Conduct Prior to the Effective Time. 4.1 Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, except to the extent that Parent shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed, to carry on the Company's business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay the debts and Taxes of the Company when due, to pay or perform other obligations when due, and, to the extent consistent with such business, use commercially reasonable efforts, consistent with past practice and policies, to preserve intact the Company's present business organizations, keep available the services of the Company's present officers and Key Employees and preserve the Company's relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company and any material event involving the Company. Except as expressly contemplated by this Agreement as set forth in Section 4.1 of the Disclosure Schedule, the Company shall not, without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayed: (a) make any expenditures or enter into any commitment or transaction exceeding $75,000 individually or $150,000 in the aggregate or any commitment or transaction of the type described in Section 2.8 hereof, other than in the ordinary course of business consistent with past practices; (b) make any purchases, or enter into any Contract to purchase, any inventory, exceeding $75,000 individually or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practices; (c) enter into or amend any Contract pursuant to which any other party is granted marketing, distribution, development or similar rights of any type or scope with respect to any products or technology of the Company; (d) amend or otherwise modify (or agree to do so), except in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Company, or violate the terms of, any of the Contracts set forth or described in the Disclosure Schedule; (e) declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stock, or split, combine or reclassify any Company Capital Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Stock (or options, warrants or other rights exercisable therefor); (f) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities; (g) cause or permit any amendments to the articles of incorporation, bylaws or other organizational documents of the Company; (h) acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the Company's business; (i) except as allowed pursuant to Section 4.1 hereof, sell, lease, license or otherwise dispose of any of its properties or assets, except in the ordinary course of business and consistent with past practices; (j) incur any indebtedness, except for trade credit or advances to employees in the ordinary course of business consistent with past practices, or guarantee any indebtedness or issue or sell any debt securities or guarantee any debt securities of others; (k) grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreement; (l) grant any severance or termination pay (i) to any director or officer, or (ii) to any other employee except consistent with prior practices of the Company as disclosed in the Disclosure Schedule; (m) adopt or amend any employee benefit plan, or enter into any employment contract or, except as otherwise contemplated by this Agreement, non-competition agreement, pay or agree to pay any special bonus or special remuneration to any director or employee, or, increase the salaries or wage rates of its employees except payments made pursuant to standard written agreements in place on the date hereof and disclosed in the Disclosure Schedule; (n) revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of business; (o) pay, discharge or satisfy, in an amount in excess of $10,000 in any one case, or $30,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet or subsequently incurred in the ordinary course of business; (p) except as may be required by applicable law, make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes; (q) enter into any strategic alliance or joint marketing arrangement or agreement; (r) except in a manner consistent with the Company's past practices, hire, terminate or enter into settlement agreements with any employees, or encourage any employees to resign from the Company; or (s) take, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through 4.1(r) hereof, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective covenants hereunder.
Appears in 1 contract
Conduct Prior to the Effective Time. 4.1 5.1 Conduct of Business of the Company. During Except as set forth in Schedule 5.1, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, (except to the extent that Parent SCM shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed), to carry on the Company's its business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay the its debts and Taxes of the Company when duedue unless validly withheld, to pay or perform other obligations when due, and, to the extent consistent with such businessbusiness and except as agreed to by SCM and the Company, use commercially all reasonable efforts, efforts consistent with past practice and policies, policies to preserve intact the Company's present business organizationsorganization, keep available the services of the Company's its present officers and Key Employees key employees and preserve the Company's their relationships with customers, suppliers, distributors, licensors, licensees, customers and others having business dealings with it, all with the goal of preserving unimpaired the Company's goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company and any material event involving the Company. Except as expressly contemplated by this Agreement as set forth in Section 4.1 of the Disclosure ScheduleAgreement, the Company (and each of its subsidiaries) shall not, without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayedSCM:
(a) make any expenditures or enter Enter into any commitment or transaction exceeding $75,000 individually or $150,000 not in the aggregate ordinary course of business or any commitment or transaction of the type described in Section 2.8 2.6 hereof, ;
(b) Transfer to any person or entity any material rights to the Company's Intellectual Property (other than such transfers effectuated in the ordinary course of business consistent with past practices;
(b) make any purchases, or enter into any Contract to purchase, any inventory, exceeding $75,000 individually or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practicesbusiness);
(c) enter Enter into or amend any Contract agreements not cancelable by the Company without penalty on thirty (30) days notice or less pursuant to which any other party is granted marketing, distribution, development distribution or similar rights of any type or scope with respect to any products or technology of the Company;
(d) amend Materially amend, terminate or otherwise modify (violate any distribution agreement or agree material contract, agreement or license which the Company is a party or by which it is bound other than termination by the Company pursuant to do so), except the terms thereof in the ordinary course of business or except as would not be reasonably likely and without financial penalty to have a Material Adverse Effect on the Company, or violate the terms of, any of the Contracts set forth or described in the Disclosure Schedule;
(e) declareCommence any material litigation;
(f) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Common Stock, or split, combine or reclassify any Company Capital Common Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Common Stock, or or, repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Common Stock (or options, warrants or other rights exercisable therefor);
(fg) issue, grantIssue, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock capital stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities;
(gh) cause Cause or permit any amendments to the articles its Certificate of incorporation, bylaws Incorporation or other Bylaws (or comparable organizational documents of the Companydocuments);
(hi) acquire Acquire or agree to acquire by merging or consolidating with, or by purchasing any of the assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the business of the Company's business, or propose or discuss any of the foregoing with any party other than SCM;
(ij) except as allowed pursuant to Section 4.1 hereof, sellSell, lease, license or otherwise dispose of or contract for the disposition or acquisition of any of its properties or assets, assets in excess of $50,000 except in the ordinary course of business and consistent with past practices;
(j) incur any indebtedness, except for trade credit or advances to employees in the ordinary course of business consistent with past practices, the Company's current business plan;
(k) Incur any indebtedness for borrowed money (except with respect to indebtedness incurred by the Company in the ordinary course of business and under existing term loans or revolving credit lines) or guarantee any such indebtedness or issue or sell any debt securities of the Company or guarantee any debt securities of others;
(k) grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreement;
(l) grant Grant any severance or termination pay (i) to any director or officer, officer or (ii) to any other employee except consistent with prior practices payments made pursuant to written agreements outstanding on the date hereof and disclosed in Section 2.11(a) or Section 2.20 of the Company as disclosed in the Disclosure Schedule;
(m) adopt Adopt or amend any employee benefit plan, or enter into any employment contract or, except as otherwise contemplated by this Agreement, non-competition agreementcontract, pay or agree to pay any special bonus or special remuneration to any director or employee, or, or increase the salaries or wage rates of its employees except payments made pursuant to standard written agreements in place on the date hereof other than hirings and disclosed terminations in the Disclosure Scheduleordinary course of business and other than customary increases associated with annual reviews scheduled during such period;
(n) revalue Revalue any of its assetsassets including, including without limitation limitation, writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of business;
(o) payPay, discharge or satisfy, in an amount in excess of $10,000 (in any one case, ) or $30,000 25,000 (in the aggregate), any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of liabilities in the ordinary course of business of or liabilities reflected or reserved against in the Current Balance Sheet Financial Statements (or subsequently incurred in the ordinary course of businessnotes thereto);
(p) except as may be required by applicable law, make Make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(q) enter Enter into any strategic alliance or product development, joint marketing or other strategic arrangement or agreement;; or
(r) except in a manner consistent with the Company's past practices, hire, terminate or enter into settlement agreements with any employees, or encourage any employees to resign from the Company; or
(s) takeTake, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a5.1(a) through 4.1(r(q) hereofabove, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective the transactions contemplated herein or its covenants hereunder.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (SCM Microsystems Inc)
Conduct Prior to the Effective Time. 4.1 Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of (i) the termination of this Agreement or and (ii) the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, (except to the extent that Parent shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed, ) to carry on the Company's its business in the usual, regular and ordinary course and in substantially the same manner as heretofore conductedaccordance with past practices, to pay the its debts and Taxes of the Company when due, to pay or perform other obligations when due, and, to the extent consistent with such business, to use all commercially reasonable efforts, efforts consistent with past practice and policies, policies to preserve intact the Company's its present business organizationsorganization, keep available the services of the Company's its present officers and Key Employees key employees and preserve the Company's their relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's its goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company its business, and any material event involving the CompanyCompany or its business. Except as expressly contemplated by this Agreement as set forth in Section 4.1 of the Disclosure ScheduleSchedule 4.1, the Company shall not, without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayed:
(a) make any expenditures or enter into any commitment or transaction exceeding $75,000 individually or $150,000 in the aggregate or any commitment or transaction of the type described in Section 2.8 hereof, other than not in the ordinary course of business as conducted on that date and consistent with past practices;.
(b) make transfer or license to or from any purchases, Person any Technology or Intellectual Property Rights (including any Company Intellectual Property) or enter into or amend any Contract to purchase, agreement with any inventory, exceeding $75,000 individually Person regarding any Technology or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practicesIntellectual Property Rights (including any Company Intellectual Property);
(c) enter into or amend any Contract agreement pursuant to which any other party is granted marketing, distribution, development distribution or similar rights of any type or scope with respect to any products or technology of the Company;
(d) amend or otherwise modify (or agree to do so), except in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Company, or violate the terms of, any of the Contracts agreements set forth or described in the Disclosure Schedule;
(e) commence or settle any litigation;
(f) declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stock, or split, combine or reclassify any Company Capital Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Stock (or options, warrants or other rights exercisable therefor);
(fg) except for the issuance of shares of Company Capital Stock upon exercise or conversion of presently outstanding Company Options or Company Preferred Stock, issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities;
(gh) except as specifically contemplated hereby, cause or permit any amendments to the articles its Articles of incorporation, bylaws Incorporation or other organizational documents of the CompanyBylaws or changes to its capital structure;
(hi) acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the Company's businessassets;
(ij) except as allowed pursuant to Section 4.1 hereof, sell, lease, license or otherwise dispose of any of its properties or assets, except in the ordinary course of business and consistent with past practices;
(j) incur any indebtedness, except for trade credit or advances to employees other than immaterial dispositions in the ordinary course of business consistent with past practices;
(k) grant any loan to any Person, purchase any debt securities of another, amend the terms of any outstanding indebtedness or any agreement related thereto, forgive any outstanding indebtedness, incur any indebtedness for borrowed money or guarantee any indebtedness of the Company or any other Person, or issue or sell any debt securities or guarantee any debt securities of others;
the Company (k) grant any in each case other than the incurrence of secured loans from Parent to others, except to contractors or customers be funded at Parent's option and in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreementParent's sole discretion);
(l) grant any severance or termination pay (i) to any director or director, officer, employee or (ii) consultant, except payments made pursuant to any other employee except consistent with prior practices of standard written agreements outstanding on the Company as disclosed in the Disclosure Scheduledate hereof;
(m) adopt or amend any employee benefit plan, hire or terminate any director, officer, employee or consultant other than a termination for cause, encourage any director, officer, employee or consultant to resign, enter into or amend any employment contract oror consulting contract, except as otherwise contemplated by this Agreement, non-competition agreementextend employment offers, pay or agree to pay any special bonus or special remuneration to any director or employee, or, increase the salaries salary or wage rates rate of its employees except payments made pursuant to standard written agreements in place on the date hereof and disclosed in the Disclosure Scheduledirector, officer, employee or consultant;
(n) revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of businessreceivable;
(o) pay, discharge or satisfy, in an amount in excess of $10,000 in any one case, or $30,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (i) the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet Company Financials (or subsequently incurred the notes thereto) or Third Party Expenses (as defined below) set forth in the ordinary course Statement of business;Expenses (as defined below); and (ii) only to the extent that the Company's cash on hand (not including any amount funded by [***] or by Parent) exceeds $320,052, the repayment of any Bridge Debt; *** Certain information on this page has been omitted and filed separately with the Commission. Confidential treatment has been requested with respect to the omitted portions.
(p) except as may be required by applicable law, make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(q) enter into any dealer, distribution, joint marketing, joint venture or development agreement, strategic alliance alliance, or joint marketing arrangement any other agreement (noncompete or agreementotherwise) that reasonably could be expected to have the effect of prohibiting or impairing any business practice of the Company, any acquisition of property by the Company, the conduct of business by the Company, or the manufacture, sale, licensing or distribution by the Company of any product, service, Technology or Intellectual Property Right in any manner, or otherwise limiting the freedom of the Company to engage in any line of business or compete with any Person;
(r) fail to pay or otherwise satisfy its monetary obligations as they become due, except such as are being contested in a manner consistent with the Company's past practices, hire, terminate good faith;
(s) knowingly waive or enter into settlement agreements a binding commitment to waive any rights with a value in excess of $10,000 in the aggregate;
(t) enter into any employees, contract or encourage transaction in which any employees to resign from director or officer of the CompanyCompany or any member of their immediate family has an interest; or
(su) take, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through 4.1(r(t) hereofabove, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective its covenants hereunder.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (Sirenza Microdevices Inc)
Conduct Prior to the Effective Time. 4.1 5.1 Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or and the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, (except to the extent that Parent shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed, ) to carry on the Company's its business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay the its debts and Taxes of the Company when due, to pay or perform other obligations when due, and, to the extent consistent with such business, to use commercially reasonable efforts, all efforts consistent with past practice and policies, policies to preserve intact the Company's its present business organizationsorganization, keep available the services of the Company's its present officers and Key Employees key employees and preserve the Company's their relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's its goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company and its business, any material event involving or adversely affecting the CompanyCompany or its business, and any contact, discussion or negotiation relating to any issuance of debt or equity to a person or entity other than Parent. Except as expressly contemplated by this Agreement as set forth in Section 4.1 of the Disclosure ScheduleAgreement, the Company shall not, without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayed:
(a) make any expenditures or enter Enter into any commitment commitment, activity or transaction exceeding $75,000 individually or $150,000 in the aggregate or any commitment or transaction of the type described in Section 2.8 hereof, other than not in the ordinary course of business consistent with past practicesbusiness, the value of which is greater than $10,000 individually or $25,000 in the aggregate;
(b) make Except as set forth on Section 5.1(b) of the Company Disclosure Letter, transfer to any purchases, person or entity any rights to any Company Intellectual Property or enter into any Contract agreement with respect to purchase, Company Intellectual Property with any inventory, exceeding $75,000 individually person or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practicesentity;
(c) enter into Terminate any employees other than for cause or amend encourage any Contract pursuant employees to which any other party is granted marketing, distribution, development or similar rights of any type or scope with respect to any products or technology of resign from the Company;
(d) amend Amend or otherwise modify (or agree to do so), except in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Company, or violate the terms of, any of the Contracts agreements set forth or described in the Company Disclosure ScheduleLetter;
(e) declareCommence or settle any litigation;
(f) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stock, or split, combine or reclassify any Company Capital Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Stock (or options, warrants or other rights exercisable therefor)) except for (i) repurchases of Company Capital Stock upon the termination of service of any service providers of the Company in accordance with the standard terms set forth in the agreements governing such repurchases, all of which agreements have been provided or made available to Parent, (ii) conversion of Company Preferred Stock and (iii) exercises or conversion of Company Convertible Securities;
(fg) Except for the issuance of shares of Company Capital Stock upon exercise or conversion of presently outstanding Company Options or Company Convertible Securities, issue, sell, grant, deliver contract to issue, grant or sell sell, or authorize or propose the issuance, grantdelivery, delivery or sale of, or purchase or propose the purchase of, of any shares of Company Capital Stock or securities convertible into, or subscriptionsexercisable or exchangeable for, rights, warrants or options to acquireshares of Company Capital Stock, or other agreements any securities, warrants, options or commitments of any character obligating it rights to issue or purchase any such shares or other convertible securitiesof the foregoing;
(gh) cause Cause or permit any amendments to the its articles of incorporation, bylaws incorporation or other organizational documents of the Companybylaws;
(hi) acquire Acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the business of the Company's business;
(ij) except as allowed pursuant to Section 4.1 hereof, sellSell, lease, license or otherwise dispose of any of its the assets or properties or assetsof the Company which are not Company Intellectual Property, except including, but not limited to, the performance of obligations under contractual arrangements listed in the ordinary course Company Disclosure Letter existing as of business and consistent with past practicesthe date hereof, or create any security interest in such assets or properties;
(jk) Grant any loan to any person or entity, incur any indebtedness or guarantee any indebtedness, except for trade credit or advances to employees in the ordinary course of business consistent with past practices, or guarantee any indebtedness or issue or sell any debt securities or securities, guarantee any debt securities of others;
(k) grant , purchase any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreementagreements related to borrowed money;
(l) grant Grant any severance or termination pay (i) to any director or officer, officer or (ii) to any employee or consultant, or increase in the salary or other employee compensation payable or to become payable by the Company to any of its officers, directors, employees or advisors, or declare, pay or make any commitment or obligation of any kind for the payment by the Company of a bonus or other additional salary or compensation to any such person, or except consistent with prior practices as described in Section 5.1(l) of the Company as disclosed in the Disclosure Schedule;
(m) Letter, adopt or amend any employee benefit plan, plan or enter into any employment contract or, except as otherwise contemplated by this Agreement, non-competition agreement, pay or agree to pay any special bonus or special remuneration to any director or employee, or, increase the salaries or wage rates of its employees except payments made pursuant to standard written agreements in place on the date hereof and disclosed in the Disclosure Schedulecontract;
(nm) revalue Revalue any of its assets, including including, without limitation limitation, writing down the value of inventory or writing off notes or accounts receivable other than receivable;
(n) Except as set forth in Section 5.1(n) of the ordinary course Company Disclosure Letter, take any action to accelerate the vesting schedule of businessany of the outstanding Company Options or Company Capital Stock;
(o) payPay, discharge or satisfy, in an amount in excess of $10,000 15,000 (in any one case, ) or $30,000 (in the aggregate, ) any claim, liability claim or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet or subsequently incurred in the ordinary course of businessLiability;
(p) except as may be required by applicable law, make Make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(q) enter Enter into any strategic alliance alliance, joint development or joint marketing arrangement or agreement;
(r) Fail to pay or otherwise satisfy its monetary obligations as they become due, except such as are being contested in good faith;
(s) Waive or commit to waive any rights with a manner consistent with value in excess of $5,000 (in any one case) or $10,000 (in the Company's past practicesaggregate);
(t) Cancel, hirematerially amend or renew any insurance policy other than in the ordinary course of business;
(u) Alter, terminate or enter into settlement agreements with any employeescommitment to alter, its interest in any corporation, association, joint venture, partnership or encourage business entity in which the Company directly or indirectly holds any employees to resign from interest on the Companydate hereof; or
(sv) takeTake, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a5.1(a) through 4.1(r(u) hereofabove, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective its covenants hereunder.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (Digital Impact Inc /De/)
Conduct Prior to the Effective Time. 4.1 5.1 Conduct of Business of the Companyby Company and Marine. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Effective TimeClosing, the Company agrees to use commercially reasonable efforts to cause the Companyand Marine shall, except to the extent that Parent the other party shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed, to carry on the Company's its business in the usual, regular and ordinary course consistent with past practices, in substantially the same manner as heretofore conductedconducted and in compliance with all applicable laws and regulations (except where noncompliance would not have a Material Adverse Effect), to pay the its debts and Taxes of the Company taxes when duedue subject to good faith disputes over such debts or taxes, to pay or perform other material obligations when due, and, to the extent consistent with such business, and use its commercially reasonable efforts, efforts consistent with past practice practices and policies, policies to (i) preserve substantially intact the Company's its present business organizationsorganization, (ii) keep available the services of the Company's its present officers officers, managers and Key Employees employees, and (iii) preserve the Company's its relationships with customers, suppliers, distributors, licensors, licensees, and others having with which it has significant business dealings with itdealings. In addition, all with except as permitted or required by the goal terms of preserving unimpaired the Company's goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company and any material event involving the Company. Except as expressly contemplated by this Agreement as or set forth in Section 4.1 of on the Disclosure Schedule, the Company shall notSchedule 5.1 hereto, without the prior written consent of Parentthe other party, which consent during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Closing, each of Company and Marine shall not be unreasonably withheld or delayed:
do any of the following: (a) make Waive any expenditures stock repurchase rights, accelerate, amend or enter into any commitment (except as specifically provided for herein) change the period of exercisability of options or transaction exceeding $75,000 individually or $150,000 in the aggregate or any commitment or transaction of the type described in Section 2.8 hereof, other than in the ordinary course of business consistent with past practices;
(b) make any purchasesrestricted stock, or enter into reprice options granted under any Contract to purchaseemployee, consultant, director or other stock plans or authorize cash payments in exchange for any inventory, exceeding $75,000 individually or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practices;
(c) enter into or amend any Contract pursuant to which any other party is options granted marketing, distribution, development or similar rights of any type or scope with respect to any products or technology of the Company;
(d) amend or otherwise modify (or agree to do so), except in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Company, or violate the terms of, under any of the Contracts set forth or described in the Disclosure Schedulesuch plans;
(e) declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stock, or split, combine or reclassify any Company Capital Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Stock (or options, warrants or other rights exercisable therefor);
(f) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities;
(g) cause or permit any amendments to the articles of incorporation, bylaws or other organizational documents of the Company;
(h) acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the Company's business;
(i) except as allowed pursuant to Section 4.1 hereof, sell, lease, license or otherwise dispose of any of its properties or assets, except in the ordinary course of business and consistent with past practices;
(j) incur any indebtedness, except for trade credit or advances to employees in the ordinary course of business consistent with past practices, or guarantee any indebtedness or issue or sell any debt securities or guarantee any debt securities of others;
(k) grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreement;
(l) grant any severance or termination pay (i) to any director or officer, or (ii) to any other employee except consistent with prior practices of the Company as disclosed in the Disclosure Schedule;
(m) adopt or amend any employee benefit plan, or enter into any employment contract or, except as otherwise contemplated by this Agreement, non-competition agreement, pay or agree to pay any special bonus or special remuneration to any director or employee, or, increase the salaries or wage rates of its employees except payments made pursuant to standard written agreements in place on the date hereof and disclosed in the Disclosure Schedule;
(n) revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of business;
(o) pay, discharge or satisfy, in an amount in excess of $10,000 in any one case, or $30,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet or subsequently incurred in the ordinary course of business;
(p) except as may be required by applicable law, make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(q) enter into any strategic alliance or joint marketing arrangement or agreement;
(r) except in a manner consistent with the Company's past practices, hire, terminate or enter into settlement agreements with any employees, or encourage any employees to resign from the Company; or
(s) take, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through 4.1(r) hereof, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective covenants hereunder.
Appears in 1 contract
Conduct Prior to the Effective Time. 4.1 Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or and the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, (except to the extent that Parent shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed, ) to carry on the Company's its business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay the its debts and Taxes of the Company when due, to pay or perform other obligations when due, and, to the extent consistent with such business, to use commercially all reasonable efforts, efforts consistent with past practice and policies, policies to preserve intact the Company's its present business organizationsorganization, keep available the services of the Company's its present officers and Key Employees key employees and preserve the Company's its relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's its goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company business, and any material event involving adversely affecting the CompanyCompany or its business. Except as expressly contemplated by this Agreement as set forth Agreement, or disclosed in Section 4.1 of the Disclosure ScheduleSchedule 4.1, the Company shall not, without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayed:
(a) make any expenditures or enter Enter into any material commitment or transaction exceeding $75,000 individually or $150,000 in the aggregate or any commitment or transaction of the type described in Section 2.8 hereof, other than not in the ordinary course of business consistent with past practices;business.
(b) make Transfer to any purchases, person or enter into entity any Contract rights to purchase, any inventory, exceeding $75,000 individually or $150,000 in the aggregate, Company Intellectual Property Rights (other than pursuant to End-User Licenses in the ordinary course of business consistent with past practicesbusiness);
(c) enter Enter into or amend in any Contract material respect any agreements pursuant to which any other party is granted manufacturing, marketing, distribution, development distribution or similar rights of any type or scope with respect to any products or technology of the Company;
(d) amend Amend or otherwise modify in any material respect (or agree to do so), except in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Companybusiness, or violate the terms of, any of the Contracts agreements set forth or described in the Disclosure ScheduleCompany Schedules where such violation would have a Material Adverse Effect;
(e) declareCommence any litigation;
(f) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stockof its capital stock, or split, combine or reclassify any Company Capital Stock of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stockcapital stock of the Company, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Stock its capital stock (or options, warrants or other rights exercisable therefor), other than pursuant to the Company's repurchase right under employee restricted stock purchase agreements;
(fg) issueIssue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock its capital stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities;
(gh) cause Cause or permit any amendments to the articles its Articles of incorporation, bylaws Incorporation or other organizational documents of the CompanyBylaws;
(hi) acquire Acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the business of the Company's business;
(ij) except as allowed pursuant to Section 4.1 hereof, sellSell, lease, license or otherwise dispose of any of its properties or assets, except in the ordinary course of business and consistent with past practicespractice;
(jk) incur Incur any indebtedness, except indebtedness for trade credit or advances to employees in the ordinary course of business consistent with past practices, borrowed money or guarantee any such indebtedness or issue or sell any debt securities of the Company or guarantee any debt securities of others;
(k) grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreement;
(l) grant Grant any severance or termination pay (i) to any director or director, officer, employee or consultant, except payments made pursuant to standard written agreements outstanding on the date hereof (ii) to any other employee except consistent with prior practices of the Company as which are disclosed in the Disclosure Scheduleon Schedule 4.1(l));
(m) adopt Adopt or amend any employee benefit plan, program, policy or arrangement, or enter into any employment contract orcontract, except as otherwise contemplated by this Agreement, non-competition agreementextend any employment offer, pay or agree to pay any special bonus or special remuneration to any director director, employee or employeeconsultant, or, or increase the salaries or wage rates of its employees except payments made pursuant to standard written agreements in place on the date hereof and disclosed in the Disclosure Scheduleemployees;
(n) revalue Revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of businessbusiness and consistent with past practice;
(o) payPay, discharge or satisfy, in an amount in excess of $10,000 in any one case, case or $30,000 20,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unassertedunassented, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet Company Financial Statements or subsequently incurred that arose in the ordinary course of businessbusiness subsequent to April 30, 1999;
(p) except as may be required by applicable law, make Make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(q) enter into Take any strategic alliance action, including the acceleration of vesting of any restricted stock or joint marketing arrangement any options or agreementother rights to acquire shares of the capital stock of the Company which would be reasonably likely to jeopardize the tax-free reorganization hereunder;
(r) except Enter into any strategic alliance, joint development or joint marketing agreement;
(s) Waive or commit to waive any rights with a value in a manner consistent with excess of $10,000, in any one case, or $20,000, in the Company's past practicesaggregate;
(t) Cancel, hirematerially amend or renew any insurance policy other than in the ordinary course of business;
(u) Alter, terminate or enter into settlement agreements with any employeescommitment to alter, its interest in any corporation, association, joint venture, partnership or encourage business entity in which the Company directly or indirectly holds any employees to resign from interest on the Companydate hereof; or
(sv) takeTake, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through 4.1(r(u) hereofabove, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective its covenants hereunder. Provided, however, that Parent's consent shall not be required with reference to the Company adjusting, compromising, forgiving, settling, discharging, distributing, liquidating or otherwise dealing with the Philxx X. Xxxxxx xxxurance policy, the so called Selecterm bank account, debt due to the Company by its stockholders and the rent owed by the Company to Danvers Executive Park Trust, provided that in no event will Parent have any liability for the preceding items.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (New Era of Networks Inc)
Conduct Prior to the Effective Time. 4.1 Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or and the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, (except to the extent that Parent shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed, ) to carry on the Company's its business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay the debts and Taxes of the Company when due, to pay or perform other obligations when due, conducted and, to the extent consistent with such business, to use commercially all reasonable efforts, efforts consistent with past practice and policies, policies to preserve intact the Company's its present business organizationsorganization, keep available the services of the Company's its present officers and Key Employees key employees and preserve the Company's its relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's its goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company its business, and any material event involving or adversely affecting the CompanyCompany or its business. Except as expressly contemplated by this Agreement as set forth in Section 4.1 of or the Disclosure ScheduleAccord and Satisfaction Agreement, the Company shall not, without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayed:
(a) make any expenditures or enter Enter into any commitment commitment, activity or transaction exceeding $75,000 individually or $150,000 in that creates an obligation that will continue to bind the aggregate Company or any commitment of its Subsidiaries after the Closing Date, which commitment, activity or transaction of the type described in Section 2.8 hereof, other than is not in the ordinary course of business as conducted on the Company Balance Sheet Date and consistent with the Company's past practices;
(b) make Transfer to any purchases, Person or enter into entity any Contract rights to purchase, any inventory, exceeding $75,000 individually or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practicesCompany Intellectual Property;
(c) enter into Enter into, amend, willfully violate the terms of, fail to perform under or amend terminate any Contract material agreement, including, without limitation, any agreement pursuant to which (i) any other party is granted manufacturing, marketing, distribution, development distribution or similar rights of any type or scope with respect to any products or technology drug candidates of the CompanyCompany or (ii) the Company is granted exclusive rights in a geographical area or field of use;
(d) amend Amend or otherwise modify (or agree to do so), except in the ordinary course of business consistent with the Company's past practices, or except as willfully violate the terms of, any of the material agreements set forth or described in the Company Schedules;
(e) Amend or otherwise modify (or agree to do so), or willfully violate the terms of, any of the agreements set forth or described in Schedule 2.13(i);
(f) Settle or compromise, or agree to settle or compromise, any suit or other litigation matter or matter in an arbitration proceeding for any material amount (after taking into account any insurance proceeds to which the Company is entitled) or otherwise on terms which would not be reasonably likely to have a Material Adverse Effect on the Company, or violate the terms of, any of the Contracts set forth or described in the Disclosure Schedule;
(eg) Except as contemplated by the Accord Agreement, declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stock, or split, combine or reclassify any Company Capital Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Stock (or options, warrants or other rights exercisable therefor);
(fh) issue, grantGrant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock or securities convertible intoSecurities, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities; except for (i) the issuance of shares of Company Capital Stock upon exercise or conversion of Company Options or Company Warrants outstanding at the date of execution of this Agreement, (ii) options required to be issued by the Company pursuant to employment or consultant agreements with certain key executive officers and consultants in effect as of the date hereof, or (iii) additional options exercisable into not more than 200,000 shares of Company Common Stock, in the aggregate;
(gi) cause Cause or permit any amendments to the articles its Certificate of incorporation, bylaws Incorporation or other organizational documents of the CompanyBylaws;
(hj) acquire Acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the business of the Company's business;
(ik) except as allowed pursuant Knowingly fail in any material respect to Section 4.1 hereofcomply with any laws, sellordinances, regulations or other governmental restrictions applicable to the Company;
(l) Sell, lease, license or otherwise dispose of any of its properties or assets, assets except in the ordinary course of business and consistent with past practicespractice;
(jm) Make loans or advances or incur any indebtedness, except indebtedness for trade credit or advances to employees in the ordinary course of business consistent with past practices, borrowed money or guarantee or otherwise become responsible for any such indebtedness or guarantee such indebtedness or issue or sell any of its debt securities or guarantee any debt securities guarantee, endorse or otherwise become responsible for the obligations of others;
(kn) grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreement;
(l) grant Grant any severance or termination pay to any director, officer, employee or consultant, except (i) payments made pursuant to any director or officer, written agreements outstanding on the date hereof (which agreements are disclosed on Schedule 4.1(n)) or (ii) to any other employee except consistent with prior practices of the Company as payments disclosed in the Disclosure Scheduleon Schedule 4.1(n)) ("Severance Payments");
(mo) adopt Adopt or amend any employee benefit plan, program, policy or arrangement, or enter into any employment contract orcontract, except as otherwise contemplated by this Agreement, non-competition agreementextend any employment offer, pay or agree to pay any special bonus or special remuneration to any director director, employee or employeeconsultant in excess of an aggregate of $75,000, or, or increase the salaries or wage rates of its employees employees, except payments made pursuant to standard written agreements in place on payments under the date hereof Accord and disclosed in the Disclosure ScheduleSatisfaction Agreement;
(np) revalue Revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of businessbusiness and consistent with past practice, so as to result in a Material Adverse Effect to the Company;
(oq) payPay, discharge or satisfy, in an amount in excess of $10,000 in any one case, or $30,000 25,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet or subsequently incurred in the ordinary course Company Financial Statements, other than Third Party Expenses which shall be paid pursuant to Section 5.5 of businessthis Agreement;
(pr) except as may be required by applicable lawFail to pay Taxes when due, make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;any
(qs) enter Enter into any strategic alliance alliance, joint development or joint marketing arrangement or agreement;
(rt) Fail to pay or otherwise satisfy its monetary obligations as they become due, except such as are being contested in good faith and except such obligations as are due under the Service Agreement;
(u) Waive or commit to waive any rights with a manner consistent with value in excess of $10,000 in any one case, or $25,000 in the Company's past practicesaggregate;
(v) Cancel, hiremodify, terminate reduce or renew at rates not substantially similar to those rates in recent prior years any of its existing liability insurance, including without limitation existing directors' and officers' liability insurance, except an extension of the existing directors' and officers' liability insurance for two years following the Closing Date at a cost to the Company not to exceed $350,000, which extension the Company shall be free to obtain without the consent of Parent or Merger Sub;
(w) Alter, or enter into settlement agreements with any employeescommitment to alter, its interest in any corporation, association, joint venture, partnership or encourage any employees to resign from business entity in which the Company; orCompany directly or indirectly holds an interest on the date hereof;
(sx) takeTake, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through 4.1(r(w) hereofabove, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective its covenants hereunder.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (Ligand Pharmaceuticals Inc)
Conduct Prior to the Effective Time. 4.1 Conduct of Business of the Company. by Twin Vee Inc.
(a) During the period from commencing with the date execution and delivery of this Agreement and continuing until the earlier to occur of the termination of this Agreement pursuant to its terms or the Effective Time, the parties and each of its subsidiaries shall, except to the extent that the other parties shall otherwise consent in writing, carry on its business, in the usual, regular and ordinary course, in substantially the same manner as heretofore conducted and in compliance with all applicable laws and regulations, pay its debts and taxes when due subject to good faith disputes over such debts or taxes, pay or perform other material obligations when due, and use its commercially reasonable efforts consistent with past practices and policies to (i) preserve intact its present business organization, (ii) keep available the services of its present officers and employees and (iii) preserve its relationships with customers, suppliers, distributors, licensors, licensees, and others with which it has business dealings. In addition, the parties will promptly notify each other of any material event involving its business or operations.
(b) Except as permitted or required by the terms of this Agreement, during the period commencing with the execution and delivery of this Agreement and continuing until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, Twin Vee Inc. shall not do any of the Company agrees following, and shall not permit any of its subsidiaries to use commercially reasonable efforts to cause do any of the Companyfollowing, except to the extent that Parent the other party shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed, to carry on the Company's business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay the debts and Taxes of the Company when due, to pay or perform other obligations when due, and, to the extent consistent with such business, use commercially reasonable efforts, consistent with past practice and policies, to preserve intact the Company's present business organizations, keep available the services of the Company's present officers and Key Employees and preserve the Company's relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company and any material event involving the Company. Except as expressly contemplated by this Agreement as set forth in Section 4.1 of the Disclosure Schedule, the Company shall not, without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayed:
(ai) make any expenditures or enter into any commitment or transaction exceeding $75,000 individually or $150,000 in the aggregate or any commitment or transaction of the type described in Section 2.8 hereof, other than in the ordinary course of business consistent with past practices;
(b) make any purchases, or enter into any Contract to purchase, any inventory, exceeding $75,000 individually or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practices;
(c) enter into or amend any Contract pursuant to which any other party is granted marketing, distribution, development or similar rights of any type or scope with respect to any products or technology of the Company;
(d) amend or otherwise modify (or agree to do so), except in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Company, or violate the terms of, any of the Contracts set forth or described in the Disclosure Schedule;
(e) declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stock, or split, combine or reclassify any Company Capital Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Stock (capital stock, except repurchases of unvested shares at cost in connection with the termination of the employment relationship with any employee pursuant to stock option or options, warrants or other rights exercisable therefor)purchase agreements in effect on the date hereof;
(f) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities;
(g) cause or permit any amendments to the articles of incorporation, bylaws or other organizational documents of the Company;
(hii) acquire or agree to acquire by merging or consolidating with, or by purchasing any equity interest in or a portion of the assets or equity securities of, or by any other manner, any business or any corporation, limited liability company, general or limited partnership, business trust, unincorporated association or other business organization organization, entity or division thereof, or otherwise acquire or agree to acquire any all or substantially all of the assets which are material, individually or in the aggregate, to the Company's business;
(i) except as allowed pursuant to Section 4.1 hereof, sell, lease, license or otherwise dispose of any of its properties or assets, except in the ordinary course of business and consistent with past practices;
(j) incur any indebtedness, except for trade credit or advances to employees in the ordinary course of business consistent with past practices, or guarantee any indebtedness or issue or sell any debt securities or guarantee any debt securities of others;
(k) grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreement;
(l) grant any severance or termination pay (i) to any director or officer, or (ii) to any other employee except consistent with prior practices of the Company as disclosed in the Disclosure Schedule;
(m) adopt or amend any employee benefit planforegoing, or enter into any employment joint ventures, strategic partnerships or similar alliances;
(iii) incur or enter into any agreement, contract oror other commitment or arrangement requiring such party or any of its subsidiaries to make payments in excess of $500,000 in any individual case, except or $1,000,000 in the aggregate;
(iv) engage in any action that could reasonably be expected to cause the Merger to fail to qualify as a “reorganization” under Section 368(a) of the Code, whether or not otherwise permitted by the provisions of this Article IV ;
(v) engage in any action with the intent to, directly or indirectly, adversely impact or materially delay the consummation of the Merger or any of the other transactions contemplated by this Agreement, non-competition agreement, pay or agree to pay any special bonus or special remuneration to any director or employee, or, increase the salaries or wage rates of its employees except payments made pursuant to standard written agreements in place on the date hereof and disclosed in the Disclosure Schedule;
(n) revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of business;
(o) pay, discharge or satisfy, in an amount in excess of $10,000 in any one case, or $30,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet or subsequently incurred in the ordinary course of business;
(p) except as may be required by applicable law, make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(q) enter into any strategic alliance or joint marketing arrangement or agreement;
(r) except in a manner consistent with the Company's past practices, hire, terminate or enter into settlement agreements with any employees, or encourage any employees to resign from the Company; or
(svi) take, or agree in writing or otherwise to take, take any of the actions described in Sections 4.1(aSection 4.1(b)(i) through 4.1(rSection 4.1(b)(v) hereof, or any other action that would make any of its representations or warranties inclusive.
(c) Notwithstanding anything contained in this Agreement untrue Article IV , it is expressly agreed and understood that any action which might other fall within the description of Section 4.1(a) or incorrect 4.1(b), but which could not be reasonably expected to materially affect the business, operations or prevent value of such party, shall not be prohibited by Article IV ; provided, however, that prompt notice of any such actions shall be provided by the Company or any of party taking such action to the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective covenants hereunderother.
Appears in 1 contract
Conduct Prior to the Effective Time. 4.1 Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, (except to the extent that Parent shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed), to carry on the Company's business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay the debts and Taxes of the Company when due, to pay or perform other obligations when due, and, to the extent consistent with such business, use commercially their reasonable efforts, best efforts consistent with past practice and policies, policies to preserve intact the Company's present business organizations, keep available the services of the Company's present officers and Key Employees key employees and preserve the Company's relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company and any material event involving the Company. Except as expressly contemplated by this Agreement as set forth in Section 4.1 of the Disclosure Schedule, the Company shall not, without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayed:
(a) make Make any expenditures or enter into any commitment or transaction exceeding $75,000 10,000 individually or $150,000 50,000 in the aggregate or any commitment or transaction of the type described in Section 2.8 2.9 hereof;
(i) Sell any Company Intellectual Property or enter into any agreement with respect to the Company Intellectual Property with any person or entity, (ii) buy any Intellectual Property or enter into any agreement with respect to the Intellectual Property of any person or entity, (iii) enter into any agreement with respect to development of any Intellectual Property with a third party;
(c) Transfer to any person or entity any rights to any Company Intellectual Property, other than non-exclusive licenses to Company's customers in the ordinary course of business consistent with past practicespractice;
(bd) make any purchases, or enter into any Contract to purchase, any inventory, exceeding $75,000 individually or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practices;
(c) enter Enter into or amend any Contract pursuant to which any other party is granted marketing, distribution, development or similar rights of any type or scope with respect to any products or technology of the Company;
(de) amend Amend or otherwise modify (or agree to do so), except in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Company, ) or violate the terms of, any of the Contracts set forth or described in the Disclosure Schedule;
(ef) declareCommence or settle any litigation;
(g) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stockof its capital stock, or split, combine or reclassify any Company Capital Stock of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stockcapital stock of the Company, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of the capital stock of the Company Capital Stock (or options, warrants or other rights exercisable therefor);
(fh) Except for the issuance of shares of Company Capital Stock upon the exercise or conversion of options outstanding on the date of this Agreement and except for the issuance of options to purchase shares of the Company's Common Stock as contemplated by Section 5.12 of this Agreement, issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, redeem or purchase or propose the purchase of or redemption of, any shares of Company Capital Stock its capital stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities;.
(gi) cause Cause or permit any amendments to the articles its Articles of incorporation, bylaws Incorporation or other organizational documents of the CompanyBylaws;
(hj) acquire Acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the Company's business;
(ik) except as allowed pursuant to Section 4.1 hereof, sellSell, lease, license or otherwise dispose of any of its properties or assets, except properties or assets in the ordinary course of business and consistent with past practices;
(jl) incur Incur any indebtedness, except indebtedness for trade credit or advances to employees in the ordinary course of business consistent with past practices, borrowed money or guarantee any such indebtedness or issue or sell any debt securities or guarantee any debt securities of others;
(km) grant Grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, others or purchase debt securities of others or amend the terms of any outstanding loan agreement;
(ln) grant Grant any severance or termination pay (i) to any director or officer, officer or (ii) to any other employee except consistent with prior practices payments made pursuant to written agreements outstanding on the date of the Company as this Agreement and disclosed in the Disclosure Schedule;
(mo) adopt or amend Adopt any employee benefit plan, or enter into any employment contract or, except as otherwise contemplated by this Agreement, non-competition agreementcontract, pay or agree to pay any special bonus or special remuneration to any director or employee, or, or increase the salaries salary or wage rates or other compensation (including accelerating any options) of its employees except payments made pursuant to standard written agreements in place on the date hereof and disclosed in the Disclosure Scheduleofficers, directors or employees;
(np) revalue Revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of business;
(oq) payPay, discharge or satisfy, in an amount in excess of $10,000 in any one case, case or $30,000 50,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet or subsequently incurred in the ordinary course of businessSheet;
(pr) except as may be required by applicable law, make Make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(qs) enter Enter into any strategic alliance or joint marketing arrangement or agreement;
(rt) except in a manner consistent with Amend or modify the Company's past practicesterms of any of the outstanding Company Options, hire, Company Warrants or Company Capital Stock to accelerate the vesting thereof;
(u) Hire or terminate or enter into settlement agreements with any employees, employees or encourage any employees to resign from the Companyresign; or
(sv) takeTake, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through 4.1(r(u) hereofabove, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective its covenants hereunder, or any other action not in the ordinary course of the Company's business and consistent with past practice.
Appears in 1 contract
Samples: Merger Agreement (Xcarenet Inc)
Conduct Prior to the Effective Time. 4.1 Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or and the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, (except to the extent that Parent shall otherwise consent in writing, which consent shall not be unreasonably withheld or delayed, ) to carry on the Company's its business in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, to pay the its debts and Taxes of the Company when due, to pay or perform other obligations when due, and, to the extent consistent with such business, to use commercially all reasonable efforts, efforts consistent with past practice and policies, policies to preserve intact the Company's its present business organizationsorganization, keep available the services of the Company's its present officers and Key Employees key employees 39 and preserve the Company's its relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's its goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company its business, and any material event involving or adversely affecting the CompanyCompany or its business. Except as expressly contemplated by this Agreement as set forth in Section 4.1 of the Disclosure ScheduleAgreement, the Company shall not, without the prior written consent of Parent, Parent (which such consent shall not be unreasonably withheld or delayed:by Parent):
(a) make any expenditures or enter Enter into any commitment commitment, activity or transaction exceeding $75,000 individually or $150,000 in the aggregate or any commitment or transaction of the type described in Section 2.8 hereof, other than not in the ordinary course of business consistent with past practices;business.
(b) make Transfer to any purchases, person or enter into entity any Contract rights to purchase, any inventory, exceeding $75,000 individually or $150,000 in the aggregate, Company Intellectual Property Rights (other than pursuant to End-User Licenses in the ordinary course of business consistent with past practices;business).
(c) enter Enter into or amend any Contract agreements pursuant to which any other party is granted manufacturing, marketing, distribution, development distribution or similar rights of any type or scope with respect to any products or technology of the Company;
(d) amend Amend or otherwise modify (or agree to do so), except in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Companybusiness, or violate the terms of, any of the Contracts agreements set forth or described in the Disclosure ScheduleCompany Schedules;
(e) declareCommence any litigation or any dispute resolution process;
(f) Declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stock, or split, combine or reclassify any of Company Capital Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or repurchase, redeem or otherwise acquire, directly or indirectly, any shares of Company Capital Stock (or options, warrants or other rights exercisable therefor);
(fg) Except for the issuance of shares of Company Capital Stock upon exercise or conversion of presently outstanding Company Options or Warrants, issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities;
(gh) cause Cause or permit any amendments to the articles its Certificate of incorporation, bylaws Incorporation or other organizational documents of the CompanyBylaws;
(hi) acquire Acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the business of the Company's business;
(ij) except as allowed pursuant to Section 4.1 hereof, sellSell, lease, license or otherwise dispose of any of its properties or assets, assets except in the ordinary course of business and consistent with past practicespractice;
(jk) Except as contemplated on Schedule 2.7(a), incur any indebtednessindebtedness for borrowed money or guarantee any such indebtedness or issue or sell any debt securities of the Company or guarantee any debt securities of others;
(l) Grant any severance or termination pay to any director, officer, employee or consultant, except for trade credit payments made pursuant to standard written agreements outstanding on the date hereof (which such agreements are disclosed on Schedule 4.1(1));
(m) Adopt or advances amend any employee benefit plan, program, policy or arrangement (other than changes made to employees the Company's health insurance plans made in the ordinary course of business consistent with past practices, or guarantee any indebtedness or issue or sell any debt securities or guarantee any debt securities of others;
(k) grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreement;
(l) grant any severance or termination pay (i) to any director or officer, or (ii) to any other employee except consistent with prior practices of the Company as disclosed in the Disclosure Schedule;
(m) adopt or amend any employee benefit plan), or enter into any employment contract orcontract, except as otherwise contemplated by this Agreement, non-competition agreementextend any employment offer, pay or agree to pay any special bonus or special remuneration to any director director, employee or employeeconsultant, or, or increase the salaries or wage rates of its employees except payments made pursuant to standard written agreements in place on the date hereof and disclosed in the Disclosure Scheduleemployees;
(n) revalue Revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of businessbusiness and consistent with past practice;
(o) payTake any action, including the acceleration of vesting of any options, warrants, restricted stock or other rights to acquire shares of Company capital stock, which would be reasonably likely to interfere with Parent's ability to account for the Merger as a pooling of interests or any other action that could jeopardize the tax-free reorganization hereunder;
(p) Pay, discharge or satisfy, in an amount in excess of $10,000 10,000, in any one case, or $30,000 25,000, in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet Company Financial Statements or subsequently liabilities incurred in the ordinary course of businessbusiness consistent with past practices after the date of the Company Financial Statements;
(pq) except as may be required by applicable law, make Make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle 41 any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(qr) enter Enter into any strategic alliance alliance, joint development or joint marketing arrangement or agreement;
(rs) Fail to pay or otherwise satisfy its monetary obligations as they become due, except such as are being contested in good faith;
(t) Waive or commit to waive any rights with a manner consistent with value in excess of $10,000, in any one case, or $25,000, in the Company's past practicesaggregate;
(u) Cancel, hirematerially amend or renew any insurance policy other than in the ordinary course of business;
(v) Alter, terminate or enter into settlement agreements with any employeescommitment to alter, its interest in any corporation, association, joint venture, partnership or encourage business entity in which the Company directly or indirectly holds any employees to resign from interest on the Companydate hereof; or
(sw) takeTake, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through 4.1(r(v) hereofabove, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform their respective its covenants hereunder.
Appears in 1 contract
Samples: Agreement and Plan of Reorganization (Corsair Communications Inc)
Conduct Prior to the Effective Time. 4.1 Conduct of Business of the Company. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, the Company agrees to use commercially reasonable efforts to cause the Company, except to the extent that (a) Unless Parent shall otherwise consent consents in writing, writing (which consent shall not be unreasonably withheld withheld, conditioned or delayed, to carry on the Company's business in the usual, regular ) and ordinary course in substantially the same manner except as heretofore conducted, to pay the debts and Taxes of the Company when due, to pay or perform other obligations when due, and, to the extent consistent with such business, use commercially reasonable efforts, consistent with past practice and policies, to preserve intact the Company's present business organizations, keep available the services of the Company's present officers and Key Employees and preserve the Company's relationships with customers, suppliers, distributors, licensors, licensees, and others having business dealings with it, all with the goal of preserving unimpaired the Company's goodwill and ongoing businesses at the Effective Time. The Company shall promptly notify Parent of any event or occurrence or emergency not in the ordinary course of business of the Company and any material event involving the Company. Except as expressly otherwise contemplated by this Agreement or set forth in the Company Disclosure Schedule, during the period commencing with the execution and delivery of this Agreement and terminating upon the earlier to occur of the Effective Time and the termination of this Agreement pursuant to and in accordance with Section 8.1 (the “Pre-Closing Period”), the Company shall, and shall cause its Subsidiaries to, conduct the Business in the ordinary course. During the Pre-Closing Period, no party to this Agreement (including the Equityholders’ Representative) shall take, or cause to be taken, any action which would materially interfere with the consummation of the transactions contemplated by this Agreement or materially delay the consummation of such transactions.
(b) Without limiting the foregoing, except as otherwise contemplated by this Agreement or set forth in Section 4.1 6.1 of the Company Disclosure Schedule, during the Pre-Closing Period, the Company shall not, and shall cause its Subsidiaries to not, do or cause to be done any of the following without the prior written consent of Parent, Parent (which consent shall not be unreasonably withheld withheld, conditioned or delayed:):
(ai) make issue any expenditures Company Common Stock or enter into any commitment or transaction exceeding $75,000 individually or $150,000 in the aggregate or any commitment or transaction capital stock of the type described in Section 2.8 hereofCompany’s Subsidiaries, except upon the exercise of Company RSU Awards, Company Options or Company PSU Awards;
(ii) create any Encumbrance on any assets or properties (whether tangible or intangible) of any Group Company, other than (y) Permitted Encumbrances; and (z) Encumbrances that will be satisfied upon the payment of the applicable portion of the Closing Debt;
(iii) sell, assign, transfer, lease, license or otherwise dispose of, or agree to sell, assign, transfer, lease, license or otherwise dispose of, any of the fixed assets of any Group Company having a value, in any individual case, in excess of $100,000.00;
(iv) acquire (by merger, consolidation or combination, or acquisition of stock or assets or otherwise) any corporation, partnership or other business organization or division thereof;
(v) (A) enter into or amend any employment, deferred compensation, severance or similar agreement, except any employment agreement providing for compensation of less than $100,000.00 per annum; (B) increase the compensation payable, or to become payable, by any Group Company to directors or officers of any Group Company; or (C) increase the coverage or benefits available under any Employee Benefit Plan, payment or arrangement made to, for or with any director, officer, Company Employee, agent or representative, other than increases, payments or provisions which are in normal amounts and are made in the ordinary course of business consistent with past practicespractice, or which are made pursuant to a contractual obligation or are required by applicable Law;
(bvi) make materially change any purchasesmethod of financial accounting or financial accounting practice used by any Group Company, other than such changes required by GAAP, as applicable;
(vii) amend the Organizational Documents of any Group Company;
(viii) establish, adopt, enter into, amend a plan or agreement of complete or partial liquidation, dissolution, restructuring, merger, consolidation, recapitalization or other reorganization;
(ix) enter into any Contract agreement to purchasetake, or cause to be taken, any inventoryof the actions set forth in this Section 6.1(b); or
(x) make or change any Tax election, exceeding $75,000 individually change any annual Tax accounting period, change any method of Tax accounting, enter into any closing agreement with respect to any Tax, settle any Tax claim or $150,000 in the aggregate, other than in the ordinary course of business consistent with past practices;any assessment or surrender any right to claim a Tax refund.
(c) enter into Without in any way limiting any Party’s rights or amend any Contract pursuant to which any other party is granted marketingobligations under this Agreement, distributionthe parties understand and agree that (i) during the Pre-Closing Period, development or similar rights of any type or scope with respect to any products or technology of the Company;
(d) amend or otherwise modify (or agree to do so), except nothing contained in the ordinary course of business or except as would not be reasonably likely to have a Material Adverse Effect on the Company, or violate the terms of, any of the Contracts set forth or described in the Disclosure Schedule;
(e) declare, set aside or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Capital Stock, or split, combine or reclassify any Company Capital Stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Capital Stock, or repurchase, redeem or otherwise acquirethis Agreement shall give Parent, directly or indirectly, any shares of Company Capital Stock (the right to control or options, warrants or other rights exercisable therefor);
(f) issue, grant, deliver or sell or authorize or propose direct the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any shares of Company Capital Stock or securities convertible into, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating it to issue or purchase any such shares or other convertible securities;
(g) cause or permit any amendments to the articles of incorporation, bylaws or other organizational documents operation of the Company;
(h) acquire or agree to acquire by merging or consolidating with, or by purchasing any assets or equity securities of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets which are material, individually or in the aggregate, to the Company's business;
(i) except as allowed pursuant to Section 4.1 hereof, sell, lease, license or otherwise dispose of any of its properties or assets, except in the ordinary course of business Company and consistent with past practices;
(j) incur any indebtedness, except for trade credit or advances to employees in the ordinary course of business consistent with past practices, or guarantee any indebtedness or issue or sell any debt securities or guarantee any debt securities of others;
(k) grant any loans to others, except to contractors or customers in the ordinary course of business consistent with past practices, or purchase debt securities of others or amend the terms of any outstanding loan agreement;
(l) grant any severance or termination pay (i) to any director or officer, or (ii) to any other employee except during the Pre-Closing Period, the Company and the Equityholders shall exercise, consistent with prior practices the terms and conditions of the Company as disclosed in the Disclosure Schedule;
(m) adopt or amend any employee benefit plan, or enter into any employment contract or, except as otherwise contemplated by this Agreement, non-competition agreement, pay or agree to pay any special bonus or special remuneration to any director or employee, or, increase the salaries or wage rates of its employees except payments made pursuant to standard written agreements in place on the date hereof complete control and disclosed in the Disclosure Schedule;
(n) revalue any of its assets, including without limitation writing down the value of inventory or writing off notes or accounts receivable other than in the ordinary course of business;
(o) pay, discharge or satisfy, in an amount in excess of $10,000 in any one case, or $30,000 in the aggregate, any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business of liabilities reflected or reserved against in the Current Balance Sheet or subsequently incurred in the ordinary course of business;
(p) except as may be required by applicable law, make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, enter into any closing agreement, settle any material claim or assessment in respect of Taxes, or consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of Taxes;
(q) enter into any strategic alliance or joint marketing arrangement or agreement;
(r) except in a manner consistent with the Company's past practices, hire, terminate or enter into settlement agreements with any employees, or encourage any employees to resign from the Company; or
(s) take, or agree in writing or otherwise to take, any of the actions described in Sections 4.1(a) through 4.1(r) hereof, or any other action that would make any of its representations or warranties contained in this Agreement untrue or incorrect or prevent the Company or any of the Principal Officers/Shareholders from performing or cause the Company or any of the Principal Officers/Shareholders not to perform supervision over their respective covenants hereunderbusinesses and operations.
Appears in 1 contract
Samples: Merger Agreement (Brown & Brown Inc)
