Common use of Covenants of Auxilium Clause in Contracts

Covenants of Auxilium. Auxilium covenants and agrees that, until the earlier of the Closing and the time that this Agreement is terminated in accordance with its terms, unless QLT otherwise consents in writing (to the extent that such consent is permitted by applicable Law), which consent shall not be unreasonably withheld, conditioned or delayed, or as is otherwise disclosed in Section 4.2 of the Auxilium Disclosure Letter or expressly permitted or specifically contemplated by this Agreement or as is otherwise required by applicable Law or Order: (a) the respective businesses of Auxilium and the Auxilium Material Subsidiaries will be conducted, their respective facilities will be maintained, and Auxilium and the Auxilium Material Subsidiaries will continue to operate their respective businesses, on an aggregate basis in all material respects only in the ordinary course of business; it being understood that the foregoing shall not apply to any of the specific actions contemplated by Section 4.2(b) below; (b) Auxilium will not and will not permit any of the Auxilium Material Subsidiaries to, directly or indirectly: (i) alter or amend its articles, charter, by-laws or other constating documents in a manner adverse to the QLT Shareholders or inconsistent with this Agreement; (ii) declare, set aside or pay any dividend on or make any distribution or payment or return of capital in respect of any of its equity securities except (A) the payment of interest or other amounts as and when due pursuant to the terms of Auxilium Convertible Notes and (B) in the case of any of Auxilium's wholly-owned Subsidiaries, for dividends payable to Auxilium or among wholly owned Subsidiaries of Auxilium; (iii) split, divide, consolidate, combine or reclassify Auxilium Shares; (iv) issue any Auxilium equity securities or securities convertible into Auxilium equity securities other than pursuant to the ESPP or upon conversion of Auxilium Convertible Notes or exercise of any Auxilium Warrants in accordance with their terms or in settlement of any outstanding equity compensation awards or grants of new equity compensation awards in the ordinary course of business (including to new hires or in connection with promotions) or issuing warrants in connection with a debt financing by Auxilium; (v) redeem, purchase or otherwise acquire any outstanding Auxilium Shares or other securities convertible into or exchangeable for Auxilium Shares, other than (A) in transactions between two or more Auxilium wholly-owned Subsidiaries or between Auxilium and an Auxilium wholly-owned Subsidiary, (B) pursuant to the terms of employee or director equity awards, including any awards issued under Auxilium Share Plans or (C) upon conversion of Auxilium Convertible Notes or exercise of Auxilium Call Options in accordance with their respective terms; (vi) amend the material terms of any equity securities of Auxilium or securities convertible into Auxilium equity securities; (vii) adopt a plan of liquidation or resolution providing for the liquidation or dissolution of Auxilium; (viii) amalgamate or merge with any other Person other than pursuant to the Merger and other than any amalgamation or merger solely involving wholly-owned Subsidiaries of Auxilium; (A) acquire (by merger, amalgamation, consolidation, arrangement or acquisition of shares or other equity securities or interests or assets or otherwise) any corporation, partnership, association or other business organization or division thereof or any property or asset, or make any investment by the purchase of securities, contribution of capital, property transfer, or purchase of any property or assets of any other Person that, together with all other such acquisitions, investments, contributions, transfers or purchases, has guaranteed cash payments of $60 million or greater in the aggregate; or (B) enter into any letter of intent, agreement in principle, acquisition agreement or other similar agreement with respect to such a transaction; (A) enter into any contract that would, if entered into prior to the date hereof, be an Auxilium Material Contract and which is reasonably expected to involve payment in the amount of $60 million or greater, or (B) materially modify, materially amend or terminate any such Auxilium Material Contract or waive, release or assign any material rights or claims thereunder; (xi) take any action that would reasonably be expected to prevent or significantly impede or materially delay the completion of the Merger; or (xii) enter into, modify or terminate any Contract with respect to any of the foregoing or otherwise agreed or announce an intention to do any of the foregoing. (c) Auxilium will promptly notify QLT in writing of the occurrence of any event which would have a Material Adverse Effect with respect to Auxilium.

Covenants of Auxilium. Except as disclosed in Section 4.1 of the Auxilium Disclosure Letter, Auxilium covenants and agrees that, until the earlier of the Closing and the time that this Agreement is terminated in accordance with its terms, unless QLT Endo otherwise consents in writing (to the extent that such consent is permitted by applicable Law), which consent shall not be unreasonably withheld, conditioned or delayeddelayed (except in the case of clauses (c)(i) and (xix) below, for which Endo’s consent may be withheld, conditioned or as is otherwise disclosed delayed in Section 4.2 of the Auxilium Disclosure Letter its sole discretion), or expressly permitted or specifically contemplated by this Agreement or as is otherwise required by applicable Law or Order: (a) the respective businesses of Auxilium and the Auxilium Material its Subsidiaries will be conducted, their respective facilities will be maintained, maintained and Auxilium and the Auxilium Material its Subsidiaries will continue to operate their respective businesses, on an aggregate basis in all material respects businesses only in the ordinary course of business; it being understood that the foregoing shall not apply to any of the specific actions contemplated by Section 4.2(b) below; (b) Auxilium will not use its commercially reasonable efforts to maintain and preserve intact its and its Subsidiaries’ respective business organizations, taken as a whole, material assets, material Permits, material properties, material rights, goodwill and material business relationships and keep available the services of its and its Subsidiaries’ respective officers and employees as a group; (c) Auxilium will not, and will cause its Subsidiaries not permit any of the Auxilium Material Subsidiaries to, directly or indirectly: (i) alter or amend its articles, charter, by-laws or other constating documents in a manner adverse to the QLT Shareholders or inconsistent with this Agreementconstituent documents; (ii) declare, set aside or pay any dividend on or make any distribution or payment or return of capital in respect of any of its equity securities except the Auxilium Shares (A) the payment of interest whether in cash or other amounts as and when due pursuant to the terms of Auxilium Convertible Notes and (B) in the case of any of Auxilium's wholly-owned Subsidiaries, for dividends payable to Auxilium or among wholly owned Subsidiaries of Auxiliumproperty); (iii) split, divide, consolidate, combine or reclassify the Auxilium SharesShares or any other securities of Auxilium; (iv) issue issue, grant, sell or pledge or authorize or agree to issue, grant, sell or pledge any Auxilium equity Shares or other securities of Auxilium or securities its Subsidiaries (including options or any equity-based or equity-linked awards such as restricted or deferred share units or phantom share plans) which are convertible into or exchangeable or exercisable for, or otherwise evidencing a right to acquire, Auxilium equity securities Shares, other than the issuance or sale of Auxilium Shares pursuant to (A) the ESPP or upon conversion exercise of Auxilium Convertible Notes Options outstanding on the date hereof, (B) the terms of employee or director equity awards, including any awards issued under the Auxilium Share Plan and outstanding on the date hereof, (C) the exercise of the Actient Warrants, (D) the exercise of any conversion right in respect of the Auxilium Warrants in accordance with their Convertible Notes, (E) the exercise of the Auxilium Warrants, or (F) the terms of the Rights Agreement; (v) except as contemplated by this Agreement or in settlement as required by applicable Law or the terms of any outstanding equity Auxilium Plan in effect as of the date hereof (A) grant any increases in the compensation awards or grants benefits of new equity any of its directors, individual independent contractors, executive officers, employees or consultants, except for increases in the compensation awards of employees in the ordinary course of business whose annual base salary is less than $250,000; or (B) grant or increase any severance, change in control, termination or similar compensation or benefits payable to any director, individual independent contractor, officer or employee, (C) promote any employee who is an officer to a position more senior than such employee’s position as of the date of this Agreement, or promote a non-officer employee to an officer position, (D) accelerate the time of payment or vesting of, or the lapsing of restrictions with respect to, any compensation (including bonuses) or benefits under any Auxilium Plan; (E) enter into, terminate or materially amend any Auxilium Plan (or, except as provided in Section 2.1(l)), any plan, program, agreement, or arrangement that would constitute an Auxilium Plan if in effect on the date hereof); (F) hire any person to new hires be employed by or a consultant of Auxilium or any of its Subsidiaries other than the hiring of employees or consultants in the ordinary course of business, where such employee or consultant has total annual compensation (base salary and target cash incentive opportunity) not in excess of $250,000; (G) terminate any person in connection with promotionsany mass reduction, reduction in force or corporate restructuring and (H) loan or advance any money to any employee, director or individual independent contractor of Auxilium or any of its Subsidiaries (other than advances in the ordinary course of business) or issuing warrants in connection with a debt financing by Auxiliumforgive any loans to any such employee, director or individual independent contractor; (vvi) redeem, purchase or otherwise acquire any outstanding Auxilium Shares or other securities convertible into or exchangeable or exercisable for Auxilium Shares, other than (A) in transactions between two or more Auxilium wholly-wholly owned Subsidiaries or between Auxilium and an Auxilium wholly-wholly owned Subsidiary, (B) pursuant to the terms of employee or director equity awards, including any awards issued under the Auxilium Share Plans Plan, or (C) upon conversion of Auxilium Convertible Notes or exercise of Auxilium Call Options Options, Auxilium Warrants or Actient Warrants in accordance with their respective terms; (vivii) amend the material terms of any equity securities of Auxilium or securities convertible into Auxilium equity securitiesits Subsidiaries; (viiviii) adopt a plan of liquidation or resolution providing for the liquidation or dissolution of AuxiliumAuxilium or any of its Subsidiaries; (viiiix) amalgamate subject to the terms of Section 6.1 and Section 6.2, reorganize, consolidate or merge with any other Person Person; (x) make any changes to any of its material accounting policies, principles, methods, practices or procedures (including by adopting any material new accounting policies, principles, methods, practices or procedures), except as required by applicable Laws or U.S. GAAP; (xi) except for sales, leases or licenses entered into in the ordinary course of business or as contemplated hereby or in connection with any transactions contemplated hereby, and except for Permitted Liens, sell, lease or license, voluntarily pledge or otherwise dispose of any assets or properties of Auxilium (including the shares or other than pursuant to the Merger and other than equity securities of any amalgamation or merger solely involving wholly-owned Subsidiaries Subsidiary of Auxilium) or of any of its Subsidiaries having a value greater than $500,000 in the aggregate; (xii) abandon, allow to lapse or fail to maintain any Intellectual Property that is owned by or exclusively licensed to Auxilium or any Auxilium Subsidiary and that is material to Auxilium and its Subsidiaries taken as a whole; (A) acquire (by merger, amalgamation, consolidation, arrangement or acquisition of shares or other equity securities or interests or assets or otherwise) any corporation, partnership, association or other business organization or division thereof or any property or assetasset constituting a business (but excluding properties or assets acquired in the ordinary course of business), or (B) make any investment in any Person that is not Auxilium or an Auxilium Subsidiary, by the purchase of securities, securities or contribution of capitalcapital or otherwise, property transferthat has a value (in the case of clauses (A) and (B)) greater than $2,500,000 in the aggregate; (xiv) incur any indebtedness for borrowed money in excess of $5,000,000 in the aggregate; (xv) enter into any hedging, derivative or purchase swap transaction or Contract in respect thereof, except for any such transaction or Contract entered into in the ordinary course of any property business and not for speculative purposes; (xvi) assume, guarantee, endorse or assets otherwise as an accommodation become responsible for the indebtedness for borrowed money of any other Person that(other than Auxilium or any Auxilium Subsidiary); (xvii) make any loans or advances to any other Person (other than Auxilium or any Auxilium Subsidiary), together with all other such acquisitions, investments, contributions, transfers or purchases, has guaranteed cash payments except for extensions of $60 million or greater credit in the aggregate; ordinary course of business; (xviii) voluntarily waive, release, assign, settle or compromise any material claim or Proceeding where such waivers, releases, assignments, settlements or compromises exceed $500,000 individually or in any case would entail the imposition of any material non-monetary damages against Auxilium or any Auxilium Subsidiary; (Bxix) negotiate or enter into any collective bargaining agreement, collective agreement or other contract with any labor organization or union or other employee association; (xx) settle or compromise any action, claim or other Proceeding brought by any present, former or purported holder of its securities in connection with the Merger or the other transactions contemplated by this Agreement; (xxi) enter into any letter material new line of intentbusiness, agreement in principle, acquisition agreement enterprise or other activity, which excludes, for the avoidance of doubt, the development or acquisition (subject to the terms hereof) of pharmaceutical or similar agreement with respect to such a transactionproducts or product candidates (including the expansion of the usage or potential usage of any existing pharmaceutical or similar products or product candidates); (xxii) expend or commit to expend any amounts that would constitute capital expenditures pursuant to U.S. GAAP as applied by Auxilium, where such expenditures or commitments exceed $500,000 in the aggregate; (xxiii) other than in the ordinary course of business, (A) enter into any contract Contract that would, if entered into prior to the date hereof, be an Auxilium Material Contract and which is reasonably expected to involve payment in the amount of $60 million or greaterContract, or (B) materially modify, materially amend or terminate any such Auxilium Material Contract or waive, release or assign any material rights or claims thereunder; (xixxiv) take except as required by applicable Law or U.S. GAAP, make, change, revoke or rescind any action that would reasonably be expected material election relating to prevent Taxes; make or significantly impede or materially delay the completion change any material method of the MergerTax accounting; or (xii) enter into, modify or terminate make any Contract material amendment with respect to any of the foregoing Return; or settle or otherwise agreed or announce an intention finally resolve any controversy relating to a material amount of Taxes; (xxv) agree to do any of the foregoing.; and (cd) Auxilium will promptly notify QLT Endo in writing of the occurrence of any event which would have a Material Adverse Effect with respect to Auxilium. Nothing in this Section 4.1 shall give Endo or any Endo Subsidiary the right to control, directly or indirectly, the operations or the business of Auxilium or any of its Subsidiaries at any time prior to the Closing.

Covenants of Auxilium. Except as disclosed in Section 4.1 of the Auxilium Disclosure Letter, Auxilium covenants and agrees that, until the earlier of the Closing and the time that this Agreement is terminated in accordance with its terms, unless QLT Endo otherwise consents in writing (to the extent that such consent is permitted by applicable Law), which consent shall not be unreasonably withheld, conditioned or delayeddelayed (except in the case of clauses (c)(i) and (xix) below, for which Endo’s consent may be withheld, conditioned or as is otherwise disclosed delayed in Section 4.2 of the Auxilium Disclosure Letter its sole discretion), or expressly permitted or specifically contemplated by this Agreement or as is otherwise required by applicable Law or Order: (a) the respective businesses of Auxilium and the Auxilium Material its Subsidiaries will be conducted, their respective facilities will be maintained, maintained and Auxilium and the Auxilium Material its Subsidiaries will continue to operate their respective businesses, on an aggregate basis in all material respects businesses only in the ordinary course of business; it being understood that the foregoing shall not apply to any of the specific actions contemplated by Section 4.2(b) below; (b) Auxilium will not use its commercially reasonable efforts to maintain and preserve intact its and its Subsidiaries’ respective business organizations, taken as a whole, material assets, material Permits, material properties, material rights, goodwill and material business relationships and keep available the services of its and its Subsidiaries’ respective officers and employees as a group; (c) Auxilium will not, and will cause its Subsidiaries not permit any of the Auxilium Material Subsidiaries to, directly or indirectly: (i) alter or amend its articles, charter, by-laws or other constating documents in a manner adverse to the QLT Shareholders or inconsistent with this Agreementconstituent documents; (ii) declare, set aside or pay any dividend on or make any distribution or payment or return of capital in respect of any of its equity securities except the Auxilium Shares (A) the payment of interest whether in cash or other amounts as and when due pursuant to the terms of Auxilium Convertible Notes and (B) in the case of any of Auxilium's wholly-owned Subsidiaries, for dividends payable to Auxilium or among wholly owned Subsidiaries of Auxiliumproperty); (iii) split, divide, consolidate, combine or reclassify the Auxilium SharesShares or any other securities of Auxilium; (iv) issue issue, grant, sell or pledge or authorize or agree to issue, grant, sell or pledge any Auxilium equity Shares or other securities of Auxilium or securities its Subsidiaries (including options or any equity-based or equity-linked awards such as restricted or deferred share units or phantom share plans) which are convertible into or exchangeable or exercisable for, or otherwise evidencing a right to acquire, Auxilium equity securities Shares, other than the issuance or sale of Auxilium Shares pursuant to (A) the ESPP or upon conversion exercise of Auxilium Convertible Notes Options outstanding on the date hereof, (B) the terms of employee or director equity awards, including any awards issued under the Auxilium Share Plan and outstanding on the date hereof, (C) the exercise of the Actient Warrants, (D) the exercise of any conversion right in respect of the Auxilium Warrants in accordance with their Convertible Notes, (E) the exercise of the Auxilium Warrants, or (F) the terms of the Rights Agreement; (v) except as contemplated by this Agreement or in settlement as required by applicable Law or the terms of any outstanding equity Auxilium Plan in effect as of the date hereof (A) grant any increases in the compensation awards or grants benefits of new equity any of its directors, individual independent contractors, executive officers, employees or consultants, except for increases in the compensation awards of employees in the ordinary course of business whose annual base salary is less than $250,000; or (B) grant or increase any severance, change in control, termination or similar compensation or benefits payable to any director, individual independent contractor, officer or employee, (C) promote any employee who is an officer to a position more senior than such employee’s position as of the date of this Agreement, or promote a non-officer employee to an officer position, (D) accelerate the time of payment or vesting of, or the lapsing of restrictions with respect to, any compensation (including bonuses) or benefits under any Auxilium Plan; (E) enter into, terminate or materially amend any Auxilium Plan (or, except as provided in Section 2.1(l)), any plan, program, agreement, or arrangement that would constitute an Auxilium Plan if in effect on the date hereof); (F) hire any person to new hires be employed by or a consultant of Auxilium or any of its Subsidiaries other than the hiring of employees or consultants in the ordinary course of business, where such employee or consultant has total annual compensation (base salary and target cash incentive opportunity) not in excess of $250,000; (G) terminate any person in connection with promotionsany mass reduction, reduction in force or corporate restructuring and (H) loan or advance any money to any employee, director or individual independent contractor of Auxilium or any of its Subsidiaries (other than advances in the ordinary course of business) or issuing warrants in connection with a debt financing by Auxiliumforgive any loans to any such employee, director or individual independent contractor; (vvi) redeem, purchase or otherwise acquire any outstanding Auxilium Shares or other securities convertible into or exchangeable or exercisable for Auxilium Shares, other than (A) in transactions between two or more Auxilium wholly-wholly owned Subsidiaries or between Auxilium and an Auxilium wholly-wholly owned Subsidiary, (B) pursuant to the terms of employee or director equity awards, including any awards issued under the Auxilium Share Plans Plan, or (C) upon conversion of Auxilium Convertible Notes or exercise of Auxilium Call Options Options, Auxilium Warrants or Actient Warrants in accordance with their respective terms; (vivii) amend the material terms of any equity securities of Auxilium or securities convertible into Auxilium equity securitiesits Subsidiaries; (viiviii) adopt a plan of liquidation or resolution providing for the liquidation or dissolution of AuxiliumAuxilium or any of its Subsidiaries; (viiiix) amalgamate subject to the terms of Section 6.1 and Section 6.2, reorganize, consolidate or merge with any other Person Person; (x) make any changes to any of its material accounting policies, principles, methods, practices or procedures (including by adopting any material new accounting policies, principles, methods, practices or procedures), except as required by applicable Laws or U.S. GAAP; (xi) except for sales, leases or licenses entered into in the ordinary course of business or as contemplated hereby or in connection with any transactions contemplated hereby, and except for Permitted Liens, sell, lease or license, voluntarily pledge or otherwise dispose of any assets or properties of Auxilium (including the shares or other than pursuant to the Merger and other than equity securities of any amalgamation or merger solely involving wholly-owned Subsidiaries Subsidiary of Auxilium) or of any of its Subsidiaries having a value greater than $500,000 in the aggregate; (xii) abandon, allow to lapse or fail to maintain any Intellectual Property that is owned by or exclusively licensed to Auxilium or any Auxilium Subsidiary and that is material to Auxilium and its Subsidiaries taken as a whole; (xiii) (A) acquire (by merger, amalgamation, consolidation, arrangement or acquisition of shares or other equity securities or interests or assets or otherwise) any corporation, partnership, association or other business organization or division thereof or any property or assetasset constituting a business (but excluding properties or assets acquired in the ordinary course of business), or (B) make any investment in any Person that is not Auxilium or an Auxilium Subsidiary, by the purchase of securities, securities or contribution of capitalcapital or otherwise, property transferthat has a value (in the case of clauses (A) and (B)) greater than $2,500,000 in the aggregate; (xiv) incur any indebtedness for borrowed money in excess of $5,000,000 in the aggregate; (xv) enter into any hedging, derivative or purchase swap transaction or Contract in respect thereof, except for any such transaction or Contract entered into in the ordinary course of any property business and not for speculative purposes; (xvi) assume, guarantee, endorse or assets otherwise as an accommodation become responsible for the indebtedness for borrowed money of any other Person that(other than Auxilium or any Auxilium Subsidiary); (xvii) make any loans or advances to any other Person (other than Auxilium or any Auxilium Subsidiary), together with all other such acquisitions, investments, contributions, transfers or purchases, has guaranteed cash payments except for extensions of $60 million or greater credit in the aggregate; ordinary course of business; (xviii) voluntarily waive, release, assign, settle or compromise any material claim or Proceeding where such waivers, releases, assignments, settlements or compromises exceed $500,000 individually or in any case would entail the imposition of any material non-monetary damages against Auxilium or any Auxilium Subsidiary; (Bxix) negotiate or enter into any collective bargaining agreement, collective agreement or other contract with any labor organization or union or other employee association; (xx) settle or compromise any action, claim or other Proceeding brought by any present, former or purported holder of its securities in connection with the Merger or the other transactions contemplated by this Agreement; (xxi) enter into any letter material new line of intentbusiness, agreement in principle, acquisition agreement enterprise or other activity, which excludes, for the avoidance of doubt, the development or acquisition (subject to the terms hereof) of pharmaceutical or similar agreement with respect to such a transactionproducts or product candidates (including the expansion of the usage or potential usage of any existing pharmaceutical or similar products or product candidates); (xxii) expend or commit to expend any amounts that would constitute capital expenditures pursuant to U.S. GAAP as applied by Auxilium, where such expenditures or commitments exceed $500,000 in the aggregate; (xxiii) other than in the ordinary course of business, (A) enter into any contract Contract that would, if entered into prior to the date hereof, be an Auxilium Material Contract and which is reasonably expected to involve payment in the amount of $60 million or greaterContract, or (B) materially modify, materially amend or terminate any such Auxilium Material Contract or waive, release or assign any material rights or claims thereunder; (xixxiv) take except as required by applicable Law or U.S. GAAP, make, change, revoke or rescind any action that would reasonably be expected material election relating to prevent Taxes; make or significantly impede or materially delay the completion change any material method of the MergerTax accounting; or (xii) enter into, modify or terminate make any Contract material amendment with respect to any of the foregoing Return; or settle or otherwise agreed or announce an intention finally resolve any controversy relating to a material amount of Taxes; (xxv) agree to do any of the foregoing.; and (cd) Auxilium will promptly notify QLT Endo in writing of the occurrence of any event which would have a Material Adverse Effect with respect to Auxilium. Nothing in this Section 4.1 shall give Endo or any Endo Subsidiary the right to control, directly or indirectly, the operations or the business of Auxilium or any of its Subsidiaries at any time prior to the Closing.