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.)
