Conduct of the Business Prior to Closing. (a) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business. (b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to: (i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity; (ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business; (iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution; (iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business; (v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business; (vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company; (vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company; (viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business; (ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP); (x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group; (xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser; (xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business; (xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business; (xiv) amend any Organizational Documents of the Company; (xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business; (xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement; (xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities; (xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate; (xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance; (xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business. (xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect; (xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business; (xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse; (xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained; (xxv) fail to comply in all material respects with any applicable Law; or (xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing. (c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser. (d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 3 contracts
Samples: Membership Interest Purchase Agreement (Planet 13 Holdings Inc.), Membership Interest Purchase Agreement (Planet 13 Holdings Inc.), Membership Interest Purchase Agreement (Planet 13 Holdings Inc.)
Conduct of the Business Prior to Closing. Seller covenants and agrees that, during the period from the date of this Agreement until the Closing Date, that it will comply with the following covenants, unless otherwise expressly approved in writing by the Purchaser.
(a) Until Seller will:
(i) maintain its legal existence;
(ii) use all reasonable efforts to preserve the Closing or the earlier termination of this Agreement in accordance with Business and its termsbusiness organization intact, retain its licenses, permits, authorizations, franchises and certifications, and except for Dispensaries assignment preserve the existing Contracts and goodwill of ownership of the CAT Generator to the Company its customers, suppliers, vendors, service providers, personnel and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing others having business relations with it;
(collectively, the “CAT Related Internal Transaction”), the Company shall: (iiii) conduct its business (including the Business) only in the Ordinary Course of Business, Business (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available including without limitation the services collection of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters receivables and the general status payment of ongoing operations as requested by Parent, payables and capital expenditures); and
(iv) comply with applicable Law, (v) pay its debts use all reasonable efforts to operate in such a manner as to assure that the representations and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain warranties set forth in ARTICLE 3 of this Agreement will be true and operate its properties in a good and workmanlike manner in correct as of the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of BusinessClosing Date.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent Seller will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase amend or sell propose any membership units change to its certificate of incorporation or bylaws or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equitysimilar governing documents;
(ii) lease, license, assign, sell, transfer change its method of management or otherwise dispose of operations in any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Businessmaterial respect;
(iii) adopt dispose, acquire or license any plan of merger, consolidation, reorganization, liquidation assets or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, properties or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement commitment to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Persondo so, other than in the Ordinary Course of Business;
(xviiv) maintain its assets in their current conditionincur any indebtedness for borrowed money, ordinary wear and tear excludedmake any loans or advances, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practicesassume, including without limitation shorten guarantee or lengthen the customary payment and collection cycles, as the case may be, endorse or otherwise become responsible for the Company’s trade accounts payable and receivables and obligation of any other current liabilities;
(xviii) make Person, or commit subject any of its properties or assets to make any capital expenditures except (A) as contemplated by the Company’s then current budgetLien, (B) in each case other than Permitted Liens in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xixv) hire modify, amend, cancel or terminate any new employees Material Contract or officers of any other existing agreement, Contract or instrument material to Seller or the Company who cannot be terminated at-will Business, or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take or omit to take any action that would cause any Intellectual Property, including registrations thereof or applications for registration, to lapse, be abandoned or cancelled, or fall into the representations public domain;
(vi) make any change in the compensation paid or payable to any equityholder, officer, director, manager, employee, agent, representative or consultant of Seller, or pay or agree to pay any bonus or similar payment (other than bonus payments or other amounts to which the Seller is committed prior to the date of this Agreement and warranties contained which are expressly disclosed in ARTICLE IV this Agreement); provided however, Seller may increase any compensation in an amount equal to be untrue the normal and customary amount of raises provided by Seller upon notice to the Purchaser;
(vii) promote, change the job title of, or incorrect otherwise alter in any material respectrespect the responsibilities or duties of, any management employee or officer of Seller;
(xxiiviii) enter into any contract Contract or agreement (A) with respect to which Seller has any manager liability or obligation involving more than $10,000, contingent or otherwise, (B) which may place any limitation on the method of conducting or scope of the Company Business, (C) which would otherwise be considered a Material Contract, or Company affiliate (D) outside of the Ordinary Course of Business;
(ix) declare, set aside, make, pay or representative thereof cause to be made any dividend, distribution, redemption, repurchase, recapitalization, reclassification, issuance, split, combination or other transaction involving the capital stock or other equity securities of Seller, or any option, warrant or right to acquire any such capital stock or equity securities, or enter into any Contract with respect to the voting of its capital stock;
(x) make any change in its accounting practices or procedures;
(xi) cancel, modify or waive any debts or claims held by it or waive any rights having in each case a value in excess of $25,000 or in the aggregate a value in excess of $50,000;
(xii) settle any litigation or other Proceedings before a Governmental Authority (A) for an amount in excess of $50,000 or any obligation or liability of Seller in excess of such amount, (B) on a basis that would result in (I) the imposition of any writ, judgment, decree, settlement, award, injunction or similar order of any Governmental Authority that would restrict the future activity or conduct of Seller or (II) a finding or admission of a violation of Law or violation of the rights of any Person by Seller, or (C) that is brought by any current, former or purported holders of any capital stock or debt securities of Seller relating to the transactions contemplated by this Agreement;
(xiii) file or make any change to any material Tax election or any Tax Return, except as required by law;
(xiv) change its customer pricing or offer any rebates, discounts or promotions, other than in the Ordinary Course of Business;
(xxiiixv) allow acquire any Permit to (A) no longer be in good standing with an applicable Governmental Authority business or (B) lapsePerson, whether by merger or consolidation, purchase of assets or equity securities or any other manner;
(xxivxvi) allow its levels make any capital expenditures that, individually or in the aggregate, exceed $10,000, unless such capital expenditures are in the Ordinary Course of inventory to vary in any material respect from the levels customarily maintainedBusiness;
(xxvxvii) fail to comply in all make any filing requesting any material respects with modification of any applicable LawFCC License or any application for any new FCC License;
(xviii) take any other action that could have a material adverse effect on the Business or the affairs, assets, condition (financial or otherwise) or results of operations of Seller or any material division of Seller, or could adversely affect or detract from the value of the Seller, the Acquired Assets, or the Business; or
(xxvixix) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoingforegoing referred to in clauses (i) - (xviii).
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 2 contracts
Samples: Asset Purchase Agreement (BOSTON OMAHA Corp), Asset Purchase Agreement (BOSTON OMAHA Corp)
Conduct of the Business Prior to Closing. (a) Until Except with the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of PurchaserMedirisk and except as may be required to effect the transactions contemplated by this Agreement, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of between the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect and the benefits provided to or with respect to any employee earlier of (i) the Company or otherwise increase Merger Effective Time and (ii) the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
the Company will (xiia) compromise, settle, grant not make any waiver or release relating to or otherwise adjust any right or claim with respect distributions of its assets to any pending persons except as expressly contemplated by the Schedules hereto; (b) conduct its operations in the ordinary course of business; (c) keep and maintain its properties and facilities in good condition, repair and working order, reasonable wear and tear excepted, and fully insured for liability and property damages; (d) use its reasonable best efforts to preserve intact its business; (e) use its reasonable best efforts to retain the service of its employees, agents and consultants involved with or threatened Action (A) relating employed by the Company on terms and conditions not less favorable than those existing prior to the Transaction execution of this Agreement; (f) cooperate with Medirisk's representatives (without disclosure of this Agreement or the contemplated sale to the Company's customers or suppliers without the consent of Medirisk) in reviewing facts and establishing and implementing procedures necessary to effect the Merger as contemplated by this Agreement; (Bg) against the Company other than conduct its activities in the Ordinary Course a manner consistent with this Agreement; (h) not enter into, assume or make any contract, loan, license, designation, loan commitment, purchase, sale or disposition of Business;
(xiii) change, or agree to change, any material business policies assets of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than outside the ordinary course of business; (i) except for mailing invoices in the Ordinary Course ordinary course of Business;
business, not contact any customer regarding collection of any account receivable and not discount any account receivable; (xivj) amend not declare any Organizational Documents dividend or comparable distribution of assets; and (k) promptly advise Medirisk in writing of any material adverse change in the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber 's financial condition or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Businessbusiness affairs.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 2 contracts
Samples: Acquisition Agreement (Medirisk Inc), Acquisition Agreement (Medirisk Inc)
Conduct of the Business Prior to Closing. The Company agrees that, between the date hereof and the earlier of the Closing Date and the date this Agreement is terminated in accordance with ARTICLE X, except as (a) Until the Closing otherwise expressly contemplated by this Agreement, (b) otherwise consented to by Parent, in writing, (c) set forth on Schedule 6.1, or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”)d) required by applicable Legal Requirement, the Company shall, and the Stockholders shall cause the Company to: (i) conduct its business (including the Business) and operations only in the Ordinary Course ordinary course of Businessbusiness consistent with past practice, (ii) use commercially reasonable best efforts consistent with past practices to maintain its assets and properties and to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory current relationships with customers, vendors employees, suppliers and others having business relationships dealings with it, and (iii) subject use commercially reasonable efforts to applicable Laws, confer on a regular preserve the goodwill and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations of the Business. Without limiting the generality of the foregoing, except as requested otherwise expressly contemplated by this Agreement or as otherwise consented to by Parent, (iv) comply with applicable Lawin writing, (v) pay its debts and Taxes when due (subject to good faith disputes over during such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaserperiod, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers Stockholders shall cause the Company not to:
(ia) issuedeclare, purchase accrue, set aside or sell pay any membership units cash or other Equity of the Company or grant non-cash dividend or make any option, subscription, warrant, call, commitment other cash or agreement of any character non-cash distribution in respect of any of its Equity Interests (other than cash distributions to pay the Stockholders’ estimated income tax liabilities with respect to allocable income of the Company and other cash distributions in the normal course of business of the Company consistent with past practice), and shall not repurchase, redeem or otherwise reacquire any such membership units, capital stock or other EquityEquity Interests;
(iib) leaseauthorize for issuance, licenseissue, assignor sell or agree or commit to issue or sell (whether through the issuance or granting of options, sellwarrants, transfer commitments, subscriptions, rights to purchase or otherwise dispose of otherwise) any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of BusinessEquity Interests;
(iiic) adopt amend or propose to make any plan of merger, consolidation, reorganization, liquidation or dissolutionchange to the Company Organizational Documents;
(ivd) create, incur, assume, Guarantee materially increase the rates of direct compensation or otherwise bonus compensation payable or to become liable or obligated with respect payable to any Indebtedness, officer or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets employee of the Company, other than Permitted Encumbrances except in the Ordinary Course ordinary course of Businessbusiness or in accordance with the existing terms of contracts entered into prior to the date of this Agreement;
(vie) enter into any new lease for any Real Property or modifyissue, amendsell, renewpledge, terminatedispose of, or grant or seek encumber any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property Equity Interests of the Company;
(viif) except as required by applicable Legal Requirement or by any Company Employee Plan or Contract in effect as of the Effective Date (Ai) split, combine increase the compensation payable or reclassify that could become payable by the Company or any of its outstanding unitssubsidiaries to directors, capital stock officers, or Equity employees, other than increases in compensation made to non-officer employees in the ordinary course of business consistent with past practice, (ii) promote any officers or employees, except in connection with the Company's annual or quarterly compensation review cycle or as the result of the Company termination or issue or authorize the issuance resignation of any units, capital stock officer or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Companyemployee, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (Aiii) establish, adopt, enter into into, amend, terminate, exercise any discretion under, or take any action to accelerate rights under any Company Employee Plans or any plan, agreement, program, policy, trust, fund fund, or other arrangement that would be a Benefit Company Employee Plan if it were in existence as of the Effective Date, or make any contribution to any Company Employee Plan, other than contributions required by Legal Requirement, the terms of such Company Employee Plans as in effect on the date hereof, or that are made in the ordinary course of this Agreement business consistent with past practice;
(g) acquire, by merger, consolidation, acquisition of stock or amend assets, or terminate otherwise, any Benefit Plan in a manner that would affect the benefits provided business or Person or division thereof or make any loans, advances, or capital contributions to or with respect investments in any Person in excess of $10,000 in the aggregate;
(h) transfer, license, sell, lease, or otherwise dispose of (whether by way of merger, consolidation, sale of stock or assets, or otherwise) or pledge, encumber, mortgage, or otherwise subject to any employee Lien (other than a Permitted Lien), any assets, including the capital stock or other Equity Interests in any subsidiary of the Company;
(i) repurchase, prepay, or incur any Indebtedness for borrowed money or guarantee any such Indebtedness of another Person, issue or sell any debt securities or options, warrants, calls, or other rights to acquire any debt securities of the Company or otherwise increase the Liabilities any of the Company under the Benefit Plansits subsidiaries, except as required by Law and other than in the Ordinary Course guarantee any debt securities of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaseranother Person, enter into any new employment, severance, consulting, "keep well" or other compensation agreement with, Contract to maintain any financial statement condition of any other Person (other than any wholly-owned subsidiary of it) or enter into any arrangement having the economic effect of any of its equity holdersthe foregoing, employees or managers other than in connection with the Ordinary Course financing of Businessordinary course trade payables consistent with past practice;
(ixj) enter into or amend or modify in any material respect, or consent to the termination of (other than at its stated expiry date), any Company Material Contract;
(k) institute, settle, or compromise any legal action or Matter involving the payment of monetary damages by the Company or acknowledgement of wrongdoing or fault, other than any claims arising out of a breach or alleged breach settlement of claims, liabilities, or obligations reserved against on the Most Recent Balance Sheet or settlements or compromises that are solely monetary in nature and do not exceed $15,000 individually or $30,000 in the aggregate; provided, that neither the Company nor any of its subsidiaries shall settle or agree to settle any legal action which settlement involves a conduct remedy or injunctive or similar relief or has a restrictive impact on the Company's business;
(l) make any material change in its any method of financial accounting methodsprinciples or practices, policies or practices (other than in each case except for any such changes that have been change required by Law a change in GAAP or GAAP)applicable Legal Requirement;
(xm) make(i) settle or compromise any material Tax claim, audit, or assessment for an amount materially in excess of the amount reserved or accrued on the Most Recent Balance Sheet, (ii) make or change any material Tax election, change or revoke any election relating to Taxesannual Tax accounting period, change an annual accounting period or adopt or change any accounting method relating to Taxesof Tax accounting, (iii) amend any material Tax Returns or file claims for material Tax refunds, or (iv) enter into any amended Tax Returnmaterial closing agreement, surrender in writing any right to claim a material Tax refund, offset or other reduction in Tax liability or consent to any extension or waiver of the limitation period applicable to any material Tax claim or assessment relating to the Company, Company or become a member of a consolidated groupits subsidiaries;
(xi) (An) enter intointo any material agreement, enter into the negotiation ofagreement in principle, amendletter of intent, supplementmemorandum of understanding, waiveor similar Contract with respect to any joint venture, modifystrategic partnership, terminate, annul, cancelor alliance;
(o) abandon, allow to lapse, sell, assign, conveytransfer, grant any security interest in otherwise encumber or otherwise transferdispose of any Company Intellectual Property, or grant any right or license to any Company Intellectual Property other than pursuant to non-exclusive licenses entered into in each case the ordinary course of business consistent with past practice;
(p) terminate or modify in any material respect, in whole or in partfail to exercise renewal rights with respect to, rights and interests in any material insurance policy;
(q) agree or under commit to do any Material Contracts, or (B) enter into discussions with third parties regarding of the foregoing. Nothing herein shall require the Company to obtain consent from Parent to do any matter that of the foregoing if obtaining such consent might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreementviolate applicable Legal Requirements, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing nothing contained in this Agreement Section 6.1 shall be deemed give to give PurchaserParent, directly or indirectly, the right to control or direct the Business or ordinary course of business operations of the Company prior to the ClosingClosing Date. Prior to the ClosingClosing Date, the Company shall exercise, consistent with the terms and conditions of this Agreementhereof, complete control over and supervision of its Business and respective operations.
Appears in 2 contracts
Samples: Merger Agreement (Bendele Phillip), Merger Agreement (Inotiv, Inc.)
Conduct of the Business Prior to Closing. (a) Until From the Closing or Agreement Date until the earlier of the termination of this Agreement in accordance with pursuant to its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company terms and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing Date (collectivelysuch earlier period, the “CAT Related Internal TransactionPre-Closing Period”), except to the Company extent expressly provided otherwise in Section 6.1(a) of the Seller Disclosure Schedule, or as consented to in writing by Purchaser, Seller shall: (i) conduct its business (including , and Seller shall cause each of the Business) Seller Subsidiaries to, operate the Seller Business in all material respects in the Ordinary Course ordinary course of Business, (ii) use reasonable best efforts business consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships in material compliance with customers, vendors and others having business relationships with it, (iii) subject to all applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of BusinessLegal Requirements.
(b) Without limiting the foregoing generality of the foregoing, during the Pre-Closing Period, except to the extent expressly provided otherwise in this Agreement or Section 6.1(b) of the Seller Disclosure Schedule, Seller and except for the CAT Related Internal Transaction, the Company covenants and agrees thatSeller Subsidiaries shall not, without the prior written consent of Purchaser, Purchaser (which consent will shall not be unreasonably withheld, conditioned or delayed), until the Closing directly or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not toindirectly:
(i) issueacquire (whether by merging or consolidating with, purchase purchasing or sell by any membership units other manner) any equity securities or assets (other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement than capital expenditures permitted by Section 6.1(b)(ix)) of any character in respect of business or any such membership units, capital stock Person or other Equityany portion thereof;
(ii) leasepropose or adopt a plan of complete or partial liquidation, licensedissolution, assignmerger, sellconsolidation, transfer restructuring, recapitalization or otherwise dispose other reorganization of Seller or any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of BusinessSeller Subsidiaries;
(iii) adopt incur any plan Lien on, or sell, transfer, lease, assign, license or otherwise encumber or dispose of mergerany of the Purchased Assets or assets of any Seller Subsidiary, consolidationexcept for the sale of Inventory and the granting of non-exclusive licenses to customers, reorganizationresellers or distributors of Seller Products, liquidation or dissolutionin each case in the ordinary course of business;
(iv) createexcept as required by applicable Legal Requirements or GAAP, incurmaterially revalue any of the Purchased Assets or assets of any Seller Subsidiary, assume, Guarantee including writing-off notes or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Businessaccounts receivable;
(v) incur enter into any Encumbrances Contract that if in effect on the Agreement Date, would constitute a Material Contract (other than non-exclusive licenses with customers and non-exclusive reseller or distributor agreements each in the ordinary course of business, in each case which would not be required to be disclosed pursuant to Section 4.2(c) if in effect on the Agreement Date); provided, however, that notwithstanding the foregoing, (A) with respect to renewals of customer agreements upon substantially similar terms as the agreement being renewed, Seller shall only be required to consult with Purchaser prior to such renewal, but not to obtain the prior written consent of Purchaser and (B) with respect to the entry into any propertiesnew customer agreements or granting of any new licenses, rights or assets Purchaser’s consent shall be deemed to have been given solely for purposes of this Section 6.1(b)(v) unless Purchaser shall have objected to the entry into such agreement within three (3) Business Days after a written request (containing the applicable contract and a written summary of the Company, other than Permitted Encumbrances in the Ordinary Course of Businessterms thereof) for such consent by Seller;
(vi) enter into violate or amend in any new lease for material respect or terminate any Real Property Material Contract or modifyGovernmental Approval, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property except expirations of the CompanyMaterial Contracts by their respective terms;
(vii) commence a Proceeding other than (A) split, combine or reclassify any for the routine collection of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Companyaccounts receivables, (B) for injunctive relief on the grounds that Seller has suffered immediate and irreparable harm not compensable in money damages or (C) with respect to the Excluded Assets or Excluded Liabilities;
(viii) purchase, redeem lease, license or otherwise acquire any assets which are material, individually or dispose in the aggregate, to the Seller Business, except for supplies acquired by Seller in the ordinary course of business, licenses to generally available commercial unmodified off-the-shelf software with an Table of Contents aggregate initial purchase price of less than $100,000 and aggregate annual support and maintenance fees (and other annual costs) of less than $25,000 that is not incorporated in or bundled with the Seller Products, or for capital expenditures permitted by Section 6.1(b)(ix);
(ix) incur or commit to incur any capital expenditures in excess of One Hundred Thousand Dollars ($100,000) in the aggregate in any month;
(x) borrow from any Person (other than Purchaser) by way of a loan, advance, guaranty, endorsement, indemnity, or warranty;
(xi) change in any material respect its credit practices, accounting methods or practices or standards used to maintain its books, accounts or business records (other than as may be required by GAAP);
(xii) amend any Seller Organizational Document or Assumed Plan in any manner;
(xiii) (A) hire any new employee or terminate any existing employee, in each case at the level of Vice President or above or with an annual base salary in excess of $100,000, (B) increase the annual level of compensation of any unitsEmployee except for regular, capital stock scheduled compensation increases in connection with promotions or Equity in the ordinary course of the Companybusiness, or (C) issueestablish or adopt any Employee Benefit Plan, sellor (D) grant any bonuses, transferbenefits or other forms of direct or indirect compensation to any Employee, officer, director or consultant, except that Seller and the Selling Subsidiaries may (1) provide routine salary increases to non-executive Employees in the ordinary course of business in connection with customary employee review processes or promotions, (2) grant, pledgeor accelerate the vesting of, dispose of stock options or otherwise encumber other equity compensation to any unitsEmployee, capital stock (3) amend any Employee Benefit Plan to the extent required by applicable Legal Requirements, or Equity of (4) make customary bonus and commission payments consistent with past practices, in accordance with bonus and commission plans and programs in effect on the CompanyAgreement Date;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ixxiv) make any material or change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to in respect of Taxes, change an annual accounting period or adopt or change any accounting method relating to in respect of Taxes, file any amended amendment to a Tax Return, surrender enter into any right to closing agreement, settle any claim a refundor assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member in respect of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transferTaxes, in each case only to the extent such action could (1) result in any material respect, in whole or in part, rights and interests in or under any Material Contractssuccessor liability for Purchaser, or (B2) enter into discussions with third parties regarding give rise to a Lien on any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns Purchased Assets or warranties other than in the Ordinary Course assets of Business;
(xiv) amend any Organizational Documents of the CompanySeller Subsidiary;
(xv) selldeclare, licenseset aside, sublicenseestablish a record date for, covenant not make or pay any dividend or other distribution (whether payable in cash, stock, property or a combination thereof) with respect to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of its capital stock, or enter into any agreement with respect to the Company’s Intellectual Property to any Person, voting of its capital stock (other than in the Ordinary Course of Business;Voting Agreements)
(xvi) maintain issue, grant or amend any Contract with respect to any options to acquire any of its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreementcapital stock;
(xvii) materially alter its cash management customs and practicesredeem, including without limitation shorten repurchase, prepay, defease, cancel, incur or lengthen otherwise acquire, or modify the customary payment and collection cyclesterms of, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilitiesany Indebtedness;
(xviii) make settle or commit otherwise compromise or consent to make the entry of any capital expenditures judgment or otherwise seek termination with respect to any claim, proceeding, investigation, litigation or dispute (except (A) as contemplated by the Company’s then current budget, (B) in connection with disputes with respect to accounts payable in the Ordinary Course ordinary course of Business, or (C) such expenditures as do business where the amount in controversy does not exceed $100,000 in the aggregate10,000);
(xix) hire take any new employees action or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) omit to take any action that would cause the representations and warranties contained in ARTICLE IV require disclosure pursuant to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable LawSection 4.6; or
(xxvixx) agree agree, in writing or commit otherwise, to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, take any of the foregoingactions described in Section 6.1(b)(i) through (xix) above.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until Except with the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership prior written consent of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”)Purchaser, the Company shall: (i) conduct its business (including the Business) businesses of the Company in the Ordinary Course ordinary course of Business, business; (ii) use reasonable its best efforts consistent to (A) preserve the present business operations, organization (including management and the sales force) and goodwill of the Company and (B) preserve the present relationship with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others Persons having business relationships dealings with it, the Company (including customers and suppliers); (iii) subject to applicable Laws, confer on a regular maintain (A) all of the assets and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, condition (ordinary wear and tear excluded, with excepted) and (B) insurance upon all of the properties and assets of the Company in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
; (xviiiv) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by maintain the Company’s then current budgetbooks, accounts and records of the Company in the ordinary course of business, (B) in the Ordinary Course continue to collect accounts receivable and pay accounts payable utilizing normal procedures and without discounting or accelerating payment of Businesssuch accounts, or and (C) such expenditures as do not exceed $100,000 in comply with all contractual and other obligations applicable to the aggregate;
(xix) hire any new employees or officers operation of the Company who cannot be terminated at-will or within sixty Company; (60v) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with all applicable Legal Requirements; (vi) timely provide to holders of Equity Securities all advance notices required to be given to such holders in connection with this Agreement and the transactions contemplated by this Agreement under the Company’s Constitutional Documents or other applicable Contracts, (vii) timely provide all notices and other information required to be given (which notices and information shall be in form and substance reasonably satisfactory to the Purchaser) to the employees of the Company, any collective bargaining unit representing any group of employees of the Company, and any applicable Law; or
Governmental Authority under the WARN Act, the National Labor Relations Act, as amended, the Code, COBRA and other Law in connection with the transactions contemplated by this Agreement or other applicable Contracts, and (xxviviii) agree or commit to do, or allow or permit not take any employee, manager or officer action which would adversely affect the ability of the Company parties to agree or commit to do, any of consummate the foregoingtransactions contemplated by this Agreement.
(cb) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult Except with the Indemnifying Members periodically on material business developments prior written consent of Purchaser; provided, however, that the final decisions regarding any such matter shall remain Purchaser or as specifically set forth in Section 6.3 of the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the ClosingDisclosure Letter, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operationsnot take any Material Action.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until From the Closing or the earlier termination date of this Agreement in accordance with its termsuntil the Closing, the Selling Parties shall, and except for Dispensaries assignment of ownership of the CAT Generator to the Company shall cause their respective Affiliates and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: Representatives to:
(i) conduct its business (including operate the Business) Business only in the Ordinary Course ordinary course of Business, business;
(ii) use reasonable best efforts consistent with past practices pay all of the Selling Parties’ Liabilities where failure to preserve its business organization and goodwill, keep available pay could reasonably be expected to result in material harm to the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts Business and Taxes when due (due, subject to good faith disputes over such debts Liabilities or Taxes), ;
(viiii) maintain insurance coverage in amounts adequate to cover the reasonably anticipated risks of the Selling Parties and in amounts consistent with past practice;
(iv) prosecute pending applications for Intellectual Property registration; and
(v) operate its properties in a good and workmanlike manner the Business in the Ordinary Course ordinary course and not enter into or renew any agreement with a customer, supplier or distributor for a term of Businessmore than one year or specifying the purchase or sale of more than $10,000 in products without providing Purchaser with two Business Days prior notice and receiving Purchaser’s written consent to the terms thereof, and (vii) pay or cause to which consent shall not be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Businessunreasonably withheld.
(b) Without limiting From the foregoing date of this Agreement until the Closing Date, Seller and the Insignia Subsidiaries shall not, and shall cause their respective members, officers, directors and employees, not to:
(i) Enter into, create, incur or assume (A) any borrowings under capital leases or (B) any obligations which would have a Seller Material Adverse Effect or a material adverse effect on Purchaser’s ability to conduct the Business in substantially the same manner and condition as currently conducted by Seller;
(ii) Acquire by merging or consolidating with, or by purchasing any equity securities or assets (which are material, individually or in the aggregate, to Seller) of, or by any other manner, any business or any Person;
(iii) Sell, transfer, lease, license or otherwise encumber any of the Purchased Assets, except for the CAT Related Internal Transactionsale of Inventory and the granting of non-exclusive licenses in the ordinary course of business;
(iv) Enter into any agreements or commitments with another Person, except on commercially reasonable terms in the Company covenants ordinary course of business;
(v) Violate in any material respect any Legal Requirement applicable to Seller;
(vi) Materially change or announce any change to the Seller products or any services sold by Seller;
(vii) Violate or amend in any material respect or terminate any Seller Contract or Governmental Approval, except amendments and agrees thatterminations in the ordinary course of business consistent with Seller’s past practices;
(viii) Commence a Proceeding other than (A) for the routine collection of accounts receivables, without (B) for injunctive relief on the grounds that Seller has suffered immediate and irreparable harm not compensable in money damages if Seller has obtained the prior written consent of Purchaser, which such consent will not to be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, withheld or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company Excluded Assets or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of BusinessExcluded Liabilities;
(ix) make Purchase, lease, license or otherwise acquire any material change assets, except for supplies acquired by Seller in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP)the ordinary course of business;
(x) makeMake any capital expenditure in excess of Twenty-Five Thousand Dollars ($25,000), individually or in the aggregate;
(xi) Borrow from any Person (other than Purchaser) by way of a loan, advance, guaranty, endorsement, indemnity, or warranty (other than an increase in amounts borrowed under receivables financing arrangements with Silicon Valley Bank in place on the date hereof);
(xii) Change its credit practices, accounting methods or practices or standards used to maintain its books, accounts or business records;
(xiii) Incur or become subject to any Liability, contingent or otherwise, except current Liabilities in the ordinary course of business;
(xiv) Make any material change affecting the Business;
(xv) Amend any charter or revoke organizational documents in any manner that could adversely effect Seller’s or the Insignia Subsidiaries’ ability to consummate the Transaction and perform its obligations hereunder;
(xvi) Hire any new employee other than in the ordinary course of business, terminate any officer or key Employee of Seller or any Insignia Subsidiary, increase the annual level of compensation of any Employee except for regular, scheduled compensation increases in the ordinary course of business, establish or adopt any Employee Benefit Plan, or grant any bonuses, benefits or other forms of direct or indirect compensation to any employee, officer, director or consultant;
(xvii) Make or change any election relating to in respect of Taxes, change an annual accounting period or adopt or change any accounting method relating to in respect of Taxes, file any amended amendment to a Tax Return, surrender enter into any right to closing agreement, settle any claim a refundor assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member in respect of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transferTaxes, in each case in any material respect, in whole only to the extent such action could (1) affect the liability of Purchaser for Taxes of Seller or in part, rights and interests in Taxes with respect to the Purchased Assets or under any Material Contractsthe Business, or (B2) enter into discussions with third parties regarding any matter that might reasonably be expected give rise to result in a Contract that would be a Material Contract if in effect Lien on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the CompanyPurchased Assets or the Business or otherwise affect Purchaser’s Intellectual Property to any Person, other than in enjoyment of the Ordinary Course of Purchased Assets or the Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit Fail to make any capital expenditures except (A) maintain the Purchased Assets, taken as contemplated by the Company’s then current budgeta whole, (B) in the Ordinary Course of Businessgood repair, or (C) such expenditures as do not exceed $100,000 in the aggregate;order and condition, reasonable wear and tear excepted; or
(xix) hire Enter into any new employees Contract specifying the purchase or officers sale of more than $10,000 in products or the payment of more than $10,000, or agree, in writing or otherwise, to take any of the Company who cannot be terminated at-will or within sixty (60actions described in Section 6.1(b)(i) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
through (xxi) take above, or any action that would cause the make any of its representations and or warranties contained in ARTICLE IV to be this Agreement untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company respect or Company affiliate prevent it from performing or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit cause it not to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary perform in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoingits covenants hereunder.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until Between the date hereof and the Closing Date, except as contemplated by this Agreement, or except with the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership prior written consent of the CAT Generator to Purchaser, the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) Subsidiaries shall operate their businesses in the Ordinary Course of Business, Business (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees thatincluding, without the prior written consent of Purchaserlimitation, which consent with respect to compliance with Laws and performance under contracts) and will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not topermit:
(i) issue, purchase or sell any membership units or other Equity of the assets of the Company or grant or make its Subsidiaries to be subjected to any option, subscription, warrant, call, commitment or agreement Encumbrance which does not exist as of any character in respect the date of any such membership units, capital stock or other Equitythis Agreement;
(ii) leaseany changes, licenseincluding changes to connection, assigndisconnection and collection practices, sellto be made in the operations of the Company or its Subsidiaries;
(iii) any assets of the Company or its Subsidiaries to be sold, transfer transferred, leased, subleased, licensed, encumbered or otherwise dispose of any of its propertiesdisposed of, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment except in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create(A) any increase, incuror the announcement of any increase, assumein the wages, Guarantee salaries, compensation, bonuses, incentives, pension or otherwise become liable other benefits payable by either of the Company or obligated with respect its Subsidiaries to any Indebtednessdirector, officer, employee, independent contractor or agent to be granted, including, without limitation, any increase or change pursuant to any employee benefit plan, or make (B) any loan benefits under any employee benefit plan to be established or advance toincreased or to be promised to be increased, or any investment in, any Person other than in the Ordinary Course of Businesspayment or vesting thereof to be accelerated;
(v) incur any Encumbrances on material change in any propertiesmethod of accounting or accounting practice or policy used by the Company or its Subsidiaries to be made, rights including, without limitation, material changes in assumptions underlying or assets methods of the Companycalculating bad debt, contingency or other reserves, or notes or accounts receivable write-offs, or in corporate location methodology, in each case other than Permitted Encumbrances in the Ordinary Course of Businessas required by Law or under GAAP;
(vi) enter into any new lease commitments for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property either of the CompanyCompany or its Subsidiaries to make capital expenditures in excess of $150,000 individually or in the aggregate;
(vii) (A) split, combine any amendment of the certificate or reclassify any articles of its outstanding units, capital stock incorporation or Equity bylaws of either of the Company or issue or authorize its Subsidiaries, except for the issuance of any units, capital stock or Equity filing of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the CompanyAmended Articles;
(viii) (A) establishany material Action, adopt, enter into Indebtedness or any plan, agreement, program, policy, trust, fund other claims or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided rights related to or with respect to any employee of the Company or its Subsidiaries to be compromised, settled or otherwise increase the Liabilities of adjusted, or any waiver or release relating thereto to be granted (unless such action would not impose material restrictions or obligations on the Company under or its Subsidiaries after the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (BClosing) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any new agreement, contract, commitment or arrangement, or any amendments or modifications to any existing such agreement, contract, commitment or arrangement, to be entered into with any Affiliate of either of the Company or its Subsidiaries or any third parties that is material change to the Company or its Subsidiaries or that will continue in effect after the Closing Date and not be terminable by the Company or its accounting methods, policies Subsidiaries on not more than 30 days’ written notice without payment of premium or practices (other than such changes that have been required by Law or GAAP)penalty;
(x) make, any change in the stock ownership of any Company to be made or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver interest in either of the limitation period applicable Company or its Subsidiaries to any Tax claim be granted or assessment relating to the Companyassigned, or become a member of a consolidated groupexcept as contemplated by this Agreement;
(xi) any Indebtedness to be created, incurred, assumed or guaranteed by either of the Company or its Subsidiaries that cannot be prepaid or terminated without payment of premium or penalty, except for borrowings under existing credit agreements (Aor replacements therefor on substantially the same terms) enter into, enter into or the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date creation of this Agreement, without first consulting with Purchasertrade payables;
(xii) compromise, settle, grant any waiver new material contract or release relating to any material amendments or otherwise adjust any right or claim with respect material modifications to any pending or threatened Action (A) relating existing such contract, to the Transaction or (B) against the Company other than in the Ordinary Course of Business;be entered into; or
(xiii) changeany agreement, contract, commitment or agree arrangement to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under do any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV foregoing to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoingentered into.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: Except (i) conduct its business (as contemplated in this Agreement, including the Business) in Reorganization, or the Ordinary Course of Businessother Transaction Agreements, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with itas required by any Legal Requirement or Contract, (iii) subject to applicable Laws, confer for matters set forth on a regular and frequent basis with Representatives Schedule 6.1(a) of Parent to report operational matters and the general status of ongoing operations as requested by ParentSeller Disclosure Schedule, (iv) comply with applicable Law, reasonably in response to or related to any (A) COVID-19 Measure or (B) change in any Legal Requirement or policy relating to or resulting from any COVID-19 Measure or (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in with the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, the applicable Purchaser (which consent will shall not be unreasonably withheld, conditioned or delayed), from the date of this Agreement until the earlier of the Closing or the earlier termination of this Agreement pursuant to the terms and conditions hereof (including as set forth in accordance with its termsSection 3.1(b) hereof), the Company shall notSeller shall, and the Sellers shall cause its Controlled Affiliates (including the Selling Subsidiaries), in each case exclusively with respect to each Acquired Company and each Business, (1) to use reasonable efforts to operate each Business in the ordinary course of business consistent with past practice in all material respects, and (2) not toto do any of the following:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character change in respect of any such membership units, the authorized capital stock or other Equityequity interests, or amend or modify the Fundamental Documents of any Acquired Company (except with respect to any ministerial or other immaterial amendments or modifications that are not adverse to a Purchaser or would create or modify any obligations or liabilities of Purchaser following the Closing);
(ii) leaseissue or sell any shares of capital stock or other equity interests or securities convertible into or exchangeable for shares of capital stock or other equity interests of any Acquired Company, licenseor purchase or otherwise acquire for consideration any outstanding shares of capital stock or other equity interests of any Acquired Company, assignor split, reverse split, combine, subdivide or reclassify the outstanding capital stock or other equity interests of any Acquired Company or effect any recapitalization;
(iii) except for (x) intercompany borrowings that will be repaid or settled in full or terminated or canceled at or before the Closing, (y) ordinary course borrowings under the Credit Facilities that will be included in the calculation of Indebtedness, and (z) obligations under leases which have become Indebtedness as a result of a change in GAAP or the application thereof so long as such obligations will be paid in full as of Closing, (A) incur Indebtedness or any obligations under capital leases, (B) enter into any Contract involving financing or borrowing of money or (C) assume, guarantee or endorse the obligations of any Person (other than under the Seller Debt Facilities) if, in each case, such obligations would be obligations of the Acquired Companies in excess of $3,000,000 following the Closing or such obligations are secured by any assets of any Acquired Companies;
(iv) permit any of the material assets of the Business to become subjected to any Encumbrance other than (A) those Encumbrances which will be removed at or prior to Closing, (B) Permitted Encumbrances, or (C) in connection with the Seller Debt Facilities;
(v) with respect to any Acquired Company, fail to maintain its corporate existence or permit it to liquidate, wind-up or dissolve or merge or consolidate with any other Person or enter into any joint venture or similar venture with any other Person;
(vi) purchase any securities or make any investment in any Person (other than another Acquired Company within the same Business), either by purchase of stock or securities, contributions to capital, material asset transfers or purchase of any material assets, or otherwise acquire direct or indirect control over any Person;
(vii) except in the ordinary course of business, sell, transfer transfer, lease, sublease or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights properties or assets of the Company, other than Permitted Encumbrances Business having an aggregate value in the Ordinary Course excess of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company$1,500,000;
(viii) (A) establish, adopt, enter into declare or set aside any plan, agreement, program, policy, trust, fund dividends or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate distributions on any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits equity interest of any employee of Acquired Company (in cash or in kind) to the Company who is not a Related Employee that is not in extent such dividends or distributions are payable after the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of BusinessClosing;
(ix) make except in the ordinary course of business and with respect to which full insurance coverage is available, compromise, settle, or grant any release of any claim relating to, any litigation, regulatory action, or arbitration where the amount involved is in excess of $500,000 or involves a material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP)restriction upon the operations of the Business;
(x) make, make any material change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver practice or system of internal accounting control of the limitation period applicable Business, except as may be appropriate to any Tax claim conform to changes in Legal Requirements, regulatory accounting requirements or assessment relating to the Company, or become a member of a consolidated groupGAAP;
(xi) (A) enter intomake or incur any capital expenditures in excess of $500,000 in the aggregate, enter into other than in accordance with the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow capital expenditure budget provided to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected Purchaser prior to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaserhereof;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandonassert, assign, transfer, discloseabandon, encumber allow to lapse or expire, or otherwise dispose of or grant any rights under with respect to any material Intellectual Property, except (A) non-exclusive and immaterial exclusive licenses (including covenants not to assert) granted in the ordinary course of business, and (B) Intellectual Property expiring at the end of it statutory term;
(xiii) make any material change in cash management practices and policies, practices and procedures with respect to collection of accounts receivable (including acceleration of the Company’s Intellectual Property payment, funding, right to payment, or collection of accounts receivable), establishment of reserves for uncollectible accounts, accrual of accounts receivable, prepayment or deferral of expenses, payment of trade accounts payable (including delay of the payment of accounts payable), accrual of other expenses, deferral of revenue and acceptance of customer deposits, or change or modification of any Personexisting credit, collection, or payment policies, procedures or practices in each case, other than in the Ordinary Course ordinary course of Businessbusiness consistent with past practice;
(xiv) other than in the ordinary course of business, (A) enter into any Real Property Lease or any Contract that would have been required to be set forth on Schedule 4.8(a) of the Seller Disclosure Schedule hereto if it were in effect on the date hereof or (B) materially modify, amend, or terminate (other than allowing expiration according to its scheduled term, including by failing to renew) any Material Contract or Real Property Lease;
(xv) make, change or revoke any material Tax election, adopt or change any material method of Tax accounting, consent to any waiver or extension of time to assess or collect any material Taxes, settle or compromise any material Tax liability, surrender any claim for a refund of material Taxes, enter into any closing agreement relating to any Tax, obtain or request any Tax ruling or file any amended material Tax Return or fail to pay any Taxes (including estimated Taxes) when due and payable, in each case, except in the ordinary course of business and except as would not reasonably expected to have materially adverse consequences to any Acquired Company after the Closing;
(xvi) maintain its assets let any material Permits expire, lapse or otherwise not remain in their current conditionfull force and effect;
(xvii) except as required by a Benefit Plan or Labor Agreement, (1) increase, decrease or accelerate the payment, funding or vesting of the compensation or benefits of any Business Employee, former employee of any of the Acquired Companies, or other individual service provider of any of the Acquired Companies (including severance benefits), except in the ordinary wear and tear excludedcourse of business consistent with past practice for Business Employees or other individual service providers with a gross annual compensation or aggregate fees, with insurance in such amounts and as applicable, of such kinds comparable to less than $150,000, (2) enter into, adopt, materially amend or terminate any Benefit Plan (or any arrangement that would be a Benefit Plan if in effect on the date hereof) other than any action that applies equally to Business Employees and similarly-situated employees of this Agreement;
Seller and its Controlled Affiliates, (xvii3) materially alter hire or engage any Person as a Business Employee or other individual service provider, other than the hiring of Business Employees or other individual service providers at the Acquired Companies with a gross annual compensation not in excess of $150,000 or terminate the employment or engagement, other than for cause, of any Business Employee or other individual service provider at the Acquired Companies with a gross annual base compensation in excess of $150,000, (4) (x) other than as expressly contemplated by Section 9.1(a), transfer the employment or engagement of any individual into the Acquired Companies, or (y) transfer the employment of any Business Employee out of the Acquired Companies, (5) reassign or modify the job duties of (x) any Business Employee such that he or she is no longer a Business Employee or (y) any other employee of Seller, its cash management customs and practicesControlled Affiliates or the Acquired Companies such that he or she will be a Business Employee or (6) enter into, including without limitation shorten negotiate, modify, extend, amend or lengthen the customary payment and collection cyclesterminate any Labor Agreement or recognize or certify any labor union, labor organization, works council, or group of employees as the case may be, for the Company’s trade accounts payable and receivables and other current liabilitiesbargaining representative in relation to any Business Employees;
(xviii) make implement or commit to make announce any capital expenditures except (A) as contemplated by Business Employee layoffs, plant closings, reductions in force, furloughs, temporary layoffs, salary or wage reductions, work schedule changes or other such actions that could implicate the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregateWARN Act;
(xix) hire furlough, or temporarily layoff any new employees Business Employee or officers independent contractor of the Company who cannot be terminated at-will or within sixty (60) days and without severanceBusiness with annual compensation in excess of $150,000;
(xx) materially alter affirmatively waive or release any noncompetition, nonsolicitation, nondisclosure, noninterference, nondisparagement, or other restrictive covenant obligation of any current or former employee or independent contractor providing services to the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.Business or Acquired Companies;
(xxi) take following the Benchmark Time applicable to Cash, use any action that would cause Cash of the representations and warranties contained in ARTICLE IV Acquired Companies to be untrue or incorrect in pay any material respectIndebtedness;
(xxii) enter into distribute or otherwise transfer any contract cash or property from ACAMS China to Seller or any Seller Affiliate except to the extent such distribution is in cash and is treated as a dividend made in accordance with applicable Legal Requirement and any manager of applicable withholding Taxes arising in connection with such distribution are paid (any such distributed amount, the Company “Pre-Closing Distributed ACAMS China Cash”) and except for any payment by ACAMS China to Seller or Company affiliate or representative thereof other than any Seller Affiliate made in the Ordinary Course ordinary course of Business;business, including the payment of royalties and other payables by ACAMS China to Seller or any Seller Affiliate; or
(xxiii) allow enter into any Permit legally binding commitment with respect to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(b) Notwithstanding anything to the contrary contained in this Agreement, nothing herein shall prevent Seller or its Affiliates from taking or failing to take any action reasonably consistent with actions taken by other similarly-situated participants in the industry in which the Business operates, in each case in good faith (including the establishment of any policy, procedure or protocol or any action taken or failed to be taken to protect the Business, the health and safety of the personnel or employees of Seller or other persons with whom the personnel or employees of the Seller comes into contact with in the ordinary course of business) in response to or related to any COVID-19 Measure or any change in any Legal Requirement or policy (including guidelines and directives of industry groups) relating to or resulting from any COVID-19 Measure, and none of the foregoing shall in any event be deemed to constitute a breach of Section 6.1(a); provided that the Seller shall, in good faith, consult with and consider the recommendations of the applicable Purchaser prior to taking or failing to take such action (unless doing so is impracticable due to emergency or urgent circumstances, in which case Seller shall promptly provide notice to and consult in good faith with such Purchaser as soon as is reasonably practicable).
(c) Until Notwithstanding anything to the Closing or contrary contained in this Agreement, prior to the earlier termination Benchmark Time applicable to Cash, the bank accounts of this Agreement in accordance with its terms, Purchaser shall, the Acquired Companies shall continue to be subject to applicable lawsSeller’s and its Controlled Affiliates’ daily cash sweep in their sole discretion, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; providedAcquired Companies may pay cash dividends, however, make cash distributions and take any and all actions that the final decisions regarding any such matter shall remain may be necessary (as determined by Seller in the its sole discretion of Purchaserdiscretion) to capitalize accumulated profits and profit reserves.
(d) Notwithstanding anything to the contrary contained in this Agreement, Seller and any of its Affiliates (including any Acquired Company) shall not enter into any intercompany loan with ACAMS China prior to the Closing and to the extent such intercompany loan exists, Seller shall, and shall cause any applicable Affiliate (including any Selling Subsidiary) to, terminate all intercompany loans pursuant to Section 6.6.
(e) Nothing contained in this Agreement is intended to or shall be deemed to give either Purchaser, directly or indirectly, the right to control or direct the operations of the Business or operations any of the Acquired Companies prior to the Closing. Prior to the Closing, the Company Seller shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its the operations of the Business and operationsthe Acquired Companies.
Appears in 1 contract
Samples: Equity Purchase Agreement (Adtalem Global Education Inc.)
Conduct of the Business Prior to Closing. (a) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: Except (i) conduct its business (expressly as contemplated by this Agreement, including the Business) in Reorganization, or the Ordinary Course of Businessother Transaction Agreements, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with itas expressly required by any Legal Requirement or Contract, (iii) subject to applicable Lawsfor matters set forth on Schedule 6.1(a) of the Seller Disclosure Schedule, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, or (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, Purchaser (which consent will shall not be unreasonably withheld, conditioned or delayed), from the date of this Agreement until the earlier of the Closing or and the earlier termination of this Agreement in accordance with pursuant to its terms, the Company shall notSeller shall, and the Sellers shall cause its Controlled Affiliates to, in each case exclusively with respect to the Acquired Companies and the Business, (1) use commercially reasonable efforts to operate the Business in the ordinary course of business in all material respects, (2) use commercially reasonable efforts to preserve current relationships of the Acquired Companies with customers, suppliers and other Persons with which any Acquired Company has significant business relations, (3) use commercially reasonable efforts to keep and maintain their assets and properties in good repair and normal operating condition, ordinary wear and tear excepted, (4) pay all material operating leases when due, and (5) not todo any of the following:
(i) issueamend, purchase waive, supplement or sell any membership units or other Equity of modify the Company or grant or make any option, subscription, warrant, call, commitment or agreement organizational documents of any character in respect of any such membership units, capital stock or other EquityAcquired Company;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grantdispose of, pledgeredeem, dispose of repurchase, split, reverse split, combine, subdivide or otherwise encumber any units, reclassify the outstanding capital stock or Equity other equity interests of any Acquired Company;
(iii) except for (A) intercompany borrowings that will be repaid or settled in full or terminated or canceled at or prior to the Closing or that are wholly among the Acquired Companies and (B) obligations under finance leases that constitute Indebtedness, (1) incur in excess of $500,000 of indebtedness for borrowed money outstanding at any time, (2) enter into any Contract involving financing or borrowing of money or (3) assume, guarantee or endorse the obligations of any Person (other than under the Seller Debt Facilities) if, the case of each of (1)-(3), such obligations would be obligations of the Acquired Companies following the Closing;
(iv) permit any of the material assets of the Acquired Companies to become subjected to any Encumbrance other than Permitted Encumbrances;
(v) with respect to any Acquired Company, fail to maintain its corporate existence or merge or consolidate with any other Person or enter into any joint venture or similar venture with any other Person;
(vi) purchase any securities or make any investment in any Person, either by purchase of stock or securities, contributions to capital, asset transfers or purchase of any assets, or otherwise acquire direct or indirect control over any Person for which the aggregate consideration paid in the aggregate is in excess of $100,000, and such securities, contributions or assets would be held by the Acquired Companies following the Closing;
(vii) except in the ordinary course of business, sell, transfer, lease, sublease or otherwise dispose of any properties or assets of the Business having an aggregate value in excess of $100,000 in the aggregate;
(viii) (A) establish, adopt, enter into declare or set aside any plan, agreement, program, policy, trust, fund dividends or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate distributions on any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits equity interest of any employee of Acquired Company (in cash or in kind) to the Company who is not a Related Employee that is not in extent such dividends or distributions are payable after the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of BusinessClosing;
(ix) make compromise, settle or grant any material change release of any claim relating to any pending litigation or arbitration where the amount involved is in its accounting methods, policies excess of $50,000 or practices (other than such changes that have been required by Law or GAAP)involves a restriction upon the operations of the Business;
(x) make, make any material change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating accounting method or system of internal accounting control of the Business, except as may be appropriate to conform to changes in Legal Requirements, regulatory accounting requirements or GAAP or in the Company, or become a member ordinary course of a consolidated groupbusiness;
(xi) (A) enter intomake, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber change or otherwise transfer, in each case in revoke any material respectTax election, in whole or in part, rights and interests in or under any Material Contracts, or (B) file an amended Tax Return or a claim for refund of material Taxes, (C) agree to any extension or waiver of any statute of limitations applicable to any Tax claim or assessment, (D) enter into discussions with third parties regarding any matter that might reasonably be expected to result closing agreement or otherwise settle any Tax claim for an amount in excess of $50,000 or (E) file any material Tax Return in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting manner materially inconsistent with Purchaserpast practices;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action except (A) relating to as may be required by the Transaction terms of a Benefit Plan or collective bargaining agreement or other labor-related agreement with any labor or trade union, works council, employee representative or association or other labor organization, (B) against the Company obligations for which Seller and its Controlled Affiliates (other than the Acquired Companies) shall be solely obligated to pay and as would not result in a liability to Purchaser or any Acquired Company or (C) in the Ordinary Course ordinary course of business, (1) materially increase the compensation or benefits of any Business Employee, (2) enter into or adopt any Acquired Company Benefit Plan, or amend or terminate any Acquired Company Benefit Plan, other than (x) in connection with any amendment by Seller that applies to Seller and its Controlled Affiliates as a whole, or to one or more of Seller’s business units as a whole, or (y) any such entry, adoption, amendment or termination that otherwise does not seek to target the Business Employees, (3) hire any Person as a Business Employee, other than the hiring of Business Employees (x) with a gross annual base salary not in excess of $200,000 or (y) to replace any Business Employee who resigns or whose employment is terminated on the same or substantially similar terms and conditions of employment as similarly situated individuals of Seller and its Controlled Affiliates (including the Acquired Companies), including base compensation and bonus opportunity, if applicable, (4) terminate the employment, other than for cause, of any Business Employee with a gross annual base salary in excess of $200,000, or (5) transfer the employment of any Business Employee outside of the Business;
(xiii) changefail to exercise any right of renewal with respect to any Real Property Lease that by its terms would otherwise expire, or agree other than with respect to change, any material business policies Leased Real Property which is no longer necessary for the operation of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in business of the Ordinary Course of BusinessAcquired Companies as currently conducted;
(xiv) amend transfer, assign or grant any Organizational Documents license or sublicense of any rights under or with respect to any material Owned IP other than in the Companyordinary course of business consistent with past practice or not dispose of any Owned IP;
(xv) sellenter into or amend any collective bargaining agreement, licensememorandum of agreement or understanding, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber side letter agreement or otherwise grant similar agreement with any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Businesslabor union;
(xvi) maintain its assets enter into, amend, renew, extend or terminate any Contract with a Key Vendor or Key Customer, in their current condition, each case other than in the ordinary wear course of business and tear excluded, except for renewals or terminations in accordance with insurance in such amounts and the terms of such kinds comparable to that in effect on the date of this AgreementContract;
(xvii) materially alter its cash management customs and practicesmake any capital expenditures (or series of related capital expenditures) in excess of $250,000 in the aggregate, including without limitation shorten or lengthen outside of the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables ordinary course of business and other current liabilitiesthan in accordance with the capital expenditure budget provided to Purchaser prior to the date hereof;
(xviii) make adopt or commit to make enter into a plan of complete or partial liquidation, dissolution, recapitalization or other reorganization of any capital expenditures except Acquired Company (A) as contemplated by other than the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;Reorganization); or
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract legally binding commitment with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit respect to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(cb) Until Notwithstanding anything to the Closing contrary contained in this Agreement, nothing herein shall prevent Seller or its Affiliates from taking or failing to take any action (i) that is substantively consistent with the earlier termination policies of Seller or any of its Affiliates in effect as of the date of this Agreement in accordance connection with its termsany Contagion Event or in response to COVID-19 Measures generally or (ii) in good faith (including the establishment of any policy, Purchaser shallprocedure or protocol or any action taken or failed to be taken to protect the Business, the health and safety of the personnel or employees of Seller or other Persons with whom the personnel or employees of Seller come into contact with in the ordinary course of business) in response to or related to any (A) Contagion Event, (B) COVID-19 Measure or (C) change in any Legal Requirement relating to or resulting from any Contagion Event or COVID-19 Measure, and none of the foregoing shall in any event be deemed to constitute a breach of Section 6.1(a).
(c) Notwithstanding anything to the contrary contained in this Agreement, but subject to applicable lawsSection 6.15, advise the bank accounts of the Acquired Companies shall continue to be subject to Seller’s and consult with its Affiliates’ periodic cash sweep in their sole discretion, and the Indemnifying Members periodically on material business developments of Purchaser; providedAcquired Companies may pay cash dividends, however, make cash distributions and take any and all actions that the final decisions regarding any such matter shall remain may be necessary (as determined by Seller in the its sole discretion of Purchaserdiscretion) to capitalize accumulated profits and profit reserves.
(d) Nothing contained in this Agreement is intended to or shall be deemed to give PurchaserPurchaser or any of its Affiliates, directly or indirectly, the right to control or direct the operations of the Business or operations any of the Acquired Companies prior to the Closing. Prior to the Closing, the Company Seller shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its the operations of the Business and operationsthe Acquired Companies.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until a. During the Closing or period from the earlier termination date of this Agreement and continuing until the Effective Time, SKANA agrees as to Acquiree, that Acquiree shall not engage in accordance any business whatsoever other than in connection with its termsthe consummation of the transactions contemplated by this Agreement, and except for Dispensaries assignment of ownership of the CAT Generator Acquiree shall use commercially reasonable efforts to the Company preserve intact its business and the Company’s assumption of the CAT Generator Contractor which the Company assets, maintain its assets in good operating condition and Dispensaries will consummate prior to the Closing repair (collectively, the “CAT Related Internal Transaction”ordinary wear and tear excepted), the Company shall: (i) conduct its business (including the Business) in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available retain the services of its officers, employees and consultants independent contractors and maintain satisfactory relationships with customers, vendors use reasonable commercial efforts to keep in full force and others having business relationships with it, (iii) subject effect liability insurance and bonds comparable in amount and scope of coverage to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated that currently maintained with respect to its business, unless, in any Indebtednesscase, or make any loan or advance to, or any investment in, any Person other than SNRV consents otherwise in writing.
b. During the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of period from the date of this Agreement and continuing until the Effective Time, SKANA agrees with respect to Acquiree that except as expressly contemplated or permitted by this Agreement, as disclosed in Section 5.01 (a) of the SKANA's Disclosure Schedule or to the extent that SNRV shall otherwise consent in writing:
1. SKANA shall not amend or terminate propose to amend Acquiree's certificate of incorporation or by-laws or equivalent organizational.
2. SKANA shall not permit Acquiree to, issue, deliver, sell, redeem, acquire, authorize or propose to issue, deliver, sell, redeem, acquire or authorize, any Benefit Plan 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 of equity.
3. SKANA shall not permit Acquiree to: (i) declare, set aside, make or pay any dividend or other distribution, payable in a manner that would affect the benefits provided to cash, stock, property or otherwise, with respect to any employee of the Company its capital stock or (ii) reclassify, combine, split, subdivide or redeem, purchase or otherwise increase the Liabilities of the Company under the Benefit Plansacquire, except as required by Law and other than in the Ordinary Course of Businessdirectly or indirectly, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holderscapital stock.
4. SKANA shall not permit Acquiree to sell, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, conveylease, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) changedispose of, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, discloselease (whether such lease is an operating or capital lease), encumber or otherwise grant dispose of its assets.
5. SKANA shall promptly advise SNRV in writing of any rights under any of the Company’s Intellectual Property to any Person, other than change in the Ordinary Course condition (financial or otherwise), operations or properties, businesses or business prospects of Business;
(xvi) maintain its assets Acquiree which would result in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cyclesan Acquiree Material Adverse Effect, as the case may be.
6. SKANA shall not permit to occur in the case of Acquiree any (1) change in accounting principles, for the Company’s trade accounts payable methods or practices, investment practices, claims, payment and receivables and other current liabilities;
(xviii) make processing practices or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budgetpolicies regarding intercompany transactions, (B2) incurrence of Indebtedness or any commitment to incur Indebtedness, any incurrence of a contingent liability, Contingent Obligation or other liability of any type, except fof obligations related to the Exchange of Inventory in the Ordinary Course ordinary course of Businessbusiness consistent with past practices, (3) cancellation of any debt or (C) such expenditures as waiver or release of any contract, right or claim, except for cancellations, waivers and releases in the ordinary course of business consistent with its past practice which do not exceed $100,000 5,000 in the aggregate;
, (xix4) hire amendment, termination or revocation of, or a failure to perform obligations or the occurrence of any new employees or officers of the Company who cannot be terminated at-will or within sixty default under, (605) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager or agreement (including, without limitation, leases) to which it is or, as of the Company or Company affiliate or representative thereof date hereof, was a party, other than in the Ordinary Course ordinary course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing business consistent with an applicable Governmental Authority past practice, or (B6) lapse;
any License, (xxiv7) allow its levels execution of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects termination, severance or similar agreements with any applicable Law; or
of its officers, directors, employees, agents or independent contractors or (xxvi) agree 8) entering into any leases of real property or commit agreement to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoingacquire real property.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Conduct of the Business Prior to Closing. The Company will, and the Owners will cause the Company to, comply with the following covenants prior to the Closing, unless otherwise approved in writing by the Purchaser.
(a) Until The Company will:
(i) maintain its legal existence;
(ii) use all reasonable efforts to preserve the Closing or the earlier termination of this Agreement in accordance with Business and its termsbusiness organization intact, retain its licenses, permits, authorizations, franchises and certifications, and except for Dispensaries assignment preserve the existing contracts and goodwill of ownership of the CAT Generator to the Company its customers, suppliers, vendors, service providers, personnel and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing others having business relations with it;
(collectively, the “CAT Related Internal Transaction”), the Company shall: (iiii) conduct its business (including the Business) only in the Ordinary Course of Business, Business (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available including without limitation the services collection of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters receivables and the general status payment of ongoing operations as requested by Parent, payables and capital expenditures); and
(iv) comply with applicable Law, (v) pay its debts use all reasonable efforts to operate in such a manner as to assure that the representations and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain warranties set forth in Section 4.1 of this Agreement will be true and operate its properties in a good and workmanlike manner in correct as of the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of BusinessClosing Date.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the The Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase change its method of management or sell operations in any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equitymaterial respect;
(ii) leasedispose, license, assign, sell, transfer acquire or otherwise dispose of license any of its properties, rights, businesses assets or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, properties or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement commitment to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Persondo so, other than in the Ordinary Course of Business;
(xviiii) maintain its assets in their current conditionincur any indebtedness for borrowed money, ordinary wear and tear excludedmake any loans or advances, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practicesassume, including without limitation shorten guarantee or lengthen the customary payment and collection cycles, as the case may be, endorse or otherwise become responsible for the Company’s trade accounts payable and receivables and obligation of any other current liabilities;
(xviii) make Person, or commit subject any of its properties or assets to make any capital expenditures except (A) as contemplated by the Company’s then current budgetLien, (B) in each case other than Permitted Liens in the Ordinary Course of Business;
(iv) modify, amend, cancel or terminate any Material Contract or any other existing agreement, contract or instrument material to the Company or the Business;
(v) make any change in the compensation paid or payable to any Owner or any other member, officer, director, manager, employee, agent, representative or consultant of Seller, or pay or agree to pay any bonus or similar payment (other than bonus payments or other amounts to which the Company is committed prior to the date of this Agreement and which are expressly disclosed in this Agreement); provided however, the Company may increase any compensation in an amount equal to the normal and customary amount of raises provided by the Company upon notice to the Purchaser;
(vi) promote, change the job title of, or otherwise alter in any material respect the responsibilities or duties of, any management employee or officer of the Company;
(vii) enter into any contract or agreement (A) with respect to which the Company has any liability or obligation involving more than $10,000, contingent or otherwise, (B) which may place any limitation on the method of conducting or scope of the Business, (C) which would otherwise be considered a “Material Contract”, or (CD) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers outside of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxiiviii) enter into make or cause to be made any contract with any manager dividend, distribution, redemption, repurchase, recapitalization, reclassification, issuance, split, combination or other transaction involving the capital stock or other equity securities of the Company Company, or Company affiliate any option, warrant or representative thereof right to acquire any such capital stock or equity securities;
(ix) make any change in its accounting practices or procedures;
(x) file or make any change to any material Tax election or any Tax Return, except as required by law;
(xi) change its customer pricing or offer any rebates, discounts or promotions, other than in the Ordinary Course of Business;
(xxiiixii) allow acquire any Permit to (A) no longer be in good standing with an applicable Governmental Authority business or (B) lapsePerson, whether by merger or consolidation, purchase of assets or equity securities or any other manner;
(xxivxiii) allow its levels cancel or waive any rights of inventory to vary in substantial value, or pay, discharge or settle any material respect from the levels customarily maintainedclaim of substantial value;
(xxvxiv) fail to comply make any capital expenditures that, individually or in all the aggregate, exceed $10,000, unless such capital expenditures are in the Ordinary Course of Business;
(xv) take any other action that could have a material respects with adverse effect on the Business or the affairs, assets, condition (financial or otherwise) or results of operations of the Company or any applicable Lawmaterial division of the Company, or could adversely affect or detract from the value of the Company or the Business; or
(xxvixvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoingforegoing referred to in clauses (i) - (xv).
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Samples: Asset Purchase and Contribution Agreement (BOSTON OMAHA Corp)
Conduct of the Business Prior to Closing. (a) Until From the Effective Date hereof until the Closing or the earlier termination of Date, except as permitted by this Agreement or as otherwise consented to by the Purchaser in accordance with its termswriting, and except for Dispensaries assignment of ownership of the CAT Generator such consent not to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until Seller shall continue to conduct its business in connection with the Closing or Property in the earlier termination ordinary and usual course as heretofore conducted. Without limiting the generality of this Agreement the foregoing, the Seller shall:
(a) conduct its commercial harvesting operations on the Real Property in accordance with its termsthe harvest schedule attached hereto as Exhibit L (“Harvest Schedule”). Commencing on January 1, 2003 and ending on the Company Closing Date, Seller shall notpay up to $1,500,000 toward the costs of those certain silvicultural practices and activities mutually agreed upon by Purchaser and Seller. If Purchaser requests that Seller undertake any silvicultural work which causes Seller to incur costs exceeding $1,500,000, and the Sellers Purchaser shall cause the Company not to:
pay such excess costs to Seller by check within thirty (i30) issue, purchase or sell any membership units or other Equity days after receipt of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equityan invoice;
(iib) lease, license, assign, not sell, transfer transfer, encumber or otherwise dispose of any of its propertiesthe Real Property, rights, businesses or assets (including except for logs and timber harvested by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment Seller in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any ordinary course of its outstanding unitsbusiness, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, and shall not sell, transfer, grant, pledge, encumber or otherwise dispose of or otherwise encumber any units, capital stock or Equity of the CompanyPersonal Property except in the ordinary course of business;
(viiic) take all reasonable steps to enforce its rights under all Purchased Contracts, Licenses and Leases;
(Ad) establishmaintain its books of account and records relating to the Property in the usual, adoptregular and ordinary manner, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as consistent with past practice;
(e) preserve for the benefit of Purchaser the date goodwill of this Agreement or amend or terminate any Benefit Plan in a manner that would affect those Persons having business relations with the benefits provided Seller with respect to the Property;
(f) advise all of Seller’s employees who perform work at or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law Property to cooperate with Purchaser and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement its agents with Xxxxxx Xxxxxxx in a form acceptable respect to Purchaser, ’s conducting of its due diligence investigations; and
(g) not enter into any new employmentcontract, severanceagreement, consultingunderstanding, commitment, lease or other compensation agreement withlicense which would be assumed by the Purchaser hereunder, of any of its equity holdersnor renew, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modifyextend, terminate, annulmaterially modify or waive any material rights under any Contract, cancel, allow to lapse, assign, convey, encumber Lease or otherwise transferLicense, in each case in except with the Purchaser’s prior written consent; provided, that the Seller may enter into, extend or renew (i) any material respectlease pursuant to which (A) the sole benefit granted to lessee is the right to graze, in whole hunt, fish or in part, rights camp upon the Real Property and interests in or under any Material Contracts, or (B) the sole burden upon the Seller is the obligation to allow such lessee to enter into discussions with third parties regarding the Real Property and engage in such activities; (ii) any matter that might reasonably contract required to perform the silvicultural activities contemplated by (a) above, the cost of which will be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
borne solely by Seller; and (xiiiii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating contract pertaining to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies harvesting of the Company Real Property which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than harvesting is being performed in accordance with the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any PersonHarvest Schedule; in each case without obtaining such consent; and provided; further that, other than in those Leases accepted by Purchaser, Seller shall, at its cost, use commercially reasonable efforts to terminate all sand, gravel and other mining leases and use commercially reasonable efforts to cause the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and lessee to properly restore the surface pursuant to the terms of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations lease prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Louisiana Pacific Corp)
Conduct of the Business Prior to Closing. (a) Until From the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to Effective Date until the Closing (collectively, the “CAT Related Internal TransactionInterim Period”), the Company Transferred Companies shall: , and the Seller Parties shall cause each of the Success Subject Companies to, use commercially reasonable efforts to operate in the Ordinary Course of Business and, subject to the requirements of this Agreement, the other Transaction Documents and the Contemplated Transactions, to preserve, maintain and protect their material assets and the goodwill of the Business and to not take any action or omit to take any action that would result in (or would reasonably be likely to result in) any of the closing conditions set forth in Section 7.1 or Section 7.2 to be unsatisfied. Without limiting the foregoing, during the Interim Period, except as otherwise expressly contemplated by this Agreement, as set forth on Part A of Section 5.1 of the Seller Disclosure Letter, or as consented to by the Purchaser or Greenbrook, the Transferred Companies shall not, and the Seller Parties shall cause each of the Success Subject Companies not to:
(a) sell or dispose of any of their material assets or properties, other than (i) conduct its business (including the Business) sales or dispositions in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services sales or dispositions of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with itobsolete or surplus assets, (iii) subject to sales or dispositions in connection with the normal repair and/or replacement of assets or properties, or (iv) sales or dispositions in accordance with any Material Contract;
(b) directly or indirectly acquire, whether by merger or consolidation with, or acquiring all or substantially all of the assets of or Equity Interests in, any other Person;
(c) grant, issue, sell or otherwise dispose of any Equity Interests in any Success Subject Company;
(d) liquidate, dissolve, reorganize or otherwise wind up the Business or its operations;
(e) amend or modify their respective Governing Documents;
(f) effect any recapitalization or reclassification, or effect any like change in its equity capitalization;
(g) engage in any material new line of business;
(h) (i) adopt or change any material accounting methods or periods, policies or practices inconsistent with past practice, except as required by applicable LawsLaw, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent(ii) make, revoke or amend any material Tax election, (iii) enter into any Tax sharing, allocation or similar agreement, (iv) comply with applicable Lawenter into any closing agreement, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts settle or Taxes)compromise any Tax claim, assessment or deficiency, (vi) maintain and operate its properties surrender any right to a Tax refund, (vii) filed any Tax Return inconsistent with past practice, (viii) file an amended Tax Return, or (ix) consent to an extension or waiver of any statute of limitations with respect to Taxes;
(i) (A) increase the compensation or benefits of any director, officer, employee or independent contractor of any Success Subject Company (other than increases in a good and workmanlike manner base salary for non-officer employees in the Ordinary Course of BusinessBusiness consistent with past practice and not exceeding 5% per employee, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner provided that such increases are not, in the Ordinary Course of Business.
(b) Without limiting aggregate, material to the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the CompanySuccess Subject Companies), (B) purchaseamend, redeem modify, adopt or otherwise acquire terminate any Success Company Plan or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Success Company Plan if it were was in existence as of effect on the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of BusinessAgreement, (C) materially increase the compensation hire or fringe benefits of terminate any Related Employee that is not in the Ordinary Course of Businessofficer (other than for cause), or (D) pay hire any bonus new employee whose annual compensation opportunity exceeds $150,000;
(j) incur, issue, renew, prepay, syndicate, refinance or modify in any material respect the terms of any indebtedness for borrowed money, or assume or guarantee, or otherwise as an accommodation become responsible for, indebtedness for borrowed money owed by any other person, or make, forgive or cancel any loans, advances or capital contributions to, accelerate or investments in, any right other person (other than one of the Transferred Companies), in each case in an amount in excess of US$1,000,000 individually or US$3,000,000 in the aggregate, including any borrowings under a credit agreement and in respect of letters of credit);
(k) amend, terminate (unless the counterparty is in default under the applicable Material Contract and such termination is permitted) or waive any material term under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company Material Contract other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvil) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.
(c) Until . In addition to the Closing or foregoing, during the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectlyInterim Period, the right to control or direct Seller Parties shall and shall cause each of the Business or operations prior to Success Subject Companies to, take the Closing. Prior to specific actions set forth in Part B of Section 5.1 of the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operationsSeller Disclosure Letter.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Greenbrook TMS Inc.)
Conduct of the Business Prior to Closing. (a) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: Except (i) conduct its business (including the Business) as expressly provided in the Ordinary Course of Businessthis Agreement, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwillas set forth in Section 6.1 of the Cyclone Disclosure Letter or the Storm Disclosure Letter, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with itas applicable, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested required by Parent, Applicable Law or (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior express written consent of Purchaser, the other parties to this Agreement (which consent will shall not be unreasonably withheld, conditioned or delayed, until ):
(i) It shall conduct (and shall cause its Affiliates to conduct) the Closing Cyclone Subsea Business or the earlier termination of this Agreement Storm Subsea Business, as the case may be, in accordance the ordinary course consistent with its termspast practice (including with respect to the collection of receivables, payment of payables and other liabilities, advertising activities, bidding and sales practices, equipment maintenance, replacements or upgrades, inventory levels, accounting policies, contributions to or accruals to or in respect of Employee Benefit Plans and off-site and on-site storage, treatment and disposal of Hazardous Substances generated prior to Closing), and (ii) it shall use its commercially reasonable efforts (or cause its Affiliates to use their commercially reasonable efforts) to maintain the Cyclone Transferred Assets or the Storm Transferred Assets, as the case may be, in substantially the same condition (except normal wear and tear) existing on the date hereof.
(b) It shall use its commercially reasonable efforts, consistent with past practice, to maintain the services of, and good relations with, the Company dealers, jobbers, distributors, customers and suppliers with whom sales or purchases are currently effected in connection with the Cyclone Subsea Business or the Storm Subsea Business, as the case may be.
(c) It shall not, and the Sellers shall cause the Company its Affiliates not to, take any of the following actions in connection with the Cyclone Subsea Business or the Storm Subsea Business, as the case may be:
(i) issueincur, purchase assume or sell Guarantee any membership units or other Equity of the Company or grant Indebtedness or make any optionloans, subscriptionadvances or capital contributions to or investments in any other Person, warrant, call, commitment or agreement in each case other than in the ordinary course of any character in respect of any such membership units, capital stock or other Equitybusiness consistent with its past practice;
(ii) leaseenter into any swap, license, assign, futures or derivatives transaction except hedging activity in the ordinary course of business consistent with its past practice and internal policy guidelines;
(iii) sell, transfer transfer, pledge or otherwise dispose of any of its propertiesCyclone Transferred Asset or any Storm Transferred Asset, rightsas the case may be, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases except for sales of assetsinventory and the sale, inventory and/or transfer or other disposition of uneconomic or obsolete equipment in the Ordinary Course ordinary course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolutionbusiness consistent with its past practice;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to waive any Indebtedness, or make any loan or advance to, or any investment in, any Person Claims other than in the Ordinary Course ordinary course of Businessbusiness consistent with its past practice, or cancel or compromise any Indebtedness owed to it;
(v) incur any Encumbrances on any propertiesmake aggregate unbudgeted expenditures and commitments in excess of $10,000,000 in the case of Cyclone and its Affiliates, rights or assets taken as a whole, and $10,000,000 in the case of the CompanyStorm and its Affiliates, taken as a whole, in each case, other than Permitted Encumbrances (A) in the Ordinary Course ordinary course of Businessbusiness consistent with its past practice or (B) pursuant to requirements of Applicable Law;
(vi) enter into make any new lease for change in any Real Property method of accounting or modifykeeping of books of account or accounting practices or principles, amendexcept as required by Applicable Law or, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property in the opinion of the Companyindependent public accountants of such party, by GAAP;
(vii) (A) splitexcept in the ordinary course of business consistent with its past practice, combine materially modify, amend or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Companyterminate, or (C) issuewaive any material rights under, sellany Cyclone Material Contract or Storm Material Contract, transferas applicable, grant, pledge, dispose or enter into any Contract that would constitute a Cyclone Material Contract or Storm Material Contract if entered into prior to the date of or otherwise encumber any units, capital stock or Equity of the Companythis Agreement;
(viii) (A) establishclose any facilities which are material to the financial condition, adoptresults of operations, enter into any plan, agreement, program, policy, trust, fund business or other arrangement that would be a Benefit Plan if it were in existence as prospects of the date of this Agreement Cyclone Subsea Business or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Storm Subsea Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Businessas applicable;
(ix) make mortgage, pledge or subject to any material change in its accounting methodsLien any of the Cyclone Transferred Assets or the Storm Transferred Assets, policies or practices (other than such changes that have been required by Law or GAAP)as the case may be, except for Permitted Encumbrances;
(x) make, change settle or revoke agree to settle any election relating to Taxes, change an annual accounting period litigation or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment other legal proceeding relating to the CompanyCyclone Subsea Business or the Storm Subsea Business, as the case may be, where such settlement would have, or become would reasonably be expected to have, individually or in the aggregate, a member material impact on the operations or conduct of a consolidated groupthe business of the Venture Entities;
(xi) (Aa) enter intomake, enter into the negotiation ofrevoke or change any material election relating to Taxes, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber (b) change or otherwise transferrevoke any Tax accounting method or (c) change any Tax accounting period if, in each case in case, such action is inconsistent with ordinary and customary historical practices and principally related to the Cyclone Subsea Business or Storm Subsea Business, as applicable;
(xii) (a) materially amend or terminate any material respectEmployee Benefit Plan or establish, in whole adopt or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract Employee Benefit Plan that, if in effect on the date of this Agreement, without first consulting would be a material Employee Benefit Plan, (b) enter into any collective bargaining agreement or similar agreement with Purchaser;
any labor union or works council or (xiic) compromisematerially increase salary or wages, settleas applicable, grant any waiver bonus or release relating to other incentive compensation, or otherwise adjust any right other benefits or claim with respect to any pending or threatened Action compensation, in each of clauses (Aa), (b) and (c) relating to the Transaction Cyclone Subsea Business Employees or Storm Subsea Business Employees, except for any such actions (i) in the ordinary course of business consistent with past practice, (ii) required by Applicable Law or the terms of any Employee Benefit Plan in effect as of the date hereof or (Biii) against the Company other than in the Ordinary Course of Businessfor which Cyclone or Storm, as applicable, will retain all liability;
(xiii) change, fail to renew any lease that is material to the Cyclone Subsea Business or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Storm Subsea Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Lawapplicable; or
(xxvixiv) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.
. For the avoidance of doubt, none of the covenants set forth in this Section 6.1 are intended to or shall impose any restriction on (c1) Until the Closing respective operations of Cyclone or Storm or their respective Affiliates that are not related to the Cyclone Subsea Business or the earlier termination Storm Subsea Business, as applicable, (2) the Non-Transferred Cyclone Assets or the Non-Transferred Storm Assets or (3) the ability of this Agreement in accordance with its termsCyclone, Purchaser shallStorm or their respective Affiliates to transfer or assign any Non-Transferred Assets or Excluded Liabilities from a Cyclone Entity or a Storm Entity, subject as applicable, to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, an entity that the final decisions regarding any such matter shall remain in the sole discretion of Purchaseris not a Cyclone Entity or a Storm Entity.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Samples: Master Formation Agreement (Cameron International Corp)
Conduct of the Business Prior to Closing. From the Effective Date until the Closing (the "Interim Period"), the Transferred Companies shall, and the Seller Parties shall cause each of the Success Subject Companies to, use commercially reasonable efforts to operate in the Ordinary Course of Business and, subject to the requirements of this Agreement, the other Transaction Documents and the Contemplated Transactions, to preserve, maintain and protect their material assets and the goodwill of the Business and to not take any action or omit to take any action that would result in (or would reasonably be likely to result in) any of the closing conditions set forth in Section 7.1 or Section 7.2 to be unsatisfied. Without limiting the foregoing, during the Interim Period, except as otherwise expressly contemplated by this Agreement, as set forth on Part A of Section 5.1 of the Seller Disclosure Letter, or as consented to by the Purchaser or Greenbrook, the Transferred Companies shall not, and the Seller Parties shall cause each of the Success Subject Companies not to:
(a) Until the Closing sell or the earlier termination dispose of this Agreement in accordance with its termsany of their material assets or properties, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: other than (i) conduct its business (including the Business) sales or dispositions in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services sales or dispositions of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with itobsolete or surplus assets, (iii) subject to sales or dispositions in connection with the normal repair and/or replacement of assets or properties, or (iv) sales or dispositions in accordance with any Material Contract;
(b) directly or indirectly acquire, whether by merger or consolidation with, or acquiring all or substantially all of the assets of or Equity Interests in, any other Person;
(c) grant, issue, sell or otherwise dispose of any Equity Interests in any Success Subject Company;
(d) liquidate, dissolve, reorganize or otherwise wind up the Business or its operations;
(e) amend or modify their respective Governing Documents;
(f) effect any recapitalization or reclassification, or effect any like change in its equity capitalization;
(g) engage in any material new line of business;
(h) (i) adopt or change any material accounting methods or periods, policies or practices inconsistent with past practice, except as required by applicable LawsLaw, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent(ii) make, revoke or amend any material Tax election, (iii) enter into any Tax sharing, allocation or similar agreement, (iv) comply with applicable Lawenter into any closing agreement, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts settle or Taxes)compromise any Tax claim, assessment or deficiency, (vi) maintain and operate its properties surrender any right to a Tax refund, (vii) filed any Tax Return inconsistent with past practice, (viii) file an amended Tax Return, or (ix) consent to an extension or waiver of any statute of limitations with respect to Taxes;
(i) (A) increase the compensation or benefits of any director, officer, employee or independent contractor of any Success Subject Company (other than increases in a good and workmanlike manner base salary for non-officer employees in the Ordinary Course of BusinessBusiness consistent with past practice and not exceeding 5% per employee, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner provided that such increases are not, in the Ordinary Course of Business.
(b) Without limiting aggregate, material to the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the CompanySuccess Subject Companies), (B) purchaseamend, redeem modify, adopt or otherwise acquire terminate any Success Company Plan or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Success Company Plan if it were was in existence as of effect on the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of BusinessAgreement, (C) materially increase the compensation hire or fringe benefits of terminate any Related Employee that is not in the Ordinary Course of Businessofficer (other than for cause), or (D) pay hire any bonus new employee whose annual compensation opportunity exceeds $150,000;
(j) incur, issue, renew, prepay, syndicate, refinance or modify in any material respect the terms of any indebtedness for borrowed money, or assume or guarantee, or otherwise as an accommodation become responsible for, indebtedness for borrowed money owed by any other person, or make, forgive or cancel any loans, advances or capital contributions to, accelerate or investments in, any right other person (other than one of the Transferred Companies), in each case in an amount in excess of US$1,000,000 individually or US$3,000,000 in the aggregate, including any borrowings under a credit agreement and in respect of letters of credit);
(k) amend, terminate (unless the counterparty is in default under the applicable Material Contract and such termination is permitted) or waive any material term under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company Material Contract other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvil) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.
(c) Until . In addition to the Closing or foregoing, during the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectlyInterim Period, the right to control or direct Seller Parties shall and shall cause each of the Business or operations prior to Success Subject Companies to, take the Closing. Prior to specific actions set forth in Part B of Section 5.1 of the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operationsSeller Disclosure Letter.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Klein Benjamin)
Conduct of the Business Prior to Closing. (a) Until Between the date hereof and the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”)unless otherwise approved in writing by Investor, the Company shall: , and shall cause each of its Subsidiaries to:
(i) conduct its maintain their legal existence and business (including the Business) in the Ordinary Course of Business, organization;
(ii) use commercially reasonable best efforts consistent with past practices to (A) preserve its the business organization of the Company Group as currently conducted in all material respects, (B) retain their material Permits, (C) maintain and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory preserve intact in all material respects their business relationships with material customers, vendors suppliers, vendors, service providers, personnel and others having business relationships relations with itthem, and (D) retain the services of their present officers and key employees, in each case, such that their goodwill and ongoing business shall be unimpaired in all material respects at the Closing Date;
(iii) subject use commercially reasonable best efforts to applicable Lawsmaintain their facilities and assets in substantially the same state of repair, confer order and condition as they were on a regular the date hereof, except for reasonable wear and frequent basis with Representatives tear and acts of Parent to report operational matters and the general status of ongoing operations as requested by Parent, God;
(iv) comply maintain their books and records in accordance with applicable Lawpast practice, and use commercially reasonable best efforts to maintain in full force and effect all insurance policies (or obtain suitable replacement policies providing substantially the same or better combined coverage and containing terms and conditions substantially the same as, or better than, the coverage most recently maintained by the Company Group), except for changes to such policies made in the ordinary course of business;
(v) pay its debts take all actions, execute all documents, and Taxes when due (subject make all filings, in each case, reasonably necessary to good faith disputes over such debts or Taxes), cause each applicable Governmental Authority to identify a member of the Company Group as the owner of record of all Registered IP; and
(vi) maintain and operate its properties conduct their business in a good and workmanlike manner all material respects in the Ordinary Course ordinary course consistent with past practice (including, without limitation, with respect to the collection of Businessreceivables, the payment of payables and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course making of Businesscapital expenditures).
(b) Without limiting Between the foregoing date hereof and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, unless otherwise approved in writing by Investor, the Company shall not, and the Sellers shall cause the Company each of its Subsidiaries not to:
(i) issueeffect any change to their certificates of incorporation, purchase certificates of formation or sell any membership units certificates of limited partnership, and to their bylaws, limited liability company agreements or other Equity of the Company limited partnership agreements (or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equityequivalent governing documents);
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sellacquire, license, sublicense, covenant not to sue underassert, abandon, assignallow to lapse, transfercreate any Lien (other than a Permitted Lien) on, disclose, encumber or otherwise grant dispose of any rights under material assets (whether tangible or intangible) or make any of the Company’s Intellectual Property commitment to any Persondo so, other than in the Ordinary Course ordinary course of Businessbusiness consistent with past practice;
(xviiii) maintain issue, sell or pledge, or authorize or propose the issuance, sale or pledge of (A) additional equity securities of any member of the Company Group, or securities convertible into or exchangeable for any such equity securities, or any rights, warrants or options to acquire any such equity securities or other convertible securities of any member of the Company Group or (B) any other securities in respect of, in lieu of, or in substitution for equity securities of any member of the Company Group outstanding on the date hereof;
(iv) redeem, purchase or otherwise acquire any outstanding equity securities of any member of the Company Group;
(v) incur any indebtedness for borrowed money (other than drawings on the Company Group’s revolving credit facility in the ordinary course of business), make any loans or advances, assume, guarantee or endorse or otherwise become responsible for the obligation of any other Person, or subject any of its properties or assets to any Lien other than Permitted Liens;
(vi) make or cause to be made any dividend, distribution, redemption, repurchase or other payment of cash or property on or in respect of shares of capital stock or equity securities, any recapitalization, reclassification, issuance, split, combination or other transaction involving their equity securities or grant any option, warrant or right to acquire any such shares of capital stock or equity securities;
(vii) except as required by Company Plans as of the date hereof or to comply with applicable Laws, (A) increase in any manner the rate or terms of compensation (including target bonus levels) or benefits of any of its current conditionor former employees, consultants or directors, other than increases in base salary for non-executive employees in the ordinary wear and tear excludedcourse of business consistent with past practice, (B) pay or agree to pay any bonus, pension, retirement allowance or other employee benefit not contemplated by any Company Plan to any current or former director, consultant or employee, other than in the ordinary course of business consistent with insurance in such amounts and of such kinds comparable to past practice, or (C) enter into, adopt or amend any employment, bonus, severance or retirement contract, or any plan, agreement or arrangement that would have constituted a Company Plan if it had been in effect on the date of this Agreementhereof;
(xviiviii) materially alter make any capital contributions or investments other than to or between the Company and its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilitiesSubsidiaries;
(xviiiix) make except in the ordinary course of business or commit to make as required by clause (x) below, enter into, terminate or amend any capital expenditures except contract that would have been a Material Contract if such Contract had been in effect on the date hereof (other than
(A) as contemplated by bidding for and entering into contracts with customers or suppliers in the Company’s then current budgetordinary course of business consistent with past practice, (B) in terminations of contracts and Leases as a result of the Ordinary Course expiration of Businessthe term of such contracts or Leases), or (C) renewals of Leases in the ordinary course of business consistent with past practice or (D) licenses of Intellectual Property in the ordinary course of business consistent with past practice; provided, that such expenditures as licenses do not exceed $100,000 in grant any other Person exclusive rights with respect to any Intellectual Property owned by any member of the aggregateCompany Group or contain any minimum royalty terms);
(xixx) hire fail to exercise any new rights of renewal with respect to any Material Contract or material Leased Real Property that by its terms would otherwise expire or otherwise take any action which, with the lapse of time or giving of notice or both, would result in a default under any material Contract or any Lease;
(xi) write off as uncollectible any material amount of notes or accounts receivable, except write offs in the ordinary course of business consistent with past practice;
(xii) plan, announce, implement or effect any reduction in force, lay off, early retirement program, severance program or other program or effort concerning the termination of employment of employees or officers of any member of the Company who cannot be terminated at-will Group (other than terminations of individual employees in the ordinary course of business) that would constitute a “mass layoff” or within sixty “plant closing” (60) days and without severanceas defined under WARN), except as set forth on Schedule 7.1(b)(xii);
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxiixiii) enter into or amend any contract transaction with any manager of the Company or Company affiliate or representative thereof an Affiliate (other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or existing transactions set forth on Schedule 7.1(b)(xiii))(A), (B) lapse;
(xxiv) allow its levels of inventory transactions pursuant to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects existing Contracts with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer Affiliates as of the Company to agree or commit to dodate hereof, any (C) payment of the foregoing.
salary and benefits (c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise the limitations in Section 7.1(b)(xiii)(C)) and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain ordinary course expense reimbursement not to exceed $5,000 for each individual reimbursement or $50,000 in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, aggregate between the right to control or direct the Business or operations prior to the Closing. Prior to the date hereof and Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.and
Appears in 1 contract
Samples: Contribution Agreement
Conduct of the Business Prior to Closing. (a1) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator Subject to the Company and Pre-Closing Reorganization, during the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectivelyInterim Period, the “CAT Related Internal Transaction”), Vendor shall cause the Company shall: (i) Purchased Corporations to conduct its business (including the Business) their businesses in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of BusinessCourse.
(b2) Without limiting the foregoing and generality of the foregoing, except for the CAT Related Internal Transaction, the Company covenants and agrees that, without with the prior written consent of Purchaserthe Purchaser or as required to carry out the Pre-Closing Reorganization (which, which consent for greater certainty, will not be unreasonably withheldrequire the consent of the Purchaser), conditioned the Vendor shall cause each Purchased Corporation to:
(a) not cause or delayed, until permit to exist a breach of any representations and warranties of the Vendor contained in this Agreement;
(b) conduct the business in such a manner that on the Closing or Date such representations and warranties will be true and correct in all material respects as if they were made on and as of such date;
(c) preserve intact the earlier termination current business organization of this Agreement in accordance with its termsthe Purchased Corporations;
(d) to the extent reasonably practicable, the Company shall notmaintain good relations with, and the Sellers goodwill of, suppliers, creditors and all other Persons having business relationships with the Purchased Corporations, provided that this Section 6.1(2)(d) shall cause not require the Company Purchased Corporations to make any payments to such Persons;
(e) retain possession and control of the assets of the business and preserve the confidentiality of any confidential or proprietary information of the Purchased Corporation;
(f) maintain the assets of each of the Purchased Corporation consistent with past practice;
(g) not todo any of the following:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, capital expenditure or commitment or agreement of any character to do so in respect of any such membership unitseither Purchased Corporation that, capital stock individually or other Equityin the aggregate, exceeds $10,000;
(ii) leaseaccrue any new Indebtedness that, licenseindividually or in the aggregate, assign, exceeds $10,000;
(iii) sell, transfer transfer, pledge, lease or otherwise dispose of any of its properties, rights, businesses or the assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolutionPurchased Corporations;
(iv) createdeclare or pay any dividend or other distribution on or in respect of any shares in either of the Purchased Corporations, incuror purchase, assumeredeem or acquire any of such shares;
(v) fail to notify the Purchaser promptly of any material change in relation to the Purchased Corporations;
(vi) fail to prosecute with commercially reasonable efforts any pending applications to any Governmental Entities, Guarantee or otherwise become liable or obligated provided that the Vendor shall not be required to make any expenditures with respect to any Indebtedness, or such prosecution;
(vii) make any loan or advance to, or any capital contribution or investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any propertiesor assume, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem guarantee or otherwise acquire become liable with respect to the liabilities or dispose of obligations of, any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;Person; or
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Samples: Share Purchase Agreement
Conduct of the Business Prior to Closing. (a) Until Except with the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of PurchaserMedirisk and except as may be required to effect the transactions contemplated by this Agreement, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of between the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect and the benefits provided to or with respect to any employee earlier of (i) Closing and (ii) the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against Shareholders will cause the Company other than in to (a) make no distributions of its assets; (b) conduct the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies operations of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course ordinary course of Business;
business; (xivc) amend any Organizational Documents keep and maintain the properties and facilities of the business of the Company in good condition, repair and working order, reasonable wear and tear excepted, and fully insured for liability and property damages; (d) use its reasonable best efforts to preserve intact the business of the Company;
; (xve) selluse its reasonable best efforts to retain the service of its employees, agents and consultants involved with or employed by the Company on terms and conditions not less favorable than those existing prior to the execution of this Agreement; (f) cooperate with Medirisk's representatives (without disclosure of this Agreement or the contemplated sale to Seller's employees, customers or suppliers without the consent of Medirisk) in reviewing facts and establishing and implementing procedures necessary to effect the transactions contemplated by this Agreement; (g) conduct its activities in a manner consistent with this Agreement; (h) not enter into, assume or make any contract, loan, license, sublicensedesignation, covenant loan commitment, purchase, sale or disposition of assets of Seller outside the ordinary course of business; (i) except for mailing invoices in the ordinary course of business, not to sue under, abandon, assign, transfer, disclose, encumber contact any customer regarding collection of any account receivable and not discount any account receivable; (j) not declare any dividend or otherwise grant distribution; and (k) promptly advise Medirisk in writing of any rights under any of material adverse change in the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten 's financial condition or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Businessbusiness affairs.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption each of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company its Subsidiaries shall: (i) conduct its business (including the Business) in the Ordinary Course ordinary course of Businessbusiness consistent with past practice, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with itpresent employees, (iii) subject exercise reasonable best efforts to applicable Laws, confer on a regular preserve the relationships of each of the Company and frequent basis its Subsidiaries with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by ParentPersons having significant relations therewith, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Businessmanner, and (viiv) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Businessmanner.
(b) Without limiting Except as otherwise expressly permitted in this Agreement, including without limitation, with respect to the foregoing and except for matters set forth on Section 6.01(b) of the CAT Related Internal Transaction, the Company covenants and agrees thatDisclosure Schedules, without the prior written consent of Purchaserthe Parent, which consent will shall not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company and each of its Subsidiaries shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units Membership Interests, shares, capital stock or other Equity of the Company or its Subsidiaries or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership unitsMembership Interests, shares, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or and obsolete equipment in the Ordinary Course ordinary course of Businessbusiness;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolutiondissolution or filing of a petition in bankruptcy under any provision of federal or state bankruptcy Law or consent to the filing of any bankruptcy petition against it under any similar Law;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any IndebtednessDebt, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of BusinessPerson;
(v) incur any Encumbrances on any properties, rights or assets of the CompanyCompany or its Subsidiaries, in each case, other than Permitted Encumbrances in the Ordinary Course ordinary course of Businessbusiness consistent with past practice;
(vi) enter into any new lease for any Real Property Property, vehicles or any other personal property or modify, amend, renew, terminate, extend or grant or seek any waiver under terminate any existing lease for any Real Property Property, vehicles or any other personal property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property Property, vehicles or any other personal property of any of the CompanyCompany or its Subsidiaries, excluding in all cases acquisition of inventory and leasing of vehicles and equipment in the ordinary course of business consistent with past practice;
(vii) (A) make any distributions (other than distributions of cash) in respect of, any Membership Interests, shares, capital stock or Equity of any of the Company or its Subsidiaries, , (B) split, combine or reclassify any of its outstanding unitsMembership Interests, shares, capital stock or Equity of any of the Company or its Subsidiaries or issue or authorize the issuance of any shares, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Companyits Subsidiaries, (BC) purchase, redeem or otherwise acquire or dispose of any unitsMembership Interests, shares, capital stock or Equity of any of the CompanyCompany or its Subsidiaries, or (CD) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any unitsMembership Interests, shares, capital stock or Equity of any of the CompanyCompany or its Subsidiaries;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of any of the Company or its Subsidiaries or otherwise increase the Liabilities of any of the Company or its Subsidiaries under the Benefit Plans, except as required by Law and other than in Law, or take any action to accelerate vesting under, or release any restrictions applicable under, any of the Ordinary Course foregoing for any employee of Businessany of the Company or its Subsidiaries, (B) materially increase the compensation or fringe benefits of any employee of any of the Company who is not a Related Employee that is not in the Ordinary Course of Businessor its Subsidiaries, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of any of the Company other than in the Ordinary Course of Businessor its Subsidiaries, or (ED) loan or advance any money or other property to any employee of any of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of BusinessSubsidiaries;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law Law, GAAP, or GAAPIFRS);
(x) make, make or change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, enter into any closing agreement, settle any Tax claim or assessment relating to any of the Company or its Subsidiaries, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to any of the CompanyCompany or its Subsidiaries, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, Contracts or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction Merger or (B) against any of the Company other than in the Ordinary Course of Businessor its Subsidiaries;
(xiii) change, or agree to change, any material business policies of any of the Company or its Subsidiaries which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Businesswarranties;
(xiv) amend any Organizational Documents of any of the CompanyCompany or its Subsidiaries;
(xv) sell, license, sublicense, covenant not to sue xxx under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Company or its Subsidiaries’ Intellectual Property to any Person, other than in the Ordinary Course ordinary course of Businessbusiness consistent with past practice;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxvxvii) fail to comply in all material respects with shorten or lengthen the customary payment and collection cycles, as the case may be, for any applicable Lawof the Company or its Subsidiaries’ trade accounts payable and receivables; or
(xxvixviii) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Samples: Agreement and Plan of Merger and Reorganization (Green Thumb Industries Inc.)
Conduct of the Business Prior to Closing. (a) Until Except with the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of PurchaserMedirisk and except as may be required to effect the transactions contemplated by this Agreement, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of between the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect and the benefits provided to or with respect to any employee earlier of (i) the Company or otherwise increase Merger Effective Time and (ii) the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
the Company will (xiia) compromise, settle, grant not make any waiver or release relating to or otherwise adjust any right or claim with respect distributions of its assets to any pending persons except as expressly contemplated by the Schedules hereto; (b) conduct its operations in the ordinary course of business; (c) keep and maintain its properties and facilities in good condition, repair and working order, reasonable wear and tear excepted, and fully insured for liability and property damages; (d) use commercially reasonable efforts to preserve intact its business; (e) use commercially reasonable efforts to retain the service of its employees, agents and consultants involved with or threatened Action (A) relating employed by the Company on terms and conditions not less favorable than those existing prior to the Transaction execution of this Agreement; (f) cooperate with Medirisk's representatives (without disclosure of this Agreement or the contemplated sale to the Company's customers or suppliers without the consent of Medirisk) in reviewing facts and establishing and implementing procedures necessary to effect the Merger as contemplated by this Agreement; (Bg) against the Company other than conduct its activities in the Ordinary Course a manner consistent with this Agreement; (h) not enter into, assume or make any contract, loan, license, designation, loan commitment, purchase, sale or disposition of Business;
(xiii) change, or agree to change, any material business policies assets of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than outside the ordinary course of business; (i) except for mailing invoices in the Ordinary Course ordinary course of Business;
business, not contact any customer regarding collection of any account receivable and not discount any account receivable; (xivj) amend not declare any Organizational Documents dividend or comparable distribution of assets; and (k) promptly advise Medirisk in writing of any material adverse change in the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber 's financial condition or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Businessbusiness affairs.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until Except as otherwise contemplated by this Agreement, between the Effective Date and the Closing or the earlier termination of this Agreement in accordance with its termsDate, Clorox Parent will, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectivelycause each Business Operating Entity to, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) Business in the Ordinary Course ordinary course of Businessbusiness, consistent with past practice and in accordance with applicable Law with no less diligence and effort than would be applied in the absence of this Agreement, (ii) use commercially reasonable best efforts to (A) preserve intact the current business organization of the Transferred Companies and (B) maintain relations and goodwill with suppliers, customers, landlords and creditors of the Business in the ordinary course of business consistent with past practices to preserve its business organization practice and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Lawsmake capital expenditures, confer on a regular research and frequent basis development expenditures and sales, marketing and promotions expenditures consistent with Representatives the ordinary course of Parent to report operational matters business of the Business and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or TaxesSchedule 5.2(a), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting Except as otherwise contemplated by this Agreement or as set forth in Schedule 5.2, between the foregoing Effective Date and except for the CAT Related Internal TransactionClosing Date, Clorox Parent will not, and will cause the Company covenants and agrees thatBusiness Operating Entities to not, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase terminate or sell amend in any membership units material respects any Transferred Agreement or other Equity of the material Governmental Authorization to which a Transferred Company is a party or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equitywhich is a Transferred Asset;
(ii) leaseenter into any new Contracts of the kind described in Section 3.12(a) or any Intellectual Property Agreements, licenseor terminate, assignamend or modify any Listed Agreement or any Intellectual Property Agreements, sell, transfer or otherwise dispose outside the ordinary course of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Businessbusiness;
(iii) adopt amend or otherwise modify the Governing Documents of any plan of merger, consolidation, reorganization, liquidation or dissolutionthe Transferred Companies;
(iv) createissue, incursell, assumecontract to issue or sell, Guarantee pledge, license, abandon, dispose of, grant, encumber or otherwise become liable authorize the issuance, sale, pledge, disposition, grant or obligated with respect encumbrance of (A) any equity interests of any of the Transferred Companies, (B) any options, warrants, convertible securities or other rights of any kind to acquire any Indebtedness, or make any loan or advance toequity interest, or any investment inother ownership interest, of the Transferred Companies, or (C) any Person other than in material assets of the Ordinary Course Business Operating Entities (except Inventory and obsolete or excess equipment) outside the ordinary course of Businessbusiness or material Business Intellectual Property;
(v) incur repurchase or redeem or split, reverse split or reclassify any Encumbrances on equity interests of any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of BusinessTransferred Companies;
(vi) enter into any new lease for any Real Property acquire by merging or modifyconsolidating with, amend, renew, terminateby purchasing a substantial portion of the assets of, or grant by any other manner, any business or seek any waiver under any existing lease for any Real Property corporation, partnership, association or purchase other business organization or acquire division thereof or enter into any agreement to purchase or otherwise acquire any Real Property assets that are material outside the ordinary course of the Companybusiness;
(vii) (A) splitadopt or, combine or reclassify except to the extent required by Law, amend in any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of material respect any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Business Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan Plans in a manner that would affect materially increases the benefits provided cost as to or with respect Transferring Employees except in each case plans that apply to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to PurchaserClorox Parent employees generally, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt any other agreement that would materially alter the terms of employment and/or compensation or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member benefits of a consolidated group;
(xi) (A) enter intoTransferring Employee, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in adopt any material respect, in whole collective bargaining agreement with any labor union or in part, rights and interests in or under any Material Contractssimilar organization that applies to, or (B) enter into discussions with third parties regarding covers, Transferring Employees or amend or modify any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect Employment Agreement in any material respect;
(xxiiviii) enter into implement any contract with employee layoffs in a Transferred Company that could implicate the WARN Act or any manager similar foreign law in respect of collective layoffs;
(ix) grant to any Transferring Employee whose annual salary is $100,000 (or equivalent in local currency) or more any material increase in guaranteed cash compensation, other than planned, routine salary adjustments on or about October 1, 2010, or January 1, 2011, except as may be required by Law or under existing agreements, any renewal of an existing Employment Agreement or any Business Benefit Plans;
(x) make or revoke any material Tax election, settle or compromise any material Tax liability or materially amend any Tax Return that would reasonably be expected to adversely affect the Business;
(xi) permit any of the Insurance Policies to expire, or to be canceled or terminated, unless a comparable insurance policy is obtained and put into effect;
(xii) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of any of the Business Operating Companies or otherwise permit the corporate existence of any of the Business Operating Companies or the rights or franchises or any license, permit or authorization under which the business of any of the Business Operating Companies operates to be suspended, lapsed or revoked;
(xiii) permit the Transferred Companies to create, incur, assume or guarantee any material Indebtedness, or subject any of the Transferred Assets or Transferred Companies to any Lien (other than Permitted Liens);
(xiv) cancel or compromise any material debt or material claim owed to any Transferred Company or Company affiliate waive or representative thereof release any material right of any Transferred Company, or that is otherwise a Transferred Asset, except in the ordinary course of business of the Business consistent with prior practices;
(xv) change financial accounting methods, practices, policies or principles or elections from those utilized in the preparation of the latest audited financial statements of the Business for the fiscal year ended June 30, 2010, other than any such changes as may be required under GAAP or other generally accepted accounting principles of the applicable jurisdiction, or make xxxxxxxx, collect accounts receivable or pay accounts payable other than in the Ordinary Course ordinary course of Businessbusiness consistent with past practice;
(xxiiixvi) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels otherwise conduct the Business outside of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Lawordinary course of business; or
(xxvixvii) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.
(c) Until the Closing or the earlier termination Notwithstanding any other provision of this Agreement in accordance with its termsto the contrary, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior Closing Date, Clorox Parent or any of its Affiliates may cause any Transferred Company to pay out, distribute or otherwise transfer, as applicable, any cash or accounts payable, accounts receivable or assets not related to the Closing, the Business held by or on behalf of any Transferred Company shall exercise, consistent with the terms and conditions to Clorox Parent or any Subsidiary of this Agreement, complete control over its Business and operationsClorox Parent.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Armored AutoGroup Inc.)
Conduct of the Business Prior to Closing. (a) Until Seller covenants and agrees that, prior to the Closing Date or the earlier termination of this Agreement Agreement, unless the Buyer shall otherwise agree in accordance with its termswriting, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: it shall (i) conduct its business (including the Business) operations of Seller only in the Ordinary Course ordinary course of Business, business and consistent with past practice; (ii) use reasonable its best efforts consistent with past practices to maintain and preserve its business, assets, prospects, employees, customers and other advantageous business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, relationships; (iii) subject to applicable Lawsmaintain the Purchased Assets in substantially their current state of repair, confer on a regular excepting normal wear and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parenttear, (iv) comply with applicable Lawthrough the Closing Date, maintain insurance covering the Purchase Assets of the same nature and level as that in effect on the date hereof, (v) pay its debts make timely payments on accounts payable and Taxes when due (subject to good faith disputes over such debts or Taxes), other obligations of Seller in accordance with Seller's past practices; (vi) maintain and operate its properties in a good and workmanlike manner not, directly or indirectly, except in the Ordinary Course ordinary course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assignbusiness, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any unitsof its assets; (vii) enter into any contract, capital stock agreement, commitment or Equity arrangement except in the ordinary course of the Company;
business; (viii) (A) establishnot, adopt, directly or indirectly enter into or terminate any material contract or agreement, release or relinquish any material contract right or modify any contract affecting the Purchased Assets; (ix) not take any action with respect to the grant of any severance or termination pay (otherwise than pursuant to policies or agreements of Seller in effect on the date hereof) or with respect to any increase of benefits payable under its severance or termination pay policies or agreements in effect on the date hereof; (x) not adopt or amend any bonus, profit sharing, compensation, stock option, pension, retirement, deferred compensation, employment or other employee benefit plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as for the benefit or welfare of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company Seller or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase any manner the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of BusinessSeller.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until From the date of this Agreement until Closing or the earlier termination of this Agreement in accordance with pursuant to its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing terms (collectively, the “CAT Related Internal TransactionInterim Period”), the Company shall: (i) conduct its business except as otherwise contemplated by this Agreement (including the Business) Restructuring), required by applicable Law or consented to in writing by the Buyer (to be granted or withheld in the Ordinary Course Buyer’s sole discretion), the Equity Sellers, STC, SRC and SMC shall, and the Equity Sellers shall cause the Companies to, operate the Business in the ordinary course of Businessbusiness, (ii) use reasonable best efforts consistent with past practices practice, and use commercially reasonable efforts to maintain and preserve its business organization intact the current organization, business, goodwill and goodwillrelationships of the Business and their employees, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors lenders, distributors, suppliers, regulators, and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting During the foregoing and Interim Period, except for as otherwise contemplated by this Agreement (including in connection with the CAT Related Internal TransactionRestructuring), required by applicable Law, set forth on Schedule 6.1(b) hereto, or consented to in writing by the Buyer (to be granted or withheld in the Buyer’s sole discretion), the Company covenants Equity Sellers, SMC, SRC and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall notSTC shall, and the Equity Sellers shall cause the Company not Companies to:
(i) issue, purchase or sell any membership units or other Equity not (A) amend the respective Governing Documents of the Company Companies in any manner or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (AB) split, combine or reclassify the membership interests, units, or other equity interests of the Companies;
(ii) not issue, sell, pledge, transfer, or dispose of, or agree to issue, sell pledge, transfer or dispose of, any membership interests, units or other equity interests of the Companies, or issue any membership interests, units, or other equity interests of any class or issue or become a party to any subscriptions, warrants, rights, options, convertible securities or other agreements or commitments of any character relating to the issued or unissued membership interests, units or other equity interests of the Companies;
(iii) not (A) redeem, purchase or otherwise acquire any outstanding membership interests, units or other equity interests of the Companies or declare or pay any dividend of any Company or make any other distribution from any Company to any Person on or prior to the Closing Date, other than dividends paid to, or distributions of cash to, Xxxxxxx NJ or Xxxxxxx PA in the ordinary course of business consistent with past practice and applicable Law, and (B) declare, set aside or make any payment or distribution of cash or other property in respect of the Purchased Interests, other than dividends paid to, or distributions of cash to, Xxxxxxx NJ or Xxxxxxx PA in the ordinary course of business consistent with past practice and applicable Law;
(iv) not sell, assign, lease, transfer, license, abandon or otherwise dispose of, directly or indirectly, any Purchased Assets, or material property or material assets owned by the Companies, including the Owned Real Property and the Leased Real Property, except for (A) the sale, lease, licensing, transfer or disposition of inventory or obsolete machinery, equipment, or other assets in the ordinary course of business, consistent with past practice, and (B) as to the Leased Real Property, the exercise of the Companies rights and remedies under any lease thereof, in the ordinary course of business, including any expiration, termination, renewal, expansions, reductions or similar rights as to such Leased Real Property;
(v) not abandon, dispose of, terminate any ownership rights to, or assign, sell, lease, license, or transfer any material Intellectual Property Asset or permit any of its outstanding units, capital stock or Equity rights to any such Intellectual Property Assets to lapse (other than (A) the expiration of Intellectual Property Assets in accordance with its statutory terms and (B) non-exclusive licenses granted by any of the Company Companies to customers in the ordinary course of business);
(vi) disclose any confidential information or issue trade secrets to any Person (other than pursuant to written confidentiality agreements entered into in the ordinary course of business);
(vii) not make any change in any cash management practices or authorize any method of accounting or auditing practice, including any working capital procedures or practices of the issuance Companies, other than changes required as a result of changes in GAAP or applicable Law (and in such case, only after providing reasonable written notice and offering Buyer the opportunity to discuss such change with the Sellers’ Representative);
(viii) not accelerate the collection of, or discount, accounts receivable, or delay the payment of accounts payable or accrued expenses of any unitsCompany, other than in the ordinary course of business;
(ix) not make any loans, advances or capital stock contributions to, or Equity of the investments in, any other Person other than loans, advances or capital contributions by a Company (A) to another Company, (B) purchaseto any employee in connection with travel, redeem entertainment or otherwise acquire related business expenses or dispose other customary out-of-pocket expenses in the ordinary course of any unitsbusiness, capital stock or Equity of the Companyconsistent with past practice, or (C) issuein the ordinary course of business, sellconsistent with past practice, transferto any customer, grantdistributor, pledgelicensor, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund supplier or other arrangement that would be Person with which a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP)has significant business relations;
(x) not (A) make, rescind or change or revoke any election relating to TaxesTax election, (B) change an any annual Tax accounting period or period, (C) adopt or change any method of Tax accounting method relating to Taxesor reverse any accruals, file (D) sign or enter into any amended voluntary disclosure (or similar) agreement, “closing agreement” or settlement with any Governmental Authority, (E) settle or compromise any claim or assessment of Tax Returnliability, surrender any right to claim a refund, (F) consent to any extension or waiver of the limitation limitations period applicable to any Tax claim or assessment relating assessment, (G) file any amended Tax Return, (H) surrender any right to claim a Tax refund, offset or other reduction in liability, (I) request any Tax ruling or similar request, (J) incur any Tax liability other than in the Companyordinary course of business, (K) act or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow omit to lapse, assign, convey, encumber act where such action or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might omission to act would reasonably be expected to result in a Contract that would be a Material Contract if in have the effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant increasing any waiver present or release relating to future Tax liability or otherwise adjust decreasing any right present or claim with respect to future Tax benefit for any pending Company or threatened Action (A) relating to the Transaction Buyer or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, its Affiliates or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns their direct or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect indirect equityholders in any material respect;
(xxiixi) enter into not, except as required by Law or any contract with any manager of the Company Contract or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to Seller Plan, (A) no longer be increase the amount of any bonus, salary or other compensation payable, or of any benefits, to any (1) employee or individual independent contractor of the Companies making in good standing with an applicable Governmental Authority excess of $100,000 per year, or (2) to any other employee or individual independent contractor of the Companies by more than five percent (5%), or (B) lapse;
(xxiv) allow its levels of inventory grant any bonus to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager director or executive officer of the Company to agree or commit to do, any of the foregoing.
(c) Until the Closing or the earlier termination of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of PurchaserCompanies; provided, however, that the final decisions regarding Companies may, without the Buyer’s consent (1) continue to make hires based on open position requisitions as of the date hereof or (2) replace any employees whose employment is terminated so long as such matter shall remain replacements’ base salaries are less than $150,000;
(xii) not permit the Companies to enter into or agree to enter into any merger, consolidation, acquisition, joint venture or strategic alliance with any other Person;
(xiii) not enter into any Contract with a term greater than one (1) year or that will require the payment of amounts greater than $50,000 or the receipt of amounts greater than $50,000;
(xiv) not adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of a Company, or otherwise alter a Company’s corporate structure;
(xv) other than in the sole discretion ordinary course of Purchaserbusiness, not amend, waive, modify or consent to the termination of any Material Contracts;
(xvi) (A) with respect to capital expenditures for the projects set forth in the Capital Expenditure Budget, not authorize, or make any commitment with respect to, or incur any capital expenditures in excess of the applicable line item therefor set forth in the Capital Expenditure Budget; and (B) with respect to any other type of capital expenditure that is not specifically addressed in the Capital Expenditure Budget, not authorize, or make any commitment with respect to, or incur any capital expenditures in excess of $100,000 individually or $500,000 in the aggregate;
(xvii) not purchase any real property unless included in the Capital Expenditure Budget;
(xviii) not enter into any Contract with any officer, director, manager or Affiliate of the Companies;
(xix) not enter into, modify, extend, amend, negotiate or terminate any Collective Bargaining Agreement;
(xx) not recognize or certify any Union as the bargaining representative for any employees of any of the Companies or the Offer Employees;
(xxi) not implement or announce any employee layoffs, furloughs, reductions in force, plant closings, material reductions in compensation or other similar actions that could implicate the WARN Act;
(xxii) not waive or release any noncompetition, nonsolicitation, nondisclosure or other restrictive covenant obligation of any current or former employee of any of the Companies or the Offer Employees;
(xxiii) not, except in the ordinary course of business, (A) mortgage, lease to a third party, pledge or otherwise grant any Lien (other than a Permitted Lien) on any Owned Real Property, Leased Real Property or Purchased Asset, (B) sell, transfer, license, permit to lapse or otherwise dispose of any Owned Real Property or Purchased Asset (other than inventory or obsolete equipment), (C) terminate any lease, other than a lease that expires on its own terms prior to Closing, (D) amend or modify any lease, (E) permit any Company to purchase, lease or otherwise acquire additional real property, or (F) transfer or relocate any material fixtures or equipment from any Owned Real Property other than to another Owned Real Property, other than removals or relocations of obsolete fixtures and equipment in the ordinary course of business;
(xxiv) not incur any material obligations (including Indebtedness for borrowed money) or material liabilities, whether absolute, accrued, contingent or otherwise (including without limitation, liabilities as guarantor or otherwise with respect to obligations of others), other than obligations and liabilities that will be paid off at Closing as contemplated herein or obligations and liabilities incurred in the ordinary course of business consistent with past practice;
(xxv) not commence or settle any Proceeding, other than any Proceeding involving only monetary relief in an amount of two hundred fifty thousand dollars ($250,000) or less; and
(xxvi) not authorize, or commit to agree to take, any action described in this Section 6.1(b).
(dc) Nothing Without limiting the generality of Section 6.1(a) or Section 6.1(b), nothing contained in this Agreement shall be deemed to will give Purchaserthe Buyer, directly or indirectly, the right to control or direct the Business or operations of the Companies prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Samples: Membership Interest and Asset Purchase Agreement (Arcosa, Inc.)
Conduct of the Business Prior to Closing. (a) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: Except (i) conduct its business (including the Business) as expressly provided in the Ordinary Course of Businessthis Agreement, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwillas set forth in Section 6.1 of the Cameron Disclosure Letter or the Schlumberger Disclosure Letter, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with itas applicable, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested required by Parent, Applicable Law or (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior express written consent of Purchaser, the other parties to this Agreement (which consent will shall not be unreasonably withheld, conditioned or delayed, until ):
(i) It shall conduct (and shall cause its Affiliates to conduct) the Closing Cameron Subsea Business or the earlier termination of this Agreement Schlumberger Subsea Business, as the case may be, in accordance the ordinary course consistent with its termspast practice (including with respect to the collection of receivables, payment of payables and other liabilities, advertising activities, bidding and sales practices, equipment maintenance, replacements or upgrades, inventory levels, accounting policies, contributions to or accruals to or in respect of Employee Benefit Plans and off-site and on-site storage, treatment and disposal of Hazardous Substances generated prior to Closing), and (ii) it shall use its commercially reasonable efforts (or cause its Affiliates to use their commercially reasonable efforts) to maintain the Cameron Transferred Assets or the Schlumberger Transferred Assets, as the case may be, in substantially the same condition (except normal wear and tear) existing on the date hereof.
(b) It shall use its commercially reasonable efforts, consistent with past practice, to maintain the services of, and good relations with, the Company dealers, jobbers, distributors, customers and suppliers with whom sales or purchases are currently effected in connection with the Cameron Subsea Business or the Schlumberger Subsea Business, as the case may be.
(c) It shall not, and the Sellers shall cause the Company its Affiliates not to, take any of the following actions in connection with the Cameron Subsea Business or the Schlumberger Subsea Business, as the case may be:
(i) issueincur, purchase assume or sell Guarantee any membership units or other Equity of the Company or grant Indebtedness or make any optionloans, subscriptionadvances or capital contributions to or investments in any other Person, warrant, call, commitment or agreement in each case other than in the ordinary course of any character in respect of any such membership units, capital stock or other Equitybusiness consistent with its past practice;
(ii) leaseenter into any swap, license, assign, futures or derivatives transaction except hedging activity in the ordinary course of business consistent with its past practice and internal policy guidelines;
(iii) sell, transfer transfer, pledge or otherwise dispose of any of its propertiesCameron Transferred Asset or any Schlumberger Transferred Asset, rightsas the case may be, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases except for sales of assetsinventory and the sale, inventory and/or transfer or other disposition of uneconomic or obsolete equipment in the Ordinary Course ordinary course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolutionbusiness consistent with its past practice;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to waive any Indebtedness, or make any loan or advance to, or any investment in, any Person Claims other than in the Ordinary Course ordinary course of Businessbusiness consistent with its past practice, or cancel or compromise any Indebtedness owed to it;
(v) incur any Encumbrances on any propertiesmake aggregate unbudgeted expenditures and commitments in excess of $10,000,000 in the case of Cameron and its Affiliates, rights or assets taken as a whole, and $10,000,000 in the case of the CompanySchlumberger and its Affiliates, taken as a whole, in each case, other than Permitted Encumbrances (A) in the Ordinary Course ordinary course of Businessbusiness consistent with its past practice or (B) pursuant to requirements of Applicable Law;
(vi) enter into make any new lease for change in any Real Property method of accounting or modifykeeping of books of account or accounting practices or principles, amendexcept as required by Applicable Law or, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property in the opinion of the Companyindependent public accountants of such party, by GAAP;
(vii) (A) splitexcept in the ordinary course of business consistent with its past practice, combine materially modify, amend or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Companyterminate, or (C) issuewaive any material rights under, sellany Cameron Material Contract or Schlumberger Material Contract, transferas applicable, grant, pledge, dispose or enter into any Contract that would constitute a Cameron Material Contract or Schlumberger Material Contract if entered into prior to the date of or otherwise encumber any units, capital stock or Equity of the Companythis Agreement;
(viii) (A) establishclose any facilities which are material to the financial condition, adoptresults of operations, enter into any plan, agreement, program, policy, trust, fund business or other arrangement that would be a Benefit Plan if it were in existence as prospects of the date of this Agreement Cameron Subsea Business or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Schlumberger Subsea Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Businessas applicable;
(ix) make mortgage, pledge or subject to any material change in its accounting methodsLien any of the Cameron Transferred Assets or the Schlumberger Transferred Assets, policies or practices (other than such changes that have been required by Law or GAAP)as the case may be, except for Permitted Encumbrances;
(x) make, change settle or revoke agree to settle any election relating to Taxes, change an annual accounting period litigation or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment other legal proceeding relating to the CompanyCameron Subsea Business or the Schlumberger Subsea Business, as the case may be, where such settlement would have, or become would reasonably be expected to have, individually or in the aggregate, a member material impact on the operations or conduct of a consolidated groupthe business of the Venture Entities;
(xi) (Aa) enter intomake, enter into the negotiation ofrevoke or change any material election relating to Taxes, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber (b) change or otherwise transferrevoke any Tax accounting method or (c) change any Tax accounting period if, in each case in case, such action is inconsistent with ordinary and customary historical practices and principally related to the Cameron Subsea Business or Schlumberger Subsea Business, as applicable;
(xii) (a) materially amend or terminate any material respectEmployee Benefit Plan or establish, in whole adopt or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract Employee Benefit Plan that, if in effect on the date of this Agreement, without first consulting would be a material Employee Benefit Plan, (b) enter into any collective bargaining agreement or similar agreement with Purchaser;
any labor union or works council or (xiic) compromisematerially increase salary or wages, settleas applicable, grant any waiver bonus or release relating to other incentive compensation, or otherwise adjust any right other benefits or claim with respect to any pending or threatened Action compensation, in each of clauses (Aa), (b) and (c) relating to the Transaction Cameron Subsea Business Employees or Schlumberger Subsea Business Employees, except for any such actions (i) in the ordinary course of business consistent with past practice, (ii) required by Applicable Law or the terms of any Employee Benefit Plan in effect as of the date hereof or (Biii) against the Company other than in the Ordinary Course of Businessfor which Cameron or Schlumberger, as applicable, will retain all liability;
(xiii) change, fail to renew any lease that is material to the Cameron Subsea Business or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Schlumberger Subsea Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Lawapplicable; or
(xxvixiv) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.
. For the avoidance of doubt, none of the covenants set forth in this Section 6.1 are intended to or shall impose any restriction on (c1) Until the Closing respective operations of Cameron or Schlumberger or their respective Affiliates that are not related to the Cameron Subsea Business or the earlier termination Schlumberger Subsea Business, as applicable, (2) the Non-Transferred Cameron Assets or the Non-Transferred Schlumberger Assets or (3) the ability of this Agreement in accordance with its termsCameron, Purchaser shallSchlumberger or their respective Affiliates to transfer or assign any Non-Transferred Assets or Excluded Liabilities from a Cameron Entity or a Schlumberger Entity, subject as applicable, to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, an entity that the final decisions regarding any such matter shall remain in the sole discretion of Purchaseris not a Cameron Entity or a Schlumberger Entity.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Samples: Master Formation Agreement (Cameron International Corp)
Conduct of the Business Prior to Closing. (a) Until Except as otherwise contemplated by this Agreement, between the Effective Date and the Closing or the earlier termination of this Agreement in accordance with its termsDate, Clorox Parent will, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectivelycause each Business Operating Entity to, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) Business in the Ordinary Course ordinary course of Businessbusiness, consistent with past practice and in accordance with applicable Law with no less diligence and effort than would be applied in the absence of this Agreement, (ii) use commercially reasonable best efforts to (A) preserve intact the current business organization of the Transferred Companies and (B) maintain relations and goodwill with suppliers, customers, landlords and creditors of the Business in the ordinary course of business consistent with past practices to preserve its business organization practice and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Lawsmake capital expenditures, confer on a regular research and frequent basis development expenditures and sales, marketing and promotions expenditures consistent with Representatives the ordinary course of Parent to report operational matters business of the Business and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or TaxesSchedule 5.2(a), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting Except as otherwise contemplated by this Agreement or as set forth in Schedule 5.2, between the foregoing Effective Date and except for the CAT Related Internal TransactionClosing Date, Clorox Parent will not, and will cause the Company covenants and agrees thatBusiness Operating Entities to not, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase terminate or sell amend in any membership units material respects any Transferred Agreement or other Equity of the material Governmental Authorization to which a Transferred Company is a party or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equitywhich is a Transferred Asset;
(ii) leaseenter into any new Contracts of the kind described in Section 3.12(a) or any Intellectual Property Agreements, licenseor terminate, assignamend or modify any Listed Agreement or any Intellectual Property Agreements, sell, transfer or otherwise dispose outside the ordinary course of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Businessbusiness;
(iii) adopt amend or otherwise modify the Governing Documents of any plan of merger, consolidation, reorganization, liquidation or dissolutionthe Transferred Companies;
(iv) createissue, incursell, assumecontract to issue or sell, Guarantee pledge, license, abandon, dispose of, grant, encumber or otherwise become liable authorize the issuance, sale, pledge, disposition, grant or obligated with respect encumbrance of (A) any equity interests of any of the Transferred Companies, (B) any options, warrants, convertible securities or other rights of any kind to acquire any Indebtedness, or make any loan or advance toequity interest, or any investment inother ownership interest, of the Transferred Companies, or (C) any Person other than in material assets of the Ordinary Course Business Operating Entities (except Inventory and obsolete or excess equipment) outside the ordinary course of Businessbusiness or material Business Intellectual Property;
(v) incur repurchase or redeem or split, reverse split or reclassify any Encumbrances on equity interests of any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of BusinessTransferred Companies;
(vi) enter into any new lease for any Real Property acquire by merging or modifyconsolidating with, amend, renew, terminateby purchasing a substantial portion of the assets of, or grant by any other manner, any business or seek any waiver under any existing lease for any Real Property corporation, partnership, association or purchase other business organization or acquire division thereof or enter into any agreement to purchase or otherwise acquire any Real Property assets that are material outside the ordinary course of the Companybusiness;
(vii) (A) splitadopt or, combine or reclassify except to the extent required by Law, amend in any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of material respect any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Business Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan Plans in a manner that would affect materially increases the benefits provided cost as to or with respect Transferring Employees except in each case plans that apply to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to PurchaserClorox Parent employees generally, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt any other agreement that would materially alter the terms of employment and/or compensation or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member benefits of a consolidated group;
(xi) (A) enter intoTransferring Employee, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in adopt any material respect, in whole collective bargaining agreement with any labor union or in part, rights and interests in or under any Material Contractssimilar organization that applies to, or (B) enter into discussions with third parties regarding covers, Transferring Employees or amend or modify any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect Employment Agreement in any material respect;
(xxiiviii) enter into implement any contract with employee layoffs in a Transferred Company that could implicate the WARN Act or any manager similar foreign law in respect of collective layoffs;
(ix) grant to any Transferring Employee whose annual salary is $100,000 (or equivalent in local currency) or more any material increase in guaranteed cash compensation, other than planned, routine salary adjustments on or about October 1, 2010, or January 1, 2011, except as may be required by Law or under existing agreements, any renewal of an existing Employment Agreement or any Business Benefit Plans;
(x) make or revoke any material Tax election, settle or compromise any material Tax liability or materially amend any Tax Return that would reasonably be expected to adversely affect the Business;
(xi) permit any of the Insurance Policies to expire, or to be canceled or terminated, unless a comparable insurance policy is obtained and put into effect;
(xii) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of any of the Business Operating Companies or otherwise permit the corporate existence of any of the Business Operating Companies or the rights or franchises or any license, permit or authorization under which the business of any of the Business Operating Companies operates to be suspended, lapsed or revoked;
(xiii) permit the Transferred Companies to create, incur, assume or guarantee any material Indebtedness, or subject any of the Transferred Assets or Transferred Companies to any Lien (other than Permitted Liens);
(xiv) cancel or compromise any material debt or material claim owed to any Transferred Company or Company affiliate waive or representative thereof release any material right of any Transferred Company, or that is otherwise a Transferred Asset, except in the ordinary course of business of the Business consistent with prior practices;
(xv) change financial accounting methods, practices, policies or principles or elections from those utilized in the preparation of the latest audited financial statements of the Business for the fiscal year ended June 30, 2010, other than any such changes as may be required under GAAP or other generally accepted accounting principles of the applicable jurisdiction, or make bxxxxxxx, collect accounts receivable or pay accounts payable other than in the Ordinary Course ordinary course of Businessbusiness consistent with past practice;
(xxiiixvi) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels otherwise conduct the Business outside of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Lawordinary course of business; or
(xxvixvii) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.
(c) Until the Closing or the earlier termination Notwithstanding any other provision of this Agreement in accordance with its termsto the contrary, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior Closing Date, Clorox Parent or any of its Affiliates may cause any Transferred Company to pay out, distribute or otherwise transfer, as applicable, any cash or accounts payable, accounts receivable or assets not related to the Closing, the Business held by or on behalf of any Transferred Company shall exercise, consistent with the terms and conditions to Clorox Parent or any Subsidiary of this Agreement, complete control over its Business and operationsClorox Parent.
Appears in 1 contract
Conduct of the Business Prior to Closing. Except as contemplated by this Agreement or as set forth in Section 6.1 of the Company Disclosure Letter, and except as specifically required by the terms of any Contract referenced on any portion of the Company Disclosure Letter, from the date hereof to the Closings, each of the Companies covenants and agrees, unless US Purchaser shall otherwise agree in writing (such consent not to be unreasonably withheld or delayed):
(a) Until to operate the Closing or Business and cause the earlier termination of this Agreement Business to be operated in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) all material respects in the Ordinary Course ordinary course of Businessbusiness, (ii) use reasonable best efforts consistent with past practices practice; provided, however, that no action by the Sellers or any member of the Company Group with respect to preserve its business organization and goodwill, keep available the services matters specifically addressed by any provision of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iiiSection 6.1(b) subject to applicable Laws, confer on shall constitute a regular and frequent basis with Representatives breach of Parent to report operational matters and the general status this Section 6.1(a) unless such action would constitute a breach of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxesprovision of Section 6.1(b), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.; and
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent that it will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause will not permit any other member of the Company not Group to:, take any of the following actions (except in any case to carry out the Company Group Reorganization):
(i) issue, purchase amend or sell modify the Organizational Documents of any membership units or other Equity member of the Company Group, or vote in favor of any amendment or modification of the Organizational Documents of any JV Entity, or adopt or take any action with respect to the liquidation, dissolution, restructuring, recapitalization or other reorganization of any member of the Company Group or the JV Entities;
(ii) transfer, issue, sell, dispose of, pledge, encumber or grant any Equity Securities or make other securities of any member of the Company Group or the JV Entities or grant any subscription option, subscription, warrant, call, convertible security or other similar right to purchase, agreement, contract or commitment or agreement of any character in respect of kind to acquire any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of BusinessEquity Securities;
(iii) adopt any plan of mergerdeclare, consolidationauthorize, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtednessset aside, or make pay any loan dividend or advance to, or other distribution to the holders of any investment in, Equity Securities of any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights or assets member of the CompanyCompany Group, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) the cancellation of any Intercompany Accounts pursuant to Section 2.5, (B) any dividend or distribution payable exclusively from one member of the Company Group to another, and/or (C) any dividend or distribution that is declared and paid prior to the Closings and that consists solely of cash or cash equivalents (provided that such dividend or distribution does not violate, cause a breach or default under (or any event that with notice or lapse of time or both would constitute a breach or default under), or result in the acceleration of any Indebtedness under, any Company Material Contract); or split, combine or reclassify any shares of its outstanding units, capital stock or the Equity Securities of any member of the Company Group;
(iv) except in the ordinary course of business consistent with past practice, (A) sell, assign, mortgage, transfer, lease, sublease, license or issue otherwise dispose of, or authorize the issuance of agree to sell, assign, mortgage, transfer, lease, sublease, license or otherwise dispose of, any units, capital stock or Equity member of the CompanyCompany Group’s interests in any Real Property or any material portion of the other assets or properties of the Company Group, other than interests in the Real Property set forth in Section 6.1(b)(iv) of the Company Disclosure Letter or (B) purchase, redeem encumber or otherwise subject to any Lien (other than Permitted Liens) or agree to encumber or subject to any Lien (other than Permitted Liens) any asset or property of any member of the Company Group or any Equity Securities in any member of the Company Group;
(v) (A) acquire or dispose agree to acquire, by merging or consolidating with, by purchasing any Equity Securities of or a material portion of the assets of, or by any other manner, any business or any Person or other business organization or division of any units, capital stock or Equity of the Companyother Person, or (CB) issueenter into any new line of business, sellexcept as contemplated and disclosed to the US Purchaser in writing prior to the date hereof;
(vi) acquire any real property;
(vii) except in the ordinary course of business consistent with past practice, transferpermit any member of the Company Group to incur any Indebtedness, grantor assume, pledgeguarantee, dispose of endorse or otherwise encumber become responsible for the obligations of any units, capital stock or Equity Person (other than another member of the CompanyCompany Group), or make any loans or advances to or capital contributions or other investments in any Person (other than to another member of the Company Group), in each case other than the endorsement of checks, drafts and other negotiable instruments for collection, the posting of surety or performance bonds or similar arrangements entered into in the ordinary course of business;
(viii) make any material change in any method of accounting or accounting practice or policy used by the Company Group with respect to the Business, other than any such changes required by GAAP;
(Aix) establish, adopt, enter into any planContract or transaction between AMC or any of its Affiliates (other than the members of the Company Group), agreementon the one hand, programand any member of the Company Group, policyon the other hand, trustother than as expressly contemplated by this Agreement;
(x) except in the ordinary course of business consistent with past practice, fund amend, modify, supplement, terminate or waive any rights under any Company Material Contract or Real Property Lease, or enter into any Contract of the types described in clauses (i) through (xvii) of Section 4.17(a) or any new lease, sublease, license or other arrangement that would be a Benefit Plan if it were in existence as of occupancy agreement for real property;
(xi) increase the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided compensation payable to or with respect to become payable to any employee of the Company or otherwise increase the Liabilities any member of the Company under the Benefit PlansGroup except for (A) increases in salary, except as required by Law and other than in the Ordinary Course of Businesswages, bonuses or commissions payable or to become payable pursuant to existing contracts, (B) materially increase increases in the compensation ordinary course of business consistent with past practice, not to exceed 8% of base salary, to Company Employees other than corporate group personnel whose base salary exceeds $200,000 per year, and (C) any additional one-time payments funded solely by AMC and which impose no further Liabilities (whether to make additional payments or fringe benefits of otherwise) on Purchasers or any employee member of the Company who is not a Related Employee that is not in the Ordinary Course of Business, Group;
(Cxii) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (DA) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company Employee, other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change pursuant to existing severance agreements and arrangements or revoke any election relating policies or (y) in the ordinary course of business consistent with past practice to Taxes, change an annual accounting period new or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of existing employees provided such severance shall not exceed $50,000 per individual and $250,000 in the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contractsaggregate, or (B) enter into discussions into, amend or modify any new employment agreement with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date executive officer of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against member of the Company other than in the Ordinary Course of BusinessGroup;
(xiii) changeadopt any new Company Benefit Plan, employee benefit plan or agree other pension, profit sharing, deferred compensation or similar policy, except as (A) may be required by applicable Law, (B) conducted in the ordinary course, (C) may be required to change, any material business policies effect the Company Group Reorganization as set forth on Section 6.14(a) of the Company which relate Disclosure Letter or (D) may be required to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in consummate the Ordinary Course of BusinessTransactions;
(xiv) amend enter into, modify (except in the ordinary course of business) or terminate any Organizational Documents Collective Bargaining Agreement or labor or collective bargaining Contract or, except in the ordinary course of the Companybusiness consistent with past practice, otherwise make any commitment or incur any Liability to any labor organization relating to Company Employees;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except expenditure, other than in respect of those capital expenditure projects that are incurred in the ordinary course of business consistent with past practice;
(xvi) waive, settle, satisfy or compromise any Claim (including any pending or threatened Claim), or commence or threaten any Claim, in either case in an amount that exceeds $250,000 or that restricts by its terms the ability of the Company Group to operate the Business;
(xvii) permit any of the Company Permits to lapse;
(xviii) (A) as contemplated by permit any of the Company’s then current budgetInsurance Policies to lapse, (B) in the Ordinary Course of Business, fail to maintain any self-insurance or (C) fail to use commercially reasonable efforts to cause any carriers who have underwritten insurance policies of any member of the Company Group which provide insurance coverage to the Business to continue to make such expenditures as do not exceed $100,000 in coverage available to such member of the aggregate;Company Group following the Closing Date for claims arising out of occurrences prior to the Closing Date with respect to any occurrence-based policy form; or
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with Contract to do or otherwise make any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit commitment to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.; and
(c) Until the Closing or the earlier termination of this Agreement in accordance with its termsto procure, Purchaser shall, subject to applicable laws, advise at UK Purchaser’s sole cost and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectlyrisk, the right service on or before 22 December 2010 on the landlord of the lease of 66 and 00 Xxx Xxxxxxx Xxxxxx and 0/00 Xxxxxxxxx Xxxxxx, Xxxxxx X0 dated 21 November 2006 of a valid notice to control exercise the tenant’s option to determine that lease pursuant to clause 7 of that lease if the UK Purchaser shall serve notice on the UK Company on or direct before 17 December 2010 requiring the Business or operations prior service of such notice on the landlord exercising the tenant’s option to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operationsdetermine.
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until From the Closing or the earlier termination date of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the until Closing (collectively, the “CAT Related Internal TransactionInterim Period”), except as otherwise provided in this Agreement or consented to in writing by Buyer (which consent shall not be unreasonably withheld, conditioned, or delayed), Seller shall, and shall cause the Company shall: to conduct the Business in the Ordinary Course of Business and use commercially reasonable efforts to maintain and preserve intact the current organization, business, goodwill, and relationships of the Business and its employees, customers, lenders, suppliers, regulators, and others having business relationships with the Business.
(b) During the Interim Period, except as otherwise provided in this Agreement, consented to in writing by Buyer (which consent shall not be unreasonably withheld, conditioned, or delayed) or as set forth on Schedule 6.1(b), Seller shall and shall cause the Company to:
(i) conduct its business not assign, convey, abandon, encumber, transfer, license, sublicense, covenant not to assert, allow to lapse or expire or otherwise dispose of any rights to any Company Owned Intellectual Property (including the Business) except for non-exclusive licenses granted in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company covenants and agrees that, without the prior written consent of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing or the earlier termination of this Agreement in accordance with its terms, the Company shall not, and the Sellers shall cause the Company not to:
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) (A) to the extent related to the Company, Process any Personal Information in material compliance with all applicable Privacy Requirements and (B) take all actions reasonably necessary to protect the privacy and confidentiality of, and to protect and secure, any Personal Information in the possession or control of, or Processed by or on behalf of, the Company;
(iii) not (A) amend Organizational Documents of the Company or (B) split, combine or reclassify the equity interests of the Company;
(iv) not issue, sell, pledge, transfer, or dispose of any equity securities of the Company of any class or any securities convertible into or exercisable or exchangeable for any equity or voting securities of any class of the Company;
(v) (A) not redeem, purchase or otherwise acquire any outstanding equity interest of the Company or declare or pay any dividend of the Company or make any other distribution from the Company to any Person on or prior to the Closing Date, and (B) not declare, set aside or make any payment or distribution of cash or other property in respect of the Membership Interests;
(vi) not sell, assign, lease, transfer, license, assignabandon or otherwise dispose of, sellany interest in the Company’s assets, except for the sale, lease, licensing, transfer or otherwise dispose disposition of any of its propertiesInventory or obsolete machinery, rightsequipment, businesses or other assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iiivii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtedness, or not make any loan change in any cash management practices or advance to, or any investment in, any Person other than in the Ordinary Course of Business;
(v) incur accounting methods, principles or practices, including any Encumbrances on any properties, rights working capital procedures or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity practices of the Company;
(viii) (A) establishnot accelerate the collection of, adoptor discount, enter into any planaccounts receivable, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as delay the payment of accounts payable or accrued expenses of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit PlansCompany, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make in relation to the Company, not take any material change in its accounting methodsaction or fail to take any action that has had, policies or practices (other than such changes would reasonably be expected to have, the effect of accelerating to pre-Closing periods sales to customers that have been required by Law or GAAP)would otherwise be expected to occur after the Closing;
(x) not permit the Company to make any loans, advances or capital contributions to, or investments in, any other Person other than loans, advances or capital contributions by the Company (A) to any employee of the Company in connection with travel, entertainment or related business expenses or other customary out of pocket expenses in the Ordinary Course of Business or (B) in the Ordinary Course of Business to any customer, distributor, licensor, supplier or other Person with which the Company has significant business relations;
(xi) with respect to the Company, not (A) make, change or revoke any material Tax election relating (including any election to Taxeschange the Company’s Tax classification), change an annual accounting period (B) settle or adopt or change compromise any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refundliability, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Companyassessment, or become enter into any closing agreement with respect to Taxes with any Government Authority, (C) change (or make a member request to change) an annual accounting period or any aspect of its method of accounting for Tax purposes, (D) prepare or file any material Tax Returns in a consolidated groupmanner that is inconsistent with past practice, file any amended Tax Return, or file or surrender a claim for any refund of Taxes, (E) enter into any Tax indemnity agreement, Tax sharing agreement, Tax allocation agreement, or any similar agreement, arrangement or understanding, (F) obtain or request any Tax ruling, or (G) participate in, initiate any discussion with respect to, or enter into any voluntary disclosure program (or similar program or agreement) with any Government Authority with respect to Taxes;
(xixii) not (A) enter intoincrease the amount of any bonus, enter into salary or other compensation payable, or of any benefits, (i) to any employee or individual independent contractor of the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow Company making in excess of One Hundred Thousand Dollars ($100,000) per year or (ii) to lapse, assign, convey, encumber any other employee or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contractsindividual independent contractor of the Company by more than five percent (5%), or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect bonus to any pending employee, director or threatened Action (A) relating to the Transaction or (B) against executive officer of the Company other than in the Ordinary Course of Business; provided, however, that the Company may without Buyer’s consent (1) continue to make hires based on open position requisitions as of the date hereof or (2) replace any employees whose employment is terminated so long as such replacements’ base salaries are less than One Hundred Thousand Dollars ($100,000);
(xiii) change, not permit the Company to enter into or agree to changeenter into any merger, consolidation, acquisition, joint venture or strategic alliance with any material business policies Person;
(xiv) not adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of the Company which relate to advertisingCompany, promotional activities, pricing, personnel, labor relations, sales, returns or warranties otherwise alter the Company’s corporate structure;
(xv) other than in the Ordinary Course of Business;
(xiv) amend , not amend, waive, modify or consent to the termination of, any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of BusinessMaterial Contracts;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable respect to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable , other than any purchase orders with customers that contemplate the receipt of amounts less than Two Hundred Fifty Thousand Dollars ($250,000) and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) entered into in the Ordinary Course of Business, not enter into any Contract with a term greater than one (1) year or that requires the payment of amounts greater than One Hundred Thousand Dollars (C$100,000) or receipt of amounts greater than Two Hundred Fifty Thousand Dollars ($250,000); provided, however, that such threshold for purchases of coil in the Ordinary Course of Business shall be Two Hundred Fifty Thousand Dollars ($250,000) rather than One Hundred Thousand Dollars ($100,000);
(xvii) with respect to the Company, not authorize, or make any commitment with respect to, any single capital expenditure that is in excess of Fifty Thousand Dollars ($50,000) individually or capital expenditures as do not exceed $100,000 that are, in the aggregate, in excess of One Hundred Fifty Thousand Dollars ($150,000) for the Company, except for capital expenditures already expressly included in the Company’s capital budget provided to Buyer prior to the date hereof;
(xviii) not enter into any Contract with any officer, director, manager or Affiliate of the Company;
(xix) hire not commence or settle any new employees or officers of Proceeding involving the Company who cannot be terminated at-will or within sixty (60) days and without severanceCompany;
(xx) materially alter the maintenance of its books and recordsnot, which books and records shall be maintained except in the Ordinary Course of Business., (A) mortgage, lease to a third party, pledge or otherwise grant any Encumbrance (other than a Permitted Encumbrance) on any Real Property, (B) sell, transfer, license, permit to lapse or otherwise dispose of any Real Property without Buyer’s consent, (C) terminate any Lease without Buyer’s consent, other than a Lease that expires on its own terms prior to the Closing, (D) amend or modify any Lease without Buyer’s consent, (E) permit the Company to purchase, lease or otherwise acquire additional real property or (F) transfer or relocate any material fixtures or equipment from any Real Property, other than removals or relocations of obsolete fixtures and equipment in the ordinary course of business; provided, that the same are replaced with fixtures and equipment, as applicable, of equal or greater value and utility; and
(xxi) take not authorize, or commit or agree to take, any action that would cause the representations and warranties contained described in ARTICLE IV to be untrue or incorrect in any material respect;
(xxii) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, any of the foregoingthis Section 6.1(b).
(c) Until During the Closing Interim Period, Buyer may request and use commercially reasonable efforts to obtain from any landlord of any Leased Real Property, an estoppel certificate, running in favor of Buyer (or the earlier termination of this Agreement its designee) and Buyer’s actual and prospective purchasers and/or lenders, each in accordance with its terms, Purchaser shall, subject to applicable laws, advise form and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchasersubstance requested by Xxxxx acting reasonably.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Arcosa, Inc.)
Conduct of the Business Prior to Closing. From the date hereof to the Closing, except as expressly called for by this Agreement or otherwise consented to by UBI in writing, Stockholders will, or cause to the Company to:
(a) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including carry on the Business) Business in the Ordinary Course of Businessusual and ordinary course in substantially the same manner as heretofore conducted, (ii) use reasonable best efforts consistent not institute any changes not in the ordinary course of business and consistent, where applicable, with past practices practice, and (iii) use commercially reasonable efforts to preserve its intact in all material respects Company's present business organization organization, to maintain, preserve and goodwillkeep in full force and effect the existence, rights, and franchises of the Company, to maintain the quality of services provided by Company, to keep available the services of its officerspresent employees, employees and consultants and maintain satisfactory to preserve good relationships with customers, vendors suppliers, distributors and others having business relationships dealings with itCompany, (iii) subject so that they will be available to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and UBI after the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.Closing;
(b) Without limiting continue to maintain in all material respects all of the foregoing assets and except for properties of the CAT Related Internal TransactionCompany in the manner heretofore maintained;
(c) keep in full force and effect its current insurance policies covering the Company and the Business;
(d) continue to fulfill all of Company's obligations under all material Contracts to which the Company is a party;
(e) maintain Company's books of account and records in the usual, regular and ordinary manner including, without limitation, maintaining proper accounting controls;
(f) comply with all Laws, ordinances, rules and regulations, the Company covenants and agrees that, without violation of which would have a material adverse effect on the prior written consent conduct of Purchaser, which consent will not be unreasonably withheld, conditioned or delayed, until the Closing Business or the earlier termination Company's assets, results of this Agreement operations or prospects;
(g) not (i) grant any increase in accordance the salary of any Employee except normal wage or salary increases for Employees in the ordinary course of business and consistent with its termspast practice; (ii) by means of any bonus or pursuant to any plan or arrangement or otherwise, increase by any amount the benefits or compensation of any such Employee, provided, however, the Company shall notbe permitted to pay to the Employees listed on Schedule 7.3(g) hereof, a one-time retention bonus in the aggregate amount of $105,000, with each Employee listed on Schedule 7.3(g) receiving a bonus in the amount set forth next to their name;
(h) maintain in full force and effect, by renewal if necessary, all of the Sellers shall cause the Company not to:Permits disclosed on Schedule 4.13(b) hereto;
(i) issuenot take, purchase or sell permit or suffer to be taken, any membership units or other Equity of action which is represented and warranted in Section 4.7. hereof not to have been taken since the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other EquityStatement Date;
(iij) lease, license, assign, sell, transfer or otherwise dispose of any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated with respect to any Indebtednessnot take, or make permit of suffer to be taken, any loan action that would cause or advance totend to cause the conditions upon the obligations of the parties hereto to effect the transactions contemplated hereby not to be fulfilled; including, without limitation, taking, causing to be taken, or permitting or suffering to be taken or to exist any investment inaction, any Person other than in the Ordinary Course of Business;
(v) incur any Encumbrances on any properties, rights condition or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan in a manner that would affect the benefits provided to or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consulting, or other compensation agreement with, of any of its equity holders, employees or managers other than in the Ordinary Course of Business;
(ix) make any material change in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP);
(x) make, change or revoke any election relating to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, surrender any right to claim a refund, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated group;
(xi) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case in any material respect, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaser;
(xii) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim with respect to any pending or threatened Action (A) relating to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiii) change, or agree to change, any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Business;
(xiv) amend any Organizational Documents of the Company;
(xv) sell, license, sublicense, covenant not to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and of such kinds comparable to that in effect on the date of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action thing that would cause the representations and warranties contained made in ARTICLE IV Article 4 herein not to be untrue or incorrect in any material respecttrue, correct and accurate as of the Closing;
(xxiik) enter into any contract with any manager obtain all requisite approvals, Permits, waivers and consents from governmental agencies and third parties for consummation of the Company or Company affiliate or representative thereof other than transactions contemplated hereby and required for the operation of the Business after the Closing, and take all action necessary to keep the same in full force and effect as of and after the Ordinary Course of BusinessClosing;
(xxiiil) allow not change its certificate of incorporation or bylaws or merge or consolidate or obligate itself to do so with or into any Permit to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Lawother entity; or
(xxvim) agree or commit to do, or allow or permit take any employee, manager or officer of the Company to agree or commit to do, any of the foregoing.
action as set forth in items (ca) Until the Closing or the earlier termination through (l) of this Agreement in accordance with its terms, Purchaser shall, subject to applicable laws, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaser, directly or indirectly, the right to control or direct the Business or operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operations.Section 7.3
Appears in 1 contract
Conduct of the Business Prior to Closing. (a) Until the Closing or the earlier termination of this Agreement in accordance with its terms, and except for Dispensaries assignment of ownership of the CAT Generator to the Company and the Company’s assumption of the CAT Generator Contractor which the Company and Dispensaries will consummate prior to the Closing (collectively, the “CAT Related Internal Transaction”), the Company shall: (i) conduct its business (including the Business) in the Ordinary Course of Business, (ii) use reasonable best efforts consistent with past practices to preserve its business organization and goodwill, keep available the services of its officers, employees and consultants and maintain satisfactory relationships with customers, vendors and others having business relationships with it, (iii) subject to applicable Laws, confer on a regular and frequent basis with Representatives of Parent to report operational matters and the general status of ongoing operations as requested by Parent, (iv) comply with applicable Law, (v) pay its debts and Taxes when due (subject to good faith disputes over such debts or Taxes), (vi) maintain and operate its properties in a good and workmanlike manner in the Ordinary Course of Business, and (vii) pay or cause to be paid all costs and expenses (including but not limited to insurance premiums) incurred in connection therewith in a timely manner in the Ordinary Course of Business.
(b) Without limiting the foregoing and except for the CAT Related Internal Transaction, the Company The Seller hereby covenants and agrees that, without from the prior written date of this Agreement until the Closing, the Seller will, and will cause every Acquired Subsidiary to, unless otherwise expressly contemplated by this Agreement or consented to in writing by Buyer (such consent of Purchaser, which consent will not to be unreasonably withheld, conditioned or delayed), until carry on the Business only in the ordinary course of business and in compliance with Law, use reasonable commercial efforts to, and cause every Acquired Subsidiary to use reasonable commercial efforts to: (i) preserve intact the Purchased Assets and the Business, (ii) maintain its rights and franchises, (iii) retain the services of the Key Employees, and (iv) maintain its relationships with customers, suppliers and others having business dealings with the Seller in relation with the Business or with the Acquired Subsidiaries; provided, that no action by Seller or any of its Affiliates specifically permitted by any provision of Sections 8.1(a)-8.1(s) (inclusive) shall be deemed a breach of this paragraph. Without derogating from the foregoing, except as set forth in Section 8.1 of the Disclosure Schedules or as required by applicable Law or as otherwise contemplated by the terms of this Agreement, between the date hereof and the earlier of the Closing or and the earlier termination of this Agreement pursuant to its terms, the Seller shall not do any of the following solely in connection with the Business, the Purchased Assets or the Assumed Liabilities, and the Seller shall cause every Acquired Subsidiary not to, directly or indirectly, do any of the following, in each case without the prior written consent of the Buyer (such consent not to be unreasonably withheld, conditioned or delayed):
(a) enter into any Contract involving a commitment on the part of the Seller or of an Acquired Subsidiary to purchase, sell, lease or otherwise dispose of assets required for the operation of the Business, other than sales of inventory or purchase of supplies in the ordinary course and sales or dispositions of assets pursuant to a definitive agreement in effect as of the date hereof;
(b) cause or permit any amendments to the Acquired Subsidiaries’ Charter Documents;
(c) declare, set aside, or pay any dividend or any distribution (in cash or in kind) to any Person or entity with respect to any securities of the Acquired Subsidiaries;
(d) except as required under any Employee Benefit Plan or applicable Law (including any existing collective bargaining agreements) increase the compensation or other remuneration payable to or for the benefit of or committed to be paid to or for the benefit of any Transferred Employee (other than increases to base salary in connection with promotions or position changes in the ordinary course of business that do not in the aggregate exceed 3% of the aggregate annual cost of all base salaries), or increase any benefits granted under any Employee Benefit Plan, or adopt any new employee benefit plan or program, or amend any (or enter into a new) collective bargaining agreement with respect to any of the Transferred Employees, or enter into any other binding understanding with the labor union or the workers’ committee;
(e) merge with or into, consolidate with or acquire shares or material assets of another Person;
(f) terminate or amend in any material respect any material Assumed Contract or Material Contract (other than any expiration of any such Assumed Contract or Material Contract in accordance with its termsterm), or enter into any Contract that, if entered into following the Company shall notdate hereof, and would be considered a Material Contract;
(g) sell, lease or grant any option to sell or lease, give a security interest in or otherwise create any Lien (other than a Permitted Lien) on any of the Sellers shall cause Purchased Assets;
(h) enter into new agreement in respect of, or modify in a manner that may adversely affect the Company not to:Buyer or any Acquired Subsidiary, any Related Party Transaction;
(i) issue, purchase or sell any membership units or other Equity of the Company or grant or make any option, subscription, warrant, call, commitment or agreement of any character in respect of any such membership units, capital stock or other Equity;
(ii) lease, license, assign, sell, transfer or otherwise dispose of grant any of its properties, rights, businesses or assets (including by merger, consolidation or acquisition of stock or assets) excluding in all cases sales of assets, inventory and/or obsolete equipment in the Ordinary Course of Business;
(iii) adopt any plan of merger, consolidation, reorganization, liquidation or dissolution;
(iv) create, incur, assume, Guarantee or otherwise become liable or obligated license with respect to any Indebtedness, or make any loan or advance to, or any investment in, any Person the Owned IP (other than in the Ordinary Course ordinary course of Businessbusiness, consistent with past practice), or fail to make any filing, pay any fee or take any other action necessary to maintain the existence, validity and ownership by the Seller or the Acquired Subsidiary of any Owned IP;
(vj) incur settle any Encumbrances on any properties, rights or assets of the Company, other than Permitted Encumbrances in the Ordinary Course of Business;
(vi) enter into any new lease for any Real Property or modify, amend, renew, terminate, or grant or seek any waiver under any existing lease for any Real Property or purchase or acquire or enter into any agreement to purchase or acquire any Real Property of the Company;
(vii) (A) split, combine or reclassify any of its outstanding units, capital stock or Equity of the Company or issue or authorize the issuance of any units, capital stock or Equity of the Company, (B) purchase, redeem or otherwise acquire or dispose of any units, capital stock or Equity of the Company, or (C) issue, sell, transfer, grant, pledge, dispose of or otherwise encumber any units, capital stock or Equity of the Company;
(viii) (A) establish, adopt, enter into any plan, agreement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement or amend or terminate any Benefit Plan material Action in a manner that would affect have an adverse effect on the benefits provided to Purchased Assets or with respect to any employee of the Company or otherwise increase the Liabilities of the Company under the Benefit Plans, except as required by Law and other than in the Ordinary Course of Business, (B) materially increase the compensation or fringe benefits of any employee of the Company who is not a Related Employee that is not in the Ordinary Course of Business, (C) materially increase the compensation or fringe benefits of any Related Employee that is not in the Ordinary Course of Business, (D) pay any bonus to, accelerate any right under any Benefit Plan to, grant any severance or termination pay to any employee of the Company other than in the Ordinary Course of Business, (E) loan or advance any money or other property to any employee of the Company other than in the Ordinary Course of Business; or (F) except for an employment agreement with Xxxxxx Xxxxxxx in a form acceptable to Purchaser, enter into any new employment, severance, consultingAssumed Liabilities, or other compensation agreement with, of waive any of its equity holders, employees or managers other than in material benefits related to the Ordinary Course of Business;
(ixk) make issue or sell any material change debt securities or warrants or other rights to acquire any debt securities of any Acquired Subsidiary or incur any debt in its accounting methods, policies or practices (other than such changes that have been required by Law or GAAP)any Acquired Subsidiary;
(xl) makecreate or issue or grant any option or other right to subscribe, purchase or redeem any of the securities of the Acquired Subsidiaries;
(m) enter into any binding agreement or arrangement with any Tax authority with respect to the Business, which relates to any period or periods after the Closing; make or change or revoke any a material election relating with respect to Taxes, change an annual accounting period or adopt or change any accounting method relating to Taxes, file any amended Tax Return, of accounting; surrender any right to claim a Tax refund, offset or other reduction in Tax liability; enter into any settlement or compromise with respect to any Tax Liability (other than in the ordinary course of business if such settlement or compromise is not reasonably expected to adversely impact Buyer, or after the Closing, the Acquired Companies); consent to any extension or waiver of the limitation limitations period applicable to any Tax claim or assessment relating to the Company, or become a member of a consolidated groupassessment;
(xin) (A) enter into, enter into the negotiation of, amend, supplement, waive, modify, terminate, annul, cancel, allow to lapse, assign, convey, encumber or otherwise transfer, in each case change in any material respectrespect any method of accounting or accounting policies, in whole or in part, rights and interests in or under any Material Contracts, or (B) enter into discussions with third parties regarding any matter that might reasonably be expected to result in a Contract that would be a Material Contract if in effect on the date of this Agreement, without first consulting with Purchaserother than as required by US GAAP;
(xiio) compromise, settle, grant any waiver or release relating to or otherwise adjust any right or claim deviate from the current policies and/or practices with respect to any pending the collection of Accounts Receivable or threatened Action (A) relating payment of accounts payable in relation to the Transaction or (B) against the Company other than in the Ordinary Course of Business;
(xiiip) change, materially reduce the amount of any insurance coverage provided by existing insurance policies or agree to change, terminate any material business policies of the Company which relate to advertising, promotional activities, pricing, personnel, labor relations, sales, returns or warranties other than in the Ordinary Course of Businesssuch insurance coverage without replacement;
(xivq) amend commence any Organizational Documents legal proceeding other than (i) for the routine collection of bills, or (ii) in such cases where Seller in good faith determines that failure to commence such legal proceeding would result in the material impairment of a valuable aspect of the Company;
(xv) sellBusiness or the Purchased Assets, license, sublicense, covenant not provided that Seller consults with Buyer prior to sue under, abandon, assign, transfer, disclose, encumber or otherwise grant any rights under any of the Company’s Intellectual Property to any Person, other than in the Ordinary Course of Business;
(xvi) maintain its assets in their current condition, ordinary wear and tear excluded, with insurance in such amounts and filing of such kinds comparable to that in effect on the date proceeding, or (iii) for a breach of this Agreement;
(xvii) materially alter its cash management customs and practices, including without limitation shorten or lengthen the customary payment and collection cycles, as the case may be, for the Company’s trade accounts payable and receivables and other current liabilities;
(xviii) make or commit to make any capital expenditures except (A) as contemplated by the Company’s then current budget, (B) in the Ordinary Course of Business, or (C) such expenditures as do not exceed $100,000 in the aggregate;
(xix) hire any new employees or officers of the Company who cannot be terminated at-will or within sixty (60) days and without severance;
(xx) materially alter the maintenance of its books and records, which books and records shall be maintained in the Ordinary Course of Business.
(xxi) take any action that would cause the representations and warranties contained in ARTICLE IV to be untrue or incorrect in any material respect;
(xxiir) enter into any contract with any manager of the Company or Company affiliate or representative thereof other than in the Ordinary Course of Business;
(xxiii) allow any Permit Contract to (A) no longer be in good standing with an applicable Governmental Authority or (B) lapse;
(xxiv) allow its levels of inventory to vary in any material respect from the levels customarily maintained;
(xxv) fail to comply in all material respects with any applicable Law; or
(xxvi) agree or commit to do, or allow or permit any employee, manager or officer of the Company to agree or commit to do, do any of the foregoing.;
(cs) Until authorize or permit any of the Closing Seller’s or the earlier termination of this Agreement in accordance with its termsAffiliates’ directors, Purchaser shallofficers, subject to applicable lawsemployees, advise and consult with the Indemnifying Members periodically on material business developments of Purchaser; provided, however, that the final decisions regarding any such matter shall remain in the sole discretion of Purchaser.
(d) Nothing contained in this Agreement shall be deemed to give Purchaseragents or representatives, directly or indirectly, to (i) solicit, initiate, knowingly encourage or knowingly facilitate or furnish or disclose information in furtherance of, any inquiries or the right making of any proposal with respect to control or direct the acquisition of any part of the Business (each, an “Acquisition Proposal”), (ii) engage in negotiations or operations prior discussions concerning an Acquisition Proposal, (iii) agree to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control over its Business and operationsrecommend any Acquisition Proposal or (iv) enter into any agreement or understanding regarding an Acquisition Proposal.
Appears in 1 contract
Samples: Share and Asset Purchase Agreement (Magal Security Systems LTD)