COVENANTS OF BUYER AND SELLER Buyer and Seller agree that:
COVENANTS PRIOR TO CLOSING 37 7.1 Access and Cooperation; Due Diligence...........................37 7.2 Conduct of Business Pending Closing.............................38 7.3
Covenants of Buyer Buyer agrees that:
Prior to Closing As used herein, “Compensation” shall mean the direct salaries and wages and other aggregate compensation paid to or accrued for the benefit of any employee together with all fringe benefits payable to or accrued for the benefit of such employee as to which the employer is responsible, including, without limitation, employer contributions under F.I.C.A., fringe benefits, annual bonuses, unemployment compensation or other employment taxes, pension fund contributions, vacation pay, sick leave, worker’s compensation, group life and accidental and health premiums, and pension or profit sharing, retirement, disability and other similar benefits. Purchaser shall be responsible for and shall pay (i) all Compensation with respect to the operations of the Property on and after the date of Closing and (ii) all Compensation which is accrued but not payable as of the Closing and for which Purchaser is credited at Closing. For these purposes, vacation benefits, sick leave, annual bonuses and related payroll expenses of Hotel Employees (the “Supplemental Employee Expenses”) as of the Closing shall be treated as accrued and subject to proration solely (A) if vested and not subject to expiration if not used or termination in the event of the employee’s departure or (B) to the extent of 70% of any such accrued Supplemental Employee Expenses subject to later vesting or expiration if not used or termination in the event of the employee’s departure. With respect to accrued bonuses for 2006, Seller’s pro-rated share at Closing shall be based upon Operator’s reasonable estimate of the bonuses to be paid to such Hotel Employees for 2006. No later than March 31, 2007, or earlier upon the mutual agreement of the parties, the parties shall adjust Seller’s pro-rated share of the bonuses paid to the Hotel Employees for 2006 based upon the actual amounts of such bonuses (as shown by such supporting documentation as may be reasonably required by either party), and Purchaser or Seller, as the case may be, shall make such additional payment or refund as shall be required by such adjustment. Purchaser acknowledges that the New HMA shall initially afford the Hotel Employees continuation of all rights under Operator’s existing Section 401(k) plans and health care plans, as previously afforded under the Current HMA.
Prior to the Closing the Buyer shall provide to Seller a list of those employees of the Company whose employment Buyer intends to terminate after the Closing (the "Identified Employees") and Seller shall cause the Company prior to the Closing to show on its Financial Statements and the Preliminary Closing Balance Sheet, a liability equal to the amount that the Identified Employees would be eligible to receive under Company's severance pay plan and any pay-in-lieu-of-vacation arrangement offered by the Company and all employment taxes thereon computed as if the Company had terminated such employees' employment at Closing. As to such Identified Employees, Seller shall have the sole option to determine if the Identified Employees shall continue to be employed by Seller or its Affiliates or be transferred to other divisions or facilities of the Seller or its Affiliates. Buyer shall use its commercially reasonable best efforts to retain as many of the Company employees as is feasible. Buyer shall treat all service completed by an employee with the Company or any Affiliate thereof, and any predecessor thereto, the same as service completed with Buyer for all purposes, including waiting periods relating to preexisting conditions under medical plans, vacations, severance pay, eligibility to participate in, vesting or payment of benefits under, and eligibility for early retirement or any subsidized benefit provided for under, any employee benefit plan (including, but not limited to, any "employee benefit plan" as defined in Section 3(3) of ERISA) maintained by Buyer on or after the Closing Date, except for purposes of computing benefits under the actual benefit formula in a defined benefit plan (as defined in Section 3(35) of ERISA). Prior to the Closing, Seller shall furnish Buyer with a list of the length of service with the Company or its Affiliates, or any predecessor thereof, for each of the Employees. For purposes of computing deductible amounts (or like adjustments or limitations on coverage) under any employee welfare benefit plan (including, without limitation, any "employee welfare benefit plan" as defined in Section 3(1) of ERISA), expenses and claims previously recognized for similar purposes under the applicable welfare benefit plan of the Company or any Affiliate shall be credited or recognized under the comparable plan maintained after the Closing Date by Buyer. Notwithstanding anything to the contrary set forth in this Agreement, the Buyer shall not be required to permit the employees of the Company to participate in the Buyer's 401(k) plan prior to the first day of the first calendar quarter commencing after the Closing Date.
Actions Prior to Closing From the date hereof until the Closing Date, Contributor shall not take any action or fail to take any action the result of which could (1) have a material adverse effect on the Contributed Interests or the Operating Partnership’s ownership thereof, or any Material Adverse Effect on any Contributed Entity or Property after the Closing Date or (2) cause any of the representations and warranties contained in this Section 2.2 to be untrue as of the Closing Date.
At Closing (1) Seller shall execute and deliver a general warranty deed conveying title to the Property to Buyer and showing no additional exceptions to those permitted in Paragraph 6 and furnish tax statements or certificates showing no delinquent taxes on the Property.
(2) Buyer shall pay the Sales Price in good funds acceptable to the escrow agent.
(3) Seller and Xxxxx shall execute and deliver any notices, statements, certificates, affidavits, releases, loan documents and other documents reasonably required for the closing of the sale and the issuance of the Title Policy.
(4) There will be no liens, assessments, or security interests against the Property which will not be satisfied out of the sales proceeds unless securing the payment of any loans assumed by Buyer and assumed loans will not be in default.
Conduct Prior to the Closing Antisense and Biophan covenant and agree that, after the date hereof and prior to the Closing (unless ITI shall otherwise approve in writing, which approval shall not be unreasonably withheld):
(a) Antisense will not declare, set aside or pay any dividends or distributions payable in cash, stock or property, in respect of its capital stock;
(b) Antisense will not amend, nor will Biophan cause the amendment of the Antisense Articles of Incorporation or By-Laws;
(c) Antisense and Biophan will comply with all requirements which federal or state law may impose on it with respect to this Agreement and the transactions contemplated hereby, and will promptly cooperate with and furnish written information to ITI in connection with any such requirements imposed upon the parties hereto in connection therewith;
(d) Except within the regular course of business, Antisense will not incur any indebtedness for money borrowed, issue or sell any debt securities, incur or suffer to be incurred any liability or obligation of any nature whatsoever, cause or permit any lien, encumbrance or security interest to be created or arise on or in any of its properties or assets, acquire or dispose of fixed assets, change employment terms, enter into any material or long-term contract, guarantee obligations of any third party, settle or discharge any balance sheet receivable for less than its stated amount or enter into any other transaction, except to comply with the terms of this Agreement; and
(e) Antisense and Biophan shall grant to ITI and its counsel, accountants and other representatives, full access during normal business hours during the period prior to the Closing to all Antisense's respective properties, books, contracts, commitments and records and, during such period, furnish promptly to ITI and such representatives all information relating to Antisense as ITI may reasonably request, and shall extend to ITI the opportunity to meet with Antisense's accountants and attorneys to discuss the financial condition of Antisense.
Covenants Pending Closing (a) From the date hereof until the Closing, each Contributor agrees that with respect to itself and not to any other Contributor, it shall not:
(i) Sell, transfer (or agree to sell or transfer) or otherwise dispose of, or cause the sale, transfer or disposition of (or agree to do any of the foregoing) all or any portion of its Company Interests; or
(ii) Mortgage, pledge or encumber (or permit to become encumbered) all or any portion of its Company Interests.
(b) From the date hereof through the Closing, each Contributor shall, to the extent within his or its control, cause the Company and the Entity to conduct its business in the ordinary course of business, consistent with past practice, and shall, to the extent within his or its control, not permit the Company or the Entity, without the prior written consent of Acquirer, to:
(i) Enter into any material transaction not in the ordinary course of business of such entity:
(ii) Except as contemplated by the Second Contribution Agreement, sell, transfer or dispose of, or cause the sale, transfer or disposition of (or agree to do any of the foregoing) any assets of such entity, except in the ordinary course of business consistent with past practice;
(iii) Mortgage, pledge or encumber (or permit to become encumbered) any assets of such entity, except (A) liens for taxes not due, (B) purchase money security interests in the ordinary course of such entity's business, and (C) mechanics' liens being disputed by such entity in good faith and by appropriate proceeding in the ordinary course of such entity's business (provided such mechanics liens are released prior to or on the Closing Date at no cost to the Acquirer);
(iv) Amend, modify or terminate any Lease, contract or other instruments relating to the Property to which such entity is a party, except in the ordinary course of the entity's business consistent with past practice;
(v) Cause or permit the Entity to change the existing use of the Property;
(vi) Cause or permit any entity to enter into any new Lease or terminate any existing Lease except in the ordinary course of the entity's business consistent with past practice;
(vii) Cause or take any action that would render any of the representations or warranties regarding the Property as set forth herein untrue in any material respect;
(viii) Terminate or amend any existing insurance policies affecting the Property that results in a material reduction in insurance coverage for the Property;
(ix) Knowingly cause or permit the entity to violate or fail to use commercially reasonable efforts to cure any violation of any applicable laws;
(x) Materially alter the manner of keeping such entity's books, accounts or records or the accounting methods therein reflected; or
(xi) Make any distribution to its members except in the ordinary course of business of such entity, or as is contemplated by the Second Contribution Agreement.
(c) From the date hereof until the Closing Date, the Contributors will afford to the officers and authorized representatives of the Acquirer access to all of the Company's and the Entity's books and records and will furnish the Acquirer with such additional financial and operating data and other information as to the business and properties of the Company and the Entity as the Acquirer may from time to time reasonably request.
(d) Notwithstanding anything to the contrary contained herein, any failure by an Contributor to comply with or fulfill the covenants contained in this Section 3.1 shall not constitute an indemnifiable claim under Section 3.4 of this Agreement, but shall constitute an unfulfilled condition precedent pursuant to Section 5.1, provided such failure is identified to or otherwise becomes known to the Acquirer prior to Closing.
Closing Deliveries of Buyer At Closing, unless otherwise waived by Seller, Buyer will deliver to Seller the following:
(a) A duly executed counterpart of the Escrow Agreement;
(b) Evidence to Seller’s reasonable satisfaction that the Escrow Fund has been deposited with the Escrow Agent.
(c) an assumption agreement, duly executed by Buyer, pursuant to which Buyer assumes the Assumed Liabilities;
(d) A counterpart to the Lease Termination Agreement duly executed by Landlord under which Landlord agrees to terminate, effective as of December 1, 2008, the Lease Agreement in connection with the consummation of the transactions contemplated by this Agreement;
(e) A counterpart to the Xxxxxxx Termination Agreement duly executed by Owner under which Owner agrees to terminate, effective as of December 1, 2008, the Xxxxxxx Employment Agreement, in connection with the consummation of the transactions contemplated by this Agreement;
(f) A counterpart to the English Termination Agreement duly executed by Xxxxxx English under which Xxxxxx English agrees to terminate, effective as of December 1, 2008, the English Employment Agreement in connection with the consummation of the transactions contemplated by this Agreement;
(g) A counterpart to the Repurchase Termination Agreement duly executed by Owner under which Owner agrees to terminate, effective as of December 1, 2008, the Repurchase Agreement in connection with the consummation of the transactions contemplated by this Agreement;
(h) A counterpart to the Guarantee Termination Agreement duly executed by Owner under which Owner agrees to terminate, effective as of December 1, 2008, the Guarantee Agreement in connection with the consummation of the transactions contemplated by this Agreement;
(i) Copies of resolutions duly adopted by the managing member(s) of Buyer, authorizing and approving the consummation of the transactions contemplated hereby and the execution and delivery of this Agreement and the other documents described herein, each certified as true, complete and in full force and effect as of Closing by a duly authorized officer of Buyer; and
(j) An executed copy of the Promissory Note;
(k) An executed copy of a security agreement by the Buyer in favor of the Seller, substantially in the form attached hereto as “Exhibit C” (the “Security Agreement”); and
(l) An executed copy of the Transition Services Agreement (as defined below); and
(m) Such other instruments and documents as Seller may reasonably request.
