees, including by providing for severance payments, or (V) other than in the Ordinary Course of Business, enter into any employment, consulting or similar agreement (or amend any such agreement) and except with respect to which the Acquired Company is a party or, other than as contemplated matters addressed in Section 7.12(a), transfer any employee from a different business unit into the Business, except, in each case, as required by applicable Law or the terms of any Benefit Plan;
subsection (G) (I) other than as may be necessary to fill vacant positions in the Ordinary Course of Business, hire or offer to hire any new employee of the Business or the Acquired Company, (II) other than for cause, terminate the employment of any Business Employee, or (III) institute any general layoff of employees or implement any early retirement plan of the Business or the Acquired Company or announce the planning of any such action;
(H) subject any of the properties or assets (whether tangible or intangible) of the Business to any Lien, except for Permitted Exceptions;
(I) (I) other than in the Ordinary Course of Businessbelow, acquire any material properties or assets or sell, assign, license, transfer, convey, encumber, lease, abandon, cancel, allow to lapse lease or otherwise dispose of any of the properties Real Property or assets of any PEP Company (except for the Business or, (II) acquire any ownership interest in real propertypurpose of disposing of obsolete or worthless assets or to the extent such assets are replaced with like assets of equivalent value);
(JF) 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 Businessany PEP Company;
(KG) enter into any commitment for capital expenditures of the Business or the Acquired any PEP Company in excess of $500,000 for any individual project or $1,000,000 (the “CapEx Threshold”) for all commitments in the aggregate, other than (Ii) reasonable capital expenditures in connection with any emergency or force majeure events affecting as contemplated by the Business or the Acquired Company PEP Companies’ current budget, as provided to Purchaser on April 30, 2015 or (IIii) capital expenditures otherwise listed on Schedule 7.2(a)(i)(C) or Schedule 7.2(a)(ii)(K); provided that the CapEx Threshold shall be $2,000,000 in the event Closing has not occurred within six (6) months of the date of this Agreementrelated to Material Contracts with customers;
(L) (I) modify or terminate the Ground Lease, (II) other than in the Ordinary Course of Business, modify or terminate any Personal Property Lease or Material Contract or (IIIH) other than in the Ordinary Course of Business, enter into, modify or terminate any Contract labor or collective bargaining agreement of any PEP Company or, through 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 if 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 credit or similar instruments entered into in effect on the date Ordinary Course of this Agreement would have been required Business, (y) intercompany indebtedness between the PEP Companies, and (z) advances for travel and other normal business expenses to be listed on Schedule 5.10(a), Schedule 5.11(b) or Schedule 5.13(aofficers and employees of the PEP Companies in the Ordinary Course of Business);
(M) permit increase in any manner the Acquired Company rate or terms of compensation payable or to become payable or the benefits (including equity or equity based grants) provided to, grant any severance or termination pay to, establish, adopt, enter into, or amend any indemnification arrangement with, or pay any bonus to its directors, officers or employees, or establish, adopt, enter into or agree amend any Company Benefit Plan, other than as may be required by any Governmental Body, as required by the terms of any Company Benefit Plan (including the SERP), to enter into any merger, consolidation, joint venture or similar business combination transaction comply with any Personapplicable Laws, Company Transaction Expenses to be paid at Closing, or acquire in the Equity Securities Ordinary Course of any other PersonBusiness;
(N) amend, cancel or modify any Material Contract, except for amendments, cancellations and renewals in the Ordinary Course of Business, or enter into any agreement that would constitute a Material Contract, except in the Ordinary Course of Business;
(O) change an annual accounting period, 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 related to Taxes, settle any material Tax Claim or assessment relating to the PEP Companies, or surrender any right to claim a refund of Taxes;
(P) permit the creation lapse of any new Business Guaranteeright relating to any material Company Intellectual Property; or
(OQ) permit the Assumed Indebtedness (other than Net Tax Liabilities), including those items set forth on Schedule 7.2(Q), to exceed $5,000,000;
(R) agree to do anything prohibited by this Section 7.2(a)(ii)7.2.
(b) Nothing contained in this Section 7.2 or elsewhere in this Agreement is intended to give Purchaser, directly or indirectly, the right to control or direct the Business or any portion thereof prior to the Closing. Prior to the Closing, the Acquired Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over the Business.
Appears in 1 contract
Samples: Stock Purchase Agreement (Nn Inc)
