Contracts; Customers and Suppliers. (a) Schedule 8.7(a) lists all material contracts and agreements, relating to or affecting the Business which extend beyond the Closing Date to which Seller or any of its Affiliates is a party (other than purchase orders and sales orders entered into in the ordinary course of business and contracts which (unless otherwise specifically indicated) by their terms terminate or are unconditionally terminable by Seller or its Affiliates without penalty within three months or which individually involve a commitment of less than $1,000,000 in any fiscal year) which fall into one or more of the following categories: (i) any contract or agreement, or any note, bond, debenture or other evidence of indebtedness under which Seller, any member of the Seller Group, or any Purchased Subsidiary has created, incurred, assumed or guaranteed (or may create, incur, assume or guarantee) indebtedness for borrowed money or under which Seller or any Purchased Subsidiary has granted an Encumbrance on any Target Assets or Purchased Subsidiaries to secure such indebtedness; (ii) any lease of personal property; (iii) any contract or agreement containing covenants limiting the freedom of the Business or the Purchased Subsidiaries to engage in any line of business or compete with any person or in any geographical market; (iv) any contract or agreement pursuant to which any intellectual property is licensed or sublicensed to or from any person; (v) any contract or agreement granting any person any right to market, distribute or resell any products of the Business, or to act as agent for the Business in connection with the marketing, distribution or sale of any products of the Business; (vi) any contract or agreement establishing or making a Purchased Subsidiary a participant in any joint venture, strategic alliance or other collaboration; (vii) any contract or agreement for the sale of products or services of the Business; (viii) any contract or agreement for the purchase of any raw materials, components or services; (ix) any mortgage, indenture, security agreement, pledge, note, loan agreement or guarantee of indebtedness to which a Purchased Subsidiary is party; (x) any contract or agreement (including any so-called take-or-pay or keepwell agreements) under which any unaffiliated third party has directly or indirectly guaranteed indebtedness, liabilities or obligations of any Purchased Subsidiary; (xi) any contract or agreement under which any Purchased Subsidiary has, directly or indirectly, made any material advance, loan, extension of credit or capital contribution to, or other investment in, any person (other than another Purchased Subsidiary) other than extensions of trade credit in the ordinary course of business; (xii) any contract or agreement (including a sales order) involving the obligation of one or more Purchased Subsidiaries to deliver products or services for payment of more than $1,000,000 or extending for a term of more than 180 days from the date of this Agreement (unless terminable without payment or penalty upon no more than 60 days' notice), other than sales orders entered into in the ordinary course of business; (xiii) any contract or agreement for the sale of any Target Asset or asset of a Purchased Subsidiary (other than inventory sales in the ordinary course of business) or the grant of any preferential rights to purchase any such asset, except for the sales or dispositions of inventory or of obsolete or worn-out assets in the ordinary course of business, consistent with past practice; (xiv) any material contract or agreement with any governmental entity; (xv) any currency exchange, interest rate exchange, commodity exchange or similar contract to which a Purchased Subsidiary is party; and (xvi) any other contract or agreement to which a Purchased Subsidiary is party that has an aggregate minimum future liability to any person (other than a Purchased Subsidiary) in excess of $1,000,000 and is not terminable by the Purchased Subsidiary by notice of not more than 60 days for a cost of less than $50,000 (other than purchase orders and sales orders) (collectively, the "Material Contracts"). Except as set forth on Schedule 8.7(a), Seller and each Purchased Subsidiary have performed all the obligations required to be performed by them to date under the Material Contracts, and are not (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. To the Seller's Knowledge, no other party to any Material Contract is (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. Seller has made available to Purchaser true and correct copies of all Material Contracts and, with respect to Material Contracts entered into after the date of this Agreement, will make copies of such contracts available prior to Closing. (b) All of the Material Contracts (i) are legal, valid and binding obligations of the Business enforceable (except as enforcement may be limited by equitable principles limiting the right to obtain specific performance or other equitable remedies or by applicable bankruptcy or insolvency laws and related decisions affecting creditors' rights generally) against the Purchased Subsidiaries or a member of the Seller Group; (ii) have been negotiated in good faith on an "arm's-length" transaction basis; (iii) are, to the Knowledge of Seller, enforceable against the other parties in accordance with their respective terms; and (iv) constituting Target Assets are assignable without the consent of any third party except as listed on Schedule 8.3 attached hereto and made a part hereof. Except as listed on Schedule 8.7(b) hereto, none of the Purchased Subsidiaries or members of the Seller Group have received or given written notice of any default or claimed, purported or alleged default or state of facts which, with notice or lapse of time or both, would constitute a default on the part of any party in the performance or payment of any of the Material Contracts. (c) A list of the ten largest customers (in terms of revenue or turnover) and ten largest suppliers (in terms of supplies expensed during the year) of the Business (by dollar amounts) for the year ended March 31, 2001 is set forth in Schedule 8.7(c). Except as set forth in Schedule 8.7(c), neither the Seller nor, to its Knowledge, any officer, director, or Affiliate of Seller owns any interest in any person or entity which is a supplier or customer of the Business (other than less than 5% of interests in publicly traded companies) or has any contractual arrangements with the Business (other than contractual arrangements between any Seller or any subsidiary of Seller, on one hand, and the Business, on the other hand). All purchase and sale orders and other commitments for purchases and sales made by the Purchased Subsidiaries and members of the Seller Group in connection with the Business have been made in the ordinary course of business in accordance with past practices, and no payments have been made to any supplier or representative thereof other than payments to such suppliers for the payment of the invoiced price of supplies purchased in the ordinary course of business. Except as could not reasonably be expected to have a Material Adverse Effect on the Business or as set forth in Schedule 8.7(c), since the date of the most recent balance sheet delivered pursuant to Section 8.4 hereof, there has not been (i) any material adverse change in the business relationship of the Business or of any Purchased Subsidiary with any customer or supplier named in Schedule 8.7(c) or (ii) any change in any material term (including credit terms) of the supply agreements or sales agreements, as the case may be, and related arrangements with any such supplier or customer. During the past 12 months, neither the Seller, any member of the Seller Group nor any Purchased Subsidiary has received any written customer complaint concerning the products and services of the Business, nor has one of them had any such products returned by a purchaser thereof, other than complaints and returns in the ordinary course of business that, individually or in the aggregate, have not had and could not reasonably be expected to have a Material Adverse Effect.
Appears in 1 contract
Contracts; Customers and Suppliers. (a) Section 4.11(a) of the Company Disclosure Schedule 8.7(alists each of the Material Contracts that are in effect or otherwise binding on the Company or any Company Subsidiary or their respective properties or assets. The term “Material Contract” shall include each of the following: (i) lists all material contracts and agreementsany credit agreement, relating to note, bond, guarantee, mortgage, indenture, lease, or affecting the Business which extend beyond the Closing Date other instrument or obligation pursuant to which Seller any Indebtedness of the Company or any of its Affiliates Company Subsidiary is a party (outstanding or may be incurred, in each case, other than purchase orders (x) equipment leases entered into in the ordinary course of business, (y) capital or operating leases that require annual payments not in excess of $500,000, individually, and sales orders (z) guarantees of Company Subsidiary obligations (in the case of each of clauses (x) – (z), with respect to Contracts that would not otherwise be Material Contracts); (ii) any agreement, Contract or binding commitment which was or was required to be filed as an exhibit to the Company SEC Reports; (iii) any Government Contract with the United States government in excess of $500,000 annually; and (iv) any (A) collective bargaining agreement; (B) employment agreement, Contract or binding commitment providing for annual compensation or payments in excess of $250,000 in the current or any future year; (C) agreement, Contract or commitment of indemnification or guaranty not entered into in the ordinary course of business and contracts providing for indemnification which (unless otherwise specifically indicated) by their terms terminate would reasonably be expected to exceed $100,000, as well as any agreement, Contract or are unconditionally terminable by Seller or its Affiliates without penalty within three months or which individually involve a commitment of less than $1,000,000 in indemnification or guaranty between the Company or any fiscal year) which fall into one Company Subsidiary and any of their respective officers or more directors, irrespective of the following categories:
amount (iother than pursuant to the organizational documents of the Company or any Company Subsidiary); (D) any contract or agreement, Contract or binding commitment containing any note, bond, debenture covenant directly or other evidence of indebtedness under which Seller, any member of the Seller Group, or any Purchased Subsidiary has created, incurred, assumed or guaranteed (or may create, incur, assume or guarantee) indebtedness for borrowed money or under which Seller or any Purchased Subsidiary has granted an Encumbrance on any Target Assets or Purchased Subsidiaries to secure such indebtedness;
(ii) any lease of personal property;
(iii) any contract or agreement containing covenants indirectly limiting the freedom of the Business Company or the Purchased Subsidiaries any of Company Subsidiary to engage in any line of business or business, compete with any person or in any geographical market;
(iv) any contract or agreement pursuant to which any intellectual property is licensed or sublicensed to or from any person;
(v) any contract or agreement granting any person any right to market, distribute or resell any products of the BusinessPerson, or to act as agent for the Business in connection with the marketing, distribution sell any product or sale of any products of the Business;
(vi) any contract or agreement establishing or making a Purchased Subsidiary a participant in any joint venture, strategic alliance or other collaboration;
(vii) any contract or agreement for the sale of products or services of the Business;
(viii) any contract or agreement for the purchase of any raw materials, components or services;
(ix) any mortgage, indenture, security agreement, pledge, note, loan agreement or guarantee of indebtedness to which a Purchased Subsidiary is party;
(x) any contract or agreement (including any so-called take-or-pay or keepwell agreements) under which any unaffiliated third party has directly or indirectly guaranteed indebtedness, liabilities or obligations of any Purchased Subsidiary;
(xi) any contract or agreement under which any Purchased Subsidiary has, directly or indirectly, made any material advance, loan, extension of credit or capital contribution to, or other investment in, any person service (other than another Purchased SubsidiaryContracts containing (i) other than extensions of trade credit in geographic limitations or (ii) limitations related to sales to the ordinary course of business;
(xii) any contract or agreement (including a sales order) involving the obligation of one or more Purchased Subsidiaries to deliver products or services for payment of more than $1,000,000 or extending for a term of more than 180 days from the date of this Agreement (unless terminable without payment or penalty upon no more than 60 days' notice)aftermarket, other than sales orders which limitations have been entered into in the ordinary course of business;
business and, in the case of each (xiiii) any contract and (ii) that would not otherwise be Material Contracts); (E) agreement, Contract or agreement for binding commitment that shall result in the sale payment by, or the creation of any Target Asset commitment or asset obligation (absolute or contingent) to pay on behalf of the Company or any Company Subsidiary any severance, termination, “golden parachute,” or other similar payments to any employee following termination of employment or otherwise as a Purchased Subsidiary result of the consummation of the transactions contemplated by this Agreement; (other than inventory sales in F) agreement, Contract or binding commitment by the ordinary course Company or any of business) its Subsidiaries entered into since January 1, 2004 or the grant of any preferential rights to purchase any such asset, except for the sales or dispositions of inventory or of obsolete or worn-out assets in the ordinary course of business, consistent with past practice;
(xiv) any material contract or agreement with any governmental entity;
(xv) any currency exchange, interest rate exchange, commodity exchange or similar contract to which a Purchased Subsidiary is party; and
(xvi) any other contract or agreement to which a Purchased Subsidiary is party that has an aggregate minimum future liability to any person (other than a Purchased Subsidiary) in excess of $1,000,000 and is not terminable by the Purchased Subsidiary by notice of not more than 60 days for a cost of less than $50,000 (other than purchase orders and sales orders) (collectively, the "Material Contracts"). Except as set forth on Schedule 8.7(a), Seller and each Purchased Subsidiary have performed all the material obligations required that are to be performed by them subsequent to date under the Material Contractshereof, and are not (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. To the Seller's Knowledge, no other party to any Material Contract is (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. Seller has made available to Purchaser true and correct copies of all Material Contracts and, with respect to Material Contracts entered into after the date of this Agreement, will make copies of such contracts available prior to Closing.
(b) All of the Material Contracts (i) are legal, valid and binding obligations of the Business enforceable (except as enforcement may be limited by equitable principles limiting the right to obtain specific performance or other equitable remedies or by applicable bankruptcy or insolvency laws and related decisions affecting creditors' rights generally) against the Purchased Subsidiaries or a member of the Seller Group; (ii) have been negotiated in good faith on an "arm's-length" transaction basis; (iii) are, relating to the Knowledge disposition or acquisition of Seller, enforceable against the other parties in accordance with their respective terms; and (iv) constituting Target Assets are assignable without the consent of any third party except as listed on Schedule 8.3 attached hereto and made a part hereof. Except as listed on Schedule 8.7(b) hereto, none of the Purchased Subsidiaries or members of the Seller Group have received or given written notice of any default or claimed, purported or alleged default or state of facts which, with notice or lapse of time or both, would constitute a default on the part of any party in the performance or payment of any of the Material Contracts.
(c) A list of the ten largest customers (in terms of revenue or turnover) and ten largest suppliers (in terms of supplies expensed during the year) of the Business (by dollar amounts) for the year ended March 31, 2001 is set forth in Schedule 8.7(c). Except as set forth in Schedule 8.7(c), neither the Seller nor, to its Knowledge, any officer, director, or Affiliate of Seller owns any interest in any person or entity which is a supplier or customer of the Business (other than less than 5% of interests in publicly traded companies) or has any contractual arrangements with the Business (other than contractual arrangements between any Seller or any subsidiary of Seller, on one hand, and the Business, on the other hand). All purchase and sale orders and other commitments for purchases and sales made by the Purchased Subsidiaries and members of the Seller Group in connection with the Business have been made material assets not in the ordinary course of business or any ownership interest in accordance with past practicesany Subsidiary or other Person; (G) material agreement, and no payments have been made Contract or binding commitment regarding the development, ownership or use of Intellectual Property (including material licenses to any supplier or representative thereof from third parties, but other than payments to such suppliers for commercial off-the-shelf software, as the payment term is commonly understood); (H) original equipment manufacturer distribution agreement, material partnership, joint venture or similar agreement or arrangement; in excess of the invoiced price of supplies purchased in the ordinary course of business. Except as could not reasonably be expected to have a Material Adverse Effect on the Business or as set forth in Schedule 8.7(c), since the date of the most recent balance sheet delivered pursuant to Section 8.4 hereof, there has not been (i) any material adverse change $10,000,000 in the business relationship of the Business or of any Purchased Subsidiary with any customer or supplier named in Schedule 8.7(c) annual revenue or (ii) Contracts that relate to the purchase by the Company or any change in any material term Company Subsidiary of distribution rights with payments of $5,000,000 or more; (including credit termsI) Contract or agreement involving a standstill or similar obligation of the supply agreements Company or sales agreementsany of its Subsidiaries to a third party; (J) lease for real property which involves consideration or other obligation in excess of $400,000 annually; or (K) (x) any other agreement, as Contract or binding commitment which is material to the case may be, and related arrangements with any such supplier or customer. During the past 12 months, neither the Seller, any member operation of the Seller Group nor any Purchased Subsidiary has received any written customer complaint concerning Company’s and the products and services of the BusinessCompany Subsidiaries’ business, nor has one of them had any such products returned by taken as a purchaser thereofwhole, other than complaints and returns in or (y) which is entered into outside the ordinary course of business thatand which involves consideration or other obligation in excess of $100,000 annually and, individually or in the aggregatecase of clauses (x) and (y), have which has not had and could not reasonably be expected to have a Material Adverse Effectbeen described in the foregoing clauses (A) through (J) above.
Appears in 1 contract
Samples: Merger Agreement (Boeing Co)
Contracts; Customers and Suppliers. (a) Attached to Schedule 8.7(a4.17(a) lists of the Disclosure Statement is a complete list of all material contracts and agreementscontracts, relating to leases, licenses or affecting the Business which extend beyond the Closing Date other instruments, agreements or binding commitments, whether or not in written form, to which Seller the Company (or any of its Affiliates properties or assets) or either Shareholder (in connection with the Business) is a party, is bound, or otherwise subject or otherwise is related to its Business and which provides for or falls within any of the following categories (collectively, the "Contracts"):
(i) Contracts with any service provider or client, including, without limitation, agent and broker contracts;
(ii) Contracts with any broker-dealer, investment advisor, insurance/annuity company or agency or clearing agency;
(iii) Contracts with any mutual fund, hedge fund or 401(K) service providers;
(iv) Contracts granting, or consenting to the existence of, any Lien on or in any of the Company's assets in favor of any Person;
(v) Collective bargaining arrangements or other Contracts with any labor union;
(vi) Contracts for capital expenditures or the acquisition or construction of any Fixed Assets in excess of $25,000;
(vii) Contracts relating to the borrowing of money or the incurrence of any indebtedness for borrowed money, or the issuance of any letter of credit, or the guaranty of another Person's indebtedness or Contracts of suretyship;
(viii) Contracts granting to any Person a right of first refusal, first offer, option or similar preferential right to purchase or acquire any of the Company's properties, assets or securities;
(ix) Contracts limiting, restricting or prohibiting the Company from conducting any business anywhere in the world;
(x) Joint venture or partnership agreements or other similar Contracts;
(xi) Contracts of employment or for the retention of consultants or advisors or the furnishing of services by any third party;
(xii) Contracts which indemnify any other Person or which provide for charitable contributions or which are in the nature of a severance agreement or which would otherwise entitle any Person not a party to this Agreement to receive a payment based upon the consummation of the transactions contemplated hereby; or
(xiii) any other than purchase orders Contract which is material to the operations of the Business or any of the Company's assets. Each Contract (assuming due authorization and sales orders execution by the counterparty to the Contract): (i) is in full force and effect; (ii) is a valid and binding obligation of the Company enforceable in accordance with its terms; (iii) does not give rise to a Lien on any of the Company's assets; and (iv) has been entered into on an arm's-length basis in the ordinary course of business and contracts which (unless otherwise specifically indicated) by their terms terminate or are unconditionally terminable by Seller or its Affiliates without penalty within three months or which individually involve a commitment of less than $1,000,000 in any fiscal year) which fall into one or more of the following categories:
(i) any contract or agreement, or any note, bond, debenture or other evidence of indebtedness under which Seller, any member of the Seller Group, or any Purchased Subsidiary has created, incurred, assumed or guaranteed (or may create, incur, assume or guarantee) indebtedness for borrowed money or under which Seller or any Purchased Subsidiary has granted an Encumbrance on any Target Assets or Purchased Subsidiaries to secure such indebtedness;
(ii) any lease of personal property;
(iii) any contract or agreement containing covenants limiting the freedom of the Business or the Purchased Subsidiaries to engage in any line of business or compete with any person or in any geographical market;
(iv) any contract or agreement pursuant to which any intellectual property is licensed or sublicensed to or from any person;
(v) any contract or agreement granting any person any right to market, distribute or resell any products of the Business, or to act as agent for the Business in connection with the marketing, distribution or sale of any products of the Business;
(vi) any contract or agreement establishing or making a Purchased Subsidiary a participant in any joint venture, strategic alliance or other collaboration;
(vii) any contract or agreement for the sale of products or services of the Business;
(viii) any contract or agreement for the purchase of any raw materials, components or services;
(ix) any mortgage, indenture, security agreement, pledge, note, loan agreement or guarantee of indebtedness to which a Purchased Subsidiary is party;
(x) any contract or agreement (including any so-called take-or-pay or keepwell agreements) under which any unaffiliated third party has directly or indirectly guaranteed indebtedness, liabilities or obligations of any Purchased Subsidiary;
(xi) any contract or agreement under which any Purchased Subsidiary has, directly or indirectly, made any material advance, loan, extension of credit or capital contribution to, or other investment in, any person (other than another Purchased Subsidiary) other than extensions of trade credit in the ordinary course of business;
(xii) any contract or agreement (including a sales order) involving the obligation of one or more Purchased Subsidiaries to deliver products or services for payment of more than $1,000,000 or extending for a term of more than 180 days from the date of this Agreement (unless terminable without payment or penalty upon no more than 60 days' notice), other than sales orders entered into in the ordinary course of business;
(xiii) any contract or agreement for the sale of any Target Asset or asset of a Purchased Subsidiary (other than inventory sales in the ordinary course of business) or the grant of any preferential rights to purchase any such asset, except for the sales or dispositions of inventory or of obsolete or worn-out assets in the ordinary course of business, consistent with past practice;
(xiv) any material contract practices. There is no default under or agreement with any governmental entity;
(xv) any currency exchange, interest rate exchange, commodity exchange or similar contract to which a Purchased Subsidiary is party; and
(xvi) any other contract or agreement to which a Purchased Subsidiary is party that has an aggregate minimum future liability to any person (other than a Purchased Subsidiary) in excess of $1,000,000 and is not terminable breach by the Purchased Subsidiary by notice of not more than 60 days for a cost of less than $50,000 Company (other than purchase orders and sales orders) (collectivelywhich, the "Material Contracts"). Except as set forth on Schedule 8.7(a), Seller and each Purchased Subsidiary have performed all the obligations required to be performed by them to date under the Material Contracts, and are not (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. To the Seller's Knowledge, no other party to any Material Contract is (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. Seller has made available to Purchaser true and correct copies of all Material Contracts and, with respect to Material Contracts entered into after the date of this Agreement, will make copies of such contracts available prior to Closing.
(b) All of the Material Contracts (i) are legal, valid and binding obligations of the Business enforceable (except as enforcement may be limited by equitable principles limiting the right to obtain specific performance or other equitable remedies or by applicable bankruptcy or insolvency laws and related decisions affecting creditors' rights generally) against the Purchased Subsidiaries or a member of the Seller Group; (ii) have been negotiated in good faith on an "arm's-length" transaction basis; (iii) are, to the Knowledge of Seller, enforceable against the other parties in accordance with their respective terms; and (iv) constituting Target Assets are assignable without the consent of any third party except as listed on Schedule 8.3 attached hereto and made a part hereof. Except as listed on Schedule 8.7(b) hereto, none of the Purchased Subsidiaries or members of the Seller Group have received or given written notice of any default or claimed, purported or alleged default or state of facts which, with notice or lapse of time or both, ) would constitute a default on under any Contract and, to the part of any party in the performance or payment of any knowledge of the Material Shareholders there is no default under or breach by any counterparty to a Contract (which with or without the giving of notice or lapse of time or both) would constitute a default under any Contract. No Contract will be adversely affected or terminated by consummation of the transactions contemplated hereby. Attached to Schedule 4.17(a) of the Disclosure Statement are true, correct and complete copies of all Contracts and summaries of oral Contracts, if any.
(cb) A list of the ten largest customers (in terms of revenue or turnover) and ten largest suppliers (in terms of supplies expensed during the yearSchedule 4.17(b) of the Business (by Disclosure Statement contains a list of each of the Company's clients with related dollar amounts) volume of revenues for calendar year 2004 and the year six-month period ended March 31June 30, 2001 2005. Neither the Company nor either Shareholder is set forth in Schedule 8.7(c). Except as set forth in Schedule 8.7(c), neither the Seller nor, to its Knowledge, any officer, director, or Affiliate of Seller owns any interest engaged in any person dispute with any client or entity service provider, nor does either the Company or either Shareholder have knowledge of any matter or fact which is a supplier or customer of the Business (other than less than 5% of interests in publicly traded companies) or has any contractual arrangements with the Business (other than contractual arrangements between any Seller or any subsidiary of Seller, on one hand, and the Business, on the other hand). All purchase and sale orders and other commitments for purchases and sales made by the Purchased Subsidiaries and members of the Seller Group in connection with the Business have been made in the ordinary course of business in accordance with past practices, and no payments have been made to any supplier or representative thereof other than payments to such suppliers for the payment of the invoiced price of supplies purchased in the ordinary course of business. Except as could not reasonably be expected to have result in a Material Adverse Effect on dispute with any client or service provider. To the Business or as set forth in Schedule 8.7(c), since the date knowledge of the most recent balance sheet delivered pursuant to Section 8.4 hereofShareholders, there has not been (i) any material adverse change in the business relationship of the Business or of any Purchased Subsidiary with any no customer or supplier named in Schedule 8.7(c) service provider is considering termination, non-renewal or (ii) any change in any material term (including credit terms) modification of the supply agreements or sales agreements, as the case may be, and related its arrangements with any such supplier the Company prior to or customer. During following the past 12 months, neither the Seller, any member of the Seller Group nor any Purchased Subsidiary has received any written customer complaint concerning the products and services of the Business, nor has one of them had any such products returned by a purchaser thereof, other than complaints and returns in the ordinary course of business that, individually or in the aggregate, have not had and could not reasonably be expected to have a Material Adverse EffectClosing.
Appears in 1 contract
Samples: Stock Purchase Agreement (National Investment Managers Inc.)
Contracts; Customers and Suppliers. (a) Attached to Schedule 8.7(a4.17(a) lists of the Disclosure Statement is a complete list of all material contracts and agreementscontracts, relating to leases, licenses or affecting the Business which extend beyond the Closing Date other instruments, agreements or binding commitments, whether or not in written form, to which Seller the Company (or any of its Affiliates properties or assets) or either Shareholder (in connection with the Business) is a party, is bound, or otherwise subject or otherwise is related to its Business and which provides for or falls within any of the following categories (collectively, the "Contracts"):
(i) Contracts with any service provider or client, including, without limitation, agent and broker contracts;
(ii) Contracts with any broker-dealer, investment advisor, insurance/annuity company or agency or clearing agency;
(iii) Contracts with any mutual fund, hedge fund or 401(K) service providers;
(iv) Contracts granting, or consenting to the existence of, any Lien on or in any of the Company's assets in favor of any Person;
(v) Collective bargaining arrangements or other Contracts with any labor union;
(vi) Contracts for capital expenditures or the acquisition or construction of any Fixed Assets in excess of $25,000;
(vii) Contracts relating to the borrowing of money or the incurrence of any indebtedness for borrowed money, or the issuance of any letter of credit, or the guaranty of another Person's indebtedness or Contracts of suretyship;
(viii) Contracts granting to any Person a right of first refusal, first offer, option or similar preferential right to purchase or acquire any of the Company's properties, assets or securities;
(ix) Contracts limiting, restricting or prohibiting the Company from conducting any business anywhere in the world;
(x) Joint venture or partnership agreements or other similar Contracts;
(xi) Contracts of employment or for the retention of consultants or advisors or the furnishing of services by any third party;
(xii) Contracts which indemnify any other Person or which provide for charitable contributions or which are in the nature of a severance agreement or which would otherwise entitle any Person not a party to this Agreement to receive a payment based upon the consummation of the transactions contemplated hereby; or
(xiii) any other than purchase orders Contract which is material to the operations of the Business or any of the Company's assets. Each Contract (assuming due authorization and sales orders execution by the counterparty to the Contract): (i) is in full force and effect; (ii) is a valid and binding obligation of the Company enforceable in accordance with its terms; (iii) does not give rise to a Lien on any of the Company's assets; and (iv) has been entered into on an arm's-length basis in the ordinary course of business and contracts which (unless otherwise specifically indicated) by their terms terminate or are unconditionally terminable by Seller or its Affiliates without penalty within three months or which individually involve a commitment of less than $1,000,000 in any fiscal year) which fall into one or more of the following categories:
(i) any contract or agreement, or any note, bond, debenture or other evidence of indebtedness under which Seller, any member of the Seller Group, or any Purchased Subsidiary has created, incurred, assumed or guaranteed (or may create, incur, assume or guarantee) indebtedness for borrowed money or under which Seller or any Purchased Subsidiary has granted an Encumbrance on any Target Assets or Purchased Subsidiaries to secure such indebtedness;
(ii) any lease of personal property;
(iii) any contract or agreement containing covenants limiting the freedom of the Business or the Purchased Subsidiaries to engage in any line of business or compete with any person or in any geographical market;
(iv) any contract or agreement pursuant to which any intellectual property is licensed or sublicensed to or from any person;
(v) any contract or agreement granting any person any right to market, distribute or resell any products of the Business, or to act as agent for the Business in connection with the marketing, distribution or sale of any products of the Business;
(vi) any contract or agreement establishing or making a Purchased Subsidiary a participant in any joint venture, strategic alliance or other collaboration;
(vii) any contract or agreement for the sale of products or services of the Business;
(viii) any contract or agreement for the purchase of any raw materials, components or services;
(ix) any mortgage, indenture, security agreement, pledge, note, loan agreement or guarantee of indebtedness to which a Purchased Subsidiary is party;
(x) any contract or agreement (including any so-called take-or-pay or keepwell agreements) under which any unaffiliated third party has directly or indirectly guaranteed indebtedness, liabilities or obligations of any Purchased Subsidiary;
(xi) any contract or agreement under which any Purchased Subsidiary has, directly or indirectly, made any material advance, loan, extension of credit or capital contribution to, or other investment in, any person (other than another Purchased Subsidiary) other than extensions of trade credit in the ordinary course of business;
(xii) any contract or agreement (including a sales order) involving the obligation of one or more Purchased Subsidiaries to deliver products or services for payment of more than $1,000,000 or extending for a term of more than 180 days from the date of this Agreement (unless terminable without payment or penalty upon no more than 60 days' notice), other than sales orders entered into in the ordinary course of business;
(xiii) any contract or agreement for the sale of any Target Asset or asset of a Purchased Subsidiary (other than inventory sales in the ordinary course of business) or the grant of any preferential rights to purchase any such asset, except for the sales or dispositions of inventory or of obsolete or worn-out assets in the ordinary course of business, consistent with past practice;
(xiv) any material contract practices. There is no default under or agreement with any governmental entity;
(xv) any currency exchange, interest rate exchange, commodity exchange or similar contract to which a Purchased Subsidiary is party; and
(xvi) any other contract or agreement to which a Purchased Subsidiary is party that has an aggregate minimum future liability to any person (other than a Purchased Subsidiary) in excess of $1,000,000 and is not terminable breach by the Purchased Subsidiary by notice of not more than 60 days for a cost of less than $50,000 Company (other than purchase orders and sales orders) (collectivelywhich, the "Material Contracts"). Except as set forth on Schedule 8.7(a), Seller and each Purchased Subsidiary have performed all the obligations required to be performed by them to date under the Material Contracts, and are not (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. To the Seller's Knowledge, no other party to any Material Contract is (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. Seller has made available to Purchaser true and correct copies of all Material Contracts and, with respect to Material Contracts entered into after the date of this Agreement, will make copies of such contracts available prior to Closing.
(b) All of the Material Contracts (i) are legal, valid and binding obligations of the Business enforceable (except as enforcement may be limited by equitable principles limiting the right to obtain specific performance or other equitable remedies or by applicable bankruptcy or insolvency laws and related decisions affecting creditors' rights generally) against the Purchased Subsidiaries or a member of the Seller Group; (ii) have been negotiated in good faith on an "arm's-length" transaction basis; (iii) are, to the Knowledge of Seller, enforceable against the other parties in accordance with their respective terms; and (iv) constituting Target Assets are assignable without the consent of any third party except as listed on Schedule 8.3 attached hereto and made a part hereof. Except as listed on Schedule 8.7(b) hereto, none of the Purchased Subsidiaries or members of the Seller Group have received or given written notice of any default or claimed, purported or alleged default or state of facts which, with notice or lapse of time or both, ) would constitute a default on under any Contract and, to the part of any party in the performance or payment of any knowledge of the Material Shareholders there is no default under or breach by any counterparty to a Contract (which with or without the giving of notice or lapse of time or both) would constitute a default under any Contract. No Contract will be adversely affected or terminated by consummation of the transactions contemplated hereby. Attached to Schedule 4.17(a) of the Disclosure Statement are true, correct and complete copies of all Contracts and summaries of oral Contracts, if any.
(cb) A list of the ten largest customers (in terms of revenue or turnover) and ten largest suppliers (in terms of supplies expensed during the yearSchedule 4.17(b) of the Business (by Disclosure Statement contains a list of each of the Company's clients with related dollar amounts) volume of revenues for calendar year 2004 and the year six-month period ended March 31June 30, 2001 2005. Neither the Company nor either Shareholder is set forth in Schedule 8.7(c). Except as set forth in Schedule 8.7(c), neither the Seller nor, to its Knowledge, any officer, director, or Affiliate of Seller owns any interest engaged in any person dispute with any client or entity service provider, nor does either the Company or either Shareholder have knowledge of any matter or fact which is a supplier or customer of the Business (other than less than 5% of interests in publicly traded companies) or has any contractual arrangements with the Business (other than contractual arrangements between any Seller or any subsidiary of Seller, on one hand, and the Business, on the other hand). All purchase and sale orders and other commitments for purchases and sales made by the Purchased Subsidiaries and members of the Seller Group in connection with the Business have been made in the ordinary course of business in accordance with past practices, and no payments have been made to any supplier or representative thereof other than payments to such suppliers for the payment of the invoiced price of supplies purchased in the ordinary course of business. Except as could not reasonably be expected to have result in a Material Adverse Effect on dispute with any client or service provider. To the Business or as set forth in Schedule 8.7(c), since the date knowledge of the most recent balance sheet delivered pursuant to Section 8.4 hereofShareholder, there has not been (i) any material adverse change in the business relationship of the Business or of any Purchased Subsidiary with any no customer or supplier named in Schedule 8.7(c) service provider is considering termination, non-renewal or (ii) any change in any material term (including credit terms) modification of the supply agreements or sales agreements, as the case may be, and related its arrangements with any such supplier the Company prior to or customer. During following the past 12 months, neither the Seller, any member of the Seller Group nor any Purchased Subsidiary has received any written customer complaint concerning the products and services of the Business, nor has one of them had any such products returned by a purchaser thereof, other than complaints and returns in the ordinary course of business that, individually or in the aggregate, have not had and could not reasonably be expected to have a Material Adverse EffectClosing.
Appears in 1 contract
Samples: Stock Purchase Agreement (National Investment Managers Inc.)
Contracts; Customers and Suppliers. (a) Section 3.11 of the Disclosure Schedule 8.7(alists the following agreements (written or oral) lists all material contracts and agreements, relating to or affecting the Business which extend beyond the Closing Date to which Seller or any of its Affiliates Acquired Company is a party (other than purchase orders and sales orders entered into in the ordinary course of business and contracts which (unless otherwise specifically indicated) by their terms terminate or are unconditionally terminable by Seller or its Affiliates without penalty within three months or which individually involve a commitment of less than $1,000,000 in any fiscal year) which fall into one or more as of the following categoriesdate of this Agreement:
(i) any contract agreement for the lease of personal property from or to third parties providing for aggregate lease payments by any Acquired Company in excess of $10,000 per annum or which has a term extending for more than one (1) year;
(ii) any agreement for the purchase of products or for the receipt of services which involves the payment by any Acquired Company of more than the sum of $10,000 per annum or which has a term extending for more than three (3) years;
(iii) any partnership, joint venture or limited liability company agreement, or ;
(iv) any note, bond, debenture or other evidence of indebtedness agreement under which Seller, any member of the Seller Group, or any Purchased Subsidiary Acquired Company has created, incurred, assumed or guaranteed (or may create, incur, assume or guarantee) indebtedness for borrowed money or any capitalized lease obligation, or under which Seller any Acquired Company has imposed (or any Purchased Subsidiary has granted an Encumbrance may impose) a Security Interest on any Target Assets of its assets, tangible or Purchased Subsidiaries to secure such indebtedness;
(ii) any lease of personal property;
(iii) any contract or agreement containing covenants limiting the freedom of the Business or the Purchased Subsidiaries to engage in any line of business or compete with any person or in any geographical market;
(iv) any contract or agreement pursuant to which any intellectual property is licensed or sublicensed to or from any personintangible;
(v) any contract agreement for the acquisition of a business or agreement granting any person any right to marketentity, distribute or resell any products substantially all of the Business, assets of a business or to act as agent for the Business in connection with the marketing, distribution entity (including by merger or sale of any products of the Businessconsolidation);
(vi) any contract agreement concerning noncompetition or nonsolicitation, or an agreement establishing or making that otherwise restricts the ability of any Acquired Company to compete, to which any Acquired Company is a Purchased Subsidiary a participant in any joint venture, strategic alliance or other collaborationparty;
(vii) any contract or agreement for the sale employment of products any individual on a full-time, part-time or services other basis and any consulting agreement, in each case that is not terminable at will by the applicable Acquired Company and without the payment of severance, termination or similar compensation or benefits (other than required by Law) or requires payment of amounts after the Businessdate hereof in excess of $25,000 of base pay per annum;
(viii) any contract agreement under which any Acquired Company has advanced or agreement for the purchase loaned any amount to any of any raw materialsits directors, components or servicesofficers, and employees;
(ix) any mortgageagreement in which any current or former officer, indenture, security agreement, pledge, note, loan agreement director or guarantee stockholder of indebtedness to which a Purchased Subsidiary the Company is partydirectly or indirectly interested;
(x) any contract settlement, conciliation or agreement (including any so-called take-or-pay or keepwell agreements) under similar agreement, the performance of which any unaffiliated third party has directly or indirectly guaranteed indebtedness, liabilities or obligations will involve aggregate payments after the Closing Date of any Purchased Subsidiary;consideration in excess of $10,000; and
(xi) any contract or agreement under which any Purchased Subsidiary has, directly or indirectly, made any material advance, loan, extension of credit or capital contribution to, or other investment in, any person (other than another Purchased Subsidiaryagreements of the type described in subclauses (i) other through (x) above) that involves aggregate future payments by any Acquired Company in excess of $10,000 per annum or which has a term extending for more than extensions of trade credit in the ordinary course of business;one (1) year.
(xiib) any contract or agreement (including Section 3.11 of the Disclosure Schedule also sets forth a sales order) involving the obligation of one or more Purchased Subsidiaries to deliver products or services for payment of more than $1,000,000 or extending for a term of more than 180 days from the date of this Agreement (unless terminable without payment or penalty upon no more than 60 days' notice), other than sales orders entered into in the ordinary course of business;list of:
(xiiii) any contract or agreement for The 20 largest customers of the sale Acquired Companies, in terms of any Target Asset or asset of a Purchased Subsidiary the aggregate revenues to the Acquired Companies during the fiscal year ended December 31, 2006 (other than inventory sales in such customers being referred to herein as the ordinary course of business) or the grant of any preferential rights to purchase any such asset, except for the sales or dispositions of inventory or of obsolete or worn-out assets in the ordinary course of business, consistent with past practice;
(xiv) any material contract or agreement with any governmental entity;
(xv) any currency exchange, interest rate exchange, commodity exchange or similar contract to which a Purchased Subsidiary is party"MAJOR CUSTOMERS"); and
(xviii) any other contract or agreement the 20 largest suppliers of the Acquired Companies, in terms of the aggregate charges to which a Purchased Subsidiary is party that has an aggregate minimum future liability the Acquired Companies during the fiscal year ended December 31, 2006 (such suppliers being referred to any person (other than a Purchased Subsidiary) in excess of $1,000,000 and is not terminable by the Purchased Subsidiary by notice of not more than 60 days for a cost of less than $50,000 (other than purchase orders and sales orders) (collectively, herein as the "Material ContractsMAJOR SUPPLIERS"). .
(c) Except as set forth on Schedule 8.7(a), Seller and each Purchased Subsidiary have performed all the obligations required to be performed by them to date under the Material Contracts, and are not (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability Section 3.11 of the Business to conduct its operations as heretofore conducted. To the Seller's KnowledgeDisclosure Schedule, no other party to any Material Contract is (with or without the lapse of time or the giving of notice or both) in default or breach in any respect under any Material Contract except for failures to perform or defaults which do not materially impair the ability of the Business to conduct its operations as heretofore conducted. Seller has made available to Purchaser true and correct copies of all Material Contracts andsince December 31, with respect to Material Contracts entered into after the date of this Agreement2004, will make copies of such contracts available prior to Closing.
(b) All of the Material Contracts (i) are legal, valid and binding obligations of the Business enforceable (except as enforcement may be limited by equitable principles limiting the right to obtain specific performance or other equitable remedies or by applicable bankruptcy or insolvency laws and related decisions affecting creditors' rights generally) against the Purchased Subsidiaries or a member of the Seller Group; (ii) have been negotiated in good faith on an "arm's-length" transaction basis; (iii) are, to the Knowledge of Seller, enforceable against the other parties in accordance with their respective terms; and (iv) constituting Target Assets are assignable without the consent of any third party except as listed on Schedule 8.3 attached hereto and made a part hereof. Except as listed on Schedule 8.7(b) hereto, none of the Purchased Subsidiaries or members of the Seller Group have received or given written notice of any default or claimed, purported or alleged default or state of facts which, with notice or lapse of time or both, would constitute a default on the part of any party in the performance or payment of any of the Material Contracts.
(c) A list of the ten largest customers (in terms of revenue or turnover) and ten largest suppliers (in terms of supplies expensed during the year) of the Business (by dollar amounts) for the year ended March 31, 2001 is set forth in Schedule 8.7(c). Except as set forth in Schedule 8.7(c), neither the Seller nor, to its Knowledge, any officer, director, or Affiliate of Seller owns any interest in any person or entity which is a supplier or customer of the Business (other than less than 5% of interests in publicly traded companies) or has any contractual arrangements with the Business (other than contractual arrangements between any Seller or any subsidiary of Seller, on one hand, and the Business, on the other hand). All purchase and sale orders and other commitments for purchases and sales made by the Purchased Subsidiaries and members of the Seller Group in connection with the Business have been made in the ordinary course of business in accordance with past practices, and no payments have been made to any supplier or representative thereof other than payments to such suppliers for the payment of the invoiced price of supplies purchased in the ordinary course of business. Except as could not reasonably be expected to have a Material Adverse Effect on the Business or as set forth in Schedule 8.7(c), since the date of the most recent balance sheet delivered pursuant to Section 8.4 hereof, there has not been (i) any material adverse change in the business relationship of the Business or of any Purchased Subsidiary with any customer Major Customer or supplier named in Schedule 8.7(c) or Major Supplier, and (ii) there has been no material dispute between any change in Acquired Company and any material term (including credit terms) of the supply agreements Major Customer or sales agreements, as the case may be, and related arrangements with any such supplier or customerMajor Supplier. During the past 12 months, neither the Seller, any member of the Seller Group nor any Purchased Subsidiary No Acquired Company has received any written customer complaint concerning notice or, to the products and services knowledge of the BusinessCompany or the Selling Securityholders, nor any oral notice, that (x) any Major Customer intends to reduce its purchases from any Acquired Company in any material respect or otherwise intends to materially adversely change its business relationship with any Acquired Company or (y) that any Major Supplier intends to reduce its sale of goods or services to any Acquired Company in any material respect or otherwise intends to materially adversely change its business relationship with any Acquired Company.
(d) The Company has one made available to the Buyer a copy of them had each written agreement listed or required to be listed in Sections 3.10 or 3.11 of the Disclosure Schedule (the "SCHEDULED AGREEMENTS"). Neither any such products returned Acquired Company nor, to the knowledge of the Company or the Selling Securityholders, any other party, is in material breach or default under, any Scheduled Agreement, and no event has occurred, is pending (including the transactions contemplated hereby) or, to the knowledge of the Company or the Selling Securityholders, is threatened, which (with or without due notice or lapse of time or both) would constitute a material breach or default by any Acquired Company or, to the knowledge of the Company or the Selling Securityholders, any other party under a purchaser thereof, other than complaints and returns in the ordinary course of business that, individually or in the aggregate, have not had and could not reasonably be expected to have a Material Adverse EffectScheduled Agreement.
Appears in 1 contract
