Interim Operations of Seller. Subject to any obligations as debtors or debtors-in-possession under the Bankruptcy Code, or any Order of the Bankruptcy Court, Sellers covenant and agree that, after the date hereof and prior to the Closing Date, except as expressly provided in this Agreement or as may be agreed in writing by Purchaser: (a) except as set forth on Schedule 6.1(e), the Business shall be conducted substantially in the same manner as heretofore conducted, and Sellers shall use commercially reasonable efforts to preserve the business organization of the Business intact, keep available the services of the current officers and employees of the Business and maintain the existing relationships with customers, suppliers, creditors, business partners and others having business dealings with the Business; provided, that this clause (a) shall not limit Sellers’ right to amend or terminate any Plan; (b) prior to the Closing, Sellers or their Affiliates shall not modify, amend or terminate any of the Assumed Contracts, except in the Ordinary Course of Business or as necessary to assume and assign the Assumed Contracts pursuant to Section 365 of the Bankruptcy Code; (c) Sellers or their Affiliates shall not terminate or permit to lapse any material Permits or other Government Authorizations of any Government Entities that are necessary for the operation of the Business and the failure to have which would cause a Material Adverse Effect, except when such termination or lapse results from any Order or other proceeding instituted by any Government Entity; (d) Sellers or their Affiliates shall not lease, license, mortgage, pledge or encumber any Purchased Assets other than in the Ordinary Course of Business and under the DIP Agreement (provided that Sellers shall be able to transfer the Purchased Assets to Purchaser free and clear of all such liens and claims upon the Closing) or purchase, transfer, sell or dispose of any Purchased Assets other than in the Ordinary Course of Business or dispose of or permit to lapse any rights to any Transferred Intellectual Property other than in the Ordinary Course of Business; (e) Sellers or their Affiliates shall not fire any Business Employee other than for cause and except as set forth on Schedule 6.1(e); (f) Sellers or their Affiliates shall not make any change to increase the rate of base compensation or, other than in connection with a sale-related incentive or retention plan as such sale-related incentive or retention plan is approved by a Bankruptcy Court Order, bonus opportunity of any Business Employee; (g) Sellers or their Affiliates shall not enter into any Contract or transaction relating to the Purchased Assets, or enter into any Software Contracts Related to the Business, other than in the Ordinary Course of Business; (h) Sellers or their Affiliates shall not take, or agree to or commit to take, any action that would or is reasonably likely to result in any of the conditions to the Closing, as applicable, set forth in Article VIII, not being satisfied, or would make any representation or warranty of Sellers contained herein inaccurate in any material respect at, or as of any time prior to, the Closing Date or that would materially impair the ability of Sellers or Purchaser to consummate the Closing in accordance with the terms hereof or materially delay such consummation; (i) Sellers shall conduct the Business in accordance with applicable Law and Applicable Requirements in all material respects and shall maintain in full force and effect all material Permits and other Government Authorizations, except where the failure to remain in full force and effect results from any Order or other proceeding instituted by any Governmental Entity; and (j) no Seller nor any Affiliate of a Seller shall enter into any agreement, Contract, commitment or arrangement (i) to do any of the foregoing, or authorize, recommend, propose or announce an intention to do, any of the foregoing or (ii) that would violate any of the provisions of Section 5.6.
Appears in 2 contracts
Samples: Asset Purchase Agreement, Asset Purchase Agreement (New Century Financial Corp)
Interim Operations of Seller. Subject to any obligations as debtors or debtors-in-possession under the Bankruptcy Code, or any Order of the Bankruptcy Court, Sellers covenant and agree that, after the date hereof and prior to the Closing Date, except as expressly provided in this Agreement or as may be agreed in writing by Purchaser:
(a) except as set forth on Schedule 6.1(e), the Business shall be conducted substantially in the same manner as heretofore conducted, and Sellers Seller shall use commercially reasonable efforts to preserve the its present business organization of the Business intact, keep available the services of the current officers and employees of the Business intact and maintain the existing relationships satisfactory relations with customers, lenders, suppliers, creditorsemployees and other business partners. Except as expressly permitted in accordance with Schedule 5.1, business partners without Buyer’s prior written consent, Seller shall not take any of the following actions other than as expressly permitted by and others having business dealings in accordance with the Business; provided, that this clause Agreement:
(a) shall not limit Sellers’ right to amend Amend its Articles of Incorporation or terminate any PlanBylaws;
(b) prior Issue any capital stock or rights to acquire capital stock, other than stock reserved for issuance on exercise of options outstanding on the Closingdate of this Agreement, Sellers or their Affiliates shall not modifyredeem, amend split or terminate otherwise reclassify, or pay any of the Assumed Contractsdividend or distribution with respect to, except in the Ordinary Course of Business or as necessary to assume and assign the Assumed Contracts pursuant to Section 365 of the Bankruptcy Codecapital stock;
(c) Sellers Use any cash or their Affiliates shall not terminate or permit cash equivalents to lapse pay any material Permits or Excluded Liability (other Government Authorizations of any Government Entities that are necessary for the operation than use of the Business Retained Seller Cash following release from the Retained Seller Cash Account in accordance with Section 2.4) or any Liability incurred after the date of this Agreement and outside the failure to have which would cause a Material Adverse Effect, except when such termination or lapse results from any Order or other proceeding instituted by any Government Entityordinary course of business;
(d) Sellers Permit or their Affiliates shall allow any of the Assets to be subjected to any Encumbrance that is not lease, license, mortgage, pledge terminated at or encumber any Purchased Assets before the Closing other than in the Ordinary Course of Business and under the DIP Agreement (provided that Sellers shall be able to transfer the Purchased Assets to Purchaser free and clear of all such liens and claims upon the Closing) or purchase, transfer, sell or dispose of any Purchased Assets other than in the Ordinary Course of Business or dispose of or permit to lapse any rights to any Transferred Intellectual Property other than in the Ordinary Course of Businessa Permitted Encumbrance;
(e) Sellers Sell, transfer, lease, sublease, license or their Affiliates shall not fire otherwise dispose of any Business Employee Assets for an amount in excess of $100,000, other than for cause the Excluded Assets and except as set forth on Schedule 6.1(e)the sale of inventories in the ordinary course of business;
(f) Sellers Enter into or their Affiliates shall not make amend any change service agreement with any employee, Affiliate of Seller, or Affiliate of Shareholder, or increase any of the wages, salaries, compensation, bonuses, severance, incentives, pension or other benefits or payments payable (i) to increase the rate any employee, Affiliate of base compensation orSeller, other than in connection or Affiliate of Shareholder or (ii) pursuant to any Employee Benefit Plan or agreement with a sale-related incentive any employee, Affiliate of Seller, or retention plan as such sale-related incentive or retention plan is approved by a Bankruptcy Court Order, bonus opportunity Affiliate of any Business EmployeeShareholder;
(g) Sellers Pay any wages, salaries, compensation, bonuses, severance, incentives, pension or their Affiliates shall not enter into other benefits or payments to any Contract or transaction relating to the Purchased Assetsemployee, Affiliate of Seller, or enter into any Software Contracts Related to the Business, Affiliate of Shareholder other than base salary or hourly wages in the Ordinary Course effect as of BusinessSeptember 30, 2009;
(h) Sellers Permit any insurance policy to be cancelled or their Affiliates shall not takeexpire without notice to Buyer;
(i) Make any Tax election or change any Tax election already made, or settle or consent to any claim or assessment relating to Taxes;
(k) File any petition in bankruptcy or similar proceeding, or adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization;
(l) Take or agree to or commit to take, take any action that would or is be reasonably likely to result in any of the conditions to the Closing, as applicable, set forth in Article VIII, Closing not being satisfied, or would make any representation or warranty of Sellers contained herein inaccurate in any material respect at, or as of any time prior to, the Closing Date satisfied or that would materially impair the ability of Sellers or Purchaser Seller to consummate the Closing in accordance with the terms hereof Transactions or materially delay such consummation;; or
(im) Sellers shall conduct the Business in accordance with applicable Law and Applicable Requirements in all material respects and shall maintain in full force and effect all material Permits and other Government Authorizations, except where the failure to remain in full force and effect results from any Order or other proceeding instituted by any Governmental Entity; and
(j) no Seller nor any Affiliate of a Seller shall enter Enter into any written agreement, Contractcontract, commitment or arrangement (i) to do any of the foregoing, or authorize, recommend, propose propose, in writing or announce an intention to do, do any of the foregoing or (ii) that would violate any of the provisions of Section 5.6foregoing.
Appears in 2 contracts
Samples: Asset Purchase Agreement (Skanon Investments, Inc.), Asset Purchase Agreement (Ready Mix, Inc.)
Interim Operations of Seller. Subject (a) Seller covenants and agrees as to any obligations as debtors or debtors-in-possession under itself, the Bankruptcy Code, or any Order of the Bankruptcy Court, Sellers covenant Company and agree its Subsidiaries that, after the date hereof and prior to the earlier of the Closing Dateand the termination of this Agreement in accordance with Article V, except (I) as expressly provided in this Agreement or as may be agreed consented to in writing by PurchaserBuyer (such consent not to be unreasonably withheld, delayed or conditioned), (II) as otherwise required or expressly permitted by this Agreement, (III) as required by a Governmental Entity or applicable Law or (IV) as set forth in Section 3.1(a) of the Seller Disclosure Letter, (X) the business of the Company and its Subsidiaries shall be conducted in all material respects in the ordinary course of business consistent with past practice and, to the extent consistent with the foregoing, the Company and its Subsidiaries shall use their respective reasonable best efforts to preserve their businesses substantially intact and maintain satisfactory relationships with key employees and Governmental Entities, customers and suppliers having significant business dealings with them, and (Y) without limiting the generality of the foregoing, Seller shall not and shall not permit the Company or any of the Company’s Subsidiaries to:
(ai) except as set forth on Schedule 6.1(e), the Business shall be conducted substantially adopt any change in the same manner as heretofore conducted, and Sellers shall use commercially reasonable efforts to preserve the business organization its certificate of the Business intact, keep available the services of the current officers and employees of the Business and maintain the existing relationships with customers, suppliers, creditors, business partners and others having business dealings with the Business; provided, that this clause (a) shall not limit Sellers’ right to amend incorporation or terminate any Planbylaws or other applicable governing documents;
(bii) prior to the Closingadopt or publicly propose a plan of complete or partial liquidation, Sellers restructuring, recapitalization or their Affiliates shall not modifyother reorganization, amend or terminate any resolutions providing for or authorizing such a liquidation, dissolution, restructuring, recapitalization or other reorganization of the Assumed Contracts, except in the Ordinary Course of Business or as necessary to assume and assign the Assumed Contracts pursuant to Section 365 of the Bankruptcy CodeCompany;
(ciii) Sellers issue, sell, transfer, pledge, dispose of or their Affiliates shall not terminate encumber (A) any Company Membership Interests or permit any other capital stock of the Company or any of its Subsidiaries (other than (x) the issuance of shares by a wholly owned Subsidiary of the Company to lapse the Company or another wholly owned Subsidiary of the Company; or (y) Permitted Liens), (B) securities convertible or exchangeable into or exercisable for any material Permits such Company Membership Interests or other Government Authorizations of capital stock or (C) or any Government Entities that are necessary for the operation of the Business and the failure rights, warrants, options, calls or commitments to have which would cause a Material Adverse Effectacquire any such Company Membership Interests, except when such termination other capital stock or lapse results from any Order convertible or other proceeding instituted by any Government Entityexchangeable securities;
(div) Sellers declare, set aside, make or their Affiliates shall not leasepay any dividend or other distribution, payable in stock or property (other than cash or cash equivalents), with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly owned Subsidiary of the Company to the Company or to any other direct or indirect wholly owned Subsidiary of the Company);
(v) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire any of its Equity Interests, capital stock or securities convertible or exchangeable into or exercisable for any of its capital stock;
(vi) merge or consolidate the Company or any of its Subsidiaries with any other Person, or acquire any business of any other Person (whether by merger, consolidation, acquisition of stock or all or substantially all assets or similar), except for any such transactions among wholly owned Subsidiaries of the Company;
(vii) sell, assign, license, mortgagelease, pledge or encumber any Purchased Assets other than in the Ordinary Course of Business and under the DIP Agreement (provided that Sellers shall be able to transfer the Purchased Assets to Purchaser free and clear of all such liens and claims upon the Closing) or purchase, transfer, sell or dispose of any Purchased Assets of its properties, rights or assets, other than (A) sales, assignment, licenses, leases, transfer or dispositions in the Ordinary Course ordinary course of Business business, (B) sales, transfers and dispositions of obsolete, non-operating or dispose worthless assets or properties, (C) sales, leases, transfers or other dispositions made in connection with any transaction among the Company and its wholly owned Subsidiaries or among its wholly owned Subsidiaries, (D) Permitted Liens, (E) sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $250,000 individually or permit to lapse any rights to any Transferred Intellectual Property other than $500,000 in the Ordinary Course aggregate or (F) pursuant to a contract, commitment, understanding or arrangements in effect as of Businessthe date of this Agreement;
(eviii) Sellers incur any Indebtedness, or their Affiliates shall not fire issue or sell any Business Employee debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, other than for cause under credit facilities of the Company and except its Subsidiaries in existence as set forth of the date hereof and on Schedule 6.1(e)the terms of such credit facilities as of the date hereof;
(fix) Sellers or their Affiliates shall not make any change to increase the rate of base compensation or, other than in connection with a sale-related incentive or retention plan as such sale-related incentive or retention plan is approved by a Bankruptcy Court Order, bonus opportunity of any Business Employee;
(gA) Sellers or their Affiliates shall not enter into any Contract or transaction relating to the Purchased Assets, or enter into any Software Contracts Related to the Business, other than in the Ordinary Course of Business;
(h) Sellers or their Affiliates shall not take, or agree to or commit to take, any action that would or is reasonably likely to result in any of the conditions to the Closing, as applicable, set forth in Article VIII, not being satisfied, or would make any representation or warranty of Sellers contained herein inaccurate amend in any material respect ator terminate, cancel or waive any of the Company’s or its Subsidiaries’ material rights under any Material Contract or Lease (other than expirations in accordance with their respective terms or terminations by the counterparties thereto), or (B) enter into any new contract, agreement or instrument that would constitute a Material Contract if it was in effect as of the date hereof, except, in the case of the foregoing clauses (A) and (B), to the extent (x) such action was taken in the ordinary course of business consistent with past practice and (y) the Company promptly (and in any event within ten (10) business days) provides written notice of such action to Buyer;
(x) except as required pursuant to the terms of any Benefit Plan in effect as of the date hereof, or as otherwise required by applicable Law, (A) materially increase the compensation, bonus, pension, severance or termination pay of any time prior employee of the Company or any of its Subsidiaries, except, for employees with annual base salary or wages below $200,000, for increases in annual salary or wage rate in the ordinary course of business consistent with past practice, (B) become a party to, the Closing Date establish, adopt, materially amend, or terminate any Benefit Plan or any arrangement that would have been a Benefit Plan had it been entered into prior to this Agreement, or (C) materially impair change any actuarial or other assumptions used to calculate funding obligations with respect to any Benefit Plan that is required by applicable Law to be funded or change the ability manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP; or
(xi) settle any claim, investigation, proceeding or litigation with a Governmental Entity or third party, in each case threatened, made or pending against the Company or any of Sellers its Subsidiaries, other than the settlement of claims, investigations, proceedings or Purchaser to consummate litigation for only monetary damages (A) for an amount (excluding any amounts that are covered by any insurance policies of the Closing Company or its Subsidiaries, as applicable) not in accordance with excess of the terms hereof amount reflected or materially delay such consummationreserved therefor in the Financial Statements (including, for the avoidance of doubt any reserves for self-insurance) or (B) for an amount of less than $350,000 in any individual case;
(ixii) Sellers shall conduct other than as required (A) by GAAP (or any interpretation thereof), including pursuant to standards, guidelines and interpretations of the Business Financial Accounting Standards Board or any similar organization, or (B) by Law, make any change in accordance with applicable Law and Applicable Requirements in all material respects and shall maintain in full force and effect all material Permits and other Government Authorizationsaccounting methods, except principles or practices affecting the consolidated assets, liabilities or results of operations of the Company where the failure such change would reasonably be likely to remain in full force and effect results from any Order or other proceeding instituted by any Governmental Entity; andhave a Company Material Adverse Effect;
(jxiii) no Seller nor make, change or revoke any Affiliate material Tax election (including an entity classification election pursuant to Treasury Regulation 301.7701-3); settle or compromise any claim, notice, audit report or assessment in respect of a Seller shall material non-income Taxes; adopt or change any material method of Tax accounting; enter into any Tax allocation agreement, ContractTax sharing agreement, commitment Tax indemnity agreement or arrangement closing agreement relating to any material Tax; surrender any right to claim a material non-income Tax refund; or consent to any extension or waiver of the statute of limitations period applicable to any material non-income Tax claim or assessment;
(ixiv) make any loans or advances to any Person, except for the extension of credit to customers and advances to employees, officers or consultants of the Company or its Subsidiaries, in each case incurred in the ordinary course of business consistent with past practices, and intercompany loans or advances between or among the Company and its Subsidiaries;
(xv) agree, resolve, authorize or commit to do any of the foregoing, or authorize, recommend, propose or announce an intention foregoing actions prohibited pursuant to do, any clauses (i)-(xiv) of the foregoing or (ii) that would violate any of the provisions of this Section 5.63.1(a).
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Golden Entertainment, Inc.)
Interim Operations of Seller. Subject Promptly upon the execution of this Agreement, Seller agrees that Purchaser may place certain senior executives, including Xxxxxx Xxxxxx (the "INTERIM CONSULTING TEAM"), in interim consulting positions at the Company and the Insurance Subsidiaries pursuant to any obligations as debtors or debtors-in-possession under consulting arrangements which are reasonably acceptable to the Bankruptcy Codeparties and consistent with the terms of this Agreement. The Seller agrees to cause the Company and the Insurance Subsidiaries to take, or any Order not take, such actions as the Interim Consulting Team may reasonably direct with respect to (i) the strategy and execution of the Bankruptcy CourtSeller Subsidiaries' underwriting, Sellers covenant reinsurance, claims handling and agree other operational functions, and (ii) the restructuring of certain asset positions, both in the Seller Subsidiaries' investment portfolios and otherwise, each subject to Seller's approval, which will not be unreasonably withheld. The Interim Consulting Team will coordinate all of its activities under this Agreement through Xxx X. Xxxxxxx, B. Xxxxxx Xxxxxx and Xxxxxxx X. Xxxxx or their designees. Notwithstanding any other provision of the Agreement, neither the Seller, nor any of the Seller Subsidiaries, shall be obligated to commute any insurance or reinsurance policy or otherwise take any action that may be reasonably expected to cause any Governmental Entity to require Seller or any of its Affiliates to make a capital contribution to the Seller Subsidiaries. Absent the written approval of one of the Interim Consulting Team, Seller covenants and agrees that, except (i) as contemplated by this Agreement (including the distribution of the Excluded Assets) or (ii) as disclosed in Section 4.1 of the Disclosure Schedule after the date hereof and prior to the Closing Date, except as expressly provided in this Agreement or as may be agreed in writing by Purchaser:
(a) except as set forth on Schedule 6.1(e), the Business business of the Seller Subsidiaries shall be conducted substantially only in the same manner as heretofore conducted, ordinary and Sellers usual course of business and shall use commercially reasonable efforts to preserve the business organization of the Business intact, keep available the services of the current officers and employees of the Business and maintain the existing relationships with customers, suppliers, creditors, business partners and others having business dealings not include any actions inconsistent with the Business; provided, that this clause (a) shall not limit Sellers’ right to amend transactions contemplated hereby or terminate any Planby the agreements contemplated hereunder;
(b) prior to the Closing, Sellers or their Affiliates shall not modify, amend or terminate any none of the Assumed ContractsSeller Subsidiaries will amend its articles or certificate of incorporation, except in the Ordinary Course of Business bylaws or as necessary to assume and assign the Assumed Contracts pursuant to Section 365 of the Bankruptcy Codesimilar organizational documents;
(c) Sellers the Company will not (i) split, combine or their Affiliates shall not terminate reclassify the Shares, (ii) declare, set aside or permit to lapse pay any material Permits dividend or other Government Authorizations distribution payable in cash, stock or property with respect to the Shares, PROVIDED, that the Company may dividend or otherwise distribute or take any other necessary action to allow Seller to retain the Excluded Assets, (iii) issue or sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any Government Entities that are necessary for kind to acquire, the operation Shares or any capital stock of the Business and the failure to have which would cause a Material Adverse EffectCompany, except when such termination or lapse results from (iv) redeem, purchase or otherwise acquire directly or indirectly any Order or other proceeding instituted by any Government Entityof its capital stock;
(d) Sellers none of the Seller Subsidiaries shall (i) adopt any new employee benefit plan (including any stock option, stock benefit or their Affiliates shall not leasestock purchase plan) or amend any existing employee benefit plan in any material respect, licenseexcept for changes which are less favorable to participants in such plans or as may be required by applicable law or (ii) increase any compensation or enter into or amend any employment, mortgageseverance, pledge termination or encumber similar agreement with any Purchased Assets other than of its present or future officers or directors, except for promotions in the Ordinary Course ordinary course of Business and under the DIP Agreement business consistent with past practices, normal merit increases of five percent (provided that Sellers shall be able to transfer the Purchased Assets to Purchaser free and clear of all such liens and claims upon the Closing5%) or purchase, transfer, sell or dispose of any Purchased Assets other than less per annum in the Ordinary Course ordinary and usual course of Business business and the payment of cash bonuses to employees pursuant to and consistent with existing plans or dispose of or permit programs, with respect to lapse which any rights to any Transferred Intellectual Property other than in the Ordinary Course of Businessnecessary accruals have been made;
(e) Sellers or their Affiliates shall not fire any Business Employee other than for cause and none of the Seller Subsidiaries shall, except as set forth on Schedule 6.1(e)may be required or contemplated by this Agreement or in the ordinary and usual course of business, consistent with prior practice, acquire, sell, lease or dispose of any assets which, individually or in the aggregate, are material to the financial position or results of operations of the affected Seller Subsidiary;
(f) Sellers none of the Seller Subsidiaries shall (i) incur or their Affiliates shall assume any long-term or short-term debt or issue any debt securities except for borrowings under existing lines of credit in the ordinary course of business consistent with past practice, (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, indirectly, contingently or otherwise) for the material obligations of any other person except in the ordinary and usual course of business consistent with past practice in an amount not material to the affected Seller Subsidiary, (iii) make any change to increase the rate of base compensation orloans, advances or capital contributions to, or investments in, any other person other than in connection the ordinary and usual course of business consistent with a sale-related incentive past practice, (iv) pledge or retention plan as such sale-related incentive otherwise encumber the Shares or retention plan is approved by a Bankruptcy Court Order, bonus opportunity any shares of any Business EmployeeInsurance Subsidiary or (v) mortgage or pledge any of its material assets, tangible or intangible, or create or suffer to exist any material Encumbrance of any kind with respect to any such asset;
(g) Sellers none of the Seller Subsidiaries shall (i) acquire (by merger, consolidation or their Affiliates shall not acquisition of stock or assets) any corporation, partnership or other business organization or division thereof or any equity interest therein (other than purchases of marketable securities in the ordinary course of business), (ii) other than capital expenditures provided for in the 1998 capital expenditures budgets of the Seller Subsidiaries, which budgets have been delivered or made available to Purchaser, authorize any new capital expenditure or expenditures which, individually, is in excess of $150,000 or, in the aggregate, are in excess of $500,000 or (iii) enter into or amend any Contract contract, agreement, commitment or transaction relating arrangement providing for the taking of any action which would be prohibited hereunder;
(h) none of the Seller Subsidiaries shall adopt a plan of complete or partial liquidation or resolutions providing for or authorizing such liquidation or a dissolution, merger, consolidation, restructuring, recapitalization or other reorganization;
(i) none of the Seller Subsidiaries shall materially change any of the accounting methods or practices used by it unless required by GAAP, statutory accounting practices or applicable law;
(j) none of the Seller Subsidiaries shall settle or compromise any claim (including arbitration) or litigation, which after insurance reimbursement involves an amount in excess of $500,000 or otherwise is material to the Purchased AssetsSeller Subsidiaries taken as a whole, without the prior written consent of Purchaser, which consent will not be unreasonably withheld;
(k) none of the Seller Subsidiaries shall make any payment, loan or advance of any amount to or in respect of, or engage in the sale, transfer or lease of any of its property or assets to, or enter into any Software Contracts Related to the Business, other than in the Ordinary Course of Business;
(h) Sellers or their Affiliates shall not take, or agree to or commit to takecontract with, any action that would or is reasonably likely to result in any of the conditions to the ClosingAffiliate, as applicable, set forth in Article VIII, not being satisfied, or would make any representation or warranty of Sellers contained herein inaccurate in any material respect at, or as of any time prior to, the Closing Date or that would materially impair the ability of Sellers or Purchaser to consummate the Closing except (i) in accordance with the terms hereof or materially delay such consummationof the agreements set forth in Section 2.18 of the Disclosure Schedule, and (ii) in connection with Seller's retention of the Excluded Assets and the owned real property, as contemplated by this Agreement;
(l) none of the Seller Subsidiaries shall amend the terms of the (i) Sellers Material Agreements, as disclosed in Section 2.15 of the Disclosure Schedule and (ii) contracts, agreements or arrangements with any related party, as disclosed in Section 2.18 of the Disclosure Schedule, to cause any change in the cost, services being provided, or term of any such agreements, other than as specifically contemplated by this Agreement;
(m) none of the Seller Subsidiaries shall conduct cancel any indebtedness or intentionally waive, release, grant or transfer any rights of substantial value to the Business in accordance with applicable Law and Applicable Requirements in all material respects and shall maintain in full force and effect all material Permits and other Government Authorizationsaffected Seller Subsidiary, except where in the failure ordinary course of business and consistent with past practice, or forgive or waive any rights in connection with any loans to remain in full force and effect results from any Order its officers, directors or other proceeding instituted by any Governmental Entityrelated individuals; and
(jn) no neither Seller nor any Affiliate of a Seller shall Subsidiary will authorize or enter into any agreement, Contract, commitment or arrangement (i) an agreement to do any of the foregoing, or authorize, recommend, propose or announce an intention to do, any of the foregoing or (ii) that would violate any of the provisions of Section 5.6.
Appears in 1 contract
Interim Operations of Seller. Subject Promptly upon the execution of this Agreement, Seller agrees that Purchaser may place certain senior executives, including Arnoxx Xxxxxx (xxe "Interim Consulting Team"), in interim consulting positions at the Company and the Insurance Subsidiaries pursuant to any obligations as debtors or debtors-in-possession under consulting arrangements which are reasonably acceptable to the Bankruptcy Codeparties and consistent with the terms of this Agreement. The Seller agrees to cause the Company and the Insurance Subsidiaries to take, or any Order not take, such actions as the Interim Consulting Team may reasonably direct with respect to (i) the strategy and execution of the Bankruptcy CourtSeller Subsidiaries' underwriting, Sellers covenant reinsurance, claims handling and agree other operational 22 29 functions, and (ii) the restructuring of certain asset positions, both in the Seller Subsidiaries' investment portfolios and otherwise, each subject to Seller's approval, which will not be unreasonably withheld. The Interim Consulting Team will coordinate all of its activities under this Agreement through Jay X. Xxxxxxx, X. Curtxx Xxxxxx xxx Maurxxx X. Xxxxx xx their designees. Notwithstanding any other provision of the Agreement, neither the Seller, nor any of the Seller Subsidiaries, shall be obligated to commute any insurance or reinsurance policy or otherwise take any action that may be reasonably expected to cause any Governmental Entity to require Seller or any of its Affiliates to make a capital contribution to the Seller Subsidiaries. Absent the written approval of one of the Interim Consulting Team, Seller covenants and agrees that, except (i) as contemplated by this Agreement (including the distribution of the Excluded Assets) or (ii) as disclosed in Section 4.1 of the Disclosure Schedule after the date hereof and prior to the Closing Date, except as expressly provided in this Agreement or as may be agreed in writing by Purchaser:
(a) except as set forth on Schedule 6.1(e), the Business business of the Seller Subsidiaries shall be conducted substantially only in the same manner as heretofore conducted, ordinary and Sellers usual course of business and shall use commercially reasonable efforts to preserve the business organization of the Business intact, keep available the services of the current officers and employees of the Business and maintain the existing relationships with customers, suppliers, creditors, business partners and others having business dealings not include any actions inconsistent with the Business; provided, that this clause (a) shall not limit Sellers’ right to amend transactions contemplated hereby or terminate any Planby the agreements contemplated hereunder;
(b) prior to the Closing, Sellers or their Affiliates shall not modify, amend or terminate any none of the Assumed ContractsSeller Subsidiaries will amend its articles or certificate of incorporation, except in the Ordinary Course of Business bylaws or as necessary to assume and assign the Assumed Contracts pursuant to Section 365 of the Bankruptcy Codesimilar organizational documents;
(c) Sellers the Company will not (i) split, combine or their Affiliates shall not terminate reclassify the Shares, (ii) declare, set aside or permit to lapse pay any material Permits dividend or other Government Authorizations distribution payable in cash, stock or property with respect to the Shares, provided, that the Company may dividend or otherwise distribute or take any other necessary action to allow Seller to retain the Excluded Assets, (iii) issue or sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any Government Entities that are necessary for kind to acquire, the operation Shares or any capital stock of the Business and the failure to have which would cause a Material Adverse EffectCompany, except when such termination or lapse results from (iv) redeem, purchase or otherwise acquire directly or indirectly any Order or other proceeding instituted by any Government Entityof its capital stock;
(d) Sellers none of the Seller Subsidiaries shall (i) adopt any new employee benefit plan (including any stock option, stock benefit or their Affiliates shall not lease, license, mortgage, pledge or encumber any Purchased Assets other than in the Ordinary Course of Business and under the DIP Agreement (provided that Sellers shall be able to transfer the Purchased Assets to Purchaser free and clear of all such liens and claims upon the Closingstock purchase plan) or purchase, transfer, sell or dispose of amend any Purchased Assets other than in the Ordinary Course of Business or dispose of or permit to lapse any rights to any Transferred Intellectual Property other than in the Ordinary Course of Business;
(e) Sellers or their Affiliates shall not fire any Business Employee other than for cause and except as set forth on Schedule 6.1(e);
(f) Sellers or their Affiliates shall not make any change to increase the rate of base compensation or, other than in connection with a sale-related incentive or retention existing employee benefit plan as such sale-related incentive or retention plan is approved by a Bankruptcy Court Order, bonus opportunity of any Business Employee;
(g) Sellers or their Affiliates shall not enter into any Contract or transaction relating to the Purchased Assets, or enter into any Software Contracts Related to the Business, other than in the Ordinary Course of Business;
(h) Sellers or their Affiliates shall not take, or agree to or commit to take, any action that would or is reasonably likely to result in any of the conditions to the Closing, as applicable, set forth in Article VIII, not being satisfied, or would make any representation or warranty of Sellers contained herein inaccurate in any material respect atrespect, except for changes which are less favorable to participants in such plans or as of any time prior to, the Closing Date or that would materially impair the ability of Sellers or Purchaser to consummate the Closing in accordance with the terms hereof or materially delay such consummation;
(i) Sellers shall conduct the Business in accordance with may be required by applicable Law and Applicable Requirements in all material respects and shall maintain in full force and effect all material Permits and other Government Authorizations, except where the failure to remain in full force and effect results from any Order or other proceeding instituted by any Governmental Entity; and
(j) no Seller nor any Affiliate of a Seller shall enter into any agreement, Contract, commitment or arrangement (i) to do any of the foregoing, or authorize, recommend, propose or announce an intention to do, any of the foregoing law or (ii) that would violate increase any compensation or enter into or amend any employment, severance, termination or similar agreement with any of its present or future officers or directors, except for promotions in the provisions ordinary course of Section 5.6.business consistent with past practices, normal merit increases of five percent (5%) or less per
Appears in 1 contract
Samples: Purchase Agreement (Superior National Insurance Group Inc)
