Common use of Covenants and Other Matters Clause in Contracts

Covenants and Other Matters. Section 3.1. Release of Merck from Credit Support Arrangements. (a) Medco shall use commercially reasonable efforts to cause the obligations of members of the Merck Group under each guarantee, letter of credit, keepwell or support agreement or other credit support document, instrument or other similar arrangement issued for the benefit of any Person in the Medco Group by or on behalf of Merck (the "Credit Support Arrangements") on or prior to the Distribution Date to be assumed by Medco, and for Merck to be unconditionally released therefrom as of the Distribution Date or as promptly as practicable thereafter, and shall execute and deliver any and all such instruments of substitution and such other instruments or agreements as shall be necessary in connection with the discharge by Medco of its obligations under this sentence. Medco shall not modify or renew, or amend the terms of any agreement, instrument or obligation underlying any of the Credit Support Arrangements in any manner that could increase, extend or give rise to liability of a member of the Merck Group under any such Credit Support Arrangements. If any member of the Merck Group shall not have been fully released from its obligations under any Credit Support Arrangement as of the first day of any calendar month, within ten days after the completion of such calendar month, Medco shall notify Merck in writing of the amounts for which Merck could become liable under each such Credit Support Arrangements as of the last day of such calendar month. Such notice shall be accompanied by information and documentation (including such information and documentation requested by Merck) supporting the calculation of any amounts then outstanding (whether or not due and payable) for which Merck could become liable and shall describe the actions taken by Medco during such calendar quarter to seek a release of Merck's obligations under each Credit Support Arrangement. In addition, promptly (but in any event within two Business Days) after the occurrence of any default or other event as a result of which a third party may become entitled to seek or assert a claim against any member of the Merck Group under any Credit Support Arrangement (or receipt by any member of the Medco Group of any oral or written notice alleging the occurrence of any such default or event), Medco shall provide to Merck written notice setting forth in reasonable detail the circumstances of such default or event (or alleged default or event) and Merck's potential obligations under the Credit Support Arrangement as a result. Such written notice from Medco to Merck shall include any notices delivered by Medco to, or received by Medco from, any third party in connection with such default or event (or alleged default or event). Medco shall keep Merck apprised on a regular basis with respect to all developments relating to such default or event and shall provide to Merck, within five days of a written request therefor such other information as Merck may request relating to the status of Medco's obligations under any agreement subject to a Credit Support Arrangement.

Covenants and Other Matters. Section 3.17.1 Covenants of Sellers and the Company Prior to the Closing. Release Sellers and the Company covenant and agree with Buyer that, from and after the date hereof and until the earlier of Merck from Credit Support Arrangements. the Closing Date or the termination of this Agreement pursuant to Article IV hereof, Sellers and the Company (ai) Medco shall use commercially reasonable efforts effort to fulfill or satisfy, or cause the obligations of members to be fulfilled or satisfied, all of the Merck Group under each guaranteeconditions precedent to Buyer's obligations to consummate and complete the transactions provided herein and to take all other steps and do all other things required to consummate this Agreement in accordance with its terms, letter of credit, keepwell or support agreement or other credit support document, instrument or other similar arrangement issued for the benefit of any Person in the Medco Group by or on behalf of Merck (the "Credit Support Arrangements"ii) on or prior to the Distribution Date to be assumed by Medco, and for Merck to be unconditionally released therefrom as of the Distribution Date or as promptly as practicable thereafter, and shall execute and deliver any and all such instruments of substitution and such other instruments or agreements as shall be necessary in connection not interfere with the discharge performance by Medco Buyer of its obligations under this sentence. Medco Agreement, (iii) shall not modify fail to pay or renewproperly accrue any Taxes, assessments, governmental charges or amend levies imposed upon the terms Company or its income, profits or assets or otherwise required to be paid or accrued by it (other than the Aggregate Withholding Amount, which Buyer shall cause the Company to pay to the appropriate taxing authorities following the Closing Date in accordance with Section 2.1(C) hereof), (iv) shall not make any capital expenditure for the Company in excess of $10,000 without Buyer's prior written consent, (v) without the prior written consent of Buyer, shall not engage in any sale or discount of the Company's accounts receivable (whether by discount to the debtors or by sale to any third party), (vi) shall promptly notify Buyer (A) of any agreementnotice from any governmental or regulatory agency or authority, instrument (B) of any fact or obligation underlying circumstance which would make any of the Credit Support Arrangements in any manner that could increase, extend representation or give rise to liability of a member of the Merck Group under any such Credit Support Arrangements. If any member of the Merck Group shall not have been fully released from its obligations under any Credit Support Arrangement warranty set forth herein untrue or inaccurate as of the first day Closing Date, or (C) any planned or threatened labor dispute, organization efforts, strike or collective work stoppage affecting the employees of the Company, (vii) shall not take any calendar month, within ten days after action that would cause Buyer to be unable to obtain good and marketable title to the completion Shares at the Closing (including pledging any of such calendar monthShares as security for obligations of Sellers or the Company), Medco (viii) shall notify Merck operate the business in writing the ordinary course with a view to preserving the business, assets, and operations of the amounts for Company intact, and shall undertake no transactions other than in the ordinary course of business without the prior written consent of Buyer, (ix) subject to Schedule 5.21, shall not increase the compensation to officers or employees (other than increases in individual compensation consistent with the Company's past practice in timing, amount and justification), or make any extraordinary payments or bonuses to such persons, (x) shall not change or modifying any accounting practice or procedure, (xi) shall not, after April 1, 2002, without the prior written consent of Buyer (which Merck could become liable under each consent shall not be unreasonably withheld so long as Buyer is reasonably satisfied that such Credit Support Arrangements as actions will not materially adversely impact the Company's efforts to reach compliance with 34 C.F.R. (S)600.5 (the "90/10 Rule") by the end of the last day Company's fiscal year ending June 30, 2002), receive any funds disbursed under the PELL program administered by the DOE under Title IV, and (xii) shall not, after June 1, 2002, without the prior written consent of Buyer (which consent shall not be unreasonably withheld so long as Buyer is reasonably satisfied that such calendar month. Such notice shall be accompanied actions will not materially adversely impact the Company's efforts to reach compliance with 34 C.F.R. (S)600.5 (the "90/10 Rule") by information and documentation (including such information and documentation requested by Merck) supporting the calculation of any amounts then outstanding (whether or not due and payable) for which Merck could become liable and shall describe the actions taken by Medco during such calendar quarter to seek a release of Merck's obligations under each Credit Support Arrangement. In addition, promptly (but in any event within two Business Days) after the occurrence of any default or other event as a result of which a third party may become entitled to seek or assert a claim against any member end of the Merck Group Company's fiscal year ending June 30, 2002), receive or deposit any funds disbursed by the DOE under any Credit Support Arrangement (guaranteed student loan programs administered under Title IV. Until the termination of this Agreement in accordance with Article IV hereof, Sellers and the Company will not directly or receipt by indirectly solicit, respond to or negotiate with or release any member of the Medco Group of any oral or written notice alleging the occurrence of any such default or event), Medco shall provide to Merck written notice setting forth in reasonable detail the circumstances of such default or event (or alleged default or event) and Merck's potential obligations under the Credit Support Arrangement as a result. Such written notice from Medco to Merck shall include any notices delivered by Medco to, or received by Medco from, any third party in connection with such default or event (or alleged default or event). Medco shall keep Merck apprised on a regular basis with respect to all developments relating to such default or event and shall provide to Merck, within five days of a written request therefor such other information as Merck may request relating relative to the status of Medco's obligations under Company or the Schools to any agreement subject to a Credit Support Arrangementpotential buyer other than Buyer.