Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement): (a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain (b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares; (c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice); (d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish, (e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims; (f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business; (g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it; (h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and (i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.
Appears in 2 contracts
Samples: Merger Agreement (Solvay S a /Adr/), Merger Agreement (Unimed Pharmaceuticals Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this Agreement or the Option Agreement, (ii) as set forth in Section 5.2 of the Company Disclosure Schedule, (iii) in the ordinary course of business consistent with past practice or (iv) as agreed in writing by Parent, after the date hereof, and prior to the Effective Time earlier of (unless Purchaser x) the termination of this Agreement in accordance with Article VIII hereof and (y) the time the designees of Parent have been elected to, and shall otherwise consent in writing and except as otherwise permitted by this Agreementconstitute a majority of, the Board of Directors of the Company pursuant to Section 1.3 hereof (the "Appointment Date"):
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary course consistent with past practice and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its present business organization intact and maintainmaintain its satisfactory relations with customers, suppliers, employees, contractors, distributors and others having business dealings with it;
(b) the Company shall not will not, directly or indirectly, (i) sell amend its Articles of Incorporation or pledge By-laws; or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Shares or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of the SharesCompany;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock; (ii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than Shares reserved for issuance on the case date hereof pursuant to the exercise of the Company, Shares issuable Options or other rights to purchase shares of Common Stock pursuant to options the Employee Stock Purchase Plan outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.
Appears in 2 contracts
Samples: Merger Agreement (Sage Group PLC), Merger Agreement (Best Software Inc)
Interim Operations of the Company. The Except (A) as expressly contemplated by this Agreement, (B) as set forth on Section 5.1 of the Company covenants Disclosure Letter, (C) as required by applicable Law, or (D) as consented to in writing by Parent after the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, which consent solely for clauses (unless Purchaser vii) and (viii) shall otherwise consent in writing and except as otherwise permitted by this Agreement):not be unreasonably withheld or delayed, the Company agrees that:
(ai) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts Subsidiaries will conduct business only in the ordinary course of business consistent with past practice (except for modifications, suspensions or alterations of operations resulting from, or determined by the Company in good faith to preserve its business organization intact be advisable and maintainreasonably necessary in response to, COVID‑19 or COVID‑19 Measures);
(bii) the Company shall will not (i) sell amend its Articles of Incorporation or pledge or agree to sell or pledge any stock its Amended and Restated By-laws and the Company’s Subsidiaries will not amend their certificate of incorporation, bylaws or other securities owned by it comparable charter or permit organizational documents;
(iii) neither the Company nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries will (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivA) declare, set aside or pay any dividend or other distribution (including any constructive or deemed distribution), whether payable in cash, stock or property other property, with respect to the Shares;
(c) neither its capital stock, or otherwise make any payments to its shareholders in their capacity as such, other than dividends or dividends to the Company nor or any of its subsidiaries shall Subsidiaries, as applicable, solely for the purposes of paying operating expenses in the ordinary course of business consistent with past practices; (iB) issue, sell, grant, transfer, pledge, dispose of or encumber or authorize or propose to issue, sell, grant, transfer, pledge, dispose of or encumber any additional shares of, of capital stock or securities convertible into other Rights of the Company or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanySubsidiaries (including treasury stock), its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in respect of the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries Subsidiaries reserved for issuance on the date of this Agreement and issued pursuant to the exercise or settlement of awards outstanding under the Company Stock Plan as of the date of this Agreement, (C) split, combine, subdivide or reclassify the Shares or any other outstanding capital stock of the Company or any of the Subsidiaries of the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any shares of capital stock or other Rights of the Company or any of its Subsidiaries or (D) redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other Rights of the Company or any of its Subsidiaries (other than (1) the withholding of Shares to satisfy Tax obligations with respect to awards granted pursuant to the Company Stock Plan and (2) the acquisition by the Company of Rights pursuant to the Company Stock Plan);
(iv) authorize capital expenditures except as required by applicable Law or under the terms of any Company Plan in excess effect as of $50,000 individually the date of this Agreement, the Company will not and will not permit its Subsidiaries to increase the compensation payable or $100,000 to become payable to any of its or their officers, directors or employees, or any natural person engaged as a consultant, or enter into, establish, amend or terminate any Company Plans, except (A) for new hires or (B) increases in salaries, wages and benefits of employees who are neither directors nor officers of the Company made in the aggregate ordinary course of business consistent with past practice (provided that such increases shall not, in the case of any individual employee, exceed 10%, or in the aggregate, exceed 5% of such salaries, wages and benefits on the date hereof);
(v) neither the Company nor any of its Subsidiaries will, except in the ordinary course of business consistent with past practice (A) incur or assume any Indebtedness (other than Indebtedness between the Company and any of its Subsidiaries or between its Subsidiaries, or in connection with the refinancing of any Indebtedness that exists as of the date of this Agreement), (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person (other than a Subsidiary of the Company), or (C) make any material loans, advances or capital contributions to, or investments in, any other Person (other than a Subsidiary of the Company);
(vi) neither the Company nor any of its Subsidiaries will make any acquisition of (or investment in a business either by merger, consolidation or acquisition purchase of stock or assets)securities, merger or consolidation, contributions to capital, loans, advances, property transfers, or purchases of any investment in, property or assets or stock of any other person or entity Person (other than a Subsidiary of the Company), except for acquisitions or dispositions of assets (A) investment securities in the Company’s investment portfolio in the ordinary course of business consistent with past practice), or (B) Owned Real Property or Leased Real Property valued not in excess of $250,000 individually;
(dvii) neither the Company nor any of its subsidiaries shall grant Subsidiaries will pay, discharge, waive or settle any severance claims involved in any Action, other than the payment, discharge, waiver or termination pay tosettlement of claims, liabilities or obligations (A) in the ordinary course of business consistent with past practice, or enter into any employment (B) reflected or severance agreement with any directorreserved against in, officer or other employee contemplated by, the Financial Statements (or the notes to the Financial Statements) for amounts not in excess of the Company those so reflected or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,reserved;
(eviii) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate Subsidiaries will materially change any of its material Contracts the accounting methods, principles or waivepractices used by it unless required by a change in GAAP, release Applicable SAP or assign any material rights or claimsLaw;
(fix) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
Subsidiaries will (gA) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, business combination, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than this Agreement), or (B) transfer, lease, license, sell, mortgage, pledge, dispose of or encumber any material assets with a value in excess of $10 million, individually or in the Merger and other than aggregate, except in compliance this clause (B), in the ordinary course of business consistent with Section 9.4(a)); andpast practice;
(ix) neither the Company nor any of its subsidiaries Subsidiaries will authorize adopt any shareholder rights plan;
(xi) neither the Company nor any of its Subsidiaries will enter into any new business line that is outside their existing businesses as of the date hereof (or a business complementary thereto or a natural extension thereof), to the extent doing so would be material to the Company and its Subsidiaries taken as a whole;
(xii) neither the Company nor any of its Subsidiaries will enter into any material reinsurance transaction other than those proposed to be entered into prior the Closing as set forth on Section 5.1(xii) of the Company Disclosure Schedule;
(xiii) neither the Company nor the Insurance Subsidiary will alter or amend in a manner that is material to the financial condition of the Company and the Insurance Subsidiary, taken as a whole, any existing financial, underwriting, pricing, claims, claims handling, risk retention, reserving, investment or actuarial practice, guideline or policy, or any material assumption underlying an actuarial practice or policy, except as may be required by GAAP, Applicable SAP or Law;
(xiv) make, change or revoke any income Tax or other material Tax election, elect or change any material method of accounting for Tax purposes, file any Tax Return or incur any Tax outside of the ordinary course of business, waive or extend any assessment or collection period in respect of Taxes, waive, surrender or cancel any right to any Tax asset, refund or credit, settle or otherwise resolve any Action in respect of Taxes, enter into any tax sharing, indemnity, reimbursement or similar contract in respect of Taxes (customary and commercially reasonable Tax indemnification provisions in commercial contracts entered into in the ordinary course of the Company’s business and not primarily relating to Taxes), or change or any position contrary to an Insurance Contract’s Tax treatment (within the meaning of Section 3.16(m) of this Agreement).
(xv) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 2 contracts
Samples: Merger Agreement (ICC Holdings, Inc.), Merger Agreement (ICC Holdings, Inc.)
Interim Operations of the Company. The Company covenants and agrees, as to itself agrees that after the date hereof and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and Time, except as otherwise permitted (i) contemplated by this Agreement):, (ii) required by applicable law, by any Significant Agreement or by any Plan disclosed on Schedule 3.9(a) of the Disclosure Schedule or (iii) agreed to in writing by Parent:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization and the business organization of its Subsidiaries intact and maintainmaintain existing relations with customers, suppliers and employees;
(b) the Company shall not amend its Amended and Restated Certificate of Incorporation or By-Laws and shall not authorize or vote in favor of, directly or indirectly, any amendment by its Subsidiaries of their respective organizational documents;
(ic) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) Company shall not declare, set aside or pay any dividend payable in cash, stock or property other distribution with respect to the Shares;
(c) its capital stock; and neither the Company nor any of its subsidiaries Subsidiaries shall (i) issue, sell, pledge, issue or dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, Company or its subsidiaries or any Subsidiaries other property or assets other than, in the case than issuances of the Company, Shares issuable shares of Company Common Stock pursuant to options outstanding on securities, options, warrants, calls, commitments or rights existing at the date hereof under and disclosed to Purchaser in writing (including as disclosed in the Stock Plans and shares issuable pursuant to the WarrantsCompany SEC Documents); or (ii) transferredeem, lease, license, guarantee, sell, mortgage, pledge, dispose of purchase or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) otherwise acquire directly or indirectly by redemption any of its capital stock;
(d) Neither the Company nor its Subsidiaries shall incur any indebtedness for borrowed money other than (i) short term indebtedness incurred in the ordinary course of business (ii) indebtedness of Subsidiaries incurred in connection with the acquisition, development, construction or otherwise any shares operation of power generation or energy producing facilities, which indebtedness is without recourse to the Company or its assets (other than the assets or earnings of such Subsidiary or such facility), and (iii) other indebtedness not in excess of $15 million in the aggregate;
(e) except as set forth in Schedule 6.1(e) of the capital stock Disclosure Schedule, neither the Company nor its Subsidiaries shall (i) except for increases in the ordinary course of business consistent with past practice or to reflect promotions, grant any material increase in the compensation payable or to become payable by the Company or any of its subsidiaries Subsidiaries to any employee; (ii) adopt or otherwise materially increase, or accelerate the payment or vesting of the amounts payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock appreciation right, restricted stock purchase, insurance, pension, retirement or other employee benefit plan agreement or arrangement; or (iviii) authorize capital expenditures enter into or amend in any material respect any existing employment or severance agreement or consulting agreement with any individual consultant (which consulting agreement provides for payments in excess of $50,000 individually 350,000) or, except in accordance with the existing written policies of the Company, existing contracts or $100,000 in the aggregate agreements or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall , grant any severance or termination pay toto any officer, or enter into any employment or severance agreement with any director, officer employee or other employee individual consultant of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsSubsidiaries;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election change the accounting principles used by it unless required by law, SEC guidelines or permit any insurance policy naming it as a beneficiary or a loss payable payee GAAP (or, if applicable with respect to be canceled or terminated without notice to PurchaserSubsidiaries, except in the ordinary and usual course of businessapplicable foreign generally accepted accounting principles);
(g) except as may be required as a result of a change in law or in generally accepted accounting principlesThe Company shall not, neither the Company nor and shall not permit any of its subsidiaries shall change Subsidiaries to, acquire or agree to acquire any material assets except in the ordinary course of business or incur or commit to incur, or consent to the incurrence by any of the accounting practices Excluded Subsidiaries, of any capital expenditures (as such term is defined under GAAP) not included in the 1997 project financial models previously provided to Parent except for such capital expenditures not in excess of $1 million per project or principles used by it;more than $15 million in the aggregate; and
(h) neither The Company shall not permit any individual to subscribe for any additional shares of Company Common Stock under the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); andStock Purchase Plan.
(i) neither the Company nor any of its subsidiaries Subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 2 contracts
Samples: Merger Agreement (NGC Corp), Merger Agreement (Destec Energy Inc)
Interim Operations of the Company. (a) The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to during the period from the date of this Agreement through the earlier of the Effective Time or the date of termination of this Agreement, except: (unless Purchaser i) to the extent Parent shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) the Company which consent shall not (i) sell be unreasonably withheld, delayed or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiaryconditioned); (ii) amend as set forth in Section 5.01(a) of the Certificate Company Disclosure Letter; or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) as expressly required by this Agreement, the Company shall and shall cause each Company Subsidiary to (A) use its reasonable best efforts to (1) conduct their businesses in the ordinary course of business, (2) preserve intact their present business organizations, (3) maintain satisfactory relations with and keep available the services of their current officers and other key employees and (4) preserve existing relationships with material customers, lenders, suppliers, distributors and others having material business relationships with the Company or any Company Subsidiary and (B) not:
(1) amend its certificate of incorporation or bylaws or equivalent organizational documents;
(2) split, combine combine, subdivide or reclassify the outstanding Shares; or any shares of its capital stock;
(iv3) declare, set aside or pay any dividend (whether payable in cash, stock or property property) with respect to any shares of its capital stock (except with respect to shares of the Sharescapital stock of a Company Subsidiary that is directly or indirectly wholly owned by the Company);
(c) neither the Company nor any of its subsidiaries shall (i4) issue, sell, pledge, transfer, deliver, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments options or rights of any kind to acquire, any shares of its capital stock, voting securities, phantom stock, phantom stock of any class of the Companyrights, its subsidiaries stock based performance units or any other property securities that derive their value by reference to such capital stock or assets voting securities, other than, in : (i) the case issuance of Company Shares upon the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans exercise of Company Options and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose the grant of or encumber any assets or incur or modify any indebtedness or other liability other than in Company Options under the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets Company’s 2000 Non-Employee Directors Stock Option Program in the ordinary course of business consistent with past practice;
(5) transfer, lease or license to any third party, or subject to an Encumbrance (except for Permitted Encumbrances), any assets of the Company or any Company Subsidiary other than: (i) sales in the ordinary course of business; (ii) dispositions of obsolete assets; or (iii) the sale or disposition of the Aplindore Program or the Real Estate in accordance with Section 5.14;
(6) repurchase, redeem or otherwise acquire or offer to repurchase, redeem or otherwise acquire any shares of its capital stock other than pursuant to the forfeiture provisions applicable to the Company Options or pursuant to the exercise or tax withholding provisions applicable to the Company Options;
(7) acquire (whether pursuant to merger, stock or asset purchase or otherwise) or lease (i) any asset or assets, except for (A) purchases of raw materials, equipment and supplies in the ordinary course of business or (B) capital expenditures (which are subject to Section 5.01(a)(15)), or (ii) except pursuant to the sale of the Aplindore Program in accordance with Section 5.14, any equity interests in any Person or any business or division of any Person (except for marketable securities acquired by the Company from time to time in connection with its normal cash management activities);
(d8) incur, issue, repurchase, modify or assume any Indebtedness or guarantee any such Indebtedness;
(9) neither the Company nor make any of its subsidiaries shall grant any severance loans, advances or termination pay capital contributions to, or investments in, any other Person other than (i) loans, advances or capital contributions to, or investments in, a Company Subsidiary that is directly or indirectly wholly owned by the Company in the ordinary course of business, (ii) advances to employees in respect of travel and other expenses in the ordinary course of business, and (iii) investments made by the Company in marketable securities in connection with its normal cash management activities;
(10) (i) increase benefits under any Company Plan, (ii) increase or otherwise change the method for funding or insuring benefits under any Company Plan, except as required by applicable Legal Requirements, (iii) (A) establish, adopt, enter into into, amend or terminate any employment Company Plan that is an “employee benefit plan” as defined in Section 3(3) of ERISA or severance agreement with other any directorother arrangement that would be an employee benefit plan under ERISA if it were in existence as of the date of this Agreement, except as required by applicable Legal Requirements, or (B) establish, adopt, enter into, amend or terminate any collective bargaining agreement, Company Plan that is not an employee benefit plan under ERISA or any plan, agreement, program, policy, trust, fund or other arrangement that would be a Company Plan that is not an employee benefit plan under ERISA if it were in existence as of the date of this Agreement, except in the ordinary course of business or as required by applicable Legal Requirements (including, without limitation, Section 409A of the Code), (iv) grant any increase in the rates of salaries, compensation or fringe or other benefits payable to any Executive (other than as required by applicable Legal Requirements or pursuant to non-discretionary provisions of Contracts in effect as of the date hereof), (v) grant any increase in the rates of salaries, compensation or fringe or other benefits payable to any employee, except increases that are required by Legal Requirements or pursuant to non-discretionary provisions of Contracts in effect as of the date hereof, (vi) grant or pay any bonus of any kind or amount whatsoever to any current or former director or officer or other any employee of the Company or any such subsidiary; and neither Company Subsidiary (other than pursuant to the non-discretionary provisions of Contracts in effect as of the date of this Agreement) or (vii) grant or pay any stay or severance or termination pay or increase in any manner the stay or severance or termination pay of any current or former director, officer, employee or consultant of the Company nor or any Company Subsidiary other than as required by applicable Legal Requirements or pursuant to non-discretionary provisions of its subsidiaries shall establish,Contracts in effect as of the date hereof;
(e11) neither the Company nor any of its subsidiaries shall settle or compromise any material claims Legal Proceeding (whether or litigation ornot commenced before the date of this Agreement), except other than settlements or compromises of Legal Proceedings where the amount paid (after giving effect to insurance proceeds actually received) in settlement or compromise does not exceed the ordinary and usual course of business and with Company’s reserves on its books therefor by more than $10,000, or for any Legal Proceeding for which the consent of PurchaserCompany has not yet reserved, modifyin an amount therefor that does not exceed $20,000;
(12) enter into any new, or amend or prematurely terminate any of its material Contracts current, Company Contract or waive, release or assign any material rights or claimsclaims under any Company Contract (except (i) in the ordinary course of business or (ii) where the failure to amend or terminate a Company Contract would, in the reasonable judgment of the Company Board, have a Company Material Adverse Effect or (iii) the termination of any contract relating to the development of Aplindore);
(f13) neither the Company nor change any of its subsidiaries shall methods of accounting or accounting practices in any material respect, other than changes required by GAAP or Legal Requirements;
(14) make any tax material Tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, (except for elections made in the ordinary and usual course of business);
(g15) except as may be required as a result make any capital expenditure that is not contemplated by the capital expenditure budget set forth in Section 5.01(a)(15) of a change in law or in generally accepted accounting principles, neither the Company nor Disclosure Letter (a “Non-Budgeted Capital Expenditure”), except that the Company or any Company Subsidiary: (A) may make any Non-Budgeted Capital Expenditure that does not individually exceed $5,000 in amount; and (B) may make any Non-Budgeted Capital Expenditure that, when added to all other Non-Budgeted Capital Expenditures made by the Company and the Company Subsidiaries since the date of its subsidiaries shall change any of this Agreement, would not exceed $25,000 in the accounting practices or principles used by itaggregate;
(h16) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, liquidation or dissolution, merger, consolidation, restructuring, recapitalization, ;
(17) take any action that is intended or other reorganization would reasonably be expected to result in any of the Company (other than conditions to the Merger and other than set forth in compliance with Section 9.4(a))Article VI not being satisfied on or before the Outside Date; andor
(i18) neither the Company nor any of its subsidiaries will authorize or enter into an any agreement or otherwise make any commitment to do any of the foregoing foregoing.
(b) Without in any way limiting any party’s rights or take any action obligations under this Agreement, the parties understand and agree that would knowingly cause any of the representations or warranties of the Company (i) nothing contained in this Agreement shall give Parent or Merger Sub, directly or indirectly, the right to be untrue control or incorrect or would result in any direct the Company’s operations before the Effective Time, and (ii) before the Effective Time, the Company shall exercise, consistent with the terms and conditions of the Offer Conditions set forth in Annex A hereto not being satisfiedthis Agreement, complete control and supervision over its operations.
Appears in 2 contracts
Samples: Merger Agreement (Ligand Pharmaceuticals Inc), Merger Agreement (Neurogen Corp)
Interim Operations of the Company. The During the period from the date of this Agreement until the earlier of termination of this Agreement or the Effective Time, unless the prior written consent of the Parent shall have been obtained (which consent shall not be unreasonably withheld, conditioned, or delayed), and except (i) as expressly contemplated or permitted by this Agreement or (ii) is required by applicable Law (including any compliance by the Company’s directors with their fiduciary duties), the Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement)::
(a) the business of the Company and its subsidiaries the Company Subsidiaries shall be conducted only in the ordinary course of business, and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries the Company Subsidiaries shall use its commercially reasonable efforts to maintain and preserve intact its present business organization intact organization, assets, properties and maintainall material insurance of the type described in Section 4.16 hereof and maintain its rights and franchises and maintain good relations with customers, suppliers, employees, contractors, distributors and others having business dealings with it;
(b) neither the Company shall not nor any Company Subsidiary shall, directly or indirectly, (i) sell amend their respective certificates or pledge articles of incorporation or agree to sell bylaws or pledge any stock similar organizational documents; or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Common Stock or any outstanding capital stock of the Company or any Company Subsidiary;
(ivc) neither the Company nor any Company Subsidiary shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock (other than dividends and distributions by a direct or indirect wholly-owned Company Subsidiary to its parent); (ii) except upon the Shares;
exercise of the Options or upon the exercise of any other rights to purchase Common Stock outstanding on the date hereof (c) neither including, the Company nor any rights granted under the ESPP through the date of its subsidiaries shall (i) this Agreement), issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments warrants or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries Company or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the WarrantsCompany Subsidiaries (including treasury shares); (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets of its material assets, or incur or modify any material indebtedness or other liability liability, other than in the ordinary course of business; or (iv) redeem, purchase or otherwise acquire any shares of its capital stock, or enter into any transaction or instrument which includes a right to acquire such shares except (A) from holders of Options in full or partial payment of the exercise price payable by such holder upon exercise of Options to the extent required or permitted under an Option Plan, or (B) from former employees, directors, and usual consultants pursuant to agreements providing for the repurchase of their shares at the original issue price in connection with the termination of their services to the Company or any Company Subsidiary;
(d) except as required to comply with applicable Law or agreements, plans or arrangements existing on the date hereof or permitted to be entered into pursuant to the terms of this Agreement, including without limitation, Section 7.11(f) hereof, neither the Company nor any Company Subsidiary shall (i) change the compensation or benefits payable or to become payable to any of its directors, officers or employees (other than increases in wages to employees who are not directors or Affiliates in the ordinary course of business, but in any event not to exceed $300,000 in the aggregate), (ii) enter into or amend any employment, severance, consulting, termination, pension, profit-sharing, bonus, extra compensation, incentive, deferred compensation, stock purchase, stock option, stock appreciation right, group insurance, severance pay, retirement or other employee benefit plan, agreement or arrangement, or any employment or consulting agreement (except for new hire employees and promotions in the ordinary course of business whose annual salary does not exceed $150,000) or make loans to any directors, officers, employees, or Affiliates of the Company or any Company Subsidiary or change its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to an employee benefit plan or otherwise, other than such actions taken in the ordinary course of business; provided, however, that, in the event that the Merger has not been consummated by the close of business on July 31, 2007, the Company shall be permitted to implement new “management by objective” plans with or for its employees consistent with past practice except that such plans (A) shall be in effect only for the quarter ending on September 30, 2007, as opposed to a full year, and (B) shall be designed such that the expected benefits shall not exceed the benefits provided by such plans in the same quarter of the prior fiscal year when considered in the aggregate;
(e) neither the Company nor any Company Subsidiary shall pay or arrange for payment of any pension, retirement allowance or other employee benefit to any officer, director, employee or Affiliate or pay or make any arrangement for payment to any officers, directors, employees or Affiliates of the Company of any amount relating to unused vacation days, except for payments, arrangements for payments and accruals made in the ordinary course of business, pursuant to benefits or other such plans in effect as of the date hereof as enforced consistent with past practices or as otherwise required by applicable Law;
(f) except in the ordinary course of business, neither the Company nor any Company Subsidiary will, in any material respect, modify, amend or terminate any contract or agreement (other than contracts or agreements with customers) providing for aggregate payments by or to the Company of $250,000 or more, or waive, release or assign any material rights or claims under any of such contracts or agreements;
(g) neither the Company nor any Company Subsidiary shall: (i) incur, become liable for, agree to become liable for, or assume (x) any long-term indebtedness or any short-term indebtedness (which shall not include trade payables) or (y) any Off-Balance Sheet Financing Transactions; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, other than in the ordinary course of business; (iii) acquire directly make any loans, advances or indirectly capital contributions to, or investments in, any other Person (including, without limitation by redemption purchase of stock or securities, contributions to capital, asset transfers, or purchase of any assets or property, any Person (other than to or from a Company Subsidiary or which are immaterial in amount and other than investments in short term money market instruments or commercial paper, or otherwise any shares of the capital stock as set forth on Section 6.1(g)(iii) of the Company or any of its subsidiaries Disclosure Schedule); or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of acquire (by merger, consolidation or acquisition of stock or assets), ) any Person or division thereof or any investment in, assets equity interest therein or stock otherwise acquire direct or indirect control of any other person Person;
(h) subject to any duty imposed by Law, neither the Company nor any Company Subsidiary shall enter into or entity (modify any collective bargaining agreement or any successor collective bargaining agreement to any collective bargaining agreement other than acquisitions of assets in the ordinary course of business consistent with past practice)business;
(di) the Company and each Company Subsidiary shall timely and properly file, or timely and properly file requests for extensions to file, all federal, state, local and foreign Tax Returns which are required to be filed, and pay or make provision for the payment of all Taxes owed by them;
(j) neither the Company nor any Company Subsidiary will (i) materially change any of its subsidiaries shall grant the accounting methods used by it except for such changes required by GAAP or (ii) except to the extent occurring in the ordinary course of business, make any severance Tax election or termination pay tochange any Tax election already made, or adopt any Tax accounting method, change any Tax accounting method, enter into any employment closing agreement or severance agreement with settle any director, officer material claim or other employee material assessment relating to Taxes or consent to any material claim or assessment relating to Taxes or any waiver of the Company or statute of limitations for any such subsidiary; and claim or assessment;
(k) subject to Section 6.1(o) hereof, neither the Company nor any Company Subsidiary will pay, discharge or satisfy any claims, liabilities or obligations (whether absolute, accrued, contingent or otherwise) in excess of its subsidiaries shall establish,$250,000, other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, in the ordinary course of business, or claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company;
(el) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall Subsidiary will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any Company Subsidiary (other than the Merger and other than in compliance with Section 9.4(aMerger)); and;
(im) neither the Company nor any Company Subsidiary shall make any capital expenditure in excess of $250,000;
(n) neither the Company nor any Company Subsidiary shall sell, pledge, assign, lease, license, mortgage or otherwise encumber or subject to any Lien (other than a Permitted Liens) or otherwise dispose of any of its subsidiaries material properties or assets (including the Company Intellectual Property), except for sales, leases, licenses or encumbrances of its properties or assets in the ordinary course of business and Liens for Taxes not yet due and payable; provided, however, that notwithstanding the foregoing, in no event shall the Company or any Company Subsidiary transfer, assign, or otherwise dispose of a License installment receivable under any contract, arrangement, or understanding whether now existing or existing hereafter;
(o) Other than in the ordinary course of business, commence any action, suit, proceeding, or litigation other than in the ordinary course of business or settle any action, suit, proceeding, or litigation involving any liability of the Company for money damages exceeding $100,000 or restrictions upon the operations of the Company or any Company Subsidiary; and
(p) neither the Company nor any Company Subsidiary will authorize or enter into an agreement any agreement, contract, commitment or arrangement to do any of the foregoing or foregoing. Notwithstanding the foregoing, the parties shall cooperate and establish procedures and limitations to ensure that the Company would not be required to take any action as a result of the Transactions that would knowingly cause reasonably be expected to contravene any of applicable Law (including, without limitation, the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedHSR Act).
Appears in 2 contracts
Samples: Merger Agreement (Mobius Management Systems Inc), Merger Agreement (Mobius Management Systems Inc)
Interim Operations of the Company. The Company covenants and agrees, agrees as to itself and its subsidiaries, Subsidiaries that, prior after the date hereof, until the earlier to occur of (a) the termination of this Agreement pursuant to Section 8.1 and (b) the Effective Time (unless Purchaser Parent shall otherwise consent approve in writing and except writing, or unless as otherwise permitted expressly contemplated by this AgreementAgreement or expressly disclosed in the Company Disclosure Letter):
(ai) the business of the Company and its subsidiaries Subsidiaries (other than the Company's Subsidiary in Australia) taken as a whole shall be conducted only in all material respects in the ordinary and usual course consistent with the Company's past practice and, to the extent consistent therewith, each of the Company shall use, and shall cause its subsidiaries shall use its commercially Subsidiaries to use, reasonable commercial efforts to preserve its business organization intact in all material respects, keep available the services of its officers and maintainemployees as a group (subject to changes in the ordinary course) and maintain its existing relations and goodwill in all material respects with customers, suppliers, regulators, distributors, creditors, lessors, and others having business dealings with it, in each case, consistent with the Company's past practice;
(bii) the Company shall not issue, deliver, grant or sell any additional Company Common Shares or any Company Options (other than the issuance, delivery, grant or sale of Company Common Shares pursuant to the exercise or conversion of Company Options outstanding as of this date);
(iii) the Company shall not (iA) sell amend its Articles of Organization or pledge By-laws, amend or agree to sell take any action under the Rights Agreement (except as set forth in Section 6.10), or pledge adopt any stock other shareholders rights plan or other securities owned by it or permit enter into any agreement with any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiaryshareholders in their capacity as such; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iiiB) split, combine combine, subdivide or reclassify the its outstanding Sharesshares of capital stock; or (ivC) declare, set aside or pay any dividend or distribution payable in cash, stock or property with in respect to the Shares;
(c) neither the Company nor of any of its subsidiaries shall capital stock, other than dividends and distributions by a direct or indirect wholly-owned subsidiary of the Company to its parent corporation; or (iD) issuerepurchase, sellredeem or otherwise acquire or permit any of its Subsidiaries to purchase, pledge, dispose of redeem or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to otherwise acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property Company Options (it being understood that this provision shall not prohibit the exercise (cashless or assets other than, in the case otherwise) of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; Company Options);
(iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company shall not, and shall not cause or permit any of its subsidiaries Subsidiaries to, take any action that it knows would cause any of its representations and warranties in this Agreement to become inaccurate in any material respect;
(v) except as expressly permitted by this Agreement, and except as required by applicable law or pursuant to contractual obligations in effect on this date; the Company shall not, and shall not permit its Subsidiaries to, (A) enter into, adopt or amend (except for renewals on substantially identical terms) any agreement or arrangement relating to severance, (B) enter into, adopt or amend (except for renewals on substantially identical terms) any employee benefit plan or employment or consulting agreement (including, without limitation, the Company Benefit Plans referred to in Section 3.10); or (ivC) authorize capital expenditures in excess grant any stock options or other equity related awards;
(vi) except for borrowings under lines of $50,000 individually or $100,000 in credit contemplated by the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets Company Disclosure Letter and trade debt incurred in the ordinary course of business consistent with past practice, neither the Company nor any of its Subsidiaries shall issue, incur or amend the terms of any indebtedness for borrowed money or guarantee any such indebtedness (other than indebtedness of the Company or any wholly-owned Subsidiary);
(dvii) neither the Company nor any of its subsidiaries Subsidiaries shall grant make any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee capital expenditures in an aggregate amount in excess of the aggregate amount reflected in the capital expenditure budget, a copy of which is attached to the Company or any such subsidiary; and Disclosure Letter;
(viii) other than in the ordinary course of business consistent with past practice, neither the Company nor any of its subsidiaries Subsidiaries shall establish,transfer, lease, license, sell, mortgage, pledge, encumber or otherwise dispose of any of its or its Subsidiaries' property or assets (including capital stock of any of its Subsidiaries) material to the Company and its Subsidiaries taken as a whole, except pursuant to contracts existing as of this date (the terms of which have been previously disclosed to Parent);
(eix) neither the Company nor any of its subsidiaries Subsidiaries shall settle issue, deliver, sell or compromise encumber shares of any material claims class of its capital stock or litigation orany securities convertible into, or any rights, warrants or options to acquire, any such shares, except in the ordinary any such shares issued pursuant to options and usual course of business and with the consent of Purchaser, modify, amend other awards outstanding on this date under Company Benefit Plans or terminate any of its material Contracts or waive, release or assign any material rights or claimsas otherwise permitted by this Agreement;
(fx) neither the Company nor any of its subsidiaries Subsidiaries shall make acquire any tax election or permit business, including any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserfacilities, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used whether by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuringpurchase of property or assets or otherwise, recapitalizationexcept to the extent provided for in the capital expenditure budget attached to the Company Disclosure Letter;
(xi) The Company shall not change its accounting policies, practices or methods in any manner that materially affects the reported consolidated assets, liabilities or results of operations of the Company, except as required by GAAP, applicable law or by the rules and regulations of the SEC;
(xii) other than pursuant to this Agreement, the Company shall not, and shall not permit any of its Subsidiaries to, take any action to cause Company Common Shares to cease to be listed on the Nasdaq National Market System;
(xiii) The Company shall not, and shall not permit any of its Subsidiaries to, enter into any Company Contract described in clauses (c) and (d) of Section 3.18, or enter into or amend any distribution, supply, inventory purchase, franchise, license, sales agency or advertising contract outside of the ordinary course of business consistent with past practice in scope and amount but in no event for a term (or an extension of a term) beyond the date that is twelve months after the date of this Agreement;
(xiv) The Company shall not, and shall not cause or permit any of its Subsidiaries to, change or, other reorganization than in the ordinary course of business consistent with past practice, make any material Tax election, settle any audit or file any amended Tax Returns, except as required by applicable law;
(xv) The Company shall not take any action that could reasonably be expected to result in (A) any representation and warranty of the Company set forth in this Agreement that is qualified as to materiality becoming untrue, (other than B) any such representation and warranty that is not so qualified becoming untrue in any manner that has or is reasonably expected to have a Material Adverse Effect or (C) any condition to the Offer or the Merger and other than in compliance with Section 9.4(a))not being satisfied; andor
(ixvi) neither the The Company nor shall not enter into, or permit any of its subsidiaries will authorize Subsidiaries to enter into, any commitments or enter into an agreement agreements to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 2 contracts
Samples: Merger Agreement (Minnesota Mining & Manufacturing Co), Merger Agreement (Minnesota Mining & Manufacturing Co)
Interim Operations of the Company. The During the period from the date of this Agreement to the Effective Time, except as consented to in writing in advance by Parent or as otherwise expressly permitted by this Agreement, the Company covenants shall, and agreesshall cause each of its Subsidiaries to, as (x) in all material respects carry on its business in the ordinary course consistent with past practice and (y) use commercially reasonable efforts to itself preserve intact its business and its subsidiariespresent relationships with customers, suppliers, landlords and other persons with which it has business relations, and to keep available the services of its current officers, in each case set forth in this clause (y) where the failure to do so would be materially adverse to the Company and its Subsidiaries taken as a whole. In addition to and without limiting the generality of the foregoing, the Company agrees that, prior to the Effective Time Time, except (unless Purchaser i) to the extent Parent or Merger Sub shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(awhich consent shall not be unreasonably withheld, conditioned or delayed with respect to clauses (h), (k), (m), (n), (o), (p), (q), (r) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewithapplicable to the foregoing clauses, (s) below), (ii) as set forth in Section 4.1 of the Company Disclosure Schedule, or (iii) as expressly contemplated or expressly permitted by this Agreement, the Company shall not, and shall ensure that each of the Company and other Acquired Entities does not:
(a) amend its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintaincertificate of incorporation or bylaws or equivalent organizational documents or the Rights Agreement;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or any shares of its capital stock;
(ivc) declare, set aside or pay any dividend or distribution (whether payable in cash, stock or property property) with respect to any shares of its capital stock (except for dividends by a wholly owned Subsidiary of the Company to its parent), or enter into any agreement with respect to the Sharesvoting of its capital stock;
(cd) neither merge or consolidate with any other Person or restructure, reorganize or completely or partially liquidate the Company nor or any of its subsidiaries shall Subsidiaries;
(ie) form any Subsidiary or acquire any equity interest in any other Entity for which the fair market value of the total consideration paid by the Company and its Subsidiaries exceeds $5,000,000 individually or $10,000,000 in the aggregate;
(f) acquire assets outside of the ordinary course of business from any other Person with a value or purchase price in the aggregate in excess of $5,000,000 individually or $10,000,000 in the aggregate in any transaction or series of related transactions;
(g) issue, sell, grant, pledge, dispose of of, transfer or encumber encumber, or authorize the issuance, sale, grant, pledge, disposition, transfer or encumbrance of, any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Companystock, its subsidiaries or any other property or assets other thanstock appreciation rights, in the case of the Company“phantom” stock rights, Shares issuable pursuant performance units, rights to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any receive shares of the capital stock of the Company or any Subsidiary on a deferred basis or other rights linked to the value of shares of capital stock, other than: (i) up to 20,000 shares of Company Common Stock underlying new grants of Company Options and/or Company RSUs to employees of the Company and its Subsidiaries who are not executive officers or directors; (ii) shares of Company Common Stock issuable upon exercise of Company Options or to holders of RSUs, in each case outstanding on the date hereof; and (iii) shares of Company Common Stock issuable pursuant to the Company ESPP;
(h) transfer, lease or license to any third party, or encumber, any material assets other than: (i) in the ordinary course of business; or (ii) as security for any borrowings that are not prohibited by Section 4.1(j);
(i) repurchase, redeem or otherwise acquire any shares of its subsidiaries capital stock, except shares of the Company’s capital stock repurchased from employees or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock former employees of any other person of the Acquired Entities as required pursuant to existing contractual relationships with holders of Company RSUs;
(j) incur any indebtedness for borrowed money or entity guarantee any such indebtedness, except for: (other than acquisitions of assets i) short-term borrowings incurred in the ordinary course of business consistent with past practice)and (ii) borrowings pursuant to the Secured Revolving Credit Agreement;
(dk) neither adopt or amend any severance, termination or other employee benefit agreement or plan for the Company nor any benefit of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer officer, employee or other employee consultant of the Company or any such subsidiary; and neither Subsidiary, or increase the compensation or fringe benefits of any director, officer, employee or consultant of the Company nor or any Subsidiary (except, in the case of its subsidiaries shall establish,
(e) neither employees who are not executive officers of the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orCompany, except for increases in the ordinary and usual course of business that are consistent with past practices or as required by agreements, plans, programs or arrangements in effect on the date hereof and with the consent of Purchaser, modify, previously provided to Parent);
(l) enter into or amend or prematurely terminate any of its material Contracts contract or waive, release or assign any material rights or claimsclaims under any contract, in each case, where such action would have a materially adverse impact on the Company and its Subsidiaries taken as a whole;
(fi) neither enter into any individual sales order for the provision of fiber optic infrastructure in excess of 600 fiber miles or (ii) amend any individual sale order for the provision of fiber optic infrastructure to increase the number of fiber miles subject to that order by more than 600 fiber miles; provided, however, the Company nor shall have the right to renew any existing orders upon substantially the same terms as provided in the original agreement and shall have the right to enter into new orders where contractually obligated to do so; provided, further, that the Company shall provide Parent written notice of any such renewal or new order;
(n) change any of its subsidiaries shall make methods of accounting or accounting practices in any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchasermaterial respect, except in the ordinary and usual course of business;
(g) except as may be required by applicable Legal Requirements or GAAP;
(o) make any material Tax election, except for elections made in the ordinary course of business or consistent with the past practices of the Acquired Entities;
(p) fund any capital expenditure in any calendar quarter which, when added to all other capital expenditures made by the Acquired Entities in such calendar quarter, would exceed by more than $5,000,000 the aggregate amount budgeted for capital expenditures in such calendar quarter (as a result set forth in Section 4.1(p) of a change in law or in generally accepted accounting principles, neither the Company nor Disclosure Schedule);
(q) settle or compromise any litigation, audit, claim or action against the Company or any of its subsidiaries shall change Subsidiaries, other than settlements or compromises of any litigation, audit, claim or action (A) where the amount paid in settlement or compromise does not exceed $5,000,000 individually or $10,000,000 in the aggregate or (B) where the amount paid in settlement does not exceed the amount reserved against such matter in the most recent financial statements (or the notes thereto) of the accounting practices or principles used by itCompany included in the 2011 10-K;
(hr) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in fail to use commercially reasonable efforts to maintain compliance with Section 9.4(a))the material Governmental Authorizations or otherwise maintain their validity and full force and effect; andor
(is) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do take any of the foregoing or take any action that would knowingly cause any actions described in clauses “(a)” through “(r)” of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedSection 4.1.
Appears in 2 contracts
Samples: Merger Agreement (Zayo Group LLC), Merger Agreement (Abovenet Inc)
Interim Operations of the Company. The From the date hereof until the Effective Time, the Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time except (unless Purchaser shall otherwise consent in writing and except i) as otherwise permitted contemplated by this Agreement):, (ii) as disclosed in Section 4.1 of the Company Disclosure Letter or (iii) as agreed in writing by Parent:
(a) the Company shall, and shall cause its Subsidiaries to (i) conduct its business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course andconsistent with past practice, to the extent consistent therewith, each of the Company and its subsidiaries shall (ii) use its commercially reasonable efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees and business associates and (iii) at its expense, maintain its assets material to the business of the Company and its Subsidiaries in good repair and condition, except to the extent of reasonable wear and tear or fire or other casualty and the sale of inventory in the ordinary course of business;
(b) the Company shall not will not, directly or indirectly, (i) sell amend its articles of incorporation or pledge by-laws; or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Company Common Stock or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) issuedeclare, sell, pledge, dispose set aside or pay any dividend or other distribution with respect to its capital stock (other than dividends from any of the Company’s Subsidiaries to the Company or encumber any of the Company’s other Subsidiaries); (ii) issue or sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to sell or acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options the exercise of Company Stock Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries Subsidiaries shall grant acquire, sell, lease or dispose of any severance or termination pay tomaterial assets, stock, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor ownership interest in any of its subsidiaries shall establish,properties or Subsidiaries other than inventory in the ordinary course of business;
(e) neither the Company nor shall not, and shall not permit any of its subsidiaries shall settle Subsidiaries to, acquire or compromise agree to acquire (i) by merging or consolidating with, or by purchasing a substantial portion of the assets of any Entity or division thereof that would be material claims to the Company and its Subsidiaries, taken as a whole, or litigation or(ii) any assets, except for purchases in the ordinary and usual course of business and consistent with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimspast practice;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to PurchaserSubsidiaries shall, except as contemplated by this Agreement, enter into, adopt or materially amend any employee Benefit Plans or amend any employment or severance agreement or increase in any manner the compensation of any employees, except, in the case of any increase in compensation for non-officer employees, for increases in the ordinary and usual course of businessbusiness consistent with past practice; provided, that nothing herein will be deemed to restrict or prohibit the payment of benefits as they become due and payable;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries Subsidiaries shall change enter into any labor or collective bargaining agreement through negotiation or otherwise, or make any commitment or incur any liability to any labor organization with respect to the Company or any of the accounting practices or principles used by itits Subsidiaries;
(h) neither the Company nor any of its subsidiaries shall adopt a plan Subsidiaries shall: (i) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or any other reorganization of the Company Person (other than Subsidiaries of the Merger Company), except in the ordinary course of business; or (ii) make any loans, advances or capital contributions to, or investments in, any other Person (other than to Subsidiaries of the Company), other than in the ordinary course of business consistent with past practice and other than in compliance with Section 9.4(a)); androutine advances to employees;
(i) neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting methods or practices used by it unless required by GAAP or applicable Law;
(j) neither the Company nor any of its Subsidiaries shall: (i) settle or compromise any material Tax claim, audit or assessment; (ii) make or change any material Tax election, change any annual Tax accounting period, or adopt or change any method of Tax accounting; (iii) amend any material Tax Returns or file claims for material Tax refunds; or (iv) enter into any material closing agreement, surrender in writing any right to claim a material Tax refund, offset or other reduction in Tax liability or consent to any extension or waiver of the limitation period applicable any material Tax claim or assessment relating to the company or its Subsidiaries;
(k) neither the Company nor any of its Subsidiaries will adopt any plan of complete or partial liquidation, dissolution, restructuring or other reorganization of the Company or any of its Subsidiaries;
(l) neither the Company nor any of its Subsidiaries will settle or compromise any material claim (including arbitration) or material litigation; and
(m) neither the Company nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 2 contracts
Samples: Merger Agreement (Elecsys Corp), Merger Agreement (Lindsay Corp)
Interim Operations of the Company. The Except (A) as expressly contemplated by this Agreement, (B) as set forth on Section 5.1 of the Company covenants Disclosure Letter, (C) as required by applicable Law, or (D) as consented to in writing by Parent after the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, which consent, solely in the case of clauses (unless Purchaser v), (vi) and (vii) below, shall otherwise consent in writing and except as otherwise permitted by this Agreement):not be unreasonably withheld or delayed, the Company agrees that:
(ai) the business of the Company and its subsidiaries shall be conducted Subsidiaries will conduct business only in the ordinary and usual course and, to the extent of business consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainwith past practice;
(bii) the Company shall will not (i) sell amend its Second Amended and Restated Articles of Incorporation or pledge or agree to sell or pledge any stock Second Amended and Restated Regulations and the Company’s Subsidiaries will not amend their certificate of incorporation, bylaws or other securities owned by it comparable charter or permit organizational documents;
(iii) neither the Company nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries will (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivA) declare, set aside or pay any dividend or other distribution (including any constructive or deemed distribution), whether payable in cash, stock or property other property, with respect to its capital stock, or otherwise make any payments to its shareholders in their capacity as such, other than the Shares;
Company’s ordinary course quarterly dividends to holders of Shares in a per Share amount no greater than the Company’s most recently declared dividend, with record and payment dates in accordance with the Company’s customary dividend schedule; (c) neither the Company nor any of its subsidiaries shall (iB) issue, sell, grant, transfer, pledge, dispose of or encumber or authorize or propose to issue, sell, grant, transfer, pledge, dispose of or encumber any additional shares of, of capital stock or securities convertible into other Rights of the Company or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock Subsidiaries (including treasury stock), other than in respect of any class the shares of the Company, its subsidiaries or any other property or assets other than, in ’s capital stock reserved for issuance on the case date of the Company, Shares issuable this Agreement and issued pursuant to options the exercise of Options outstanding on the date hereof under of this Agreement, (C) split, combine, subdivide or reclassify the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of Shares or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the outstanding capital stock of the Company or any of the Subsidiaries of the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any shares of capital stock or other Rights of the Company or any of its subsidiaries Subsidiaries or (D) redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other Rights of the Company or any of its Subsidiaries;
(iv) authorize capital expenditures except as required by applicable Law or under the terms of any Company Plan in excess effect as of $50,000 individually the date of this Agreement, the Company will not and will not permit its Subsidiaries to increase the compensation payable or $100,000 in the aggregate to become payable to any of its officers, directors, employees, agents, consultants or make any acquisition of (by merger, consolidation or acquisition of stock or assets)Affiliates, or enter into, establish, amend or terminate any investment inCompany Plans, assets except increases in salaries, wages and benefits of employees who are not directors or stock officers of any other person the Company or entity (other than acquisitions of assets its Subsidiaries made in the ordinary course of business consistent with past practice);
(dv) neither the Company nor any of its subsidiaries shall grant Subsidiaries will (A) incur or assume any severance long-term Indebtedness, or termination pay except in the ordinary course of business, incur or assume any short-term Indebtedness in amounts not consistent with past practice, (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except in the ordinary course of business and consistent with past practice or (C) make any loans, advances or capital contributions to, or enter into investments in, any employment other Person except in the ordinary course of business and consistent with past practice;
(vi) make any acquisition or severance agreement with investment in a business either by purchase of stock or securities, merger or consolidation, contributions to capital, loans, advances, property transfers, or purchases of any director, officer property or assets of any other employee Person other than a direct or indirect wholly owned Subsidiary of the Company Company, or otherwise make or authorize any such subsidiary; and neither capital expenditure, other than capital expenditures contemplated by the Company nor any Company’s existing capital budget, a copy of its subsidiaries shall establish,which has been furnished to Parent;
(evii) neither the Company nor any of its subsidiaries shall Subsidiaries will (A) pay, discharge, waive, settle or compromise satisfy any material claims rights, claims, liabilities or litigation orobligations (absolute, except accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge, waiver, settlement or satisfaction, (x) in the ordinary and usual course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consent Financial Statements (or the notes to the Financial Statements) or of Purchaserclaims, modifyliabilities or obligations incurred since the date of the Financial Statements in the ordinary course of business consistent with past practice or (y) for amounts, amend individually or terminate in the aggregate, not to exceed $5,000,000 (in excess of third party insurance) or (B) waive any claims of its material Contracts or waive, release or assign any material rights or claimssubstantial value;
(fviii) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall Subsidiaries will change any of the accounting methods, principles or practices or principles used by itit unless required by a change in GAAP or Law;
(hix) neither the Company nor any of its subsidiaries shall Subsidiaries will (A) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, business combination, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than this Agreement), (B) acquire by merging or consolidating with, or by purchasing a substantial equity interest in or portion of the Merger assets of, or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof or (C) acquire, transfer, lease, license, sell, mortgage, pledge, dispose of or encumber any material assets, other than, in the case of this clause (C), acquisitions of raw materials and other than inventory and sales of inventory, in compliance each case in the ordinary course of business consistent with Section 9.4(a))past practice; and
(ix) neither the Company nor any of its subsidiaries Subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 2 contracts
Samples: Merger Agreement (Berkshire Hathaway Inc), Merger Agreement (LUBRIZOL Corp)
Interim Operations of the Company. The From and after the date hereof, except (a) as expressly contemplated by this Agreement, (b) as set forth on Section 5.1 of the Company covenants Disclosure Letter, (c) as required by Law, or (d) as consented to in writing by Parent after the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser Time, which consent shall otherwise consent in writing and except as otherwise permitted by this Agreement):not be unreasonably withheld or delayed:
(ai) the Company shall, and shall cause its Subsidiaries to, conduct business of the Company and its subsidiaries shall be conducted only in the ordinary course of business consistent with past practice and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to (A) preserve its business organization organization, (B) maintain in effect all of its foreign, federal, state and local licenses, permits, consents, franchises, approvals and authorizations, (C) keep available the services of its directors, officers and employees and (D) preserve intact and maintainmaintain its existing relations with its customers, suppliers, employees, creditors and others having material business relationships with it;
(bii) the Company shall will not (iand will not permit any Subsidiary to) sell amend its (or pledge their) Amended Articles of Incorporation or agree to sell Amended Code of Regulations or pledge any stock or other securities owned by it or permit similar governing documents;
(iii) neither the Company nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries will (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivA) declare, set aside or pay any dividend or other distribution payable in cash, stock or property or otherwise with respect to the Shares;
its capital stock or other securities; (c) neither the Company nor any of its subsidiaries shall (iB) issue, sell, transfer, pledge, dispose of or encumber or agree to issue, sell, transfer, pledge, dispose of or encumber any additional shares ofCompany Securities, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, than Shares issuable reserved for issuance pursuant to options the Company Rights Agreement in accordance with the terms thereof or Shares reserved for issuance on the date of this Agreement pursuant to the exercise of Options outstanding on the date hereof under of this Agreement, (C) split, combine or reclassify, or amend the Stock Plans and shares issuable pursuant to terms of, the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of outstanding Shares or encumber any assets or incur or modify any indebtedness outstanding capital stock or other liability other than in the ordinary and usual course securities of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock Subsidiaries of the Company or (D) redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, directly or indirectly, any Company Securities;
(iv) except as required under the terms of any Company Plan, the Company and its Subsidiaries will not (A) make any change in the compensation or fringe benefits payable or to become payable to any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by mergerofficers, consolidation or acquisition of stock or assets)directors, or any investment inemployees, assets or stock of any other person or entity agents, consultants (other than acquisitions general increases in wages to employees who are not officers, directors or Affiliates of assets the Company in the ordinary course of business consistent with past practice)) or Persons providing management services, (B) enter into or amend any employment, severance, consulting, termination or other agreement or Company Plan or (C) make any loans to any of its officers, directors, employees, Affiliates, agents or consultants or make any change in its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to a Company Plan or otherwise;
(dv) except as required under the terms of any Company Plan, the Company and its Subsidiaries will not (A) pay or make any accrual or arrangement for payment of any pension, retirement allowance or other employee benefit pursuant to any existing plan, agreement or arrangement to any officer, director, employee or Affiliate of the Company or any of its Subsidiaries, whether past or present, (B) pay or agree to pay or make any accrual or arrangement for payment to any officer, director, employee or Affiliate of the Company or any of its Subsidiaries, whether past or present, of any amount relating to unused vacation days, or (C) adopt or pay, grant, issue, accelerate or accrue salary or other payments or benefits pursuant to any Company Plan, agreement or arrangement, or any employment or consulting agreement with or for the benefit of any director, officer, employee, agent or consultant of the Company or any of its Subsidiaries, whether past or present;
(vi) neither the Company nor any of its subsidiaries shall grant Subsidiaries will (A) create, incur, assume, or suffer to exist any severance Indebtedness other than current trade payables in the ordinary course of business consistent with past practices, (B) assume, guarantee, endorse or termination pay otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, or (C) make any loans, advances or capital contributions to, or enter into investments in, any employment other Person (other than investments or severance agreement contributions in wholly owned Subsidiaries in the ordinary course of business and in amount and on terms consistent with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,past practices);
(evii) neither the Company nor any of its subsidiaries shall settle Subsidiaries will (A) enter into, amend or compromise modify in any material claims respect or litigation or, except terminate any lease or sublease for real property or any Material Contract or any contract that would be a Material Contact if entered into prior to the date hereof other than with respect to any agreement that is or would have been a Material Contract pursuant to clauses (vi) or (viii) of Section 3.9 in the ordinary and usual course of business and consistent with the consent of Purchaser, modify, amend past practices or terminate any of its material Contracts or (B) otherwise waive, release or assign any material rights rights, claims or claimsbenefits of the Company or any of its Subsidiaries;
(fviii) neither the Company nor any of its subsidiaries shall make Subsidiaries will settle, or offer or propose to settle, (A) any tax election material Action involving or permit against the Company or any insurance policy naming it as a beneficiary of its Subsidiaries, (B) any shareholder litigation or a loss payable payee dispute against the Company or any of its officers or directors or (C) any Action that relates to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessTransactions;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(hix) neither the Company nor any of its subsidiaries shall Subsidiaries will make or authorize any capital expenditure;
(x) neither the Company nor any of its Subsidiaries will pay, discharge, waive or satisfy any rights, claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge, waiver or satisfaction of any such rights, claims, liabilities or obligations, in the ordinary course of business and consistent with past practice, or claims, liabilities or obligations reflected or reserved against in, or contemplated by, the Financial Statements (or the notes to the Financial Statements);
(xi) neither the Company nor any of its Subsidiaries will (A) change any material tax election, (B) change any of the accounting methods or accounting principles or practices used by it unless required by GAAP or Law, (C) settle or enter into any closing agreement with respect to any material Tax claim or assessment or (D) consent to any material Tax claim or assessment or any waiver of the statute of limitations for any such claim or assessment;
(xii) neither the Company nor any of its Subsidiaries will adopt (A) a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than this Agreement) or (B) acquire (by merger, consolidation, acquisition of stock or assets or otherwise), transfer, lease, license, sell, mortgage, pledge, dispose of or encumber any assets, securities, properties, interests or businesses, other than, in either case, supplies and inventory in the Merger ordinary course of business and other than in compliance consistent with Section 9.4(a)); andpast practice;
(ixiii) neither the Company nor any of its subsidiaries Subsidiaries will authorize willfully take any action that would make any representation or warranty of the Company hereunder inaccurate in any material respect at, or as of any time before, the Effective Time; and
(xiv) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 2 contracts
Samples: Merger Agreement (Lamson & Sessions Co), Merger Agreement (Thomas & Betts Corp)
Interim Operations of the Company. The Company covenants Between the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, the Company shall, and shall cause each of its Subsidiaries to (unless Purchaser Parent shall otherwise consent approve in writing and or except as otherwise permitted contemplated by this AgreementAgreement or disclosed in the Company Disclosure Letter):
(ai) the conduct its business of the Company and its subsidiaries shall be conducted only in all material respects in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, each use reasonable best efforts to (x) preserve intact its business organization, (y) keep available the services of its officers and employees and (z) maintain its existing relations and goodwill with customers, suppliers, regulators, distributors, creditors, lessors and others having business dealings with it; provided that the failure of any officer or employee of the Company and or its subsidiaries Subsidiaries to remain an officer or employee of the Company or its Subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainnot constitute a breach of this covenant;
(bii) the Company shall not (iA) sell amend the Restated Certificate of Incorporation or pledge By-laws of the Company; (B) split, combine, subdivide or agree to sell or pledge any reclassify its outstanding shares of capital stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiaryequity securities; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivC) declare, set aside or pay any dividend or distribution payable in cash, stock or property with in respect to the Shares;
(c) neither the Company nor of any of its subsidiaries shall (i) issue, sell, pledge, dispose shares -42- 52 of capital stock or encumber any additional shares ofother equity securities, or securities convertible into into, exercisable for or exchangeable for, any of its shares of capital stock or optionsother equity securities, warrantsother than (x) quarterly cash dividends of $.27 per share in respect of the outstanding shares of Company Common Stock, callsdeclared, commitments set aside and paid at such times during the quarter as is consistent with past practice, and (y) dividends and distributions by wholly owned Subsidiaries of the Company; (D) repurchase, redeem or rights otherwise acquire or permit any of any kind its Subsidiaries to purchase, redeem or otherwise acquire, any shares of its capital stock or other equity securities, or securities convertible into, exercisable for or exchangeable for, any of its shares of capital stock or other equity securities (it being understood that this clause (D) shall not prohibit the exercise, exchange or conversion of Company Equity Equivalent Securities); or (E) enter into any class agreement or letter of the Companyintent, its subsidiaries agreement in principle or any other property similar arrangement to sell, transfer or assets other thanotherwise dispose of, or purchase or otherwise acquire, in the case aggregate, a material amount of assets or properties or any material business by merger, consolidation, transfer or acquisition of shares of capital stock or otherwise;
(iii) not take any action that to the knowledge of the Company, Shares issuable pursuant Company would prevent the business combination to options outstanding on the date hereof under the Stock Plans and shares issuable be effected pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose Parent Merger from qualifying for pooling of or encumber any assets or incur or modify any indebtedness or other liability other than in interests accounting treatment under GAAP and the ordinary rules and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares regulations of the capital stock SEC or would prevent the business combination to be effected pursuant to the Parent Merger or the Alternative Merger, as applicable, from qualifying as a "reorganization" within the meaning of Section 368 of the Code;
(iv) except as required by applicable law or pursuant to contractual obligations in effect as of the date of this Agreement, not (A) execute, establish, adopt or amend, or accelerate rights or benefits under, any agreement relating to severance or change-in-control, any Company Employee Plan, any employment or consulting agreement with current or former officers or directors or any collective bargaining agreement, (B) increase the compensation payable or to become payable to any of its subsidiaries officers, directors or employees (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except for increases in the ordinary course of business consistent with past practicepractices);
, (dC) neither the Company nor any of its subsidiaries shall grant any severance or termination pay toto any officer or director of the Company, or enter into (D) grant any employment or severance agreement with any director, officer stock options or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsequity related awards;
(fv) neither the Company nor not issue, deliver, grant, sell, pledge or otherwise dispose of shares of any class of its subsidiaries shall make capital stock, other equity securities, or any tax election securities convertible, exercisable or permit exchangeable for or into, any insurance policy naming it as a beneficiary such shares or a loss payable payee to be canceled or terminated without notice to Purchaserother equity securities, except in upon the ordinary and usual course exercise, exchange or conversion of businessCompany Equity Equivalent Securities;
(gvi) not change its accounting policies, practices or methods except as may be required as a result of a change in law by GAAP or in generally accepted accounting principles, neither by the Company nor any of its subsidiaries shall change any rules and regulations of the accounting practices or principles used by itSEC;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.
Appears in 1 contract
Samples: Merger Agreement (Zilkha Michael)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this Agreement, (ii) as set forth in Section 5.1 of the Company Disclosure Schedule or (iii) as agreed in writing by Parent, after the date hereof, and prior to the Effective Time time the directors of the Purchaser have been elected to, and shall constitute a majority of, the Company Board pursuant to Section 1.4 hereof (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreementthe "Appointment Date"):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not, directly or indirectly, amend or propose to amend its Certificate of Incorporation or By-laws or similar organizational documents;
(c) the Company shall not, and it shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; to: (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivi)(A) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any Company's capital stock or that of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares ofsubsidiaries, or securities convertible into (B) redeem, purchase or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or of its subsidiaries or any other securities thereof or any rights, warrants or options to acquire any such shares or other securities; (ii) authorize for issuance, issue, sell, pledge, deliver or agree to commit to issue, sell, pledge or deliver (whether through the issuance or granting of any options, warrants, calls, subscriptions, stock appreciation rights or other rights or other agreements) or otherwise encumber any shares of capital stock of any class of the Company or of its subsidiaries or any securities convertible into or exchangeable for shares of capital stock of any class of the Company or of its subsidiaries other than Shares issued upon the exercise of Company Options outstanding on the date hereof in accordance with the Company Option Plans as in effect on the date hereof or Shares for which there are accrued payments through September 30, 1997 in accordance with the Employee Stock Purchase Plan as in effect on the date hereof; or (iii) split, combine or reclassify the outstanding capital stock of the Company or of any of its subsidiaries or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares in the capital stock of the Company or of any of its subsidiaries;
(ivd) authorize capital expenditures except for those acquisitions specifically set forth and described in Section 5.1(d) of the Company Disclosure Schedule, the Company shall not, and it shall not permit any of its subsidiaries to, acquire or agree to acquire (i) by merging or consolidating with, or by purchasing a substantial portion of the assets of, or by any other manner, any business or any corporation, partnership, limited liability company, joint venture, association or other business organization or division thereof or (ii) any assets, outside of the ordinary course of business, that individually is in excess of $50,000 individually 5 million or $100,000 in the aggregate in excess of $10 million;
(e) the Company shall not, and it shall not permit any of its subsidiaries to, sell, lease, license, mortgage or make otherwise encumber or subject to any acquisition of (by merger, consolidation Lien or acquisition of stock or assets), or any investment in, assets or stock otherwise dispose of any other person assets of the Company or entity (of its subsidiaries other than acquisitions (i) sales and dispositions of assets interests or rights with respect to property having an aggregate fair market value on the date of this Agreement of less than $5 million, in each case only if in the ordinary course of business and consistent with past practice or (ii) encumbrances and Liens that are incurred in the ordinary course of business and consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall: (i) grant any increase in the compensation payable or to become payable by the Company or any of its subsidiaries to any of its executive officers or key employees or (ii)(A) adopt any new, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employ- 38 44 ee benefit plan agreement or arrangement, including without limitation, the Company Option Plans; or (iii) enter into any employment or severance agreement with or, except in accordance with the existing written policies of the Company, grant any severance or termination pay to any officer, director or employee of the Company or any its subsidiaries;
(g) neither the Company nor any of its subsidiaries shall: (i) modify, amend or terminate any of its or its subsidiaries' material contracts or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice (ii) enter into any other agreements, commitments or contracts that are material to the Company and its subsidiaries taken as a whole, other than in the ordinary course of business and consistent with past practice, or otherwise make any material change that is adverse to the Company (including by way of termination) in (A) any existing agreement, commitment or arrangement that is material to the Company and its subsidiaries taken as a whole or (B) the conduct of the business or operations of the Company and its subsidiaries;
(h) neither the Company nor any of its subsidiaries shall: (i) incur or assume any long-term debt, or except in the ordinary course of business in amounts consistent with past practice, incur or assume any short-term indebtedness; (ii) incur or modify any material indebtedness or other liability; (iii) issue or sell any debt securities or warrants or other rights to acquire any debt securities of the Company or of any of its subsidiaries; (iv) enter into any "keep well" or other arrangement to maintain any financial condition of another person; (v) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in the ordinary course of business and consistent with past practice; (vi) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned subsidiaries of the Company); or (vii) enter into any material commitment or transaction (including, but not limited to, any material capital expenditure or purchase or lease of assets or real estate other than the purchase of products for inventory and supplies in the ordinary course of business); provided that this Section 5.1(h) shall not prevent the financings of the acquisitions described in Section 5.1(d) of the Company Disclosure Schedule;
(i) neither the Company nor any of its subsidiaries shall change any of the accounting methods used by it unless required by GAAP;
(j) neither the Company nor any of its subsidiaries shall, without the prior written consent of Parent, pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, in the ordinary course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated subsidiaries;
(k) neither the Company nor any of its subsidiaries will take, or agree to commit to take, any action that would or is reasonably likely to result in any of the conditions to the Offer set forth in Annex A or any of the conditions to the Merger set forth in Article VI not being satisfied, or would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time, or that would materially impair the ability of the Company to consummate the Offer or the Merger in accordance with the terms hereof or materially delay such consummation;
(l) neither the Company nor any of its subsidiaries shall make any tax Tax election or settle or compromise any Tax liability or refund, except to the extent already provided in the Current Company SEC Documents;
(m) neither the Company nor any of its subsidiaries shall permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(hn) neither the Company nor any of its subsidiaries shall will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its subsidiaries (other than the Merger and other than in compliance with Section 9.4(a)Merger); and
(io) neither the Company nor any of its subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this Agreement, (ii) as set forth in Section 5.1 of the Company Disclosure Schedule, or (iii) as consented to in writing by Parent, such consent not to be unreasonably withheld or delayed, during the period from the date of this Agreement to the Effective Time, and prior to the Effective Time time the directors of the Purchaser have been elected to, and shall constitute two-thirds of, the Board of Directors of the Company pursuant to Section 1.3 (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreementthe "Ap pointment Date"):
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact intact, keep available the services of its current officers and maintainemployees and maintain its existing relations with franchisees, customers, suppliers, creditors, business partners and others having business dealings with it, to the end that its goodwill and ongoing business shall be unimpaired at the Effective Time of the Merger in any material respect;
(b) the Company shall not will not, directly or indirectly, (i) sell sell, transfer or pledge or agree to sell sell, transfer or pledge any of the shares, preferred stock or other securities owned by it or permit capital stock of any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities Subsidiaries beneficially owned by such subsidiary; it, (ii) amend the Certificate its Articles of Incorporation or its bylaws Bylaws or amend, modify similar organizational documents; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Shares or (iv) declare, set aside Preferred Stock or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock; (ii) except pursuant to the Stock Option Agreement, issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than Shares reserved for issuance on the case of the Company, Shares issuable date hereof pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice, or incur or modify any material indebtedness or other liability, other than in the ordinary and usual course of business and consistent with past practice; or (iiiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) grant any severance increase in the compensation payable or termination pay toto become payable by the Company or any of its Subsidiaries to any of its executive officers or key employees or (ii)(A) adopt any new, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan agreement or arrangement; or (iii) enter into any employment or severance agreement with or, except in accordance with the existing written policies of the Company, grant any directorseverance or termination pay to any officer, officer director or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Subsidiaries;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts contracts or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any long-term debt, or except in the ordinary course of business, incur or assume any short-term indebtedness in amounts not consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obliga tions of any other person, except in the ordinary course of business and consistent with past practice; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned Subsidiaries of the accounting practices Company); or principles used by it(iv) enter into any material commitment or transaction (including, but not limited to, any borrowing, capital expenditure or purchase, sale or lease of assets or real estate);
(h) neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting methods used by it unless required by GAAP;
(i) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries;
(j) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries (other than the Merger and other than in compliance with Section 9.4(aMerger)); and;
(ik) neither the Company nor any of its subsidiaries Subsidiaries will authorize take, or agree to commit to take, any action that would or is reasonably likely to result in any of the conditions to the Merger set forth in Article VI not being satisfied, or that would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time, or that would impair the ability of the Company to consummate the Merger in accordance with the terms hereof or delay such consummation; and
(l) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (HFS Inc)
Interim Operations of the Company. The Company covenants and agreesagrees that, between the date of this Agreement and the Effective Time, except as otherwise expressly contemplated by this Agreement or as agreed to itself in writing by Parent, the Company and its subsidiariesSubsidiaries will each conduct its operations according to its ordinary and usual course of business and consistent with past practice, thatand the Company and its Subsidiaries will each use its reasonable efforts to preserve intact its business organization, to keep available the services of its officers and employees and to maintain existing relationships with licensors, licensees, suppliers, contractors, distributors, customers, lessors and others having business relationships with it. Without limiting the generality of the foregoing, and except as otherwise expressly provided in this Agreement, prior to the Effective Time (unless Purchaser shall otherwise Time, neither the Company nor any of its Subsidiaries will, without the prior written consent in writing and except as otherwise permitted by this Agreement):of Parent:
(a) the business amend its Certificate of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainIncorporation or By-laws;
(b) authorize for issuance, issue, sell, deliver or agree or commit to issue, sell or deliver (whether through the Company shall not issuance or granting of options, warrants, commitments, subscriptions, rights to purchase or otherwise) any stock of any class or any other securities, except (i) sell as required by any employee benefit plan or pledge or agree to sell or pledge any stock or other securities owned by it or permit any arrangement as in effect as of its subsidiaries to sellthe date hereof, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend in connection with the Certificate or its bylaws or amend, modify or terminate the Rights AgreementRecapitalization, or redeem the Rights issued pursuant thereto; (iii) in connection with the Conversion, or amend any of the terms of any such securities or agreements outstanding as of the date hereof;
(c) split, combine or reclassify any shares of its capital stock (except in connection with the outstanding Shares; or (iv) Recapitalization and the Par Value Amendment), declare, set aside or pay any dividend payable or other distribution (whether in cash, stock or property with or any combination thereof) in respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock (except for its regular quarterly dividend on the Preferred Stock), or redeem or otherwise acquire any of any class of the Company, its subsidiaries securities or any other property or assets other than, in the case securities of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; its Subsidiaries;
(iid) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or (i) incur or modify assume any indebtedness or other liability other than long-term debt or, except in the ordinary and usual course of business; business consistent with past practice under existing lines of credit, incur or assume any short-term debt (iii) acquire directly or indirectly by redemption or otherwise except any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets trade debt incurred in the ordinary course of business consistent with past practice); (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person except in the ordinary course of business and except for obligations of wholly owned Subsidiaries of the Company which, if incurred by the Company, would be permitted under clause (i) above; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned Subsidiaries of the Company);
(de) neither the Company nor enter into, adopt or (except as may be required by law) amend or terminate any of its subsidiaries shall grant any bonus, profit sharing, compensation, severance, termination, stock option, stock appreciation right, restricted stock, performance unit, pension, retirement, deferred compensation, employment, severance or termination pay toother employee benefit agreement, trust, plan, fund or enter into any employment other arrangement for the benefit or severance agreement with welfare of any director, officer or other employee of the Company employee, or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except for normal increases in the ordinary and usual course of business that are consistent with past practices and with that, in the consent aggregate, do not result in a material increase in benefits or compensation expense to the Company) increase in any manner the compensation or fringe benefits of Purchaserany director, modifyofficer or employee or pay any benefit not required by any plan and arrangement as in effect as of the date hereof (including, amend without limitation, the granting of stock options, stock appreciation rights or terminate performance units) or enter into any contract, agreement, commitment or arrangement to do any of its material Contracts or waive, release or assign any material rights or claimsthe foregoing;
(f) neither acquire, sell, lease or dispose of any assets outside the ordinary course of business or any assets which in the aggregate are material to the Company nor any of and its subsidiaries shall make any tax election or permit any insurance policy naming it Subsidiaries taken as a beneficiary whole or a loss payable payee to be canceled enter into any commitment or terminated without notice to Purchaser, except in transaction outside the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting principles or practices or principles used by it, except as required by generally accepted accounting principles;
(h) neither the Company nor revalue in any material respect any of its subsidiaries shall adopt a plan assets, including, without limitation, writing down the value of complete inventory or partial liquidation, dissolution, writing off notes or accounts receivable other than in the ordinary course of business;
(i) acquire (by merger, consolidation, restructuringor acquisition of stock or assets) any corporation, recapitalization, partnership or other reorganization business organization or division thereof; (ii) enter into any material contract or agreement other than in the ordinary course of business; (iii) except as previously authorized by the Company and its Board of Directors, authorize any new capital expenditure or expenditures; or (iv) enter into or amend any contract, agreement, commitment or arrangement with respect to any of the matters set forth in this Section 5(i);
(j) make any material tax election or settle or compromise any material income tax liability;
(k) pay, discharge or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business and consistent with past practice of liabilities reflected or reserved against in the consolidated financial statements (or the notes thereto) of the Company (other than and its consolidated Subsidiaries or incurred in the Merger ordinary course of business and other than in compliance consistent with Section 9.4(a))past practice; andor
(il) neither the Company nor any of its subsidiaries will authorize take, or enter into an agreement agree in writing or otherwise to do take, any of the foregoing actions described in Sections 5.1
(a) through 5.1(k) or take any action that which would knowingly cause make any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect as of the date when made or as of a future date or would result in any of the Offer Conditions conditions set forth in Annex A hereto Sections 6.1 or 6.3 not being satisfied.
Appears in 1 contract
Samples: Agreement and Plan of Recapitalization (Faulding Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this Agreement, (ii) as set forth in Section 5.1 of the Company Disclosure Schedule, or (iii) as consented to in writing by Parent, such consent not to be unreasonably withheld or delayed, during the period from the date of this Agreement to the Effective Time, and prior to the Effective Time time the directors of the Purchaser have been elected to, and shall constitute two-thirds of, the Board of Directors of the Company pursuant to Section 1.3 (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreementthe "Appointment Date"):
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the usual, regular and ordinary course in substantially the same manner as heretofore conducted, and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact intact, keep available the services of its current officers and maintainemployees and maintain its existing relations with franchisees, customers, suppliers, creditors, business partners and others having business dealings with it, to the end that its goodwill and ongoing business shall be unimpaired at the Effective Time of the Merger in any material respect;
(b) the Company shall not will not, directly or indirectly, (i) sell sell, transfer or pledge or agree to sell sell, transfer or pledge any of the shares, preferred stock or other securities owned by it or permit capital stock of any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities Subsidiaries beneficially owned by such subsidiary; it, (ii) amend the Certificate its Articles of Incorpora- tion or its bylaws Bylaws or amend, modify similar organizational documents; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Shares or (iv) declare, set aside Preferred Stock or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock; (ii) except pursuant to the Stock Option Agreement, issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than Shares reserved for issuance on the case of the Company, Shares issuable date hereof pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice, or incur or modify any material indebtedness or other liability, other than in the ordinary and usual course of business and consistent with past practice; or (iiiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) grant any severance increase in the compensation payable or termination pay toto become payable by the Company or any of its Subsidiaries to any of its executive officers or key employees or (ii)(A) adopt any new, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan agreement or arrangement; or (iii) enter into any employment or severance agreement with or, except in accordance with the existing written policies of the Company, grant any directorseverance or termination pay to any officer, officer director or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Subsidiaries;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts contracts or waive, release or assign any material mate- rial rights or claims, except in the ordinary course of business and consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any long-term debt, or except in the ordinary course of business, incur or assume any short-term indebtedness in amounts not consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in the ordinary course of business and consistent with past practice; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned Subsidiaries of the accounting practices Company); or principles used by it(iv) enter into any material commitment or transaction (including, but not limited to, any borrowing, capital expenditure or purchase, sale or lease of assets or real estate);
(h) neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting methods used by it unless required by GAAP;
(i) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries;
(j) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries (other than the Merger and other than in compliance with Section 9.4(aMerger)); and;
(ik) neither the Company nor any of its subsidiaries Subsidiaries will authorize take, or agree to commit to take, any action that would or is reasonably likely to result in any of the conditions to the Merger set forth in Article VI not being satisfied, or that would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time, or that would impair the ability of the Company to consummate the Merger in accordance with the terms hereof or delay such consummation; and
(l) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (HFS Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly provided in this Agreement, (ii) with the prior written consent of the Parent or (iii) as set forth on Section 5.1 of the Disclosure Schedule, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
Time: (a) the business of the Company and its subsidiaries Subsidiaries, including, without limitation, investment practices and policies, shall be conducted only in the ordinary and usual course of business consistent with past practice and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially all reasonable efforts to preserve its business organization intact and maintain
maintain its existing relations with material customers, distributors, suppliers, employees, creditors and business partners; (b) the Company shall not (i) sell will not, directly or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellindirectly, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding SharesCompany Common Stock, or any outstanding capital stock of any of the Subsidiaries of the Company; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries Subsidiaries shall (i) amend its certificate of incorporation or by-laws or similar organizational documents; (ii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with re spect to its capital stock other than dividends paid by the Company's wholly owned Subsidiaries to the Company; (iii) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to exercise of stock options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantsas disclosed in Section 3.3 hereof; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets or incur or modify any indebtedness or other liability that are material to the Company and its Subsidiaries taken as a whole other than in the ordinary and usual course sales of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
; or (v) redeem, purchase or otherwise acquire directly or indirectly any of its capital stock; (d) neither the Company nor any of its subsidiaries Subsidiaries shall (i) grant any increase in the compensation payable or to become payable by the Company or any of its Subsidiaries to any officer or employee other than scheduled annual increases in the ordinary course of business consistent with past practice in an amount not to exceed five percent (5%) 39 for any individual; (ii) adopt any new, or amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any Company Benefit Plan; (iii) enter into any, or amend any existing, employment, consulting or severance agreement with or, except in accordance with the existing written policies of the Company, grant any severance or termination pay toto any officer, director or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiaryof its Subsidiaries; and neither (iv) make any additional contributions to any grantor trust created by the Company nor to provide funding for non-tax-qualified employee benefits or compensation; or (v) provide any severance program to any Subsidiary which does not have a severance program as of its subsidiaries shall establish,
the date of this Agreement; (e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its the material Contracts Company Agreements or waive, release or assign any material rights or claims;
, except in the ordinary course of business consistent with past practice; (f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to Purchaserterminated, except in the ordinary and usual course of business;
business consistent with past practice; (g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any debt except for borrowings under its existing credit facility in an amount exceeding $100,000 without the written consent of the accounting practices Parent, which consent shall not be unreasonably withheld, provided that the Company may extend the term of its existing credit facility for a period not to exceed one (1) year so long as the commitment thereunder is not increased; (ii) assume, guarantee, endorse or principles used by it;
otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person; (iii) make any loans, advances or capital contributions to, or investments in, any other Person (other than to wholly owned Subsidiaries of the Company, or customary loans or advances to employees in accordance with past practice not to exceed $25,000 in the aggregate); or (iv) enter into any material commitment (including, but not limited to, any capital expenditure, "take-or-pay" contract or purchase of assets) in excess of $100,000, provided that the Company may (x) purchase inventory in the ordinary course of business consistent with past practice (without any "take-or-pay" commitment) and (y) enter into a lease for office space in the greater Denver, Colorado area not to exceed 4,500 square feet, at a cost per square foot per year not to exceed $17.00 and for a term not to exceed three (3) years; (h) neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting principles used by it unless required by GAAP; (i) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any material claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, (x) reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries, (y) incurred in the ordinary course of business consistent with past practice or (z) which are legally required to be paid, discharged or satisfied; (j) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.41
Appears in 1 contract
Interim Operations of the Company. The Except as contemplated by --------------------------------- this Agreement, the Company covenants and agreesDisclosure Schedule, as to itself and its subsidiariesor with the prior written consent of Reitco, that, prior during the period from the date of this Agreement to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) the business of Time, the Company will, and will cause each of its subsidiaries shall be conducted Subsidiaries to, conduct its operations in all material respects only in the ordinary and usual course of business consistent with past practice and in compliance in all material respects with all applicable law and, to the extent consistent therewith, will use its reasonable efforts, and will cause each of its Subsidiaries to use its best efforts, to preserve intact the business organization of the Company and each of its subsidiaries shall use its commercially reasonable efforts Subsidiaries, to keep available the services of their present officers and key employees, and to preserve its the goodwill of those having business organization intact relationships with it. Without limiting the generality of the foregoing and maintain
(b) except as otherwise contemplated by this Agreement or Section 6.1 of the Company shall Disclosure Schedule, the Company will not, and will not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries Subsidiaries to, prior to sellthe Effective Time, without the prior written consent of Reitco:
(a) adopt any amendment to its Certificate of Incorporation or Bylaws or comparable organizational documents;
(i) issue, pledge or agree sell, or authorize the issuance, pledge or sale of additional shares of capital stock of any class (except upon exercise of outstanding Options), or securities convertible into capital stock of any class, or any rights, warrants or options to sell acquire any convertible securities or pledge capital stock, or any stock or other securities owned by such subsidiary; in respect of, in lieu of, or in substitution for, shares of Company Common Stock outstanding on the date hereof or (ii) amend the Certificate or its bylaws or amend, waive or otherwise modify any of the terms of any option, warrant or terminate stock option plan of the Rights AgreementCompany or any of its Subsidiaries, including without limitation, the Options or redeem the Rights issued pursuant thereto; Option Plan;
(iii) split, combine or reclassify the outstanding Shares; or (ivc) declare, set aside or pay any dividend payable or other distribution (whether in cash, stock securities or property with or any combination thereof) in respect to of any class or series of its capital stock other than between any wholly-owned Subsidiary of the SharesCompany and the Company or any other wholly-owned Subsidiary of the Company;
(cd) neither the Company nor any of its subsidiaries shall (i) issuesplit, sellcombine, pledgesubdivide, dispose of reclassify or encumber any additional shares ofredeem, purchase or otherwise acquire, or securities convertible into propose to redeem or exchangeable for, purchase or options, warrants, calls, commitments or rights of any kind to otherwise acquire, any shares of its capital stock of any class of the Companystock, its subsidiaries or any of its other property securities;
(e) increase the compensation or assets other thanfringe benefits payable or to become payable to its directors, in officers or employees (whether from the case Company or any of its Subsidiaries), or pay any benefit not required by any existing plan or arrangement (including, without limitation, the Companygranting of stock options, Shares issuable stock appreciation rights, shares of restricted stock or performance units) or grant any severance or termination pay to (except pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transferexisting agreements or policies), leaseor enter into any employment or severance agreement with, licenseany director, guarantee, sell, mortgage, pledge, dispose of officer or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock employee of the Company or any of its subsidiaries Subsidiaries or establish, adopt, enter into, or amend any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, savings, welfare, deferred compensation, employment, termination, severance or other employee benefit plan, agreement, trust, fund, policy or arrangement for the benefit or welfare of any directors, officers or current or former employees, except in each case (i) to the extent required by applicable law or regulation, or (ivii) for annual raises and/or bonuses consistent with past practice;
(i) except for sales of inventory, sell, pledge, lease, dispose of, grant, encumber, or otherwise authorize the sale, pledge, disposition, grant or encumbrance of any assets of the Company or any of the Subsidiaries, except for sales in the ordinary course of business of the Company or (ii) except for (A) purchases of inventory and supplies in the ordinary course of business, (B) capital expenditures in excess accordance with the Company's 1998 capital expenditure budget and (C) completion of $50,000 individually or $100,000 pending acquisitions identified in writing to Reitco in connection with the execution of this Agreement on terms substantially as set forth in the aggregate applicable letter of intent or make any acquisition of definitive agreement, as the case may be, acquire (including, without limitation, by merger, consolidation consolidation, lease or acquisition of stock or assets) any corporation, partnership, other business organization or any division thereof (or a substantial portion of the assets thereof) or any other assets, except for such acquisitions which, individually or in the aggregate, do not exceed $50,000;
(g) (i) incur, assume or pre-pay any debt, except that the Company and its Subsidiaries may incur or pre-pay debt in the ordinary course of business consistent with past practice under existing lines of credit and may incur indebtedness to fund the acquisitions described in Section 6.1(f), (ii) assume, guarantee, endorse or any investment inotherwise become liable or responsible (whether directly, assets continentally or stock otherwise) for the obligations of any other person or entity (other than acquisitions of assets Person except in the ordinary course of business consistent with past practice), or (iii) make any loans, advances or capital contributions to, or investments in, any other Person except in the ordinary course of business consistent with past practice and except for loans, advances, capital contributions or investments between any wholly-owned Subsidiary of the Company and the Company or another wholly-owned Subsidiary of the Company;
(dh) neither the Company nor any authorize, recommend, propose or announce an intention to adopt a plan of its subsidiaries shall grant any severance complete or termination pay to, partial liquidation or enter into any employment or severance agreement with any director, officer or other employee dissolution of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Subsidiaries;
(ei) neither the Company nor make any of its subsidiaries shall tax elections or settle or compromise any federal or state income tax liability with Tax authorities;
(j) pay, discharge or satisfy any material claims claims, liabilities or litigation orobligations (absolute, except accrued, asserted, unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary and usual course of business and consistent with past practice of liabilities reflected or reserved against in the consent consolidated financial statements of Purchaserthe Company;
(k) enter into any collective bargaining agreement;
(l) take any action, other than reasonable and usual actions in the ordinary course of business and consistent with past practice, with respect to accounting policies or procedures, unless required by GAAP or the SEC;
(m) modify, amend or terminate any of its material the Company Material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessbusiness consistent with past practice;
(gn) except as may be required as a result take, or agree to commit to take, any action that would make any representation or warranty of a change in law or in generally accepted accounting principles, neither the Company nor contained herein inaccurate in any respect at, or as of its subsidiaries shall change any time prior to, the Effective Time;
(o) engage in any transaction with, or enter into any agreement, arrangement, or understanding with, directly or indirectly, any of the accounting practices Company's affiliates which involves the transfer of consideration or principles used by ithas a financial impact on the Company, other than pursuant to such agreements, arrangements, or understandings existing on the date of this Agreement (which are set forth on Section 6.1 of the Company Disclosure Schedule);
(hp) neither the Company nor close, shut down, or otherwise eliminate any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization the Company's golf courses located on any of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
Properties, except for such closures, shutdowns or eliminations which are (i) neither the Company nor any required by action, order, writ, injunction, judgment or decree or otherwise required by law, or (ii) due to acts of its subsidiaries will authorize God or other force majeure events; or
(q) enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations foregoing.
(r) take any other action (or warranties fail to take any action) that would be inconsistent with Reitco's continued qualification as a REIT after the Effective Time under the Code and the rules and regulations promulgate thereunder; or
(s) directly or indirectly through a Subsidiary enter into any agreement, or participate in active negotiations with any third party, relating to any business transaction the reasonably foreseeable effect of which would be to delay the Company contained in this Agreement to be untrue Effective Time beyond June 15, 1998, prevent the Effective Time from occurring or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto Merger not being satisfiedtreated as, or as part of, a tax-free reorganization for federal income tax purposes.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time except (unless Purchaser shall otherwise consent in writing and except i) as otherwise permitted expressly contemplated by this Agreement):, (ii) as set forth in Section 5.1 of the Company Disclosure Schedule or (iii) as agreed in writing by Parent, after the execution and delivery of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course and in all material respects in compliance with all applicable Legal Requirements and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact intact, to maintain its existing relations with customers, suppliers, employees, creditors and maintainbusiness partners and to maintain customary levels of insurance coverage with respect to its assets and operations;
(b) the Company shall not (i) sell not, directly or pledge indirectly, amend its or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge Subsidiaries' certificate of incorporation or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amendsimilar organizational documents;
(c) the Company shall not, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; and it shall not permit its Subsidiaries to: (iii) split, combine or reclassify the outstanding Shares; or (ivi)(A) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
(c) neither Company's capital stock or that of its Subsidiaries other than those dividends or other distributions payable solely to the Company nor or one of its wholly-owned Subsidiaries, or (B) redeem, purchase or otherwise acquire directly or indirectly any of the Company's capital stock (or options, warrants, calls, commitments or rights of any kind to acquire any shares of capital stock) or that of its subsidiaries shall Subsidiaries; (iii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries other than Shares issued upon the exercise of Stock Options or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options Warrants outstanding on the date hereof under hereof; or (iii) split, combine or reclassify the Stock Plans outstanding capital stock of the Company or of its Subsidiaries;
(d) the Company shall not, and shares issuable pursuant it shall not permit its Subsidiaries to, acquire or agree to acquire, or except as contemplated by the Warrants; Cxxxx Restructuring (ii) as defined in the Foamex Credit Agreement), transfer, lease, license, guarantee, sell, mortgage, pledge, encumber, dispose of or encumber agree to dispose of, any assets material assets, including Intellectual Property, either by purchase, merger, consolidation, sale of shares in any of its Subsidiaries or incur otherwise, except pursuant to Contracts of the Company or modify any indebtedness or other liability other than its Subsidiaries in effect on the date hereof, in the ordinary and usual course of business; business consistent with past practice or in transactions involving consideration of less than $5,000,000, in the aggregate;
(iiie) acquire directly neither the Company nor its Subsidiaries shall: (i) grant any increase in the compensation payable or indirectly to become payable by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries Subsidiaries (A) to any of its executive officers or directors, other than regularly scheduled pay increases of not more than 10% per annum, or (ivB) authorize capital expenditures in excess to any of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (its key employees other than acquisitions of assets in the ordinary course of business consistent with past practice);
; or (dii)(A) neither adopt any new, or (B) except as contemplated by Section 2.4 or as required by any obligation existing as of the date hereof to do so or any applicable Legal Requirement or in connection with the Cxxxx Restructuring, amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan, agreement or arrangement; or (iii) (A) enter into or modify or amend any employment agreement or arrangement with any officer or director of the Company nor or any of its subsidiaries shall Subsidiaries, other than in the ordinary course of business consistent with past practice or (B) enter into or modify or amend any severance agreement with, or grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee director of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orSubsidiaries, except in the ordinary and usual course of business and consistent with past practice or as required by any applicable Legal Requirement or in connection with the consent of Purchaser, modify, amend Cxxxx Restructuring or terminate Contracts in effect on the date hereof; or (iv) enter into any of its material Contracts or waive, release or assign any material rights or claimscollective bargaining agreement;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make modify, amend or terminate any tax election of its material Contracts (other than the Credit agreement of Foamex Cuautitlan, S.A. de C.V.) or permit waive, release or assign any insurance policy naming it as a beneficiary material rights or a loss payable payee to be canceled or terminated without notice to Purchaserclaims, except other than in the ordinary and usual course of businessbusiness consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any indebtedness other than indebtedness with respect to working capital in amounts consistent with past practice and capital leases in the ordinary course of business; (ii) materially modify any material indebtedness; (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for any material obligations of any other person (other than a Subsidiary of the accounting practices Company or principles used by itas set forth on Section 5.1 of the Company's Disclosure Schedule); (iv) make any loans, advances or capital contributions to, or investments in, any other person (other than (A) to the Subsidiaries of the Company, (B) pursuant to the Merger Agreement, (C) as set forth on Section 5.1 of the Company's Disclosure Schedule (provided the ownership structure of such Subsidiary has not changed from that existing on the date hereof), (D) to Foamtec (Singapore) Pte. Ltd. or Foamex Asia Co. Ltd. in the ordinary course of business consistent with past practice, or (E) customary advances to employees); or (v) enter into any material Contract or transaction other than in the ordinary course of business consistent with past practice;
(h) neither the Company nor any of its subsidiaries Subsidiaries shall adopt materially change any of the accounting methods, practices or policies used by it, other than changing its fiscal year to a plan of complete calendar year, unless required by GAAP;
(i) the Company shall not, and it shall not permit its Subsidiaries to, make any material tax election (unless required by law) or partial liquidationsettle or compromise any material income tax liability;
(j) the Company shall not, dissolutionand it shall not permit its Subsidiaries to (i) except in connection with any transaction permitted by Section 5.5, merger, consolidation, restructuring, recapitalizationwaive the benefits of, or other reorganization of agree to modify in any material manner, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is a party, or (ii) except in the ordinary course of business consistent with past practice, pay, discharge or satisfy any actions, suits, proceedings or claims, other than the Merger payment, discharge or satisfaction, in each case in complete satisfaction, and with a complete release, of such matter with respect to all parties to such matter, of actions, suits, proceedings or claims that would not reasonably be expected to result in, individually or in the aggregate, a Material Adverse Effect;
(k) the Company shall not, and it shall not permit its Subsidiaries to, commence a lawsuit other than (i) for the routine collection of bills, (ii) in compliance such cases where the Company in good faith determines that the failure to commence suit would result in a material impairment of a valuable aspect of the Company's business or the forfeiture of substantial rights, provided that the Company consults with Section 9.4(a))Parent prior to filing such suit or (iii) to enforce this Agreement; and
(il) neither the Company nor any of its subsidiaries will authorize or Subsidiaries shall enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The (a) During the period between the date hereof and the earlier of the Closing and the valid termination of this Agreement pursuant to its terms, except (i) as set forth in Section 5.1 of the Company covenants and agreesDisclosure Letter, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except ii) as otherwise permitted by this Agreement):
, (aiii) the business of as required by any Governmental Entity or applicable Law or Order, or (iv) as consented to by Parent in writing (which consent shall not be unreasonably withheld, conditioned or delayed), the Company will, and will cause its subsidiaries shall be conducted only in the ordinary and usual course andSubsidiaries to, to the extent consistent therewith, each of the Company and its subsidiaries shall (A) use its their respective commercially reasonable efforts to preserve its conduct the business organization intact in the ordinary course of business in all material respects and maintain(B) not:
(b1) in the Company shall not case of the Company, amend the Articles of Incorporation or the Bylaws, and in the case of the Company’s Subsidiaries, amend their respective Organizational Documents;
(2) (a) other than (i) sell dividends or pledge distributions made by a wholly owned Subsidiary of the Company to the Company or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by another such subsidiary; Subsidiary and (ii) amend regular quarterly cash dividends paid by the Certificate or its bylaws or amendCompany, modify or terminate not in excess of, with respect to each quarter, $0.125 per Share, with usual declaration, record and payment dates and in a manner consistent with the Rights AgreementCompany’s past dividend policy, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend or other distribution, whether payable in cash, stock or property other property, with respect to the Shares;
its capital stock or other Rights, (c) neither the Company nor any of its subsidiaries shall (ib) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind agree to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guaranteeissue, sell, mortgagetransfer, pledge, dispose of or encumber (other than Permitted Encumbrances) any assets or incur or modify any indebtedness additional shares of capital stock or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock Rights of the Company or any of its subsidiaries Subsidiaries, other than in respect of the shares of the Company’s capital stock reserved for issuance and issued pursuant to the awards under the Company Stock Plans or in respect of account balances under the Company Plans, (ivc) authorize split, combine or reclassify the Shares or any other outstanding capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), Rights of the Company or any investment in, assets of the Subsidiaries of the Company or stock issue or authorize the issuance of any other person securities in respect of, in lieu of or entity in substitution therefor, or (d) redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other than acquisitions Rights of assets the Company or any of its Subsidiaries, except, in the case of each of clauses (a) through (d), as required by any Company Plan or any awards issued thereunder;
(a) except as otherwise required under applicable Law, enter into, amend or terminate any Collective Bargaining Agreement, (b) except as otherwise required under applicable Law, for setting monthly or quarterly performance targets thereunder or establishing sales performance incentive fund formula or similar spot bonus programs in the ordinary course of business consistent with past practice, enter into or amend any Company Plan, or (c) except as otherwise required under applicable Law or Collective Bargaining Agreement, and except for annual salary or wage rate adjustments in the ordinary course of business consistent with past practice, including merit-based adjustments: (i) increase the salary or wages payable to any Company Employees with a title of Director or higher; or (ii) materially increase, in the aggregate, the salary or wages payable to Company Employees with a title below Director;
(4) (a) enter into or amend any employment Contract or severance Contract with any director, executive officer or Company Employee whose annual salary exceeds or would exceed $250,000, (b) hire any employees whose annual salary would exceed $250,000, or (c) terminate the employment of any Company Employee whose annual salary exceeds $250,000 (other than: (x) in the case of termination for cause or (y) with respect to Company Employees who are Canadian, frustration or upon expiry in accordance with an employment Contract);
(d5) neither incur any Indebtedness, except for (a) Indebtedness incurred in the ordinary course of business consistent with past practice, including under letters of credit, (b) guarantees by the Company nor or any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee Subsidiaries of Indebtedness of the Company or any other such subsidiary; and neither Subsidiary, or (c) Indebtedness of any of the Company nor or any of its subsidiaries shall establish,Subsidiaries to the Company or any such Subsidiary;
(e6) neither make any capital expenditures that, in the aggregate, exceed the amount of all capital expenditures contemplated by the Company’s existing capital budget as set forth on Section 5.1(a)(6) of the Company nor Disclosure Letter;
(7) discharge, settle or satisfy any Actions, other than (a) in the ordinary course of business, or (b) for amounts, individually or in the aggregate, not to exceed $1,000,000 (in excess of third party insurance or existing reserves), in each case, that do not impose any material ongoing obligation or limitations upon the Company or any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsSubsidiaries;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall 8) change any of the accounting methods, principles or practices or principles used by itit unless required by a change in GAAP or applicable Law;
(h9) neither the Company nor any of its subsidiaries shall (a) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, business combination, restructuring, recapitalization, recapitalization or other reorganization (other than this Agreement or otherwise in connection with the Transactions), (b) acquire, by merging or consolidating with, by purchasing a substantial equity interest in or portion of the assets of, or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof, or (c) acquire, transfer, lease, license, sell, mortgage, pledge, dispose of or encumber (other than Permitted Encumbrances) any material assets, other than, in the case of this clause (c), acquisitions or dispositions of materials and inventory, sales or leases of inventory and grants of non-exclusive licenses of Intellectual Property Rights, in each case, except in the ordinary course of business;
(10) (a) make, rescind or change any material Tax election or settle or compromise any material Tax liability, (b) change its taxable year, or (c) change any material method of accounting for Tax purposes except, in each case, in the ordinary course of business or as required by applicable Law, or (d) enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign Law);
(11) enter into any Contract that would, if entered into prior to the date hereof, be a Material Contract, or modify, amend, extend or voluntarily terminate (other than non-renewals occurring in the ordinary course of business) any Material Contract, or waive, release or assign any rights or claims thereunder;
(12) enter into a material new line of business outside of the existing businesses of the Company and its Subsidiaries, taken as a whole, or open any new store (other than the Merger and other than in compliance with Section 9.4(a)whether on a franchisee-managed or Company (or its Subsidiaries)-managed basis); andor
(i13) neither the Company nor agree to take or make any of its subsidiaries will authorize or enter into an agreement commitment to do take any of the actions described in the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company clauses (1)-(12).
(b) Nothing contained in this Agreement shall give Parent or Merger Sub, directly or indirectly, the right to be untrue control or incorrect or would result in any direct the Company’s operations prior to the Effective Time. Prior to the Effective Time, the Company is entitled to exercise, consistent with the terms and conditions of the Offer Conditions set forth in Annex A hereto not being satisfiedthis Agreement, complete control and supervision over its operations.
Appears in 1 contract
Interim Operations of the Company. The During the Pre-Closing Period, Company shall use its commercially reasonable best efforts to preserve its business and to preserve the goodwill of customers, suppliers and others having business relations with the Company, provided however, that the Company covenants and agreesagrees that if at any time during the Pre-Closing Period, Nxxxxx X. Xxxxxxxxx, Xx. is no longer employed by the Company as to itself and its subsidiariesan executive officer, that, prior then except (i) to the Effective Time (unless Purchaser extent Parent shall otherwise consent in writing and except (which consent shall not be unreasonably withheld or delayed), (ii) as otherwise contemplated or permitted by this Agreement):, or (iii) as may be required to facilitate compliance with any Legal Requirement, the Company shall not:
(a) conduct its business in a manner that departs materially from the manner in which such business of the Company and its subsidiaries shall be was being conducted only in the ordinary and usual course and, prior to the extent consistent therewith, each date of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainthis Agreement;
(b) the Company shall not amend its certificate of incorporation or bylaws;
(i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iiic) split, combine or reclassify any shares of the outstanding Shares; or Company’s capital stock;
(ivd) declare, set aside or pay any dividend (whether payable in cash, stock or property property) with respect to any shares of the SharesCompany’s capital stock;
(ce) neither the Company nor form any of its subsidiaries shall subsidiary or acquire any material equity interest in any other Entity;
(if) issue, sell, pledge, dispose of sell or encumber grant any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Companystock, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iiii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the options to purchase Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets Common Stock in the ordinary course of business consistent with past practicepractices, (ii) Company Common Stock issuable upon exercise of Company Options outstanding on, or granted after, the date of this Agreement, (iii) Company Common Stock issuable pursuant to warrants outstanding as of the date of this Agreement and (iv) Company Common Stock issuable pursuant to the Employee Stock Purchase Plan;
(g) transfer, lease or license to any third party, or encumber, any material assets other than (i) in the ordinary course of business, or (ii) as security for any borrowings permitted by Section 5.1(i);
(dh) neither repurchase, redeem or otherwise acquire any shares of the capital stock of the Company, except for (i) acquisitions of Common Stock by the Company nor pursuant to agreements which permit the Company to repurchase such shares at cost (or the lesser of cost or fair market value) upon termination of services to the Company; or (ii) acquisitions of Common Stock in exercise of the Company’s right of first refusal to repurchase such shares;
(i) incur any indebtedness for borrowed money or guarantee any such indebtedness, except for (A) short-term borrowings incurred in the ordinary course of its subsidiaries shall grant any severance or termination pay tobusiness, (B) borrowings pursuant to existing credit facilities, or pursuant to any modifications, renewals or replacements of any such credit facilities, and (C) borrowings of up to $1,000,000 under any new credit facility which the Company may enter into into;
(j) adopt or materially amend any employment material bonus, profit sharing, compensation, severance, termination, stock option, stock appreciation right, restricted stock, pension, retirement, deferred compensation or severance agreement with other employee benefit agreements or plans, for the benefit of any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except for normal increases in the ordinary and usual course of business and that are consistent with past practices or that, in the consent aggregate, do not result in a material increase in benefits or compensation expense) increase the compensation or fringe benefits of Purchaserany director, modify, officer or employee or pay any benefit not required by any existing agreement or plan;
(k) materially amend or prematurely terminate any of its material Material Contracts or waive, release or assign any material rights or claims;
claims under any Material Contracts (f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessbusiness or where the failure to amend or terminate a Material Contract would, in the reasonable judgment of the Company’s Board of Directors, have an adverse impact on the Company);
(gl) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any methods of the accounting or accounting practices or principles used by itin any material respect;
(hm) neither make any material Tax election (except for elections made in the Company nor any ordinary course of its subsidiaries shall adopt a plan of complete business or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of consistent with the Company (other than the Merger and other than in compliance with Section 9.4(aCompany’s past practices)); and;
(in) neither make any capital expenditure which, when added to all other capital expenditures made since the Company nor any date of its subsidiaries will authorize this Agreement, would exceed $100,000 in the aggregate; or enter into an agreement to do take any of the foregoing or take any action that would knowingly cause any actions described in clauses “(a)” through “(n)” of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedsection.
Appears in 1 contract
Samples: Merger Agreement (Cysive Inc)
Interim Operations of the Company. The 5.1.1 Each of the Company covenants and agreesTopCo shall, as and shall cause each of the other Acquired Companies to, continue to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) conduct the business of the Company, TopCo and such Acquired Company as currently conducted and as currently contemplated to be conducted, and use commercially reasonable efforts maintain its subsidiaries shall be conducted only business relationships in the ordinary and usual course andconsistent with its past practices. From the Signing Date until the Closing Date or the earlier termination of this Agreement in accordance with Section 7.1, to except as set forth on the extent consistent therewith, each corresponding subsection of Section 5.1.1 of the Disclosure Schedules, as expressly contemplated by the terms of this Agreement or as the Company may determine to be reasonably necessary or appropriate in connection with any COVID-19 Measures, unless Buyer has previously consented thereto in writing (which consent will not be unreasonably withheld, conditioned or delayed), the Company, TopCo and its subsidiaries the Sellers shall use its commercially reasonable efforts not, and shall not permit any of the Acquired Companies to preserve its business organization intact and maintaindo any of the following:
(a) amend any organizational documents of any Acquired Company;
(b) the Company shall not (i) split, divide, combine, issue or reclassify of any capital stock, shares or other equity securities of any Acquired Company, or issue, sell or pledge otherwise dispose of or agree grant any rights to sell purchase or pledge obtain (including upon conversion, exchange or exercise) any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Sharesequity securities;
(c) neither the Company nor declare or pay any of its subsidiaries shall (i) issue, sell, pledge, dispose of dividends or encumber any additional shares of, distributions on or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights in respect of any kind to acquire, any shares of its capital stock equity securities of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Acquired Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practiceany dividends or distributions declared or paid between Acquired Companies);
(d) neither the Company nor purchase or acquire any equity securities of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Acquired Company;
(e) neither except as required by applicable Laws or GAAP, or to align the Company nor accounting practices of BullGuard with those of the other Acquired Companies, change any method of its subsidiaries shall settle accounting or compromise accounting practice of any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsAcquired Company;
(f) neither the Company nor except as required by applicable Laws or GAAP, revalue any of its subsidiaries shall make any tax election properties or permit any insurance policy naming it as a beneficiary assets, including writing-off notes or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessaccounts receivable;
(g) except as may be required as a result of a change in law propose or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the any Acquired Company (other than the Merger Transaction);
(h) amend, modify, accelerate, relinquish, terminate or cancel any Material Contract or enter into any Contract that would constitute a Material Contact, other than entering into any such Contract in the ordinary course of business; provided, that such exception shall not apply to any Contract that would constitute a Material Contract under [***];
(i) (i) terminate any Key Employee other than for cause or (ii) hire any, director, officer, Employee, contractor or consultant with an annual compensation of [***] or more, except to replace (on substantially similar terms and at a substantially similar cost) any departed individual;
(j) (i) adopt, amend or materially modify any Employee Benefit Plan, (ii) grant any severance or termination pay to any Employee, (iii) increase the compensation of, or pay any bonus to, any Employee with annual compensation of [***] or more, except, in each of (i) through (iii), as required by Law or pursuant to any legally binding obligation entered into by any Acquired Company prior to the date hereof;
(k) except as required by applicable Law, enter into, amend, or extend any collective bargaining agreement or works council arrangement;
(l) incur, create, assume, pay, cancel or discharge (i) any Lien on any of its assets (other than Permitted Liens), (ii) any Indebtedness; or (iii) any liability as a guarantor or surety with respect to the obligations of others;
(m) transfer, assign, sell, exclusively license or other dispose of any of material assets of any Acquired Company shown or reflected in the Financial Statements, other than in the Ordinary Course;
(n) abandon, cancel or allow to lapse or fail to maintain or protect any Intellectual Property that is subject to a registration, filing, or application by any Acquired Company and material to such Acquired Company;
(o) except for any arrangements between Acquired Companies and other than in compliance with Section 9.4(a)); and
the Ordinary Course: (i) neither sell, lease, license or transfer to any Person any rights to any Intellectual Property of any Acquired Company, (ii) purchase or license any Intellectual Property or enter into any agreement or modify any existing Contract with respect to the Intellectual Property of any Person, (iii) enter into any Contract or modify any existing Contract with respect to the development of any Intellectual Property with any Third Party, (iv) change pricing or royalties set or charged by any Acquired Company nor to its customers or licensees, or the pricing or royalties set or charged by Person who have licensed Intellectual Property to any Acquired Company; (v) enter into or amend any Contract pursuant to which any other party is granted marketing, distribution, or similar rights of any type or scope with respect to any products or Technology of any Acquired Company; or (vi) enter into or amend any Contract pursuant to which any other party is granted development, manufacturing or similar rights of any type or scope with respect to any products or Technology of any Acquired Company;
(p) acquire (by merger, consolidation or acquisition of stock or assets) any other Person or any equity interest therein;
(q) (i) sell, transfer, assign, lease, license or otherwise dispose of any Owned Real Property or any interest therein, (ii) enter into any lease or sublease of real property (whether as a lessor, sublessor, lessee or sublessee) which involves an increase in expenditures or costs or (iii) modify, amend or exercise any right to renew any Real Property Lease or waive or violate any term or condition thereof or grant any consents thereunder; grant or otherwise create or consent to the creation of any easement, covenant, restriction, assessment, Lien or charge affecting any Owned Real Property or Leased Real Property or any part thereof; convey any interest in any Real Property; commit any waste or nuisance on any such property; or make any material changes in the construction or condition of any such property (except as required by applicable Law or to comply with applicable health and safety requirements or as necessary ensure the uninterrupted continuation of the Business);
(r) intentionally damage or destroy any Real Property;
(s) incur, effect, pay or make any capital investment in, or grant, give, pay or make any loan to, any other Person,
(t) forgive any loans to any Employees, officers or directors of any Acquired Company, or any of their respective Affiliates or Related Persons; (u) incur, pay, become liable for or make any capital expenditures in excess of (a) [***] for any individual expenditure or (b) [***] [***] in the aggregate (provided, in each case, that those items within such thresholds are incurred in the Ordinary Course);
(v) terminate, waive, settle or compromise any right of value or initiate or settle any Proceeding, except for any such Proceeding that is settled or compromised for monetary damages only not in excess of [***] individually or [***] in the aggregate;
(w) request or negotiate of any Tax ruling on behalf of any Acquired Company, or enter into any closing agreement, agreement to an extension of the statute of limitations with respect to the assessment or collection of Taxes, amend any Tax Return, file any Tax Return in a manner that is inconsistent with past custom and practice, make, change or rescind any election relating to Taxes, surrender any claim for a refund of Taxes, settle or compromise of any Tax liability, make any change to any Acquired Company’s methods of accounting or methods of reporting income or deductions for Tax or accounting practice or policy from those employed in the preparation of its subsidiaries will most recent Tax Return;
(x) enter into any Tax sharing, Tax allocation, Tax indemnity or similar agreement (other than in the Ordinary Course with respect to Contracts the principal subject of which is not Taxes) or closing or advanced pricing agreement, assume any liability for the Taxes of any other Person (whether by Contract or otherwise), change any Acquired Company’s residence for any Tax purpose or establish any branch, agency, permanent establishment or other taxable presence in any jurisdiction outside such Acquired Company’s jurisdiction of incorporation or organization, or fail to accrue or pay when due any material Taxes; or
(y) authorize or enter into an any agreement or commitment with respect to do any of the foregoing foregoing, or take any action or omission that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions foregoing.
5.1.2 If so requested by Buyer, the Company and TopCo shall exercise commercially reasonable efforts to cooperate with Buyer prior to the Closing for the purposes of facilitating an orderly and smooth transition of such relationships to Buyer after the Closing.
5.1.3 Notwithstanding anything to the contrary in Section 5.1.1 or 5.1.2, or any other provision of this Agreement or any other Transaction Document, the Company and TopCo shall not (i) be prevented from or (ii) be required to obtain the Buyer’s consent in relation to, effecting any of the following on or prior to Closing:
(a) compliance with the terms and provisions of the [***] SPA and the Minority SPAs and such actions as are necessary to effect the acquisition by the BullGuard Buyer of the entire issued share capital of BullGuard [***]; provided, that the Company shall obtain Buyer’s prior written consent (such consent not to be unreasonably withheld, conditioned or delayed) prior to delivering any Completion Accounts or Balancing Payments (each as defined in the [***] SPA) to the BullGuard Sellers and/or confirming to the BullGuard Sellers any final agreement of the Completion Accounts and/or Balancing Payments; provided, further, that no Acquired Company (including the BullGuard Buyer) shall (i) amend or modify, and shall not permit to be amended or modified, the [***] SPA or any other Contracts contemplated thereby without the prior written consent of Buyer, or (ii) waive, forgive or cancel any rights of any Acquired Company (including the BullGuard Buyer) under the [***] SPA or any other Contracts contemplated thereby without the prior written consent of Buyer;
(b) any:
(i) actions set out in the BullGuard Integration Plan; provided, that prior to effecting the transactions contemplated by the BullGuard Integration Plan the Company and TopCo shall afford Buyer a reasonable opportunity to review and comment on the documentation and all other actions proposed to be used or taken by any Acquired Company to effect the BullGuard Integration Plan and the Company and TopCo shall include all reasonable comments and revisions provided by Buyer or any if its Representatives to such documentation and shall apply all reasonable comments of Buyer or its Representatives to the other actions proposed to be used or taken in connection with the BullGuard Integration Plan; and
(ii) other actions which the Company considers reasonably necessary or appropriate in connection with (A) the integration of BullGuard into the Company’s corporate group following the acquisition of BullGuard by the Acquired Companies and (B) the integration of the Avira Group following the acquisition of the Avira Group by Glitz F20-33 GmbH provided that the Company has provided the Buyer with not less than [***] Business Days’ written notice prior to taking any such action and, if the Buyer has notified the Company of any reasonable objections to it taking such actions within such [***] Business Day-period, no Acquired Company shall take such action reasonably objected to by Buyer;
(c) any non-renewal and lapse of any Acquired Company’s Trademarks as expressly set forth in Annex A hereto the Trademark Plan and any non-renewal and lapse of domain names not being satisfiedused by any of the Acquired Companies in the Ordinary Course;
(d) the passing of a resolution of the shareholders of each relevant Acquired Company granting discharge (Entlastung) to the managing directors in respect of their office;
(e) the full release and discharge by the relevant Acquired Company of (i) Seller 2’s obligation and liability to pay the Outstanding Loan Amount (including the netting off of the relevant Acquired Company’s liability to Seller 2 from the Outstanding Loan Amount and the subsequent writing-off of the resulting amount) and (ii) of [***] obligation and liability to pay their outstanding Indebtedness to the relevant Acquired Company in the amounts of [***] and [***] respectively; and
(f) the incurrence or making of any payment of Permitted Leakage.
Appears in 1 contract
Interim Operations of the Company. The Company covenants Between the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, the Company shall, and shall cause each of its Subsidiaries to (unless Purchaser Parent shall otherwise consent approve in writing and or except as otherwise permitted by this AgreementAgreement or disclosed in the Company Disclosure Letter):
(a) conduct its business in all material respects in the business of ordinary course consistent with past practice taking into account new scientific projects currently planned by the Company and its subsidiaries shall be conducted only in as previously communicated by the ordinary and usual course Company to Parent and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to (i) preserve intact its business organization intact organization; (ii) keep available the services of its officers and maintainemployees and (iii) maintain its existing relations and goodwill with customers, suppliers, regulators, distributors, creditors, lessors, sales agents and others having business dealings with it
(b) the Company shall not (i) sell amend the Certificate of Incorporation or pledge or agree to sell or pledge any stock or other securities owned by it or permit any By-laws of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarythe Company; (ii) amend the Certificate split, combine, subdivide or reclassify its bylaws outstanding shares of capital stock or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoother equity securities; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend or distribution payable in cash, stock or property with in respect to the Shares;
(c) neither the Company nor of any of its subsidiaries shall (i) issue, sell, pledge, dispose shares of capital stock or encumber any additional shares ofother equity securities, or securities convertible into into, exercisable for or exchangeable for, any of its shares of capital stock or optionsother equity securities, warrantsother than dividends and distributions by wholly owned Subsidiaries of the Company; (iv) repurchase, callsredeem or otherwise acquire or permit any of its Subsidiaries to purchase, commitments redeem or rights of any kind to otherwise acquire, any shares of its capital stock or other equity securities, or securities convertible into, exercisable for or exchangeable for, any of any class its shares of capital stock or other equity securities (it being understood that this clause (iv) shall not (A) prohibit the Companyexercise, its subsidiaries exchange or any other property conversion of Company Equity Equivalent Securities or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant (B) apply to the Warrants; (ii) transferrepurchase of shares of Common Stock from employees, leaseofficers, licensedirectors, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness consultants or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of persons performing services for the Company or any Subsidiary pursuant to agreements under which the Company has the option to repurchase such shares at cost upon the occurrence of its subsidiaries certain events, such as the termination of employment, or through the exercise of any right of first refusal); or (ivv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment agreement or severance letter of intent, agreement with any directorin principle or similar arrangement to sell, officer transfer or other employee otherwise dispose of, or purchase or otherwise acquire, in the aggregate, a material amount of the Company assets or properties or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, transfer or other reorganization acquisition of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any shares of its subsidiaries will authorize capital stock or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.otherwise;
Appears in 1 contract
Samples: Merger Agreement (Merck & Co Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior to agrees that during the period from the date of this Agreement until the Effective Time (unless Purchaser shall otherwise consent in writing and Time, except as otherwise permitted (i) provided or contemplated by this Agreement):, (ii) agreed to in writing by Parent, or (iii) set forth in Section 5.1 of the Disclosure Letter:
(a) the business of the Company and its subsidiaries shall be conducted Subsidiaries will conduct their respective businesses only in the ordinary course of business consistent with past practices, and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall will use its commercially reasonable efforts to preserve intact its business organization intact and maintaingoodwill and the business organization and goodwill of its Subsidiaries and keep available the services of their current officers and employees and preserve and maintain existing relations with customers, suppliers, regulators, licensors, licensees, officers, employees and creditors;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by will not, nor will it or permit any of its subsidiaries to sellSubsidiaries to, pledge or agree to sell or pledge enter into any stock or other securities owned by such subsidiary; new line of business;
(iic) the Company will not, nor will it permit any of its Subsidiaries to, amend its organizational documents;
(d) the Certificate or Company will not, nor will it permit any of its bylaws or amendSubsidiaries to, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend or other distribution (except dividends or distributions from a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary of the Company), whether payable in cash, stock or any other property or right, with respect to the Sharesits capital stock;
(ce) neither the Company will not, nor will it permit any of its subsidiaries shall Subsidiaries to, (i) adjust, split, combine, or reclassify any capital stock or issue, grant, sell, transfer, pledge, dispose of of, or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments commitments, or rights of any kind to acquire, any shares of its capital stock of any class or of the Company, its subsidiaries or any other property such securities or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock agreements of the Company or any of its subsidiaries Subsidiaries, other than issuances of shares of Company Common Stock pursuant to securities, options, warrants, calls, commitments, or rights existing at the date hereof and as set forth on Section 3.02 of the Disclosure Letter or under the ESPP; or (ivii) authorize redeem, purchase, or otherwise acquire directly or indirectly any of its capital stock or any other securities or agreements of the type described in clause (i) of this Section 5.1(e);
(f) the Company will not, nor will it permit any of its Subsidiaries to, purchase any capital assets or make any capital expenditures in excess of $50,000 individually or $100,000 1,000,000 in the aggregate or make aggregate;
(g) the Company will not, nor will it permit any acquisition of its Subsidiaries to, except as required by law (by merger, consolidation or acquisition including Section 409A of stock or assetsthe Code and the rules and regulations promulgated thereunder), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets i) except in the ordinary course of business consistent with past practice);
(d) neither , grant any increase in the compensation or benefits payable or to become payable by the Company nor or any of its subsidiaries shall Subsidiaries to any non-officer employee; (ii) grant any severance increase in the compensation or termination pay tobenefits payable or to become payable by the Company or any of its Subsidiaries to any director or officer of the Company or any of its Subsidiaries; (iii) adopt, enter into, amend, or otherwise increase, or accelerate the payment or vesting of the amounts, benefits, or rights payable or accrued or to become payable or accrued under any compensation, severance, retention, other similar profit sharing, stock option, stock purchase, or equity-linked pension or retirement plan, program, agreement or arrangement (including with respect to any Change of Control Obligations); (iv) enter into or amend any employment or severance agreement with any officer, director, officer or other employee of the Company or any such subsidiaryof its Subsidiaries; and neither or (v) except in accordance with existing contracts or agreements disclosed in the Disclosure Letter, make any severance payment, payments pursuant to any Change of Control Obligations, or termination payment to any officer, director, or employee of the Company nor or any of its subsidiaries shall establish,Subsidiaries;
(eh) neither the Company will not, nor will it permit any of its subsidiaries shall settle Subsidiaries to, enter into any collective bargaining agreement or compromise enter into any material claims substantive negotiations with respect to any collective bargaining agreement, except as required by law;
(i) the Company will not, nor will it permit any of its Subsidiaries to, change the accounting principles used by it unless required due to changes in GAAP or litigation orby Regulation S-X under the Exchange Act;
(j) the Company will not, nor will it permit any of its Subsidiaries to, make any acquisition, whether by purchase of stock or assets, of any Person or any division or business of any Person;
(k) the Company will not, nor will it permit any of its Subsidiaries to, sell, lease, license, exchange, transfer, or otherwise dispose of, or agree to sell, lease, license, exchange, transfer, or otherwise dispose of, any of the Assets (including the Company IP), except in the ordinary and usual course of business consistent with past practices;
(l) the Company will not, nor will it permit any of its Subsidiaries to, mortgage, pledge, hypothecate, grant any security interest in, or otherwise subject to any other Lien other than Permitted Liens, any of the Assets (including the Company IP);
(m) the Company will not, nor will it permit any of its Subsidiaries to, (i) pay, discharge, settle, or satisfy any material claims against the Company or any of its Subsidiaries (including claims of stockholders), liabilities, or obligations (whether absolute, accrued, contingent, or otherwise), other than (x) the payment, discharge, settlement, or satisfaction of such claim, liability, or obligation in the ordinary course of business consistent with past practice; or (y) the payment, discharge, settlement, or satisfaction of claims, liabilities, or obligations reflected or reserved against in the most recent audited financial statements (or the notes thereto) of the Company included in the Company SEC Documents (for amounts not in material excess of such reserves) or incurred since the date of such financial statements in the ordinary course of business consistent with past practice; or (ii) waive, release, grant, or transfer any right of material value, other than in the ordinary course of business consistent with past practice or, subject to the terms hereof, fail to enforce, or consent to any material matter with respect to which its consent is required under, any material confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is a party;
(n) the Company will not, nor will it permit any of its Subsidiaries to, engage in any transaction with, or enter into any agreement, arrangement, or understanding with, directly or indirectly, any of the Company’s affiliates other than wholly-owned Subsidiaries of the Company or pursuant to agreements in force on the date of this Agreement as set forth in the Disclosure Letter;
(o) the Company and its Subsidiaries will not make or change any Tax election, adopt or change any method of accounting with respect to Taxes, amend any Return, waive any rights to a Tax refund or credit, or settle or compromise any Tax liability; agree to an extension or waiver of the consent statute of Purchaserlimitations with respect to the assessment or determination of Taxes; or enter into any closing agreement with respect to any Tax or surrender any right to claim a Tax refund;
(p) the Company will not, and will not permit any of its Subsidiaries to, liquidate or dissolve or approve a plan of liquidation or dissolution;
(q) the Company will not, nor will it permit any of its Subsidiaries to, incur, assume, or guarantee any Indebtedness;
(r) the Company will not, and will not permit any of its Subsidiaries to, enter into any agreement, understanding, or commitment that restrains, limits, or impedes the Company’s or any of its Subsidiaries’ ability to compete with or conduct any business or line of business, including geographic limitations on the Company’s or any of its Subsidiaries’ activities;
(s) the Company will not, and will not permit any of its Subsidiaries to, modify, amend amend, or terminate any of its material Contracts Material Contract or waiveenter into any contract that would be a Material Contract if entered into prior to the date hereof, release or waive or assign any material of its rights or claims;
(f) neither claims under a Material Contract or contract that would be a Material Contract if entered into prior to the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserdate hereof, in each case except in the ordinary and usual course of businessbusiness consistent with past practice;
(gt) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor will not, and will not permit any of its subsidiaries shall change Subsidiaries to, (i) abandon or permit to lapse any rights in any material Company IP, (ii) disclose, deliver or otherwise provide to any Person, or grant a contingent right to any Person to receive, the source code of any Company Software Product or any material part thereof, or (iii) disclose to any Person, that is not an employee of, or consultant or advisor to, the Company or any of its Subsidiaries, who has confidentiality obligations to the accounting practices Company or principles used by itsuch Subsidiary with respect thereto pursuant to a written agreement, any confidential information (including any trade secret, process, or know-how) of the Company or any of its Subsidiaries not in the public domain prior to the date of this Agreement, except pursuant to judicial order or process or pursuant to commercially reasonable disclosures made in the ordinary course of business consistent with past practice and under a new or existing contract or agreement with such Person containing adequate confidentiality obligations;
(hu) neither the Company nor will not, and will not permit any of its subsidiaries shall adopt a plan of complete or partial liquidationSubsidiaries to, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization engage in Company-wide communication with employees of the Company or any of its Subsidiaries regarding the compensation or benefits that they will receive in connection with the Merger, unless any such communications are consistent with prior directives or documentation provided to the Company by Parent;
(v) the Company will not, and will not permit any of its Subsidiaries to, make any loans, advances or capital contributions to or investments in any other Person (other than loans, advances, capital contributions, or investments made to the Merger and other than in compliance with Section 9.4(aCompany’s Subsidiaries)); and;
(iw) neither the Company nor will not, and will not permit any of its subsidiaries will authorize Subsidiaries, employees or enter into an agreement to do any of the foregoing or representatives to, take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions conditions to the Merger set forth in Annex A hereto Article 6 not being satisfiedsatisfied or that would reasonably be expected to prevent, delay, or impair the ability of the Company to consummate the Merger;
(x) the Company will not, and will not permit any of its Subsidiaries to, hire any new employees other than non-officer employees in the ordinary course of business consistent with past practice or terminate the employment of any officer or key employee of the Company; and
(y) the Company will not, nor will it permit any of its Subsidiaries to, enter into an agreement, contract, commitment, or arrangement to do any of the foregoing. Nothing contained in this Agreement is intended to give Parent, directly or indirectly, the right to control or direct the operations of the Company or any of its Subsidiaries prior to the Effective Time. Prior to the Effective Time, each of Parent and the Company will exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time earlier of the purchase of the Shares pursuant to the Offer or the termination of this Agreement in accordance with its terms (unless Purchaser shall otherwise consent agree in writing and except as otherwise permitted expressly contemplated by this Agreement):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business associates;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarysubsidiaries; (ii) amend the its Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoBy-Laws; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, Company or its subsidiaries or any other property or assets (other than, in the case of the Company, (x) Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable (y) options to be granted pursuant to the Warrantsterms of Section 3.12 hereof); (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or Company; (iv) make or authorize capital expenditures in excess of $50,000 individually or $100,000 other than in the aggregate ordinary and usual course of business and in amounts not exceeding those contemplated by the Company's current capital expenditure budget provided to Purchaser; or (v) make or authorize any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock of any other person or entity (other than acquisitions the acquisition of, or investment in, any entity listed on Schedule 3.1(c) of assets the Company Disclosure Schedule involving amounts not in excess of $10,000,000 individually or $25,000,000 in the ordinary course of business consistent with past practice)aggregate;
(d) other than the Employment Agreements, neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with with, any director, director or officer or other employee of the Company or any such subsidiarysubsidiaries; and and, other than the options to be granted pursuant to the terms of Section 3.12 hereof, neither the Company nor any of its subsidiaries shall establish,, adopt, enter into, make any new grants or awards under or amend, any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, employee stock ownership, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any directors, officers or employees (the "Benefit Plans");
(e) neither the Company nor any of its subsidiaries shall (i) settle or compromise any material claims or litigation or(including any claims for Taxes made by a Governmental Entity) in excess of $1,000,000, except in the ordinary and usual course of business and with the consent of Purchaser, (ii) modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims, (iii) cancel or forgive any indebtedness owed to the Company or any of its subsidiaries by any officer or director of the Company or by any of its subsidiaries, or (iv) cancel or forgive any other indebtedness owed to the Company or any of its subsidiaries other than in the ordinary and usual course of business;
(f) neither the Company nor any of its subsidiaries shall make any tax election Tax Election for a Tax Return or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, in each case except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change waive, release or fail to use commercially reasonable efforts to enforce any of its rights under any confidentiality agreement, standstill agreement or any similar agreement to which it is a party, unless the accounting practices or principles used by itBoard of Directors of the Company determines in good faith, after consultation with its outside counsel, that it is necessary to do so in order for its directors to comply with their respective fiduciary duties;
(h) neither the Company nor any of its subsidiaries shall adopt a plan enter into any material contract or agreement;
(i) neither the Company nor any of complete its subsidiaries shall, except as specifically permitted in Section 3.2, take or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalizationfail to take any action that is reasonably likely to result in any failure of the Offer, or other reorganization is reasonably likely to make any representation or warranty of the Company (other than contained herein inaccurate if qualified by "Company Material Adverse Effect" or inaccurate in any material respect if not so qualified at, or as of any time prior to, Purchaser's purchase of Shares pursuant to the Merger and other than in compliance with Section 9.4(a))Offer; and
(ij) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Tender Offer Agreement (Koninklijke Philips Electronics Nv)
Interim Operations of the Company. and the PHP Group. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to except (i) as contemplated by this Agreement and the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted transactions contemplated by this Agreement):, (ii) as disclosed on Schedule 5.1 [OMITTED], or (iii) with the prior written consent of Buyer (which consent shall not be unreasonably withheld), after the date hereof and before the Closing Date, the PHP Group:
(a) shall conduct the business of the Company and its subsidiaries shall be conducted only Business in the ordinary and usual course andcourse, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainwith past practice;
(b) will not amend the Company PHP Group’s articles of incorporation or bylaws or organizing and governing documents;
(c) shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding SharesShares or the shares of PHPI; (ii) issue or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any the Shares or the shares of its capital stock PHPI; or (iii) redeem, purchase or otherwise acquire, directly or indirectly, any of the Shares or the shares of PHPI, other than in connection with the Spin Off Transaction; provided, however, that notwithstanding the provisions of this Section 5.1(c), the Company may seek, and upon obtaining any required regulatory approval, shall make, a distribution to shareholders and other equity holders of Newco Group which shall acquire only the Excluded Assets and assume the Excluded Liabilities either directly or through the Merger with or acquisition of the shares of one or more of the Excluded Subsidiaries or otherwise (a “Shareholder Distribution”) and redeem and retire the Preferred Shares (the “Redemption”);
(d) shall not (i) adopt any new employee benefit plan or amend any existing benefit plan to enhance or otherwise modify any benefit (other than to 100% vest the employees hired/retained by the Company or PHPI who thereby are deemed separated from employment for purposes of any class of the Company, its subsidiaries benefit plan transferred to or any other property assumed by Newco Group) or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transferincrease any compensation (except in the ordinary course of business consistent with past practices; provided that any increase of more than 10% for any Designated Employee shall require the prior written consent of Buyer) or enter into or amend any employment, leaseseverance, licensetermination or similar agreement with any of its present or future officers, guaranteedirectors or employees, except for those required under existing plans or programs; provided, however that nothing contained herein shall prohibit the PHP Group from granting and paying its officers, directors or employees bonuses prior to the Closing Date except that no bonuses shall be paid to Agent and provided that such payments are in compliance with Code Section 280G;
(e) shall not, except as may be permitted by this Agreement, acquire, sell, mortgage, pledge, lease or dispose of any Assets if any such action would result in a material adverse change to the Closing Balance Sheet or encumber any assets regulatory non-compliance by the PHP Group;
(f) except as provided in Section 7.2(c), shall not amend, supplement or incur or modify any indebtedness or other liability otherwise alter, other than in the ordinary course, any Material Agreement with AHCA, Kids Corporation, or FEA, except as required by such Payors and usual course with prompt prior written notice of businesssuch to Buyer, and any hospital Providers or other third parties, except for the termination or transfer to Newco Group of those contracts included in the Excluded Assets;
(g) shall not (i) incur or assume any long-term or short-term debt or issue any debt securities that cannot be prepaid at or before Closing; (ii) assume, guarantee, endorse or otherwise become liable or responsible for the obligations of any unaffiliated third party; (iii) acquire directly make any loans, advances or indirectly by redemption capital contributions to, or otherwise investments in, any shares of the capital stock of the Company or any of its subsidiaries unaffiliated third party; or (iv) authorize capital expenditures pledge or otherwise encumber the Shares, any equity interest in excess PHPI, or any of $50,000 individually the Assets, or $100,000 in the aggregate or make create any acquisition of Security Interest with respect to any Asset;
(h) shall not (i) acquire (by merger, consolidation or acquisition of stock or assets)) any corporation, partnership or other business organization or division thereof or any equity interest therein; or (ii) other than capital expenditures identified on Schedule 5.1(h) [OMITTED], authorize any new capital expenditure or expenditures for assets to be included on the Closing Balance Sheet which, individually, is in excess of $50,000, or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course aggregate, are in excess of business consistent with past practice)$100,000;
(di) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall not adopt a plan of complete or partial liquidation, liquidation or resolutions providing for or authorizing such liquidation or a dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization unless required by law or administrative order;
(j) shall not change any of the Company accounting methods used by it unless required by GAAP or applicable law;
(other than k) shall not have failed to pay any material medical claim liability or indebtedness relating to the Merger and other than Business when due, except in compliance with Section 9.4(a))applicable law and where such failure could not be reasonably expected to lead to adverse relations with a hospital Provider, unless contested in good faith;
(l) shall not have instituted, settled, or agreed to settle, any material litigation, action, or proceeding before any court or governmental body relating to the Business;
(m) shall use its best efforts to keep in full force and effect insurance covering the PHP Group and the Assets comparable in amount and scope of coverage to that currently maintained;
(n) shall not permit Newco Group or any Excluded Subsidiary to acquire any business which is in competition with the Business or acquire any asset or contract right or conduct any business except as may be transferred to Newco Group pursuant to this Agreement, or with the written consent of Buyer; and
(io) neither the Company nor shall not have entered into any of its subsidiaries will authorize agreement or enter into an agreement commitment to do take any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained actions described in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedSection 5.1(a)-(n) above.
Appears in 1 contract
Samples: Merger Agreement (Amerigroup Corp)
Interim Operations of the Company. The Company covenants Except as expressly provided herein or as consented to in writing by the Buyer or the Transitory Subsidiary, from and agrees, as to itself and after the date of this Agreement until the earlier of the termination of this Agreement in accordance with its subsidiaries, that, prior to terms or the Effective Time (unless Purchaser Time, the Company shall, and shall otherwise consent cause each of its Subsidiaries to, act and carry on its business only in writing the ordinary course of business consistent with past practice and use reasonable best efforts to maintain and preserve its business organization, assets and properties, keep available the services of its officers and key employees and maintain and preserve its advantageous business relationships with suppliers, landlords and others having material business dealings with it. Without limiting the generality of the foregoing, except as otherwise permitted by expressly set forth in Section 5.1 of the Company Disclosure Letter, from and after the date of this Agreement):Agreement until the earlier of the termination of this Agreement in accordance with its terms or the Effective Time, the Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, do any of the following without the prior written consent of the Buyer or the Transitory Subsidiary:
(a) the business except as contemplated by Section 1.1, amend its Certificate of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain-32- Incorporation or By-laws or comparable governing documents;
(b) the Company shall not (i) sell sell, transfer or pledge or agree to sell sell, transfer or pledge any shares of capital stock or other securities equity interests owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Person;
(ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivc) declare, set aside or pay any dividend or other distribution payable in cash, stock securities or other property with respect to, or split, combine, redeem or reclassify, or purchase or otherwise acquire, any shares of its capital stock (or other equity interests) or other securities of the Company or any of the Subsidiaries (other than the making of a dividend or other distribution by a wholly-owned Subsidiary to another wholly-owned Subsidiary or to the SharesCompany);
(cd) neither the Company nor except as contemplated by Sections 1.1 and 2.1, issue or sell, or authorize to issue or sell, any shares of its subsidiaries shall (i) issuecapital stock or any other securities, or issue or sell, pledgeor authorize to issue or sell, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquirepurchase or subscribe for, or enter into any arrangement or contract with respect to the issuance or sale of, any shares of its capital stock of any class of the CompanyCompany or Voting Debt or other securities, its subsidiaries or make any other property or assets other thanchange in its capital structure, in except for the case possible issuance by the Company of the Company, Shares issuable shares of Common Stock pursuant to options the terms of any Options outstanding on the date hereof under hereof;
(e) acquire, make (or commit to make) any investment in, or make capital contribution to, any Person other than in the Stock Plans ordinary course of business consistent with past practice, other than transactions between a wholly-owned Subsidiary and shares issuable pursuant the Company or between wholly-owned Subsidiaries;
(f) make (or commit to make), or enter into any Contracts (or any amendments, modifications, supplements or replacements to existing Contracts) to be performed relating to, capital expenditures with a value in excess of $100,000 in any calendar year, or in the Warrantsaggregate capital expenditures with a value in excess of $250,000; PROVIDED that, other than as expressly set forth in Section 5.1 of the Company Disclosure Letter, in no event shall the Company or any of the Subsidiaries make (iior commit to make), or enter into any Contracts (or any amendments, modifications, supplements or replacements to existing Contracts) to be performed relating to, capital expenditures with respect to any new restaurants or maintenance of existing restaurants;
(g) acquire, by merging or consolidating with, by purchasing an equity interest in or a portion of the assets of, or by any other manner, any business or any Person, or otherwise acquire any assets of any Person (other than the purchase of equipment, inventories and supplies in the ordinary course of business consistent with past practice);
(h) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, subject to any Lien (other than a Permitted Lien) or otherwise encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary with respect to (i) transactions between a wholly-owned Subsidiary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any between wholly-owned Subsidiaries, (ii) dispositions of its subsidiaries excess or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of obsolete assets in the ordinary course of business consistent with past practice and (iii) leases, licenses or sales in the ordinary course of business consistent with past practice);
(di) neither except to the extent required under existing employee and director benefit plans, agreements or arrangements in effect on the date of the most recent audited financial statements included in the Company nor SEC Documents or required by applicable law or contemplated by Section 2.4, increase the compensation or fringe benefits of any of its subsidiaries shall directors, officers or employees, except for immaterial increases to employees who are not officers of the Company or any of the Subsidiaries in the ordinary course of business consistent with past practice, or grant any severance or termination pay tonot currently required to be paid under existing severance plans, or enter into any employment employment, consulting or severance agreement or arrangement with any present or former director, officer or other employee of the Company or any such subsidiary; of the Subsidiaries, or establish, adopt, enter into or amend, modify, supplement, replace or terminate any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the collective benefit of any directors, officers or employees (it being understood and neither agreed that in no event shall the Company nor or any of its subsidiaries shall establish,the Subsidiaries amend, modify, supplement, replace or terminate the policy in effect on the date hereof and previously disclosed to the Buyer with respect to suspension of any increases in the compensation or other remuneration of officers and other employees of the Company and the Subsidiaries);
(ej) neither the Company nor enter into or amend, modify, supplement or replace any employment, consulting, severance or similar agreement (including any change of its subsidiaries shall settle or compromise control agreement) with any material claims or litigation orPerson, except with respect to new hires of non-officer employees in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(gk) except as may be required as a result of a by applicable law, GAAP or SEC position, make any change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change accounting practices, policies or procedures or any of the accounting practices its methods of reporting income, deductions or principles used by itother items for income tax purposes;
(hl) neither the Company nor any of its subsidiaries shall except as contemplated by Sections 1.1 and 2.1, adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any Subsidiary (other than as may exclusively involve one or more wholly-owned Subsidiaries but only so long as the same shall not have and would not reasonably be likely to have (x) a material adverse effect on the Tax liability of the Company and the Subsidiaries or (y) a material adverse effect on the operations of the Company and the Subsidiaries) or any agreement relating to an Acquisition Proposal, except as expressly permitted in Section 5.3;
(m) except as contemplated by Section 5.7(a)(i), (i) incur, assume, modify or prepay any indebtedness for borrowed money, issue any debt securities or warrants or other rights to acquire debt securities, or guarantee, endorse or otherwise become liable or responsible for the obligations or indebtedness of another Person, other than indebtedness owing to or guarantees of indebtedness owing to the Company or any direct or indirect wholly-owned Subsidiary, or enter into any capital lease, or (ii) make any loans, extensions of credit or advances to any other Person, other than to the Company or to any direct or indirect wholly-owned Subsidiary, except, (A) in the case of preceding clause (i), for (x) borrowings under the Company Senior Credit Agreement in the ordinary course of business consistent with past practice and (y) the making of scheduled amortization payments to the extent required by -34- the Company Senior Credit Agreement and ordinary course repayments of borrowings under the working capital facility of the Company Senior Credit Agreement, (B) in the case of preceding clauses (i) and (ii), for loans, extensions of credit or advances constituting trade payables or receivables arising in the ordinary course of business and (C) in the case of preceding clause (ii), for advances to employees in respect of travel and entertainment expenses in the ordinary course of business in amounts of $12,500 or less to any individual on any date of determination and $150,000 in the aggregate on any date of determination;
(n) except as permitted by Section 2.4, accelerate the payment, right to payment or vesting of any bonus, severance, profit sharing, retirement, deferred compensation, stock option, insurance or other compensation or benefits;
(o) pay, discharge, settle or satisfy any claims, litigation, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise) other than (i) the payment, discharge, settlement or satisfaction, in the ordinary course of business consistent with past practice, of (1) liabilities reflected or reserved against in the December 30, 2001 balance sheet included in the Company SEC Documents or (2) liabilities (other than litigation) subsequently incurred in the ordinary course of business consistent with past practice and (ii) other claims, litigation, liabilities or obligations (qualified as aforesaid) that in the aggregate do not exceed $250,000.
(p) other than as disclosed in Company SEC Documents filed prior to the date hereof, plan, announce, implement or effect any material reduction in force, lay-off, early retirement program, severance program or other program or effort concerning the termination of employment of employees of the Company or the Subsidiaries; PROVIDED that routine employee terminations in the ordinary course of business shall not be considered subject to this subclause;
(q) take any action or non-action (including, without limitation, the adoption of any shareholder-rights plan or amendments to its Certificate of Incorporation or By-laws (or comparable governing documents)) which would, directly or indirectly, restrict or impair the ability of the Buyer to vote or otherwise to exercise the rights and receive the benefits of a stockholder with respect to securities of the Company that may be acquired or controlled by the Buyer or the Transitory Subsidiary, or any action which would permit any Person to acquire securities of the Company on a basis not available to the Buyer or the Transitory Subsidiary;
(r) take any action or non-action which (x) constitutes a violation of any Liquor License, which violation would result in or would reasonably be likely to result in, individually or in the aggregate, the modification, suspension, cancellation, termination of any one or more Liquor Licenses or otherwise have or would reasonably be likely to have a material adverse impact on any Company Restaurant or the nature or level of discipline imposed on account of future violations of the laws related to sales and service of alcoholic beverages or (y) would (or would reasonably be likely to) materially impede, delay, hinder or make more burdensome for the Buyer to obtain and maintain any and all authorizations, approvals, consents or orders from any Governmental Entity or other third party necessary or required to maintain the Liquor Licenses in effect at all times following the Merger and other than on the same terms as in compliance effect on the date of this Agreement;
(s) enter into any new material line of business or enter into any agreement that restrains, limit or impedes the Company's or any Subsidiary's ability to compete with Section 9.4(a)); andor conduct any business or line of business;
(i) neither file or cause to be filed any materially amended Tax Returns or claims for refund; (ii) make or rescind any material tax election or otherwise fail to prepare all Tax Returns in a manner which is consistent with the past practices of the Company nor and each Subsidiary, as the case may be, with respect to the treatment of items on such Tax Returns except to the extent that any inconsistency (1) would not or may not materially increase the Buyer's, the Company's, or any Subsidiary's liability for Taxes for any period or (2) is required by law; (iii) incur any material liability for Taxes other than in the ordinary course of business; or (iv) enter into any settlement or closing agreement with a taxing authority that materially increases or would reasonably be likely to materially increase the Tax liability of the Company or any of the Subsidiaries for any period;
(u) fail to maintain with current or other financially responsible insurance companies insurance on its subsidiaries will authorize tangible assets and its businesses in such amounts and against such risks and losses as are consistent with past practice; or
(v) authorize, agree or enter into announce an agreement intention, in writing or otherwise, to do take any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedactions.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) the business of Except as otherwise approved in writing by Buyer, the Company shall, and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Sellers shall cause the Company to, operate its business in, and its subsidiaries shall use its commercially reasonable efforts not take any action except in, the ordinary course consistent with past practice and to preserve its intact their respective business organization intact organizations, Assets, Intellectual Property, and maintainthe current relationships and goodwill of their customers, suppliers and others with whom it has significant business relations.
(b) The Company, and each of the Sellers shall cause the Company shall not to, during the period from the date of this Agreement to the Closing Date, except with the prior written consent of Buyer, directly or indirectly;
(i) sell amend or pledge or agree to sell or pledge any stock or other securities owned by it or permit any otherwise change the Organizational Documents of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the SharesCompany;
(c) neither the Company nor any of its subsidiaries shall (iii) issue, sell, pledgedispose of, dispose create a Lien on, or authorize the issuance, sale, disposal or creation of or encumber any additional shares Lien on, (A) any capital stock of, or securities convertible into other ownership interests in, the Company, including the Shares (including, but not limited to, by way of stock split or exchangeable fordividend) or any subscriptions, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness convertible securities or other liability other than in rights to acquire the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries foregoing, or (ivB) authorize capital expenditures in excess any Asset or property right, except for sales of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets inventory in the ordinary course of business consistent with past practice);
(diii) neither redeem, purchase, reclassify, combine, split, subdivide, change the terms of, or otherwise acquire, any capital stock of, or other ownership interests in, the Company;
(iv) declare or pay any dividend or other distribution (whether in cash, stock or other property) with respect to any capital stock of, or other ownership interests in, the Company;
(v) with respect to the Company nor create, incur or assume any indebtedness or any Liability, including granting or becoming subject to any Guaranty in excess of its subsidiaries shall $100.000;
(vi) with respect to the Company make or commit to make any capital expenditures in excess of $10.000;
(vii) with respect to the Company, except in the ordinary course of business consistent with past practice, discharge or otherwise obtain the release of any Lien or pay or otherwise discharge any Liability;
(viii) with respect to the Company except in the ordinary course of business consistent with past practice, write off the value of any assets, inventory or any accounts receivable or increase the reserves for obsolete, damaged, spoiled or otherwise not usable inventory or doubtful or uncollectable receivables;
(ix) increase the compensation payable or to become payable to directors, officers or employees of the Company, or grant any rights to severance or termination pay to, or enter into any employment or severance agreement with with, any such person or establish, adopt, enter into or amend any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Company;
(ex) neither with respect to the Company nor Company, acquire (including, without limitation, by merger, consolidation or acquisition of stock or assets) any interest in any Person or assets (other than the acquisition of its subsidiaries shall settle inventory in the ordinary course of business);
(xi) alter the manner of keeping the books, accounts or records, or change in any manner the accounting practices, methods or assumptions therein reflected, of the Company;
(xii) amend, terminate, cancel or compromise any material claims of the Company or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate waive any of its material Contracts or waive, release or assign any other material rights or claimsof the Company;
(fxiii) neither with respect to the Company nor any Company, delay or postpone the payment of its subsidiaries shall make any tax election accounts payable or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessother Liabilities;
(gxiv) except as may be required as a result of a change in law take or in generally accepted accounting principles, neither the Company nor omit to take any action which is intended to render any of its subsidiaries shall change each of the Seller’s representations or warranties untrue or misleading, or which would be a material breach of any of each of the accounting practices Sellers’ covenants or principles used by itagreements;
(hxv) neither allow any Permit to lapse or terminate or fail to renew any Permit;
(xvi) take any action which is intended to have a Material Adverse Effect or which is intended to delay the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization consummation of the Company transactions contemplated by this Agreement;
(xvii) with respect to the agreements listed in Schedule 4.19, amend, terminate, cancel, waive any rights thereunder or take any action with respect to the same, other than amending the Merger terms of the Convenio de Distribución between Laboratorio Volta S.A. and Pharma Genexx S.A. dated December 12, 2006 so that Pharma Genexx S.A. may not terminate the same before April 15, 2010 or such other than earlier date on which OPKO Chile releases, at its own discretion, the amount held in compliance escrow pursuant to the Escrow Agreement, with Section 9.4(a))a prior written notice of at least 75 days; andor
(ixviii) neither the Company nor any of its subsidiaries will authorize agree, whether in writing or enter into an agreement otherwise, to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this Agreement, or (ii) as agreed in writing by Parent, after the date hereof, and prior to the Effective Time time the directors of the Purchaser have been elected to, and shall constitute a majority of, the Board of Directors of the Company pursuant to Section 1.3 (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreementthe "Appointment Date"):
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course of business and consistent with past practice and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its business organization organizations and business organizations of its Subsidiaries intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not will not, directly or indirectly, (i) sell except upon exercise of employee stock options, pursuant to which up to 517,117 Shares may be issued, outstanding on the date hereof, issue, sell, transfer or pledge or agree to sell sell, transfer or pledge any treasury stock of the Company or other securities owned by it or permit any capital stock of any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities Subsidiaries beneficially owned by such subsidiary; it, (ii) amend the its Certificate of Incorporation or its bylaws By-Laws or amend, modify similar organizational documents; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, subdivide, combine or reclassify the outstanding Shares; Shares or (iv) declare, set aside Preferred Stock or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock other than dividends paid by Subsidiaries of the Company to the Company or any of its wholly-owned Subsidiaries in the ordinary course of business; (ii) issue, sell, pledge, grant, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than Shares reserved for issuance on the case of the Company, Shares issuable date hereof pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable hereof, pursuant to the Warrantswhich up to 517,117 Shares may be issued; (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice; or (iiiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) grant any severance increase in the compensation payable or termination pay toto become payable by the Company or any of its Subsidiaries to any of its executive officers or employees, enter into any contract or other binding commitment in respect of any such increase with any of its directors, officers or other employees or any director, officer or other employee of its Subsidiaries, and not establish, adopt, enter into, make any new grants or awards under or amend, any collective bargaining agreement; (ii)(A) adopt any new, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan, agreement or arrangement; or (iii) enter into any employment or severance agreement with or, except in accordance with the existing written policies of the Company, grant any directorseverance or termination pay to any officer, officer director or other employee of the Company or any such subsidiaryof its Subsidiaries; and neither PROVIDED, HOWEVER, that (i) prior to consummation of the Offer, the Company nor any may enter into severance agreements with the individuals set forth in Section 5.1(d) of its subsidiaries the Company Disclosure Schedule (the "Designated Employees") in the form as approved by the Company's Board of Directors, (ii) the aggregate cost of payments and benefits provided to the Designated Employees pursuant to the terms of such severance agreements (unless otherwise amended with the written consent of, or at the written direction of, Parent or Purchaser) shall establish,not exceed $2,000,000 in the aggregate, and (iii) with respect to the severance plan described in Section 3.4 of the Company Disclosure Schedule that covers individuals other than the Designated Employees (the "Nondesignated Employees"): (a) the implementation of such plan and the entering into of agreements with Nondesignated Employees shall be subject to the prior written consent of the Purchaser, which consent shall not be unreasonably withheld (with reasonableness to be determined based upon Purchaser's reasonable business objectives and consistent with Purchaser's past practice), and (b) the aggregate cost of payments and benefits provided to the Nondesignated Employees pursuant to the terms of such severance agreements (unless otherwise amended with the written consent of, or at the written direction of, Parent or Purchaser) shall not exceed $1,000,000 in the aggregate;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserterminated, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(f) neither the Company nor any of its Subsidiaries shall enter into any contracts or transactions relating to the purchase of assets that exceed $1,000,000 in the aggregate;
(g) except as may be neither the Company nor any of its Subsidiaries shall change any of the accounting methods used by it unless required as a result of a change in law or in generally accepted accounting principlesby GAAP, neither the Company nor any of its subsidiaries Subsidiaries shall make any material Tax election except in the ordinary course of business consistent with past practice, change any material Tax election already made, adopt any material Tax accounting method except in the ordinary course of business consistent with past practice, change any material Tax accounting method unless required by GAAP, enter into any closing agreement, settle any Tax claim or assessment or consent to any Tax claim or assessment or any waiver of the accounting practices statute of limitations for any such claim or principles used by itassessment;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
Subsidiaries shall: (i) neither the Company nor incur or assume any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.long-term debt;
Appears in 1 contract
Interim Operations of the Company. The Company covenants From and agrees, as to itself and its subsidiaries, that, prior to after the Effective Time date hereof until the Closing Date (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by or earlier termination of this Agreement):
(a) the business of ), Honeywell shall cause the Company and its subsidiaries shall be conducted only Subsidiaries to conduct their respective businesses in the ordinary course consistent with past practice and usual course and, to the extent consistent therewith, each of the Company in compliance in all material respects with all applicable Laws and its subsidiaries shall use its their commercially reasonable efforts to preserve intact the assets of, and the business organizations and relationships with employees and third parties having material business dealings with, the Company and its business Subsidiaries. Without limiting the generality of the foregoing, except (1) as otherwise expressly required by this Agreement (including the actions contemplated by Section 10.10(a) and Section 10.11), (2) for actions approved in advance by Purchaser in writing (which approval shall not be unreasonably withheld or delayed), or (3) as set forth on Section 5.1 of the Disclosure Schedule, from and after the date hereof until the Closing Date (or earlier termination of this Agreement), Honeywell shall cause the Company and its Subsidiaries not to take any of the following actions:
(a) adopt any change in their respective certificates of incorporation or bylaws or other similar organization intact and maintainor governing documents;
(b) adopt a plan or agreement of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company shall not or any of its Subsidiaries;
(c) (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to issue, sell, pledge transfer, pledge, dispose of or agree to sell encumber the Shares or pledge any shares of capital stock or other securities owned by such subsidiary; of the Subsidiaries of the Company, (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine combine, subdivide or reclassify the outstanding Shares; Shares or any shares of capital stock of the Subsidiaries of the Company, (iviii) declare, set aside or pay any dividend or other distribution, other than dividends or other distributions payable in cashcash on or prior to the Closing, stock or property with respect to the SharesShares or any shares of capital stock of the Subsidiaries of the Company or (iv) redeem, purchase or otherwise acquire directly or indirectly the Shares or any shares of capital stock of the Subsidiaries of the Company;
(cd) neither the Company nor any of its subsidiaries shall except as required by applicable Law, (i) issueadopt, sellestablish or enter into an agreement to adopt or establish any plan, pledgepolicy, dispose of agreement or encumber any additional shares of, arrangement that would be a Plan if established or securities convertible into adopted on or exchangeable for, or options, warrants, calls, commitments or rights of any kind prior to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; hereof, (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber increase the benefits under any assets or incur Plans or modify any indebtedness Plan where such modification has a cost impact on the Company or other liability its Subsidiaries or (iii) increase the salary or bonus payable to any employee of the Company or its Subsidiaries other than in the ordinary and usual course of businessbusiness consistent with past practice; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of provided, however, that nothing in this Agreement shall prevent the Company or any of its subsidiaries Subsidiaries from entering into employment agreements with new employees or severance agreements (ivother than officers or directors or other key employees) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate ordinary course of business consistent with past practice; provided, further, that no such agreements with new employees or make severance agreement shall provide for benefits upon or following a "change of control"; and provided, further, that the cost impact of all actions permitted pursuant to this clause (d) shall not exceed $250,000 in the aggregate, excluding any actions required by applicable Law;
(e) enter into or consummate any transaction involving the acquisition of (by mergerthe business, consolidation or acquisition of stock or assets)stock, or any investment in, material assets or stock other properties of any other person or entity Person (other than acquisitions of inventory or other business assets in the ordinary course of business consistent with past practice);
(df) neither sell, lease, license or otherwise dispose of any material amount of assets, tangible or intangible, or property, except pursuant to existing Material Contracts and except for sales of inventory or other business assets in the ordinary course of business consistent with past practice;
(g) other than in the ordinary course of business consistent with past practice or as otherwise required by the Code or applicable Laws, (i) make or rescind any material Tax election with respect to the Company nor or its Subsidiaries or file any amended Tax Returns, (ii) change any of its subsidiaries shall grant material methods of reporting income or deductions for Tax purposes, (iii) compromise any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee Tax liability of the Company or any such subsidiary; and neither of its Subsidiaries that is material to the Company nor and its Subsidiaries or (iv) issue a waiver to extend the period of limitations for the payment or assessment of any of its subsidiaries shall establish,Tax;
(ei) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except other than in the ordinary and usual course of business and consistent with past practice, incur any Indebtedness, (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the consent obligations of Purchaserany other Person, modifyexcept for assumptions, amend guarantees or terminate endorsements of the ordinary course obligations of any Subsidiary of the Company, (iii) make any loans, advances or capital contributions to or investments in any other Person (other than to Subsidiaries of the Company or customary loans or advances to employees, in each case in the ordinary course of business consistent with past practice) or (iv) mortgage or pledge any of its material Contracts assets, tangible or waiveintangible, release or assign create or suffer to exist any material rights or claimsEncumbrance thereupon (other than Permitted Encumbrances);
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(gi) except as may be required as a result of a change in law Law or in generally accepted accounting principlesGAAP, neither the Company nor any of its subsidiaries shall change any of the accounting principles or practices or principles (including the Specified Accounting Policies and any procedures with respect to the payment of accounts payable and collection of accounts receivable) used by itthe Company and its Subsidiaries;
(hj) neither manage working capital other than in the Company nor ordinary course of business consistent with past practice, including not extending the payment of accounts payable, accelerating the collection accounts receivable or failing to maintain and manage inventory levels, in each case, other than in the ordinary course of business consistent with past practice;
(k) enter into, terminate, modify or amend or waive any pricing provision or other material provisions of, any Material Contract;
(l) change the material terms and conditions of their business relationships with Key Customers or Key Suppliers;
(m) temporarily or permanently (i) terminate or close any facility or (ii) disrupt production or call center functioning;
(n) write up or down of any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization the assets of the Company (or its Subsidiaries individually or in the aggregate in excess of $2,500,000 other than the Merger and other than in compliance with Section 9.4(a)); andas may be required by GAAP or applicable Laws;
(io) neither the Company nor settle, discharge or compromise any of its subsidiaries will authorize material action, claim, action, suit, investigation or proceeding or enter into an agreement any material consent decree, injunction or similar restraint or form of equitable relief in settlement thereof;
(p) incur or commit to do any capital expenditures other than capital expenditures incurred or committed to in the ordinary course of business consistent in all material respects with the 2005 capital expenditure budget attached as Section 5.1(p) of the Disclosure Schedule or enter into any new line of business;
(q) make any material purchase commitment not in the ordinary course of business consistent with past practice; or
(r) authorize, or agree or commit to do, whether in writing or otherwise, any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Stock Purchase Agreement (Honeywell International Inc)
Interim Operations of the Company. The Company covenants and agrees, agrees that except as to itself and its subsidiaries, thatdescribed on Schedule 6.1, prior to the Effective Time (unless the Purchaser shall otherwise consent agree in writing (which agreement shall not be unreasonably withheld) and except as otherwise permitted contemplated by this Agreement):
(a) the business of the Company shall, and shall cause each subsidiary thereof to, conduct its subsidiaries shall be conducted respective businesses only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, corporate partners, licensees and business associates;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by nor shall it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge (i) create any stock or other securities owned by such subsidiarysubsidiaries; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretocharter documents; (iii) split, combine or reclassify the outstanding SharesShares or any other shares of capital stock of the Company or such subsidiary; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company shall not, nor shall it permit any of its subsidiaries shall subsidiary to, (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries Company or such subsidiary or any other property or assets other than, in the case than (x) Shares issuable upon exercise of the Company, Company Warrants outstanding on the date hereof and (y) Shares issuable pursuant to options outstanding on the date hereof under the Company Stock Plans and shares issuable pursuant to the WarrantsOption Plan; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets assets, including, without limitation, all intellectual property and technology rights which it owns or uses, or enter into any collaboration; (iii) incur or modify any indebtedness or other liability other than liability, except in the ordinary and usual course of businessbusiness consistent with past practice; (iiiiv) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries such subsidiary or (ivv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)entity;
(d) neither except as otherwise provided herein, the Company nor any of its subsidiaries shall not grant any severance or termination pay to, or enter into any employment or severance agreement with with, any director, officer or other employee of the Company or any such subsidiary; and neither the Company shall not, nor shall it permit any subsidiary to, establish, adopt, enter into, make any new grants or awards under or amend, any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, employee stock ownership, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of its subsidiaries shall establish,any directors, officers or employees;
(e) neither the Company shall not, nor shall it permit any of its subsidiaries shall subsidiary to, settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, or modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company shall not, nor shall it permit any of its subsidiaries shall subsidiary to, make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to the Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company shall not, nor shall it permit any of its subsidiaries shall change subsidiary to, take any of the accounting practices or principles used by itactions described in Section 5.1(f);
(h) neither except as expressly permitted hereunder, the Company shall not, nor shall it permit any of its subsidiaries shall adopt a plan of complete or partial liquidationsubsidiary to, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any foregoing; and
(i) the Company shall, within twenty (20) days after the end of each calendar month, furnish to the Purchaser an unaudited consolidated balance sheet and consolidated income statement as of the representations end of such month, together with statements of retained earnings and cash flow for such period, all in detail reasonably satisfactory to the Purchaser and furnished with a certificate signed by the Chief Financial Officer or warranties Chief Executive Officer stating that, to his knowledge, such financial statements have been prepared in accordance with GAAP (subject to normal year-end adjustments and the addition of footnotes or other explanatory material associated with its financial statements prepared in accordance with GAAP) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly and accurately present the financial position and results of operations of the Company contained and its subsidiaries for such periods, and have been prepared in this Agreement to be untrue or incorrect or would result in any accordance with the books and records of the Offer Conditions set forth in Annex A hereto not being satisfiedCompany on a consistent basis.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time (unless Purchaser Parent shall otherwise consent agree in writing (which agreement shall not be unreasonably withheld or delayed) and except as otherwise permitted contemplated by this AgreementAgreement or as set forth in Section 7.1 of the Disclosure Letter):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees and business associates;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarysubsidiaries; (ii) amend the Certificate its Articles of Incorporation or its bylaws Bylaws or amend, modify or terminate the Rights Agreement, or redeem Agreement (except for amendments and modifications to the Rights issued pursuant theretoAgreement necessary to effect a particular Superior Proposal which will not affect the continued accuracy of the representation set forth in Section 6.1(j)); (iii) split, combine or reclassify the outstanding Shares or Preferred Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares or Preferred Shares;
(c) except as contemplated by the Stock Option Agreement, neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, (A) Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares (B) the issuance of securities issuable pursuant to upon the Warrantsexercise of Rights, other than as a result of the entering into of this Agreement or the Stock Option Agreement, the commencement of the Offer, the exercise of the Stock Option Agreement or the consummation of the Merger or the other transactions contemplated hereby and thereby; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in pursuant to the ordinary course of business consistent with past practice);cashless
(d) other than (i) as provided in 7.8(f) (ii) as required by law or (iii) as required under an existing plan as of the date hereof, neither the Company nor any of its subsidiaries shall (A) grant any severance or termination pay to, or enter into any employment or severance agreement with with, any director, officer or other employee of the Company or such subsidiaries; or (B) increase compensation payable to, or establish, adopt, enter into, make any such subsidiary; and neither new grants or awards (or accelerate the Company nor vesting, or increase the value of any benefit) under, or amend, any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, employee stock ownership, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of its subsidiaries shall establish,any directors, officers or employees;
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaserbusiness, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any material tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserthe prior written approval of Parent, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall (i) terminate the employment of any Employee who is covered by a change any of the accounting practices in control, employment, termination or principles used by it;similar agreement, except for Cause (as defined in such agreements) or (ii) permit circumstances to exist that would provide -29- 29 such Employee with Good Reason (as defined in such agreements) to terminate employment; and
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Koninklijke Philips Electronics Nv)
Interim Operations of the Company. The From the date hereof through the Effective Time, the Company covenants and agrees, as to itself agrees that its business and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company it and its subsidiaries Subsidiaries shall use its commercially their respective best reasonable efforts to preserve its business organization intact and maintainmaintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates. Without limiting the generality of the foregoing, except as otherwise set forth in Section 7.1(a) of the Company Disclosure Letter, the Company covenants and agrees as to itself and its Subsidiaries that, from the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed, and except as otherwise expressly contemplated by this Agreement or by Law):
(bi) the Company it shall not (ix) sell issue, sell, pledge, dispose of or pledge or agree to sell or pledge encumber any capital stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarySubsidiaries; (iiy) amend its articles of incorporation or by-laws or the Certificate or comparable governing instruments of any of its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoSubsidiaries; (iiiz) split, combine or reclassify the its outstanding Sharesshares of capital stock; or (ivaa) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly- owned Subsidiaries to it or a wholly-owned Subsidiary or (bb) repurchase, redeem or otherwise acquire any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock, except, in connection with respect the Stock Plans, or permit any of its Subsidiaries to the Sharespurchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(cii) neither the Company it nor any of its subsidiaries Subsidiaries shall (ix) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any Voting Debt or any other property or assets (other than, in the case of the Company, than Shares issuable pursuant to options (whether or not vested) outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the WarrantsPlans); (iiy) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness for borrowed money or guarantee any such indebtedness or other liability other than in the ordinary and usual course of business; (iiiz) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or means, make any significant acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock (whether by way of any merger, consolidation, tender offer, share exchange or other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practiceactivity);
(diii) neither the Company it nor any of its subsidiaries Subsidiaries shall grant terminate, establish, adopt, enter into, make any severance new grants or termination pay toawards under, amend or otherwise modify, any Compensation and Benefit Plans, or enter into any employment or severance agreement with any directorincrease the salary, officer wage, bonus or other employee compensation of the Company any employees except for grants or any such subsidiary; awards or increases under existing Compensation and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except Benefit Plans occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and with related compensation and benefit increases), annual reestablishment of Compensation and Benefit Plans and the consent provision of Purchaser, modify, amend individual compensation or terminate any benefit plans and agreements for newly hired or appointed officers and employees of the Company and its material Contracts Subsidiaries or waive, release except for actions necessary to satisfy existing contractual obligations under Compensation and Benefit Plans or assign any material rights or claims;agreements existing as of the date hereof; and
(fiv) neither the Company it nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries Subsidiaries will authorize or enter into an agreement to do any of anything prohibited by the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Ceridian Corp)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time except (unless Purchaser shall otherwise consent in writing and except i) as otherwise permitted expressly contemplated by this Agreement):, (ii) as set forth in Section 5.1 of the Company Disclosure Schedule or (iii) as agreed in writing by Parent, after the execution and delivery of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course and in all material respects in compliance with all applicable Legal Requirements and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact intact, to maintain its existing relations with customers, suppliers, employees, creditors and maintainbusiness partners and to maintain customary levels of insurance coverage with respect to its assets and operations;
(b) the Company shall not (i) sell not, directly or pledge indirectly, amend its or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge Subsidiaries' certificate of incorporation or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amendsimilar organizational documents;
(c) the Company shall not, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; and it shall not permit its Subsidiaries to: (iii) split, combine or reclassify the outstanding Shares; or (ivi)(A) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
(c) neither Company's capital stock or that of its Subsidiaries other than those dividends or other distributions payable solely to the Company nor or one of its wholly-owned Subsidiaries, or (B) redeem, purchase or otherwise acquire directly or indirectly any of the Company's capital stock (or options, warrants, calls, commitments or rights of any kind to acquire any shares of capital stock) or that of its subsidiaries shall Subsidiaries; (iii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries other than Shares issued upon the exercise of Stock Options or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options Warrants outstanding on the date hereof under hereof; or (iii) split, combine or reclassify the Stock Plans outstanding capital stock of the Company or of its Subsidiaries;
(d) the Company shall not, and shares issuable pursuant it shall not permit its Subsidiaries to, acquire or agree to acquire, or except as contemplated by the Warrants; Xxxxx Restructuring (ii) as defined in the Foamex Credit Agreement), transfer, lease, license, guarantee, sell, mortgage, pledge, encumber, dispose of or encumber agree to dispose of, any assets material assets, including Intellectual Property, either by purchase, merger, consolidation, sale of shares in any of its Subsidiaries or incur otherwise, except pursuant to Contracts of the Company or modify any indebtedness or other liability other than its Subsidiaries in effect on the date hereof, in the ordinary and usual course of business; business consistent with past practice or in transactions involving consideration of less than $5,000,000, in the aggregate;
(iiie) acquire directly neither the Company nor its Subsidiaries shall: (i) grant any increase in the compensation payable or indirectly to become payable by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries Subsidiaries (A) to any of its executive officers or directors, other than regularly scheduled pay increases of not more than 10% per annum, or (ivB) authorize capital expenditures in excess to any of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (its key employees other than acquisitions of assets in the ordinary course of business consistent with past practice);
; or (dii)(A) neither adopt any new, or (B) except as contemplated by Section 2.4 or as required by any obligation existing as of the date hereof to do so or any applicable Legal Requirement or in connection with the Xxxxx Restructuring, amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan, agreement or arrangement; or (iii) (A) enter into or modify or amend any employment agreement or arrangement with any officer or director of the Company nor or any of its subsidiaries shall Subsidiaries, other than in the ordinary course of business consistent with past practice or (B) enter into or modify or amend any severance agreement with, or grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee director of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orSubsidiaries, except in the ordinary and usual course of business and consistent with past practice or as required by any applicable Legal Requirement or in connection with the consent of Purchaser, modify, amend Xxxxx Restructuring or terminate Contracts in effect on the date hereof; or (iv) enter into any of its material Contracts or waive, release or assign any material rights or claimscollective bargaining agreement;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make modify, amend or terminate any tax election of its material Contracts (other than the Credit agreement of Foamex Cuautitlan, S.A. de C.V.) or permit waive, release or assign any insurance policy naming it as a beneficiary material rights or a loss payable payee to be canceled or terminated without notice to Purchaserclaims, except other than in the ordinary and usual course of businessbusiness consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any indebtedness other than indebtedness with respect to working capital in amounts consistent with past practice and capital leases in the ordinary course of business; (ii) materially modify any material indebtedness; (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for any material obligations of any other person (other than a Subsidiary of the accounting practices Company or principles used by itas set forth on Section 5.1 of the Company's Disclosure Schedule); (iv) make any loans, advances or capital contributions to, or investments in, any other person (other than (A) to the Subsidiaries of the Company, (B) pursuant to the Merger Agreement, (C) as set forth on Section 5.1 of the Company's Disclosure Schedule (provided the ownership structure of such Subsidiary has not changed from that existing on the date hereof), (D) to Foamtec (Singapore) Pte. Ltd. or Foamex Asia Co. Ltd. in the ordinary course of business consistent with past practice, or (E) customary advances to employees); or (v) enter into any material Contract or transaction other than in the ordinary course of business consistent with past practice;
(h) neither the Company nor any of its subsidiaries Subsidiaries shall adopt materially change any of the accounting methods, practices or policies used by it, other than changing its fiscal year to a plan of complete calendar year, unless required by GAAP;
(i) the Company shall not, and it shall not permit its Subsidiaries to, make any material tax election (unless required by law) or partial liquidationsettle or compromise any material income tax liability;
(j) the Company shall not, dissolutionand it shall not permit its Subsidiaries to (i) except in connection with any transaction permitted by Section 5.5, merger, consolidation, restructuring, recapitalizationwaive the benefits of, or other reorganization of agree to modify in any material manner, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is a party, or (ii) except in the ordinary course of business consistent with past practice, pay, discharge or satisfy any actions, suits, proceedings or claims, other than the Merger payment, discharge or satisfaction, in each case in complete satisfaction, and with a complete release, of such matter with respect to all parties to such matter, of actions, suits, proceedings or claims that would not reasonably be expected to result in, individually or in the aggregate, a Material Adverse Effect;
(k) the Company shall not, and it shall not permit its Subsidiaries to, commence a lawsuit other than (i) for the routine collection of bills, (ii) in compliance such cases where the Company in good faith determines that the failure to commence suit would result in a material impairment of a valuable aspect of the Company's business or the forfeiture of substantial rights, provided that the Company consults with Section 9.4(a))Parent prior to filing such suit or (iii) to enforce this Agreement; and
(il) neither the Company nor any of its subsidiaries will authorize or Subsidiaries shall enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Trace International Holdings Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to except (i) as contemplated by this Agreement, (ii) as disclosed in the Disclosure Schedule or (iii) as agreed in writing by Parent, during the period from and after the date hereof until the earlier of the Effective Time (unless or the time the directors designated by Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):have been elected to the Board pursuant to Section 1.3:
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary ordinary, regular and usual course of business and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve in all material respects its business organization intact and maintainmaintain its existing relations with residents, suppliers, creditors, employees, business associates and others having business dealings with it;
(b) neither the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit nor any of its subsidiaries to sell, pledge shall: (i) amend its Restated Certificate of Incorporation or agree to sell Amended and Restated By-laws or pledge any stock or other securities owned by such subsidiarysimilar organizational documents; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Sharesany shares of any class or series of its capital stock; or (iviii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
its capital stock (c) neither the Company nor other than dividends from any of its subsidiaries shall of the Company to the Company or any other subsidiary of the Company); (iiv) issue, sell, pledge, dispose of issue or encumber sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its subsidiaries, its subsidiaries or any other property or assets other than, in except for issuances of Common Stock upon the case exercise of the Company, Shares issuable pursuant to options outstanding on the date hereof Options under the Stock Option Plans and shares issuable or upon the exercise of Warrants; or (v) redeem, purchase or otherwise acquire directly or indirectly any of its capital stock, except pursuant to the Warrants; provisions of Section 2.4;
(iic) transfer, lease, license, guaranteeneither the Company nor any of its subsidiaries shall: (i) acquire, sell, mortgage, pledge, lease or dispose of or encumber any assets or incur or modify any indebtedness or other liability material assets, other than in the ordinary and usual course of businessbusiness and consistent with past practice; (ii) incur or modify any material indebtedness or other liability, other than in the ordinary and usual course of business and consistent with past practice; (iii) acquire directly modify or indirectly by redemption amend in any material respect or otherwise any shares of the capital stock of the Company or terminate any of its subsidiaries material contracts or (iv) authorize capital expenditures in excess of $50,000 individually waive, release or $100,000 in the aggregate assign any material rights or make any acquisition of (by mergerclaims, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except in the ordinary course of business and consistent with past practice; (iv) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the material obligations of any other person (other than subsidiaries of the Company), except in the ordinary and usual course of business and consistent with past practice; (v) make any material loans, advances or capital contributions to, or investments in, any other person (other than to the wholly owned subsidiaries of the Company); or (vi) enter into any material commitment or transaction (including, but not limited to, any capital expenditure or purchase, sale or lease of assets or real estate);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orshall, except as may be required or contemplated by this Agreement or in the ordinary and usual course of business and with the consent of Purchaserbusiness, modify, terminate or materially amend or terminate any of its material Contracts Plans;
(e) except as otherwise specifically provided in this Agreement or waivein the Schedule 14D-9, release the Company shall not make any change in the compensation payable or assign to become payable to any material rights of its officers, directors, employees, agents or claimsconsultants (other than normal recurring increases in wages to employees who are not officers or directors or affiliates in the ordinary course of business consistent with past practice) or to persons providing management services, or enter into or amend any employment, severance, consulting, termination or other agreement (other than in the ordinary course of business consistent with past practice) or employee benefit plan or make any loans to any of its officers, directors, employees, affiliates, agents or consultants or make any change in its existing borrowing or lending arrangements for or on behalf of any of such persons pursuant to an employee benefit plan or otherwise;
(f) neither the Company nor any of its subsidiaries shall make pay, repurchase, discharge or satisfy any tax election of its material claims, liabilities or permit any insurance policy naming it as a beneficiary obligations (absolute, accrued, asserted or a loss payable payee to be canceled unasserted, contingent or terminated without notice to Purchaserotherwise), except other than the payment, discharge or satisfaction in the ordinary and usual course of businessbusiness and consistent with past practice or pursuant to contractual requirements existing on the date hereof, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated subsidiaries;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its subsidiaries (other than the Merger);
(h) neither the Company nor any of its subsidiaries shall change any of the accounting methods used by it unless required by the SEC, GAAP or applicable law;
(i) except as otherwise permitted by this Agreement, neither the Company nor any of its subsidiaries will take, or agree to commit to take, any action that would or is reasonably likely to result in any of the conditions to the Offer set forth in Annex A or any of the conditions to the Merger and other than set forth in compliance Article VI not being satisfied, or would make any representation or warranty of the Company contained herein qualified as to materiality inaccurate in any respect or any representation or warranty of the Company contained herein not so qualified as to materiality inaccurate in any material respect at, or as of any time prior to, the Effective Time, or that would materially impair the ability of the Company, Parent, Purchaser or the holders of Shares to consummate the Offer or the Merger in accordance with Section 9.4(a))the terms hereof or materially delay such consummation; and
(ij) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any action described in clauses (a) through (i) of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedSection 5.1.
Appears in 1 contract
Samples: Merger Agreement (Brookdale Living Communities Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly provided in this Agreement or (ii) with the prior written consent of Parent, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Time:
(a) the business of the Company and its subsidiaries shall Subsidiaries will be conducted only in the ordinary and usual customary course and, to the extent consistent therewith, with past practice and each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners; 29
(b) the Company shall not (i) sell will not, directly or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellindirectly, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Company Common Stock, or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries Subsidiaries shall (i) amend its certificate of incorporation or by-laws or similar organizational documents; (ii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock; (iii) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof, in accordance with their present terms; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice; or (iiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries Subsidiaries shall (i) grant any increase in the compensation payable or to become payable by the Company or any of its Subsidiaries to any of its officers, directors, employees, agents or consultants (other than increases for non-executive level employees in the ordinary course of business consistent with past practice); (ii) adopt or enter into any new plan, policy, agreement or arrangement that would constitute a Company Benefit Plan, or amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing Company Benefit Plan; (iii) enter into any, or amend any existing, employment or severance agreement with or, except in accordance with the existing written policies of the Company previously delivered to Parent, grant any severance or termination pay toto any officer, director or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiaryof its Subsidiaries; and neither the Company nor or (iv) make any loans to any of its subsidiaries shall establish,officers, directors, employees, agents or consultants or make any changes in its existing borrowing or lending arrangements for or on behalf of any of such persons, whether contingent on the Merger or otherwise;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts the Company Agreements or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries Subsidiaries shall change license or otherwise transfer, dispose of, permit to lapse or otherwise fail to preserve any of the accounting practices Company's or principles used by it;any of its Subsidiaries' Intellectual Property Rights, or dispose of or disclose to any person any trade secret, formula, process or know-how not theretofore a matter of public knowledge, except in the ordinary course of business and consistent with past practice; 30
(h) neither the Company nor any of its subsidiaries Subsidiaries shall cancel any debts or waive, release or relinquish any contract rights or other rights of substantial value, except settlements of accounts receivable in the ordinary course of business and consistent with past practice;
(i) neither the Company nor any of its Subsidiaries shall: (i) incur or assume any long-term debt except for amounts set forth in the Company's budget previously delivered to Parent and, except in the ordinary course of business consistent with past practice, incur or assume any short-term indebtedness in amounts not consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in the ordinary course of business and consistent with past practice; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned Subsidiaries of the Company or customary advances to employees for travel and business expenses in the ordinary course of business and consistent with past practice); or (iv) enter into any material commitment or transaction (including, but not limited to, any borrowing, capital expenditure or purchase, sale or lease of assets) other than capital expenditures pursuant to the Company's capital expenditures budget previously delivered to Parent and other capital expenditures that do not exceed $25,000 in the aggregate since March 31, 2000;
(j) neither the Company nor any of its Subsidiaries shall (i) change any of the accounting principles used by it unless required by GAAP; or (ii) take or allow to be taken any action which would jeopardize qualification of the Merger as a reorganization within the meaning of Section 368(a) of the Code;
(k) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations (i) in the ordinary course of business and consistent with past practice, or claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries, (ii) incurred in the ordinary course of business and consistent with past practice or (iii) which are legally required to be paid, discharged or satisfied (provided that if such claims, liabilities or obligations referred to in this clause (iii) are legally required to be paid and are also not otherwise payable in accordance with clauses (i) or (ii) above, the Company will notify Parent in writing if such claims, liabilities or obligations exceed, individually or in the aggregate, $25,000 in value, reasonably in advance of their payment);
(l) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor or any of its subsidiaries will authorize Subsidiaries or enter into any agreement relating to an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained Alternative Transaction (as defined in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.Section 5.6(a) hereof);
Appears in 1 contract
Interim Operations of the Company. The (a) Other than (x) with the prior written consent of Parent, which consent shall not be unreasonably withheld, delayed or conditioned, (y) as expressly contemplated or permitted by this Agreement or (z) as set forth on Section 6.1(a) of the Company covenants Disclosure Schedule, from and agrees, as to itself and its subsidiaries, that, prior after the date hereof to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by or the date, if any, on which this Agreement):
(a) the business of Agreement is earlier terminated pursuant to Article VIII, the Company shall, and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, cause each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve Subsidiaries to, conduct its business organization intact and maintain
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except only in the ordinary and usual course of business in all material respects consistent with past practice and use commercially reasonable efforts to (i) preserve intact their current business organization and (ii) maintain their relationships with material suppliers and distributors. Without limiting the generality of the foregoing, other than (x) with the prior written consent of PurchaserParent, modifywhich consent shall not be unreasonably withheld, amend delayed or terminate any conditioned, (y) as expressly contemplated or permitted by this Agreement or (z) as set forth in Section 6.1(a) of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election Disclosure Schedule, from and after the date hereof to the Effective Time or permit any insurance policy naming it as a beneficiary or a loss payable payee the date, if any, on which this Agreement is earlier terminated pursuant to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principlesArticle VIII, neither the Company nor any of its subsidiaries shall change any Subsidiaries will:
(i) amend its certificate of the accounting practices incorporation or principles used by itbylaws (or equivalent organizational documents);
(hii) neither except for Company Common Stock to be issued or delivered pursuant to Company Stock Options in accordance with their terms on the date hereof issue, deliver, sell, dispose of, pledge or otherwise encumber, or authorize or propose the issuance, sale, disposition or pledge or other encumbrance of (A) any shares of capital stock of any class or any other ownership interest of the Company nor or any of its subsidiaries shall Subsidiaries, or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries, or any rights, warrants, options, calls, commitments or any other agreements of any character to purchase or acquire any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for, any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries (including “phantom” rights and stock appreciation rights), or (B) any other securities of the Company or any of its Subsidiaries in respect of, in lieu of, or in substitution for, Company Common Stock outstanding on the date hereof;
(iii) redeem, purchase or otherwise acquire, or propose to redeem, purchase or otherwise acquire, any outstanding Company Common Stock, Company Stock Options, Company Restricted Stock Awards or other securities of the Company or any of its Subsidiaries;
(iv) split, combine, subdivide or reclassify any Company Common Stock or declare, set aside for payment or pay any dividend or other distribution (whether in cash, stock or other property) in respect of any Company Common Stock, or any other securities of the Company or any of its Subsidiaries or otherwise make any payments to stockholders in their capacity as such (other than the declaration, setting aside or payment from a wholly owned Subsidiary of the Company to the Company and the declaration and payment of quarterly cash dividends by the Company to the holders of Company Common Stock in such amount and manner as set forth in Section 6.1(a)(iv) of the Company Disclosure Schedule);
(v) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries, other than the Transactions;
(vi) directly or indirectly acquire (A) by purchase, merger or otherwise, any business or equity interest of any Person or (B) any asset or assets, except for new capital expenditures, which shall be subject to the limitations of clause (viii) below, and except for purchases of assets which, individually, are less than or equal to $100,000 or, in the aggregate, are less than or equal to $250,000;
(vii) sell, lease, license, mortgage, sell and leaseback or otherwise encumber or dispose of any of its properties or other assets or any interests therein, except for sales or dispositions of inventory, used or obsolete equipment or scrap materials in the ordinary course of business consistent with past practice and any of the foregoing which, individually, are less than or equal to $100,000 or, in the aggregate, are less than or equal to $250,000;
(viii) make any new capital expenditure or other expenditures (including in respect of research and development), other than those which, individually, are less than or equal to $100,000 or, in the aggregate, are less than or equal to $250,000;
(ix) incur any indebtedness for borrowed money in addition to that incurred as of the date hereof, or guarantee any such indebtedness or make any material loans, advances or capital contributions to, or investments in, any other Person, other than (A) to the Company or any wholly owned Subsidiary of the Company, (B) to employees in respect of travel or other expenses in the ordinary course of business consistent with past practice or (C) borrowings under the Company’s credit facility or trade payables incurred in the ordinary course of business in a total amount for this clause (C) not exceeding $250,000 in the aggregate;
(x) except as required by the terms of any Benefit Plan or Benefit Agreement, (A) increase the compensation or benefits, or pay any bonus to, any Participant, (B) grant any Participant change of control, severance, retention or termination compensation or benefits, or any increase therein, (C) enter into, amend or terminate any Benefit Agreement, (D) establish, adopt, enter into, amend or terminate any collective bargaining agreement or Benefit Plan (including any Company Stock Option, Company Restricted Stock Award or other award thereunder), (E) accelerate the time of payment or vesting of any rights or benefits, or make any material determinations, under any Benefit Plan or Benefit Agreement, (F) pay any amount or benefit under, or grant any awards under any bonus, incentive, performance or other compensation plan or arrangement, Benefit Plan or Benefit Agreement (including the grant of Company Stock Options, Company Restricted Stock Award or other equity or equity based awards or the removal or modification of any restrictions in any Benefit Agreement or Benefit Plan or awards made thereunder) or (G) take any action to fund or in any other way secure the payment of compensation or benefits under any employee plan, agreement, Contract or arrangement or Benefit Plan or Benefit Agreement;
(xi) change in any material respect any of the financial accounting methods used by the Company unless required by GAAP or applicable Law;
(xii) (A) enter into any Material Contract or (B) except as permitted pursuant to Section 6.4, modify, amend or terminate any Contract or waive, release, assign or fail to exercise or pursue any material rights or claims thereunder, which if so modified, amended, terminated, waived, released, assigned or not exercised or pursued would reasonably be expected to (x) have Company Material Adverse Effect, (y) impair in any material respect the ability of the Company to perform its obligations under this Agreement or (z) prevent or materially delay the consummation of the Merger or any of the other Transactions;
(xiii) except as required by applicable Law, (A) pay, discharge, settle or satisfy any claims, liabilities, obligations or litigation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge, settlement or satisfaction of the foregoing (x) that are covered by existing insurance policies, (y) that individually, are less than or equal to $100,000 or, in the aggregate, are less than or equal to $250,000 or (z) in the ordinary course of business consistent with past practice or in accordance with their terms, of liabilities reserved against in the most recent financial statements of the Company included in the Filed SEC Reports (for amounts not in excess of such reserves) or incurred since the date of such financial statements in the ordinary course of business consistent with past practice, (B) cancel any indebtedness owing to the Company or any of its Subsidiaries, (C) waive or assign any claims or rights of substantial value (other than in connection with the Merger and other than settlement of delinquent accounts receivable in compliance the ordinary course of business consistent with past practice), (D) except as permitted pursuant to Section 9.4(a)); and
(i) neither 6.4, waive any material benefits of, or agree to modify in any material respect, or, subject to the terms hereof, fail to enforce in any material respect, or consent to any matter with respect to which consent is required under, any material confidentiality or similar Contract to which the Company nor or any of its subsidiaries will authorize Subsidiaries is a party;
(xiv) sell, transfer or license to any Person or adversely amend or modify any rights to any Company Intellectual Property; or
(xv) enter into an agreement any Contract, agreement, commitment or arrangement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The After the date hereof, except as specifically contemplated by this Agreement, the Company shall and shall cause its Subsidiaries to carry on their respective businesses in the ordinary course and use all reasonable best efforts consistent with good business judgment to preserve intact their current business organizations, keep available the services of their current officers and key employees and preserve their relationships consistent with past practice with desirable customers, suppliers, licensors, licensees, distributors and others having business dealings with them to the end that their goodwill and ongoing businesses shall be unimpaired in all material respects at the Effective Time. Without limiting the generality of the foregoing, the Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time except (unless Purchaser shall otherwise consent in writing and except i) as otherwise permitted expressly contemplated by this Agreement):, (ii) as set forth in Schedule 5.1 of the Company Disclosure Schedule or (iii) as agreed in writing by Parent, after the date hereof:
(a) the business of neither the Company and nor any of its subsidiaries shall be conducted only in the ordinary and usual course andSubsidiaries shall, to the extent consistent therewithdirectly or indirectly, each amend its Certificate of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainIncorporation or By-laws or similar organizational documents;
(b) neither the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries shall: (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivi)(A) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
(c) neither Company's capital stock or that of its Subsidiaries, except that a wholly-owned Subsidiary of the Company nor may declare and pay a dividend or make advances to its parent or the Company or (B) redeem, purchase or otherwise acquire directly or indirectly any of the Company's capital stock or that of its subsidiaries shall Subsidiaries; (iii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than Shares issued upon the case exercise of the Company, Shares issuable pursuant to options Options outstanding on the date hereof under in accordance with the Stock Option Plans and shares issuable pursuant to as in effect on the Warrantsdate hereof; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly split, combine or indirectly by redemption or otherwise any shares of reclassify the outstanding capital stock of the Company or of any of the Subsidiaries of the Company;
(c) except as permitted by this Agreement, neither the Company nor any of its subsidiaries Subsidiaries shall acquire or agree to acquire (A) by merging or consolidating with, or by purchasing a substantial portion of the assets of or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof (including entities which are Subsidiaries of the Company or any of the Company's Subsidiaries) or (ivB) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by mergerassets, consolidation or acquisition of stock or assets)including real estate, or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except purchases in the ordinary course of business consistent with past practicepractice and capital expenditures permitted under Section 5.l(d);
(d) neither the Company nor any of its subsidiaries Subsidiaries shall grant make any severance new capital expenditure or termination pay toexpenditures in an aggregate amount exceeding $550,000, or enter into any employment or severance agreement with any director, officer or other employee and provided such capital expenditures which do not exceed said $550,000 are set forth in Schedule 5.1 of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Disclosure Schedule;
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orSubsidiaries shall, except in the ordinary and usual course of business and with the consent of Purchaser, modifyexcept as otherwise permitted by this Agreement, amend or terminate any of its material Contracts contract or agreement where such amendment or termination would have a Material Adverse Affect on the Company, or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make transfer, lease, license, sell, mortgage, pledge, dispose of, or encumber any tax election material property or permit any insurance policy naming it as a beneficiary assets other than sales of products to customers or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) enter into any employment or severance agreement with or grant any severance or termination pay to any officer, director or key employee of the accounting practices Company or principles used by it;any its Subsidiaries; or (ii) hire or agree to hire any new or additional key employees or officers; provided that the Company may hire key employees to fill vacancies in positions created prior to the date hereof and listed on Schedule 5.1 of the Company Disclosure Schedule.
(h) neither the Company nor any of its subsidiaries shall adopt a plan Subsidiaries shall, except as required to comply with applicable Law or expressly provided in this Agreement, (A) adopt, enter into, terminate, amend or increase the amount or accelerate the payment or vesting of complete any benefit or partial liquidationaward or amount payable under any Benefit Plan or other arrangement for the current or future benefit or welfare of any director, dissolutionofficer or current or former employee, mergerexcept to the extent necessary to coordinate any such Benefit Plans with the terms of this Agreement, consolidation, restructuring, recapitalization(B) increase in any manner the compensation or fringe benefits of, or other reorganization of the Company pay any bonus to, any director, officer or employee, except as set forth in Schedule 5.1 (C) pay any benefit not provided for under any Benefit Plan, other than employee salaries in the Merger and ordinary course of business consistent with past practice which is in excess of 1% of any employee's annual compensation, (D) grant any awards under any bonus, incentive, performance or other than compensation plan or arrangement or Benefit Plan (including the removal of existing restrictions in compliance with Section 9.4(a)); andany Benefit Plans or agreements or awards made thereunder) except as set forth in Schedule 5.1, (E) grant of stock options, stock appreciation rights, stock based or stock related awards, performance units or restricted stock, or (F) take any action to fund or in any other way secure the payment of compensation or benefits under any employee plan, agreement, contract or arrangement or Benefit Plan, except as set forth in Schedule 5.1.
(i) neither the Company nor any of its subsidiaries Subsidiaries shall:
(i) incur or assume any long-term debt or, except in the ordinary course of business, incur or assume any short-term indebtedness (including advances under the Company's existing revolving credit agreement) in amounts not consistent with past practice; (ii) incur or modify any material indebtedness or other liability except as set forth in Schedule 5.1 of the Company Disclosure Schedule; (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person; (iv) make any loans, advances or capital contributions to, or investments in, any other Person (other than to wholly owned Subsidiaries of the Company or to such entities which are listed in Schedule 3.2 of the Company Disclosure Schedule or customary loans or advances to employees or customers in the ordinary course of business in accordance with past practice); (v) settle any material claims; or (vi) enter into any material commitment or transaction unless it is in the ordinary course of business consistent with past practice and not otherwise specifically prohibited by this Section 5.1;
(j) neither the Company nor any of its Subsidiaries shall change any of the accounting principles used by it unless required by GAAP or the SEC;
(k) neither the Company nor any of its Subsidiaries shall make any Tax election, unless required by law, or settle or compromise any material Tax liability;
(l) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than (i) the payment, discharge or satisfaction of any such claims, liabilities or obligations in the ordinary course of business and consistent with past practice, (ii) the payment,. discharge or satisfaction of any such claims, liabilities or obligations in connection with the Transactions, (iii) the payment, discharge or satisfaction of any such claims, liabilities or obligations which in the aggregate do not exceed $100,000 and (iv) the payment, discharge or satisfaction of any such claims, liabilities or obligations which are reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries and which in the aggregate do not exceed $100,000;
(m) neither the Company nor any of its Subsidiaries shall, except in the ordinary course of business consistent with past practice, waive the benefits of, or agree to modify in any manner, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is a party; and
(n) neither the Company nor any of its Subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior agrees from the date of this Agreement to the Effective Time or the earlier termination of this Agreement as provided herein that, except (unless Purchaser shall otherwise consent in writing and except i) as otherwise permitted expressly contemplated by this Agreement):
, (aii) as set forth in Section 5.1 of the Company Disclosure Schedule or (iii) as agreed in writing by Parent, the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course course, consistent with past practice, and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) maintain its existing relations with customers, suppliers, employees, creditors and business partners and the Company shall not not:
(a) amend its Articles of Incorporation or By-laws or similar organizational documents;
(i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property other distribution with respect to the Shares;
its capital stock, (cii) neither the Company nor redeem, purchase or otherwise acquire directly or indirectly any of its subsidiaries shall securities, (iiii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries (or any rights to acquire such securities), other property or assets other than, in than Shares issued upon the case exercise of the Company, Shares issuable pursuant to options Company Options outstanding on the date hereof under in accordance with the Stock Plans and shares issuable pursuant terms of such options as in effect on the date hereof or (iv) split, combine or reclassify its outstanding capital stock;
(c) acquire or agree to the Warrants; acquire, any material assets or securities either by purchase, merger or otherwise, or acquire or agree to acquire any subsidiaries;
(iid) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability securities other than in the ordinary and usual course of business; (iii) acquire directly business and consistent with past practice, or indirectly by redemption authorize, propose or otherwise announce an intention to authorize or propose, or enter into an agreement with respect to, any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity business combination (other than acquisitions of assets in the ordinary course of business consistent with past practiceMerger);
(di) neither grant any increase in the Company nor compensation payable or to become payable to any of its subsidiaries shall grant executive officers or key employees, (ii) (A) adopt any severance or termination pay tonew, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan agreement or arrangement, (iii) enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in accordance with the existing written agreements, grant any severance or termination pay to any officer, director or employee or (iv) except in the ordinary and usual course of business and business, consistent with past practice, increase the consent compensation or benefits of Purchaser, any employee;
(f) modify, amend or terminate any of its material Contracts contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessbusiness and consistent with past practice or modify or amend the terms of any outstanding securities;
(g) (i) incur or assume any long-term debt, or except as may be required as a result in the ordinary course of a change business, incur or assume any short-term indebtedness in law amounts not consistent with past practice, (ii) incur or modify any material indebtedness or other liability, (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in generally accepted accounting principlesthe ordinary course of business and consistent with past practice, neither (iv) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned subsidiaries of the Company nor or customary loans or advances to employees in accordance with past practice) or (v) except in the ordinary course of business, enter into any of its subsidiaries shall change any of the accounting practices material commitment or principles used by ittransaction;
(h) neither the Company nor change any of its subsidiaries shall adopt a plan the financial accounting methods used by it unless required by GAAP;
(i) make (or permit to be made) any material Tax election or settle or compromise any material liability for taxes or change (or permit to be changed) any material tax accounting method;
(j) pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of complete any such claims, liabilities or partial liquidationobligations, dissolutionin the ordinary course of business and consistent with past practice, mergerof claims, consolidation, restructuring, recapitalizationliabilities or obligations reflected or reserved against in, or other reorganization contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated subsidiaries;
(k) engage in any transactions with any stockholders or other than affiliates of the Merger and other than Company or enter into any agreements with such stockholders or affiliates;
(l) take, or agree to commit to take, any action that would make any representation or warranty of the Company contained herein inaccurate in compliance with Section 9.4(a)any respect at, or as of any time prior to, the Effective Time (as if made at such time); and
(im) neither the Company nor any of its subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (CVC Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior agrees that during the period from the date of this Agreement to the Effective Time (unless Purchaser Newco shall otherwise consent agree in writing and except as otherwise expressly contemplated or permitted by this AgreementAgreement or the Company Disclosure Schedule):
(a) the business of the Company and its subsidiaries the Company Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, and each of the Company and its subsidiaries the Company Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, employees and business associates;
(b) the Company shall not (i) sell sell, transfer or pledge or agree to sell sell, transfer or pledge any stock or other securities owned by it or permit in any of the Company Subsidiaries (except for the pledge of such stock for collateral purposes in connection with its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarybank working capital facility); (ii) amend except as expressly contemplated by this Agreement, amend, or permit the Certificate amendment of, its restated certificate of incorporation or its bylaws or amend, modify or terminate the Rights Agreement, or redeem similar organizational documents of any of the Rights issued pursuant theretoCompany Subsidiaries; (iii) split, combine or reclassify the outstanding Company Shares; or (iv) declare, set aside or pay any dividend or distribution payable in cash, stock or property with respect to the SharesCompany Shares or any other capital stock of the Company;
(c) neither the Company nor any of its subsidiaries the Company Subsidiaries shall (i) issue, selldeliver or sell or authorize or propose the issuance, pledgedelivery or sale of, dispose of or encumber any additional shares of, or debt or equity securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock or other equity interests of any class of the Company, its subsidiaries Company or any the Company Subsidiaries other property or assets other than, in the case of the Company, than Company Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (iiagreements or arrangements described in Section 3.3(a) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in Disclosure Schedule and Options issued under the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets Option Plans in the ordinary course of business consistent with past practice(but in no event shall all such Options granted after the date hereof represent the right to purchase more than 50,000 shares of Common Stock (subject to adjustment for events of the type described in Section 2.9) and in no event shall any Options granted after the date hereof have an exercise price per share of Common Stock less than the fair market value of a share of Common Stock as of the grant date) or (ii) repurchase, redeem or otherwise acquire, or permit any Company Subsidiary to repurchase, redeem or otherwise acquire, any shares of capital stock or other equity interests of the Company or any Company Subsidiary (including securities exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests of the Company or any Company Subsidiary);
(d) neither the Company nor any of its subsidiaries the Company Subsidiaries shall (i) except in the ordinary course of business and consistent with past practice, grant or agree to any severance or termination pay to, or enter into any employment or severance agreement with increase in the compensation of any director, officer or employee earning in excess of $200,000 in cash, noncontingent compensation per year, except for increases contemplated by or required under employment agreements listed in Section 3.7 of the Company Disclosure Schedule and bonuses payable in the ordinary course under the Company's existing annual bonus plan, (ii) enter into any new or materially amend any existing employment, severance or termination agreement with any such director, officer or employee or (iii) except as may be required to comply with applicable Law, become obligated under any Benefit Plan that was not in existence on the date hereof or amend or modify any Benefit Plan in existence on the date hereof to materially enhance the benefits thereunder;
(e) the Company shall not, and shall not permit any of the Company Subsidiaries to, acquire or agree to acquire, including by merging or consolidating with, or purchasing all, substantially all, or any material portion of, the assets or capital stock or other employee equity interest of, any material business;
(f) the Company shall not, and shall not permit any of the Company Subsidiaries to, sell, lease, license, encumber or otherwise dispose of, or agree to sell, lease, license, encumber or otherwise dispose of, any of its assets outside the ordinary course of business, other than (i) assets with an aggregate book value not in excess of $500,000 or (ii) pursuant to existing contracts or commitments described in Section 5.1(f) of the Company Disclosure Schedule;
(g) except as contemplated by the Debt Commitment Letters, the Company shall not, and shall not permit any of the Company Subsidiaries to, incur or enter into any agreement to incur any indebtedness for borrowed money or guarantee any such indebtedness or issue or sell any debt securities or warrants or rights to acquire any debt securities of the Company or any Company Subsidiary, except (i) in the ordinary course of business consistent with past practice, provided that such subsidiary; and neither borrowings are made under the Company's existing credit agreements in an aggregate amount not to exceed the amounts currently authorized under those agreements (other than borrowings to finance any obligations of the Company nor hereunder) at any time outstanding, (ii) any indebtedness for borrowed money or guarantees of indebtedness for borrowed money acquired in any acquisition permitted hereunder or (iii) subject to the limitations set forth in clause (i) above, any continuation, extension, refinancing, renewal or replacement of any existing indebtedness or guarantee or any indebtedness or guarantee permitted by this Section 5.1(g);
(h) the Company shall not, and shall not permit any of its subsidiaries shall establish,the Company Subsidiaries to, make any loans or advances to, guarantees for the benefit of, or investments in, any person (other than the Company or an existing Company Subsidiary or an entity which becomes, after the date hereof, a subsidiary of the Company) except in the ordinary course of business consistent with past practice;
(ei) neither the Company nor any of its subsidiaries the Company Subsidiaries shall settle merge or compromise consolidate with any material claims person except for the Merger and except for any merger between or litigation oramong (x) two or more Company Subsidiaries or (y) any Company Subsidiary or Subsidiaries and the Company, except provided that the Company is the surviving corporation in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimssuch merger;
(fj) neither the Company nor any Company Subsidiary shall liquidate, dissolve or effect a recapitalization or reorganization in any form of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businesstransaction;
(gk) the Company shall not, and shall not permit any of the Company Subsidiaries to, enter into, amend, modify or supplement any Material Contract or agreement (i) outside of the ordinary course of business and consistent with past practice (except as may be necessary for the Company to comply with its obligations hereunder) or (ii) restricting in any material respect the conduct of the businesses of the Company and the Company Subsidiaries taken as a whole;
(l) the Company shall not, and shall not permit any of the Company Subsidiaries to, make any capital expenditures (other than pursuant to commitments prior to the date hereof and set forth on Section 5.1(l) of the Company Disclosure Schedule) in excess of $2,500,000 (other than an acquisition permitted in accordance herewith and other than expenditures in accordance with the Company's Year 2000 Capital Plan dated February 10, 2000, a copy of which has been previously provided to Newco);
(m) the Company and the Company Subsidiaries shall comply in all material respects with their respective obligations under the Material Contracts as such obligations become due and with their respective obligations under applicable Law;
(n) the Company shall not, and shall not permit any of the Company Subsidiaries to, enter into, amend, modify or supplement any material agreement, transaction, commitment or arrangement with any officer, director or other affiliate (or any affiliate of any of the foregoing) other than agreements, transactions, commitments and arrangements which are (i) solely between the Company and any one or more Company Subsidiaries, (ii) solely between Company Subsidiaries, (iii) permitted by Section 5.1(d) or (iv) contemplated by this Agreement or the Transactions;
(o) the Company and the Company Subsidiaries shall use their reasonable best efforts to continue in force with good and responsible insurance companies adequate insurance covering risks of such types and in such amounts as are consistent with past practice;
(p) except as may be required as a result of a change in law Law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries Company Subsidiary shall make any material change in any of the accounting principles or practices or principles used by it;
(hq) the Company shall not, and shall not permit any of the Company Subsidiaries to, settle any litigation for amounts in excess of $250,000 individually or $1,000,000 in the aggregate;
(r) neither the Company nor any Company Subsidiary shall make any material tax election other than those tax elections as are consistent with past practice; and
(s) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries Subsidiaries will authorize or enter into an any agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Us Can Corp)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, agrees that prior to the Effective Time Time, except (unless Purchaser shall otherwise consent in writing and except a) as otherwise permitted expressly contemplated by this Agreement):, (b) as agreed in writing by Parent, the determination by Parent of whether to so agree not to be unreasonably withheld or delayed or (c) as described in Schedule 5.1:
(ai) the business of the Company and its subsidiaries the Company Subsidiaries shall be conducted only in the usual, regular and ordinary course and usual course andsubstantially in the same manner as heretofore conducted, to the extent consistent therewithand except as otherwise required or prohibited by this Section 5.1, each of the Company and its subsidiaries Company Subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact intact, keep available the services of their current officers and maintainemployees (subject to satisfying job performance criteria) and maintain its existing relations with franchisees, customers, suppliers, creditors, business partners and others having business dealings with it, to the end that the goodwill and ongoing business of each of them are, at the Effective Time, in substantially the same condition as on the date hereof;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) neither the Company nor any Company Subsidiary shall: (A) amend its certificate of incorporation or by-laws, (B) issue, sell, transfer, pledge, dispose of or encumber (or propose to do any of the Certificate foregoing) any shares of its capital stock or any other securities convertible into or exchangeable for any shares of its bylaws or amend, modify or terminate the Rights Agreementcapital stock, or redeem any rights, warrants or options to acquire any such shares or convertible securities or any stock appreciation rights, phantom stock plans or stock equivalents, other than shares of Common Stock reserved for issuance on the Rights issued date hereof or issuable pursuant thereto; to the exercise of Company Options or Warrants or conversion of the Convertible Debt outstanding on the date hereof, (iii) split, combine or reclassify the outstanding Shares; or (ivC) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Sharesany shares of any class or series of its capital stock; (D) split, combine or reclassify any shares of its capital stock; or (E) redeem, purchase or otherwise acquire directly or indirectly any shares of its capital stock, or any instrument or security that consists of or includes a right to acquire such shares;
(ciii) neither the Company nor any of its subsidiaries shall Company Subsidiary shall: (iA) issuecreate, sellincur, pledge, dispose of refinance or encumber assume any additional shares of, long-term debt or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, except in the case ordinary course of the Companybusiness, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantsincur or assume any short-term indebtedness in amounts not consistent with past practice; (iiB) transfer, lease, licenseassume, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption endorse or otherwise any shares of become liable or responsible (whether directly, contingently or otherwise) for the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock obligations of any other person or entity (Person other than acquisitions Company or a Company Subsidiary, except as described in Schedule 5.1 of assets the Disclosure Schedules as being in the ordinary course of business consistent with past practice; (C) make any loans, advances (other than accounts receivable generated in the ordinary course of business) or capital contributions to, or investments in, any other Person (other than to or between wholly owned Company Subsidiaries); or (D) enter into any material commitment or transaction (including, but not limited to, any material capital expenditure or purchase, sale or lease of assets or real estate or any agreement which if entered into as of the date hereof would constitute a Material Company Agreement) or amend or cancel or agree to the amendment or cancellation of any Material Company Agreement;
(div) neither the Company nor any of its subsidiaries Company Subsidiary shall grant any severance or termination pay totransfer, lease, license, sell, mortgage, pledge, dispose of, or enter into encumber any employment assets with a value in excess of $10,000 in the case of any individual asset or severance agreement with any director$50,000 in the case of all assets, officer or other employee than sales of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except inventory in the ordinary and usual course of business and consistent with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimspast practice;
(fv) except as otherwise specifically contemplated by this Agreement or as otherwise described in Schedule 5.1, neither the Company nor any of its subsidiaries the Company Subsidiaries shall pay or make any tax election accrual or permit arrangement for payment of any pension, retirement allowance or other employee benefit pursuant to any Plan, to any officer, director, employee or Affiliate or pay or agree to pay or make any accrual or arrangement for payment to any officers, directors, employees or Affiliates of the Company of any amount relating to unused vacation days, except payments and accruals made in the ordinary course of business consistent with past practice or pursuant to the terms of such Plans, or adopt or pay, grant, issue, accelerate or accrue salary or other payments or benefits pursuant to any Plan or any employment or consulting agreement with or for the benefit of any director, officer, employee, agent or consultant, whether past or present, other than pursuant to the terms of such Plans, or amend in any respect any such existing Plan, other than as expressly required by applicable law;
(vi) the Company and the Company Subsidiaries shall use commercially reasonable efforts to prevent any insurance policy naming it or them as a beneficiary or a loss payable payee to lapse or to be canceled cancelled or terminated without written notice to PurchaserParent, except in the ordinary and usual course of businessunless comparable substitute insurance is obtained (with Parent's written consent);
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(hvii) neither the Company nor any of Company Subsidiaries shall enter into any contract or transaction relating to the purchase of assets other than in the ordinary course of business consistent with prior practices;
(viii) except as otherwise disclosed in Schedule 5.1 of the Disclosure Schedules, neither the Company nor any Company Subsidiary shall pay, repurchase, discharge or satisfy any of its subsidiaries Claims or other claims, litigation, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business and consistent with past practice;
(ix) neither the Company nor any of the Company Subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any Company Subsidiary (other than the Merger and other than in compliance with Section 9.4(aMerger)); and;
(ix) neither the Company nor any Company Subsidiary shall change any of the accounting methods used by it unless required by GAAP or otherwise required by applicable law;
(xi) except for this Agreement and the transactions expressly contemplated hereby, neither the Company nor any of the Company Subsidiaries shall take any action or fail to take any action that could limit the utilization of any of the net operating losses, built-in losses, tax credits or other similar items of the Company and the Company Subsidiaries under Section 382, 383, 384 or 1502 of the Code and the Treasury Regulations thereunder;
(xii) each of the Company and the Company Subsidiaries shall comply in all material respects with all applicable laws wherever its business is conducted, including, without limitation, the timely filing of all reports, forms or other documents with the SEC required pursuant to the Securities Act and the rules and regulations promulgated thereunder or the Exchange Act and the rules and regulations promulgated thereunder;
(xiii) the Company shall not adopt a "rights plan" or any similar plan or agreement which limits or impairs the ability to purchase, or become the direct or indirect beneficial owner of, shares of Common Stock or any other equity or debt securities of the Company or any of the Company Subsidiaries;
(xiv) neither the Company nor any of the Company Subsidiaries shall make any capital expenditures, or make any commitment for any capital expenditures to be made on or following the date of this Agreement, in each case in excess of $100,000 in the case of any single capital expenditure or $1,500,000 in the case of all capital expenditures;
(xv) the Company and the Company Subsidiaries shall maintain its subsidiaries will authorize books and records in accordance with GAAP consistently applied and, unless otherwise required by GAAP, on a basis consistent with the Company's past practice;
(xvi) neither the Company nor any of the Company Subsidiaries shall form or commence the operations of any corporation, partnership, joint venture, business association or other business organization or division thereof;
(xvii) neither the Company nor any of the Company Subsidiaries shall take, or agree to take, any action that would or would reasonably likely result in any of the Conditions not being satisfied, or would make any representation or warranty of the Company contained herein inaccurate in any material respect at, or as of any time prior to, the Effective Time, or that would impair the ability of the Company, Parent, Purchaser or the holders of the Shares and Series A Preferred Stock to consummate the Transactions in accordance with the terms hereof or materially delay such consummation; and
(xviii) neither the Company nor any of the Company Subsidiaries shall enter into an agreement agreement, contract, binding commitment or binding arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Cypress Communications Holding Co Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) From the business of date hereof to the Closing, Seller and the Members shall cause the Company and its subsidiaries shall be conducted the Subsidiaries to conduct their respective businesses only in the ordinary course consistent with past practices and usual course and, pay or cause to the extent consistent therewith, each of the Company be paid their respective obligations in a timely fashion in accordance with their respective terms and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of Subsidiary shall, unless Buyer gives its subsidiaries prior written approval (which approval shall not be unreasonably withheld, conditioned or delayed), (i) amend or otherwise change its articles or certificate of incorporation or by-laws (or organizational documents equivalent thereto), as each such document is in effect on the date hereof, (ii) issue or sell, or authorize for issuance or sale, additional shares of any class of capital stock or membership interests or issue, grant or enter into any subscription, option, warrant, right, convertible security or other agreement or commitment of any character obligating the Company or the Subsidiaries to issue securities, (iii) in the case of the Company, declare, set aside, make or pay any dividend or other distribution with respect to its capital stock or membership interests, (iv) redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or membership interests, (v) authorize any capital expenditure in excess of $50,000 (other than the capital expenditures described on SCHEDULE 4.07(C) attached hereto, which Buyer hereby consents to) or sell, pledge, dispose of or encumber any additional shares ofencumber, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind agree to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber encumber, any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any the Subsidiaries, except for sales of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 assets in the aggregate ordinary course of business and sales of surplus or make any acquisition non-essential assets disposed of for fair market value in the ordinary course of the Company's operations consistent with past practices, (vi) acquire (by merger, consolidation or share exchange, consolidation, acquisition of stock or assets, or otherwise) any corporation, partnership or other business organization or division thereof or enter into any contract, agreement, commitment or arrangement with respect to any of the foregoing, (vii) incur any indebtedness for borrowed money (other than pursuant to credit, loan or other financing agreements or arrangements as in effect on the date hereof), issue any debt securities or enter into or modify any investment incontract, assets agreement, commitment or stock arrangement with respect thereto, (viii) enter into, amend or terminate any employment or consulting agreement with any director, officer, consultant or key employee of the Company or the Subsidiaries, enter into, amend or terminate any employment agreement with any other person otherwise than in the ordinary course of business or entity (take any action with respect to the grant or payment of any severance or termination pay, other than acquisitions pursuant to policies or agreements of assets the Company or the Subsidiaries in effect on the date hereof or as contemplated by Section 6.19, (ix) enter into, extend or renew any lease for office or manufacturing space, (x) except as required by law, adopt, amend or terminate any bonus, profit sharing, compensation, stock option, pension, retirement, deferred compensation, employment or other employee benefit plan, agreement, trust, fund or arrangement for the benefit or welfare of any officer or employee of the Company or the Subsidiaries or withdraw from any multi-employer plan so as to create any liability under Article IV of ERISA to any entity, (xi) grant any increase in compensation, or grant or make any bonus or other compensatory payments, to any director, officer, consultant or key employee of the Company or the Subsidiaries, except (A) pursuant to agreements entered into prior to August 9, 2001, (B) in the ordinary course of business consistent with past practices, or (C) as contemplated by Section 6.19, (xii) grant any increase in compensation to any other employee of the Company or the Subsidiaries except in the ordinary course of business consistent with past practice);, or (xiii) make or change any election relating to Taxes.
(db) neither From the date hereof to the Closing, Seller and the Members shall cause the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee and the Subsidiaries to use their commercially reasonable efforts to preserve intact the business organization of the Company or any such subsidiary; and neither the Company nor any Subsidiaries, to keep available in all material respects the services of its subsidiaries shall establish,
(e) neither their present officers, consultants and key employees, to preserve intact their banking relationships and credit facilities, to preserve intact their relationships with their customers, suppliers and distributors, to preserve the Company nor any goodwill of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary those having business relationships with them and usual course of business and to comply with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedall applicable laws.
Appears in 1 contract
Interim Operations of the Company. The Except (A) as expressly contemplated by this Agreement, (B) as set forth on Section 5.1 of the Company covenants Disclosure Letter, (C) as required by Law, or (D) as consented to in writing by Parent after the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser Time, which consent shall otherwise consent in writing and except as otherwise permitted by this Agreement):not be unreasonably withheld or delayed, the Company agrees that:
(ai) the business of the Company and its subsidiaries shall be conducted Subsidiaries will conduct business only in the ordinary and usual course of business consistent with past practice and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners, Governmental Entities (including maintaining all Company Permits);
(bii) the Company shall will not (i) sell amend its Amended and Restated Certificate of Incorporation or pledge or agree to sell or pledge any stock Amended and Restated Bylaws and the Company’s Subsidiaries will not amend their certificate of incorporation, bylaws or other securities owned by it comparable charter or permit organizational documents;
(iii) neither the Company nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries will (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivA) declare, set aside or pay any dividend or other distribution, whether payable in cash, stock or property other property, with respect to the Shares;
its capital stock; (c) neither the Company nor any of its subsidiaries shall (iB) issue, sell, transfer, pledge, dispose of or encumber or agree to issue, sell, transfer, pledge, dispose of or encumber any additional shares of, of capital stock or securities convertible into other Rights of the Company or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock Subsidiaries (including treasury stock), other than in respect of any class the shares of the Company, its subsidiaries or any other property or assets other than, in ’s capital stock reserved for issuance on the case date of the Company, Shares issuable this Agreement and issued pursuant to options the exercise of Options outstanding on the date hereof under of this Agreement, (C) split, combine or reclassify the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of Shares or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the outstanding capital stock of the Company or any of the Subsidiaries of the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution therefor or (D) redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other Rights of the Company or any of its subsidiaries or Subsidiaries;
(iv) authorize capital expenditures in excess except as required by applicable Law or under the terms of $50,000 individually or $100,000 any Company Plan as of the date of this Agreement, the Company will not and will not permit its Subsidiaries to (A) make any changes in the aggregate compensation payable or make to become payable to any acquisition of (by mergerits officers, consolidation or acquisition of stock or assets)directors, or any investment inemployees, assets or stock of any other person or entity agents, consultants (other than acquisitions general increases in wages to employees who are not officers, directors or Affiliates of assets the Company in the ordinary course of business and consistent with past practice) or other Persons providing management services, (B) enter into or amend any employment, consulting, severance or termination agreement or any Company Plan, except that the Company and its Subsidiaries may in the ordinary course consistent with past practice (I) enter into an agreement providing for annual compensation less than $100,000 or (II) enter into any consulting agreement providing for compensation less than $100,000 on an annualized basis which is entered into with a consultant that is a United States citizen and solely in connection with sales or other business in the United States, or (C) make any loans (other than travel and payroll advances to non-officer employees in the ordinary course of business consistent with past practice)) to any of its officers, directors, employees, Affiliates, agents or consultants or make any change in its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to a Company Plan or otherwise;
(dv) except as required by applicable law or under the terms of any Company Plan as of the date of this Agreement, the Company will not and will not permit its Subsidiaries to (A) pay or make any accrual or arrangement for payment of any pension, retirement allowance or other employee benefit pursuant to any existing plan, agreement or arrangement to any officer, director, employee or Affiliate, (B) pay or agree to pay or make any accrual or arrangement for payment to any officers, directors, employees or Affiliates of the Company of any amount relating to unused vacation days (other than in the ordinary course consistent with past practice), or (C) adopt or pay, grant, issue, accelerate or accrue salary or other payments or benefits pursuant to any Company Plan, agreement or arrangement, or any employment or consulting agreement with or for the benefit of any director, officer, employee, agent or consultant, whether past or present;
(vi) neither the Company nor any of its subsidiaries shall grant Subsidiaries will (A) incur or assume (1) any severance long-term Indebtedness, or termination pay to(2) any short-term Indebtedness except in the ordinary course of business consistent with past practice, in amounts consistent with past practice, (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, or enter into any employment arrangement having the economic effect of any of the foregoing, except in the ordinary course of business consistent with past practice with respect to Indebtedness of wholly-owned Subsidiaries permitted to be incurred or severance agreement assumed pursuant to clause (A) above in amounts consistent with past practice, (C) make any directorloans, officer advances or capital contributions to, or investments in, any other employee of Person except from the Company or any such subsidiary; and neither direct or indirect wholly-owned Subsidiary of the Company nor (on the one hand) to the Company or any direct or indirect wholly-owned subsidiary (on the other hand) or (D) enter into any material commitment or transaction (including any borrowing, capital expenditure or purchase, sale or lease of its subsidiaries shall establish,assets or real estate), except in the ordinary course of business consistent with past practice;
(evii) neither the Company nor any of its subsidiaries shall settle Subsidiaries will make or compromise authorize any material claims capital expenditure, other than capital expenditures contemplated by (and not in advance of the applicable date or litigation ordates contemplated therefor in) the Company’s existing 2008 capital budget, except a copy of which has been included in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsCompany Disclosure Letter;
(fviii) neither the Company nor any of its subsidiaries shall Subsidiaries will (A) pay, discharge, waive, settle or satisfy, or make any tax election payment for the waiver thereof, any rights, claims, liabilities or permit any insurance policy naming it as a beneficiary obligations (absolute, accrued, asserted or a loss payable payee to be canceled unasserted, contingent or terminated without notice to Purchaserotherwise), except other than the payment, discharge, waiver, settlement or satisfaction, in the ordinary and usual course of businessbusiness consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the Financial Statements (or the notes to the Financial Statements) (for amounts not materially in excess of such reserves) or of claims, liabilities or obligations incurred since the date of the Financial Statements in the ordinary course of business consistent with past practice or (B) waive any claims of substantial value;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(hix) neither the Company nor any of its subsidiaries shall Subsidiaries will (A) change any of the accounting methods, principles or practices used by it unless required by a change in GAAP or Law, (B) settle any material Tax claim or assessment, (C) consent to any material Tax claim or assessment or any waiver of the statute of limitations for any such claim or assessment or (D) make or change any material Tax election;
(x) neither the Company nor any of its Subsidiaries will (A) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, business combination, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than this Agreement), (B) acquire by merging or consolidating with, or by purchasing a substantial equity interest in or portion of the Merger assets of, or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof or (C) acquire, transfer, lease, license, sell, mortgage, pledge, dispose of or encumber any material assets, other than, in the case of this clause (C), acquisitions of raw materials and other than inventory and sales of inventory, in compliance each case in the ordinary course of business consistent with Section 9.4(a)); andpast practice;
(ixi) neither the Company nor any of its subsidiaries Subsidiaries will authorize waive the benefits of, or agree to modify in any manner, or consent to any matter with respect to which its consent is required under, any material confidentiality agreement or any standstill or similar agreement to which the Company or any of its Subsidiaries is a party;
(xii) neither the Company nor any of its Subsidiaries will (A) enter into a contract, or make a Bid that if accepted or awarded would lead to a contract, or accept a task order, which if entered into would (1) be a contract of the type described in Section 3.9(a)(ii), (2) include an Organizational Conflict of Interest provision or that would or would reasonably be expected to create an Organizational Conflict of Interest issue for Parent, (3) otherwise be a Material Contract, other than (x) teaming agreements which include an exclusivity or similar provision, Bids for fixed price development contracts, Bids for fixed price production contracts with a contract value of at least $5,000,000, in each case entered into or made following consultation with Parent, which shall not be unduly delayed by Parent and (y) teaming agreements that do not include an exclusivity or similar provision, or (4) be a contract with a Related Person or amend, revise, or renew or terminate any such contract, Bid, Material Contract or contract with a Related Person or (B) enter into any contract under which the consummation of the Merger and the other Transactions or compliance by the Company with the provisions of this Agreement could reasonably be expected to conflict with, or result in a violation or breach of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of, or result in, termination, cancelation or acceleration of any obligation or to a loss of a material benefit under, or result in the creation of any Encumbrance upon any of the properties or assets of the Company or any of its Subsidiaries;
(xiii) neither the Company nor any of its Subsidiaries will select any “Fixed Rate Period” for any of the IDB Bonds;
(xiv) neither the Company nor any of its Subsidiaries will expand the nature or scope of its business outside of the United States, including with respect to countries, sales practices, distributors, agents and customers;
(xv) neither the Company nor any of its Subsidiaries will revalue any assets that are material to the Company and its Subsidiaries, taken as a whole, except as required by GAAP; and
(xvi) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties foregoing.
(b) Except as set forth in Section 5.1(b) of the Company contained Disclosure Letter, the Company shall cause all contracts or other agreements between the Company and any of its Subsidiaries, on the one hand, and Xxxxxx X. Xxxx and his Affiliates (including all stockholders of the Company that are party to the Stockholder Voting Agreement), or any of their Related Persons, on the other hand, (i) that are listed in this Agreement Section 3.21 of the Company Disclosure Letter to be untrue terminated (for the avoidance of doubt, including provisions that purport to survive termination) immediately prior to the Closing without the payment of any fees, expenses or incorrect or other amounts thereunder and (ii) that would result be required to be included in any Section 3.21 of the Offer Conditions Company Disclosure Letter but were not listed therein to be terminated (for the avoidance of doubt, including provisions that purport to survive termination), at Parent’s option, immediately prior to the Closing without the payment of any fees, expenses or other amounts thereunder. Except as set forth in Annex A hereto Section 5.1(b) of the Company Disclosure Letter, the Company shall not being satisfiedmake any payments or commit or agree to make any payments under any contract or agreement described in (i) and (ii) of the forgoing sentence between the date of this Agreement and the Closing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly provided in this Agreement, (ii) with the prior written consent of Parent or (iii) as set forth on Section 5.1 of the Company Disclosure Schedule, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Time:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary course of business consistent with past practice and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainmaintain its existing relations with material customers, suppliers, employees, creditors and business partners;
(b) the Company shall not (i) sell not, directly or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellindirectly, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Company Common Stock, or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) amend or propose to amend its articles of incorporation or organization or by-laws or operating agreements or similar organizational documents or the Rights Plan; (ii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock other than dividends paid by the Company's wholly owned Subsidiaries to the Company or its wholly owned Subsidiaries; (iii) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options outstanding on the date hereof exercises of Company Stock Options or as may be required under the Stock Plans and shares issuable pursuant to the WarrantsRights Plan; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions disposal of assets in the ordinary course of business consistent with past practice); or (v) redeem, purchase or otherwise acquire directly or indirectly any of its capital stock;
(d) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) grant any severance increase in the compensation (whether annual base salary or termination pay towages or bonus opportunities or amounts) payable or to become payable by the Company or any of its Subsidiaries to any Company employee (excluding executive officers who shall be given no increases) other than scheduled annual merit increases in annual base salary or wages in the ordinary course of business consistent with past practice; (ii) except to the extent currently required under applicable Law or the terms of the applicable Plan disclosed in Section 3.15(b) of the Company Disclosure Schedule, adopt or enter into any employment new, or severance agreement with any directoramend or otherwise increase or terminate, officer or other employee accelerate the payment or vesting of the Company amounts payable or to become payable under any such subsidiaryPlan; and neither (iii) hire any new officers, executives or employees at or above the Company nor level of vice president (except to replace an officer, executive or employee) or terminate the employment of any officers, executives or employees at or above the level of its subsidiaries shall establish,vice president (except for cause), or promote any officers, executives or employees at or above the level of vice president (except to replace an officer, executive or employee);
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle cancel or compromise terminate any material claims insurance policy naming it as a beneficiary or litigation ora loss payable payee, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsbusiness;
(f) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) incur or assume any debt except for borrowings under existing revolving credit facilities in an amount not to exceed $95 million in principal at any one time outstanding; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for any material obligations of any Person (other than the Company or one of its wholly-owned Subsidiaries); (iii) make any tax election loans, advances or permit capital contributions to, or investments in, any insurance policy naming it as a beneficiary other Person (other than to wholly owned Subsidiaries of the Company or a loss payable payee customary loans or advances to be canceled non-officer employees in accordance with past practice); or terminated without notice to Purchaser, except (iv) make any material capital expenditure or commitment therefor other than in the ordinary and usual course of businessbusiness consistent with past practice and in accordance the Company's budgeted capital expenditures for fiscal years 2006 and 2007 as previously provided to Parent;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting methods, policies, procedures, practices or principles used by itit unless required by GAAP or the SEC;
(h) neither the Company nor any of its subsidiaries shall Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other material reorganization of the Company (or any of its Subsidiaries other than the Merger and other than in compliance with as permitted by Section 9.4(a)); and5.6 or 5.16;
(i) neither the Company nor any of its subsidiaries Subsidiaries shall merge or consolidate with any other Person (other than as permitted by Section 5.6 or 5.16) or acquire assets or capital stock of any Person (other than the acquisition of inventory in the ordinary course of business consistent with past practice);
(j) neither the Company nor any of its Subsidiaries will authorize engage in any transaction with, or enter into any agreement, arrangement, or understanding with, directly or indirectly, any of the Company's affiliates, including, without limitation, any transactions, agreements, arrangements or understandings with any affiliate or other Person covered under Item 404 of Regulation S-K under the Securities Act that would be required to be disclosed under such Item 404 other than such transactions of the same general nature, scope and magnitude as are disclosed in the Company SEC Documents;
(k) neither the Company nor any of its Subsidiaries shall enter into any joint venture, partnership or other similar arrangement;
(l) neither the Company nor any of its Subsidiaries shall (i) enter into any Contract that if existing on the date hereof would be a "Company Material Contract" other than Contracts with suppliers and customers in the ordinary course consistent with past practice, (ii) terminate, amend, supplement or modify in any material respect any Company Material Contract to which the Company or any of its Subsidiaries is a party, (iii) waive, release, cancel, allow to lapse, convey, encumber or otherwise transfer any material rights or claims thereunder, (iv) change incentive policies or payments under any Company Material Contracts existing on the date hereof or entered into after the date hereof, or (v) enter into any Contract relating to the disposition of assets and/or capital stock except as permitted by Section 5.6;
(m) neither the Company nor any of its Subsidiaries shall settle or compromise any (i) material Action, whether administrative, civil or criminal, in law or in equity or (ii) any claim under any insurance policy for the benefit of the Company or any of its Subsidiaries;
(n) neither the Company nor any of its Subsidiaries shall waive or fail to enforce any provision of any confidentiality agreement or standstill or similar agreement to which it is a party;
(o) neither the Company nor any of its Subsidiaries shall make or change any elections with respect to Taxes, amend any Tax Returns, change any annual Tax accounting period, adopt or change any Tax accounting method, enter into any closing agreement, settle or compromise any proceeding with respect to any Tax claim or assessment, surrender any right to claim a refund of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company or any of its Subsidiaries, or take any other similar action relating to the filing of any Tax Return or the payment of any Tax;
(p) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claim, liability or obligation (including contingent claims, liabilities and obligations), other than in the ordinary course of business consistent with past practice;
(q) neither the Company nor any of its Subsidiaries shall enter into any material line of business other than the line of business in which the Company and its Subsidiaries is currently engaged as of the date of this Agreement;
(r) neither the Company nor any of its Subsidiaries shall open or close a store or other business location (other than those listed on Section 5.1(r) of the Company Disclosure Schedule); and
(s) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing, or to authorize, recommend, propose or announce an intention to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement (other than with respect to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedclause (a) above).
Appears in 1 contract
Interim Operations of the Company. The Company covenants Between the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, the Company shall, and shall cause each of its Subsidiaries to (unless Purchaser Parent shall otherwise consent approve in writing and or except as otherwise permitted contemplated by this AgreementAgreement or disclosed in the Company Disclosure Letter):
(ai) the conduct its business of the Company and its subsidiaries shall be conducted only in all material respects in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, each use reasonable best efforts to (x) preserve intact its business organization, (y) keep available the services of its officers and employees and (z) maintain its existing relations and goodwill with customers, suppliers, regulators, distributors, creditors, lessors and others having business dealings with it; provided that the failure of any officer or employee of the Company and or its subsidiaries Subsidiaries to remain an officer or employee of the Company or its Subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainnot constitute a breach of this covenant;
(bii) the Company shall not (iA) sell amend the Restated Certificate of Incorporation or pledge By-laws of the Company; (B) split, combine, subdivide or agree to sell or pledge any reclassify its outstanding shares of capital stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiaryequity securities; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivC) declare, set aside or pay any dividend or distribution payable in cash, stock or property with in respect to the Shares;
(c) neither the Company nor of any of its subsidiaries shall (i) issue, sell, pledge, dispose shares of capital stock or encumber any additional shares ofother equity securities, or securities convertible into into, exercisable for or exchangeable for, any of its shares of capital stock or optionsother equity securities, warrantsother than (x) quarterly cash dividends of $.27 per share in respect of the outstanding shares of Company Common Stock, callsdeclared, commitments set aside and paid at such times during the quarter as is consistent with past practice, and (y) dividends and distributions by wholly owned Subsidiaries of the Company; (D) repurchase, redeem or rights otherwise acquire or permit any of any kind its Subsidiaries to purchase, redeem or otherwise acquire, any shares of its capital stock or other equity securities, or securities convertible into, exercisable for or exchangeable for, any of its shares of capital stock or other equity securities (it being understood that this clause (D) shall not prohibit the exercise, exchange or conversion of Company Equity Equivalent Securities); or (E) enter into any class agreement or letter of the Companyintent, its subsidiaries agreement in principle or any other property similar arrangement to sell, transfer or assets other thanotherwise dispose of, or purchase or otherwise acquire, in the case aggregate, a material amount of assets or properties or any -42- material business by merger, consolidation, transfer or acquisition of shares of capital stock or otherwise;
(iii) not take any action that to the knowledge of the Company, Shares issuable pursuant Company would prevent the business combination to options outstanding on the date hereof under the Stock Plans and shares issuable be effected pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose Parent Merger from qualifying for pooling of or encumber any assets or incur or modify any indebtedness or other liability other than in interests accounting treatment under GAAP and the ordinary rules and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares regulations of the capital stock SEC or would prevent the business combination to be effected pursuant to the Parent Merger or the Alternative Merger, as applicable, from qualifying as a "reorganization" within the meaning of Section 368 of the Code;
(iv) except as required by applicable law or pursuant to contractual obligations in effect as of the date of this Agreement, not (A) execute, establish, adopt or amend, or accelerate rights or benefits under, any agreement relating to severance or change-in-control, any Company Employee Plan, any employment or consulting agreement with current or former officers or directors or any collective bargaining agreement, (B) increase the compensation payable or to become payable to any of its subsidiaries officers, directors or employees (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except for increases in the ordinary course of business consistent with past practicepractices);
, (dC) neither the Company nor any of its subsidiaries shall grant any severance or termination pay toto any officer or director of the Company, or enter into (D) grant any employment or severance agreement with any director, officer stock options or other employee equity related awards;
(v) not issue, deliver, grant, sell, pledge or otherwise dispose of shares of any class of its capital stock, other equity securities, or any securities convertible, exercisable or exchangeable for or into, any such shares or other equity securities, except upon the exercise, exchange or conversion of Company Equity Equivalent Securities;
(vi) not change its accounting policies, practices or methods except as required by GAAP or by the rules and regulations of the SEC;
(vii) not (x) take any action to amend the Company Rights Agreement, (y) redeem the rights subject to the Company Rights Agreement, or (z) take any action to render inapplicable, or to exempt any third party from, any provision of the Restated Certificate of Incorporation of the Company or any such subsidiary; and neither statute referred to in Section 6.15;
(viii) not take any action that would be reasonably likely to result in any of the conditions set forth in Article VII of this Agreement not being satisfied or that would impair the ability of the Company nor to consummate the transactions contemplated hereby in accordance with the terms hereof or delay such consummation;
(ix) not take any action to cause the shares of Company Common Stock to cease to be listed on the NYSE;
(x) not waive any of its subsidiaries shall establish,
(e) neither the Company nor rights under, or release any other party from such other party's obligation under, or amend any provision of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsstandstill agreement;
(fxi) neither the Company nor not issue, deliver, grant, sell, pledge or otherwise dispose of any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserbonds, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principlesdebentures, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, notes or other reorganization of indebtedness, in each case having the Company (other than right to vote together with the Merger and other than in compliance with Section 9.4(a))Company's stockholders on any matter; and
(ixii) neither the Company nor any of its subsidiaries will authorize or not enter into an agreement any commitments or agreements to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Sonat Inc)
Interim Operations of the Company. The Company covenants Except as (i) expressly provided in this Agreement, (ii) set forth on Schedule 7.1, or (iii) may be consented to in writing by Purchaser (such consent not to be unreasonably withheld, delayed or conditioned), Seller shall ensure that from and agrees, as to itself after the date hereof and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Closing:
(a) the Seller and Company shall (i) operate the Facility using Prudent Industry Practices, (ii) use its Commercially Reasonable Efforts to conduct the Business in the ordinary course and in the same manner as heretofore conducted, including but not limited to being managed and operated in accordance with the Operating Documents and Organizational Documents, (iii) use its Commercially Reasonable Efforts to preserve intact the current business organization of the Company and its subsidiaries shall be conducted only the Business and to maintain the relations and good will with suppliers, customers, landlords and agents relating to or in connection with the ordinary and usual course and, to the extent consistent therewith, each operation of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainBusiness;
(b) the Company shall not (i) sell amend its Operating Document or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellOrganizational Document, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, transfer, pledge, dispose of or encumber any additional shares ofof its Equity, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyEquity, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) declare, set aside or pay any dividend or other distribution with respect to any of its Equity, except Cash dividends or distributions payable before the Closing Date, (iv) split, combine or reclassify any of its Equity, (v) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets)Equity, or any investment ininstrument or security which consists of or includes a right to acquire such Equity, assets or stock (vi) make or authorize any capital expenditure other than pursuant to and in accordance with the time frames of existing commitments or business plans;
(c) the Seller and Company shall not with respect Marina Thermal Facility or the Cogen Facility (i) incur or assume any long-term Indebtedness, (ii) modify the terms of any other person or entity (Indebtedness, other than acquisitions modifications of assets short-term debt in the ordinary course of business consistent with past practice)business, which Indebtedness shall be paid in full as of the Closing Date, or (iii) assume or guarantee the obligations of any other Person, in each case except in the ordinary course of business, which guarantee shall be terminated and released as of the Closing Date;
(d) neither the Seller and Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or not permit any insurance policy (including those set forth on Schedule 5.10) naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice prior to Purchaserthe Closing Date, except policies providing coverage for losses not in the ordinary and usual course excess of business$1,000,000 which are replaced without diminution of or gaps in coverage;
(ge) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Seller and Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall not adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalizationrecapitalization or other reorganization;
(f) the Seller and Company shall not change in any respect any of the accounting methods used by it unless required or permitted by GAAP, as applicable;
(g) the Seller and the Company shall not sell, assign, transfer, lease or otherwise dispose of any Assets of the Business in excess of $25,000, and only then if such sale assignment, transfer or lease is in the ordinary course of business (including, but not limited to, ordinary course of business sales of capacity, energy, ancillary services, and excess fuel);
(h) except as set forth on Schedule 7.1(h), the Seller and the Company shall not enter into any contract that if in effect on the date hereof would be a Seller Material Contract, Company Material Contract or Real Property Lease or terminate or materially amend, or settle or compromise any claim under any Seller Material Contract, Company Material Contract or Real Property Lease;
(i) the Seller and the Company shall not amend or modify any Governmental Approval or Environmental Permit of Seller or Company relating to the Marina Thermal Facility or the Cogen Facility, except in connection with the Internal Reorganization;
(j) the Company shall not take any action that would cause the Cogen Facility to lose its status as a Qualifying Facility, and shall take all actions necessary to maintain its status as a Qualifying Facility;
(k) the Company shall not hire any employee, pay any bonuses, salaries, or other reorganization compensation to any member, manager, stockholder, director, officer or employee of the Company or enter into any employment, severance, or similar agreement, contract or arrangement with any member, manager, xxxxxxx holder, director, officer, or employee;
(l) the Seller and the Company shall use Subject Cash only (i) in accordance with Prudent Industry Practices and as if the Business was separate from any other than activities of the Merger Company or its Affiliates, (ii) to pay properly invoiced amounts under the Material Contracts as and other than when the same become due and payable in compliance accordance with Section 9.4(a))the terms of such Material Contracts, if required by Applicable Law, or in connection with the resolution of an emergency situation, which for this purpose shall mean an imminent risk of physical injury or death to any person or damage to property, or (iii) to satisfy any accrued liabilities expressly included in the Base Working Capital Amount; and
(im) neither the Company nor any of its subsidiaries will authorize or shall not enter into an agreement any agreement, contract, commitment or arrangement to do any of the foregoing or take things described in Subsections (b) through (l) above. Notwithstanding the first sentence of this Section 7.1, during the period from the date hereof until the Closing, Purchaser’s consent to any action shall not be required if Seller has delivered, or promptly thereafter does deliver, to Purchaser or its representatives written notice that would knowingly cause such action is necessary to comply with (but not change, amend or modify) requirements under any Material Contracts or Applicable Law or as required in case of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedemergency.
Appears in 1 contract
Samples: Purchase and Sale Agreement (South Jersey Industries Inc)
Interim Operations of the Company. The From the date hereof until the Effective Time, the Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time except (unless Purchaser shall otherwise consent in writing and except i) as otherwise permitted contemplated by this Agreement):, (ii) as disclosed in Section 4.1 of the Company Disclosure Letter or (iii) as agreed in writing by Parent:
(a) the Company and its Subsidiaries shall continue to operate in a manner which is consistent with the Company’s restructuring plan as described in the Company SEC Documents, and to the extent consistent therewith, (i) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary course of business and usual course and, to the extent consistent therewith, (ii) each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve in all material respects its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees and business associates;
(b) the Company shall not will not, directly or indirectly, (i) sell amend its certificate of incorporation or pledge by-laws; or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Company Common Stock or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) issueother than continuing to pay regular quarterly cash dividends on the Company Common Stock consistent with past practice, selldeclare, pledge, dispose set aside or pay any dividend or other distribution with respect to its capital stock (other than dividends from any of the Company’s Subsidiaries to the Company or encumber any of the Company’s other Subsidiaries); (ii) issue or sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to sell or acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than shares of Company Common Stock reserved for issuance on the case date hereof upon exercise of the Company, Shares issuable pursuant to options Rights outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the WarrantsRights Agreement or issuances pursuant to the exercise of Company Stock Options outstanding on the date hereof; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions redemption pursuant to the Rights Agreement of assets in the ordinary course of business consistent with past practice)Rights outstanding on the date hereof;
(d) neither the Company nor any of its subsidiaries Subsidiaries shall grant acquire, sell, lease or dispose of any severance or termination pay tomaterial assets, stock, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor ownership interest in any of its subsidiaries shall establish,properties or Subsidiaries other than in the ordinary course of business;
(e) neither the Company nor shall not, and shall not permit any of its subsidiaries shall settle Subsidiaries to, acquire or compromise agree to acquire (i) by merging or consolidating with, or by purchasing a substantial portion of the assets of any business or any corporation, partnership, joint venture, association or other business organization or division thereof that would be material claims to the Company and its Subsidiaries, taken as a whole, or litigation or(ii) any assets that would be material to the Company and its Subsidiaries taken as a whole, except for purchases in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsbusiness;
(f) neither the Company nor any of its subsidiaries shall make Subsidiaries shall, except as contemplated by this Agreement, enter into, adopt or materially amend any tax election employee Benefit Plans or permit amend any insurance policy naming it as a beneficiary employment or a loss payable payee to be canceled severance agreement or terminated without notice to Purchaserincrease in any manner the compensation of any employees, except in the case of any increase in compensation for non-officer employees, for increases in the ordinary and usual course of businessbusiness consistent with past practice; provided, that nothing herein will be deemed to restrict or prohibit the payment of benefits as they become due and payable;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the material obligations of any other Person (other than Subsidiaries of the accounting practices Company), except in the ordinary course of business; or principles used by it(ii) make any material loans, advances or capital contributions to, or investments in, any other Person (other than to Subsidiaries of the Company), other than in the ordinary course of business and other than routine advances to employees;
(h) neither the Company nor any of its subsidiaries Subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization materially change any of the Company (other than the Merger and other than in compliance with Section 9.4(a)); andaccounting methods or practices used by it unless required by GAAP or applicable law;
(i) neither the Company nor any of its subsidiaries Subsidiaries will adopt any plan of complete or partial liquidation, dissolution, restructuring or other reorganization of the Company or any of its Subsidiaries;
(j) neither the Company nor any of its Subsidiaries will settle or compromise any material claim (including arbitration) or material litigation; and
(k) neither the Company nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Russell Corp)
Interim Operations of the Company. The Company covenants and agreesagrees that after the date hereof, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser Parent shall otherwise consent agree in writing and except as otherwise permitted contemplated by this Agreement):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, agents and business partners;
(b) the Company shall not not: (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarysubsidiaries; (ii) amend the its Certificate of Incorporation or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoBylaws; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall shall: (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, Company or its subsidiaries or any other property or assets other than, in the case of the Company, than Shares issuable pursuant to options or rights outstanding on the date hereof under the Stock Plans existing employee benefit plans of the Company and shares issuable pursuant to the Warrantsits subsidiaries; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets other than in the ordinary and usual course of business, or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or of any of its subsidiaries or class; (iv) authorize any capital expenditures expenditure which is in excess of $50,000 10,000 individually or $100,000 50,000 in the aggregate aggregate, or make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock of any other person in excess of $10,000, individually or entity (other than acquisitions of assets $50,000 in the ordinary course aggregate; or (v) enter into a new lease for permanent stores (for purposes of business consistent with past practicethis Agreement, "permanent store" shall mean a store evidenced by a lease having a term of more than 12 months);
(d) the Company shall not enter into a lease for a seasonal store: (i) without first notifying Parent of its intention to do so, which notification shall identify the proposed location of the seasonal store; (ii) in a mall where Parent currently maintains or has executed a lease to operate a retail specialty Natural Wonders store; (iii) having a lease term beyond January 31, 2001; or (iv) in a mall where the prior year average mall sales per square foot were below $225.
(e) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiarysubsidiaries (other than in the ordinary course of business and consistent with past practice or as otherwise provided in this Agreement); and neither the Company nor any of its subsidiaries shall establish,
adopt, or amend to increase compensation or benefits payable under, any employment agreement or arrangement, bonus, deferred compensation, pension, retirement, profit sharing, stock option, stock purchase or other employee benefit plan (e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except other than increases granted in the ordinary and usual course of business and consistent with the consent of Purchaser, modify, amend past practice or terminate any of its material Contracts or waive, release or assign any material rights or claimsas otherwise provided in this Agreement);
(f) neither the Company nor any of its subsidiaries shall make modify, amend or terminate any tax election of its leases, contracts or agreements or waive, release or assign any rights or claims, except in the ordinary and usual course of business;
(g) neither the Company nor any subsidiary shall permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to PurchaserParent, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any subsidiary shall acquire control or majority ownership of its subsidiaries shall adopt a plan of complete any other corporation, association, joint venture, partnership, business trust or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalizationother business entity, or other reorganization acquire control or majority ownership of all or a substantial portion of the Company (assets of any of the foregoing, or merge, consolidate or otherwise combine with any other than the Merger and other than in compliance with Section 9.4(a))corporation; and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time (unless Purchaser shall otherwise consent agree in writing and except as otherwise permitted contemplated by this Agreement):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain satisfactory relations with customers, suppliers, employees and business associates, in each case in all material respects.
(b) the Company shall not (i) sell sell, pledge, dispose of or pledge encumber or agree to sell or pledge any stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarysubsidiaries; (ii) amend the its Certificate or its bylaws By-Laws or amend, modify increase or terminate propose to increase the Rights Agreement, or redeem number of directors of the Rights issued pursuant theretoCompany; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;.
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantsany Company Option Plan; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability involving an amount in excess of $100,000 in the aggregate other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize incur any indebtedness for borrowed money (except for working capital expenditures under the Company's existing credit facilities and refinancings of existing debt that permit prepayment of such debt without penalty) involving an amount in excess of $50,000 individually or $100,000 in the aggregate or assume or endorse the obligations of any other person or entity; (v) make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock of any other person or entity (involving an amount in excess of $100,000 in the aggregate other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with or (vi) make or authorize any capital expenditure in excess of $500,000 in the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;aggregate.
(fd) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except for normal increases in the ordinary and usual course of business;
business that are consistent with past practices and that, in the aggregate, do not result in a material increase in benefits or compensation expense, adopt or amend (g) except as may be required as a result of a change in by law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained as provided in this Agreement to be untrue or incorrect or would result in Agreement) any of the Offer Conditions set forth in Annex A hereto not being satisfied.bonus, profit sharing, compensation, severance, termination,
Appears in 1 contract
Samples: Merger Agreement (Tylan General Inc)
Interim Operations of the Company. The Company covenants Sellers, but specifically excluding UURF for subsections 5.5(a)-(j) hereof, each covenant and agrees, as to itself and its subsidiaries, agree that, except as contemplated by this Agreement or with the prior written consent of Purchaser, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Closing Date:
(a) the business of the Company and its subsidiaries shall be conducted only substantially in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainwithout any material operational changes;
(b) the Company will not amend its articles of incorporation or bylaws or similar organizational documents;
(c) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; (ii) issue or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, the Shares or (iii) redeem, purchase or otherwise acquire directly or indirectly any shares of its capital stock of any class of the CompanyShares;
(d) the Company shall not, its subsidiaries except as may be required or any other property contemplated by this Agreement or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly , acquire, sell, lease or indirectly by redemption or otherwise dispose of any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures assets which exceed $5,000 in excess of $50,000 individually or $100,000 value in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)aggregate;
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall not adopt a plan of complete or partial liquidation, liquidation or resolutions providing for or authorizing such liquidation or a dissolution, merger, consolidation, restructuring, recapitalizationrecapitalization or other reorganization;
(f) the Company shall not make any material commitment or incur or guarantee any material obligation for borrowed money;
(g) the Company shall not enter into, amend, renew or terminate any agreement or contract that would constitute a Material Contract hereunder, including, without limitation, the License;
(h) the Company shall not enter into any material labor, employment, deferred compensation, incentive compensation, bonus, or other reorganization program for employees or retirees;
(i) the Company shall not solicit or encourage submission of inquiries, proposals or offers from any other third party relative to the potential issuance or disposition of capital stock or debt securities of the Company, or the sale of Assets or any disposition of the Company’s business or operations or any part thereof;
(j) the Company (other than shall not provide information to third parties relating to the Merger and other than in compliance with Section 9.4(a))possible issuance or disposition of capital stock or debt securities of the Company, or the sale of Assets or the disposition of the Company’s business or operations or any part thereof; and
(ik) neither no Seller shall solicit or encourage submission of inquiries, proposals or offers from any Person relative to any potential transaction similar to the Company nor transactions contemplated by the Transaction Agreements or provide information to third parties for such purposes, including demonstrating any of its subsidiaries will authorize or enter into an agreement to do any use of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement Company’s technology to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedthird parties for such purposes.
Appears in 1 contract
Interim Operations of the Company. The Except (A) as expressly contemplated by this Agreement, (B) as set forth on Section 5.1 of the Company covenants Disclosure Letter, (C) as required by applicable Law, or (D) as consented to in writing by Parent after the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, which consent solely for clauses (unless Purchaser vii) and (viii) shall otherwise consent in writing and except as otherwise permitted by this Agreement):not be unreasonably withheld or delayed, the Company agrees that:
(ai) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts Subsidiaries will conduct business only in the ordinary course of business consistent with past practice (except for modifications, suspensions or alterations of operations resulting from, or determined by the Company in good faith to preserve its business organization intact be advisable and maintainreasonably necessary in response to, COVID-19 or COVID-19 Measures);
(bii) the Company shall will not (i) sell amend its Certificate of Incorporation or pledge or agree to sell or pledge any stock its Amended and Restated By-laws and the Company’s Subsidiaries will not amend their certificate of incorporation, bylaws or other securities owned by it comparable charter or permit organizational documents;
(iii) neither the Company nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries will (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivA) declare, set aside or pay any dividend or other distribution (including any constructive or deemed distribution), whether payable in cash, stock or property other property, with respect to the Shares;
its capital stock, or otherwise make any payments to its stockholders in their capacity as such; (c) neither the Company nor any of its subsidiaries shall (iB) issue, sell, grant, transfer, pledge, dispose of or encumber or authorize or propose to issue, sell, grant, transfer, pledge, dispose of or encumber any additional shares of, of capital stock or securities convertible into other Rights of the Company or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanySubsidiaries (including treasury stock), its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in respect of the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries Subsidiaries reserved for issuance on the date of this Agreement and issued pursuant to the exercise or settlement of awards outstanding under the Company Stock Plans as of the date of this Agreement, (C) split, combine, subdivide or reclassify the Shares or any other outstanding capital stock of the Company or any of the Subsidiaries of the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any shares of capital stock or other Rights of the Company or any of its Subsidiaries or (D) redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other Rights of the Company or any of its Subsidiaries (other than (1) the withholding of Shares to satisfy Tax obligations with respect to awards granted pursuant to the Company Stock Plans and (2) the acquisition by the Company of Rights pursuant to the Company Stock Plans);
(iv) authorize capital expenditures except as required by applicable Law or under the terms of any Company Plan in excess effect as of $50,000 individually the date of this Agreement, the Company will not and will not permit its Subsidiaries to increase the compensation payable or $100,000 in the aggregate to become payable to any of its or make any acquisition of (by mergertheir officers, consolidation directors or acquisition of stock or assets)employees, or any investment innatural person engaged as a consultant, assets or stock enter into, establish, amend or terminate any Company Plans, except increases in salaries, wages and benefits of any other person or entity (other than acquisitions employees who are neither directors nor officers of assets the Company made in the ordinary course of business consistent with past practice);
(dv) neither the Company nor any of its subsidiaries shall grant Subsidiaries will, except in the ordinary course of business consistent with past practice (A) incur or assume any severance Indebtedness (other than Indebtedness between the Company and any of its Subsidiaries or termination pay between its Subsidiaries, or in connection with the refinancing of any Indebtedness that exists as of the date of this Agreement), (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person (other than a Subsidiary of the Company), or (C) make any material loans, advances or capital contributions to, or enter into investments in, any employment or severance agreement with any director, officer or other employee Person (other than a Subsidiary of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Company);
(evi) neither the Company nor any of its subsidiaries shall settle Subsidiaries will make any acquisition of or compromise investment in a business either by purchase of stock or securities, merger or consolidation, contributions to capital, loans, advances, property transfers, or purchases of any material claims property or litigation orassets of any other Person (other than a Subsidiary of the Company) (A) in excess of $50 million, except individually or in the ordinary and usual course of business and with aggregate, or (B) that would make it more difficult to satisfy the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsconditions to Closing set forth in Section 7.1(b);
(fvii) neither the Company nor any of its subsidiaries shall make Subsidiaries will pay, discharge, waive or settle any tax election claims involved in any Action, other than the payment, discharge, waiver or permit any insurance policy naming it as a beneficiary settlement of claims, liabilities or a loss payable payee to be canceled or terminated without notice to Purchaser, except obligations (A) in the ordinary and usual course of businessbusiness consistent with past practice, or (B) reflected or reserved against in, or contemplated by, the Financial Statements (or the notes to the Financial Statements) for amounts not in excess of those so reflected or reserved;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(hviii) neither the Company nor any of its subsidiaries shall Subsidiaries will materially change any of the accounting methods, principles or practices used by it unless required by a change in GAAP, Applicable SAP or Law;
(ix) neither the Company nor any of its Subsidiaries will (A) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, business combination, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than this Agreement), or (B) transfer, lease, license, sell, mortgage, pledge, dispose of or encumber any material assets with a value in excess of $50 million, individually or in the Merger and other than aggregate, except in compliance this clause (B), in the ordinary course of business consistent with Section 9.4(a)); andpast practice;
(ix) neither the Company nor any of its subsidiaries Subsidiaries will authorize adopt any shareholder rights plan;
(xi) neither the Company nor any of its Subsidiaries will enter into any new business line that is outside their existing businesses (or a business complementary thereto or a natural extension thereof), to the extent doing so would be material to the Company and its Subsidiaries taken as a whole;
(xii) neither the Company nor any of its Subsidiaries will enter into any material block reinsurance transaction;
(xiii) neither the Company nor any of its Insurance Subsidiaries will alter or amend in a manner that is material to the financial condition of the Company and its Insurance Subsidiaries, taken as a whole, any existing financial, underwriting, pricing, claims, claims handling, risk retention, reserving, investment or actuarial practice, guideline or policy, or any material assumption underlying an actuarial practice or policy, except as may be required by GAAP, Applicable SAP or Law;
(xiv) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants After the date hereof and agrees, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser time the designees of Parent have been elected or appointed to, and shall otherwise consent in writing constitute a majority of, the Board of Directors of the Company pursu ant to Section 1.4 or the date, if any, on which this Agreement is earlier terminated pursuant to Section 7.1, and except (i) as otherwise permitted expressly contemplated by this Agreement):, (ii) as set forth on Schedule 5.1 of the Disclosure Schedule or (iii) as agreed in writing by Parent:
(a) the business Company shall and shall cause its Subsidiaries to carry on their respective businesses in the ordinary course;
(b) neither the Company nor any of its Subsidiaries shall, directly or indirectly, amend its certificate of incorporation or by-laws or similar organizational documents;
(c) Representatives of the Company and its subsidiaries Subsidiaries shall be conducted only in confer at such times as Parent may reasonably request with one or more Representatives of Parent to report material operational matters and the ordinary and usual course and, to the extent consistent therewith, each general status of ongoing operations;
(d) neither the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries shall: (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivi)(A) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
(c) neither Company's capital stock or that of its Subsidiaries, except that a wholly-owned Subsidiary of the Company nor may declare and pay a dividend or make advances to its parent or the Company or (B) redeem, purchase or otherwise acquire directly or indirectly any of the Company's capital stock or that of its subsidiaries shall Subsidiaries; (iii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than Shares issued upon the case exercise of the Company, Shares issuable pursuant to options Options outstanding on the date hereof under in accordance with the Stock Option Plans and shares issuable pursuant to as in effect on the Warrantsdate hereof; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly split, combine or indirectly by redemption or otherwise any shares of reclassify the outstanding capital stock of the Company or of any of the Subsidiaries of the Company;
(e) except as permitted by this Agreement, neither the Company nor any of its subsidiaries Subsidiaries shall acquire or agree to acquire (A) by merging or consolidating with, or by purchasing a substantial portion of the assets of, or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof (including entities which are Subsidiaries of the Company or any of the Company's Subsidiaries) or (ivB) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by mergerassets, consolidation or acquisition of stock or assets)including real estate, or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except purchases in the ordinary course of business consistent with past practice);
(df) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orSubsidiaries shall, except in the ordinary and usual course of business and with the consent of Purchaser, modifyexcept as otherwise permitted by this Agreement, amend or terminate any of its material Contracts Company Material Contract where such amendment or termination would have a Material Adverse Affect on the Company, or waive, release or assign any material rights or claims;
(fg) neither the Company nor any of its subsidiaries Subsidiaries shall make transfer, lease, license, sell, mortgage, pledge, dispose of or encumber any tax election property or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except assets other than in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by itbusiness and consistent with past practice;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete Subsidiaries shall: (A) enter into any employment or partial liquidationseverance agreement with or grant any severance or termination pay to any officer, dissolution, merger, consolidation, restructuring, recapitalization, director or other reorganization key employee of the Company or any its Subsidiaries; or (other than the Merger and other than in compliance with Section 9.4(a)); andB) hire or agree to hire any new or additional executives or senior officers;
(i) neither the Company nor any of its subsidiaries Subsidiaries shall, except in the ordinary course of business and except as required to comply with applicable Law or contracts disclosed in the Company's SEC Documents or otherwise disclosed to Parent or expressly provided in this Agreement, (A) adopt, enter into, terminate, amend or increase the amount or accelerate the payment or vesting of any benefit or award or amount payable under any Benefit Plan or other arrangement for the current or future benefit or welfare of any director, officer or current or former employee, except to the extent necessary to coordinate any such Benefit Plans with the terms of this Agreement, (B) increase in any manner the compensation or fringe benefits of, or pay any bonus to, any director, officer or employee, (C) pay any benefit not provided for under any Benefit Plan, (D) grant any awards under any bonus, incentive, performance or other compensation plan or arrangement or Benefit Plan (including the grant of stock options, stock appreciation rights, stock based or stock related awards, performance units or restricted stock, or the removal of existing restrictions in any Benefit Plans or agreements or awards made thereunder);
(j) neither the Company nor any of its Subsidiaries shall: (A) incur or assume any long-term debt, or except in the ordinary course of business, incur or assume any short-term indebtedness in amounts not consistent with past practice; (B) materially increase its bank debt; (C) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, except in the ordinary course of business and consistent with past practice; (D) make any loans, advances or capital contributions to, or investments in, any other Person (other than to wholly owned Subsidiaries of the Company or customary loans or advances to employees in the ordinary course of business and consistent with past practice); or (E) enter into any material commitment or transaction except in the ordinary course of business consistent with past practice;
(k) neither the Company nor any of its Subsidiaries shall change any of the accounting methods used by it unless required by GAAP;
(l) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, in the ordinary course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries; or, except in the ordinary course of business consistent with past practice, waive the benefits of, or agree to modify in any manner, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is a party;
(m) neither the Company nor any of its Subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or to authorize, recommend, propose or announce an intention to do any of the foregoing; and
(n) neither the Company nor any of its Subsidiaries shall take any action that would knowingly cause result in (i) any of its representations and warranties set forth in this Agreement that are qualified as to materiality becoming untrue, (ii) any of such representations and warranties that are not so qualified becoming untrue in any material respect or (iii) any of the representations or warranties of the Company contained in this Agreement conditions to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedsatisfied (subject to the Company's right to take action specifically permitted by Section 5.5).
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, during the period from the date of this Agreement through the earlier of the Acceptance Time or the date of termination of this Agreement, except (i) to the extent Parent has consented in writing (which consent shall not be unreasonably withheld, conditioned or delayed), (ii) as set forth in Part 5.1 of the Disclosure Schedule, (iii) as contemplated by the express terms of this Agreement or (iv) as may be required to comply with any Legal Requirement, the Company shall, and shall cause the other Acquired Companies to, conduct their respective businesses in the ordinary course of business and in a manner that does not depart materially from the manner in which such business was being conducted prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by date of this Agreement):, and the Company shall not, and shall cause the other Acquired Companies not to:
(a) the business of the Company and amend its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainOrganizational Documents;
(b) split, combine, reclassify, adjust, recapitalize, subdivide amend the Company shall not (i) sell terms of, redeem, purchase or pledge or agree to sell or pledge otherwise acquire any shares of its capital stock or other equity interests or any options, warrants, securities owned by it or permit other rights exercisable for or convertible into any of its subsidiaries to sell, pledge or agree to sell or pledge any such capital stock or other equity securities owned by such subsidiary; (iiexcept as permitted by, and subject to the terms of, Section 5.1(h));
(c) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside declare or pay any dividend (whether payable in cash, stock or property property) with respect to any shares of its capital stock or other equity interest (other than dividends by a wholly owned Subsidiary of the SharesCompany to the Company or another wholly owned Subsidiary of the Company);
(cd) neither the Company nor form any of its subsidiaries shall Subsidiary or acquire any equity interest in any other Entity, other than short-term investments;
(ie) issue, sell, pledge, dispose of or encumber issue any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments warrants or rights of any kind to acquire, any shares of its capital stock of any class of the Companystock, its subsidiaries or any other property or assets other than, in the case of the Company, than Company Shares issuable pursuant to options outstanding on upon exercise of Company Options or upon the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; vesting of Company RSUs or Company PSUs;
(iif) sell, pledge, depose of, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of license or encumber any material assets of the Company (other than Owned Company IP, which is addressed in Section 5.1(g)), other than (i) sales of inventory in the ordinary course of business, (ii) pursuant to written Contracts or incur commitments existing as of the date of this Agreement or modify (iii) as security for any indebtedness or other liability borrowings permitted by Section 5.1(i);
(g) sell, license (other than in the ordinary and usual course of business; ) or transfer, or, other than in the ordinary course of business, encumber, impair, abandon, permit to lapse or otherwise dispose of any right, title or interest in or to any Owned Company IP;
(h) repurchase, redeem or otherwise acquire any Company Shares, except Company Shares repurchased from employees or consultants or former employees or consultants of the Company pursuant to the exercise of repurchase rights or in connection with the withholding of Company Shares to satisfy Tax obligations or to pay the exercise price with respect to Company Options, Company RSUs, Company PSUs or the Company Restricted Shares;
(i) incur any indebtedness for borrowed money or guarantee any such indebtedness, except for (i) short-term borrowings incurred in the ordinary course of business, (ii) borrowings pursuant to existing credit facilities, or pursuant to any modifications, renewals or replacements of any such credit facilities and (iii) acquire directly or indirectly by redemption or otherwise purchase-money financings and capital leases entered into in the ordinary course of business;
(j) except as required pursuant to the terms of any shares Company Plan in effect as of the capital stock date of the this Agreement, (i) adopt, amend, or terminate any Company Plan or any arrangement that would have been a Company Plan had it been entered into prior to this Agreement or take any action to accelerate the vesting or lapsing of its subsidiaries restrictions or payment under any Company Plan; (ivii) authorize capital expenditures in excess of $50,000 individually increase the base wage or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets)salary payable to, or any investment inother components of compensation and benefits of, assets any current or stock former employee, officer, director or individual independent contractor of any other person or entity (the Acquired Companies, other than acquisitions of assets annual increases in base salary in the ordinary course of business consistent with past practice)practice to employees below the level of Vice President that do not exceed 5% in the aggregate; (iii) grant any retention, severance or termination payments to any current or former employee, officer, director or individual independent contractor of the Acquired Companies; or (iv) hire any Person to be an employee of the Acquired Companies, other than the hiring of employees below the level of Vice President in the ordinary course of business consistent with past practice whose employment may be terminated without the obligation to pay severance (other than any obligation to pay severance under any Company Plan in effect prior to this Agreement) or other Liability;
(dk) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except than in the ordinary and usual course of business and business: (i) amend, modify or terminate (other than termination upon the expiration of the term thereof in accordance with the consent of Purchaser, modify, amend or terminate terms thereof) any of its material Material Contracts or waive, release or assign any material rights rights, claims or claimsbenefits under any Material Contracts, or (ii) enter into any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement;
(fl) neither the Company nor change any of its subsidiaries shall make methods of accounting or accounting practices in any tax election material respect other than as required or permit permitted by GAAP;
(m) (i) make, change or revoke any insurance policy naming it as a beneficiary Tax election, (ii) change any material method of accounting for Tax purposes, (iii) enter into any closing agreement, settle any action in respect of material Taxes or a loss payable payee enter into any contractual obligation in respect of material Taxes with any Governmental Entity, (iv) extend or waive the application of any statute of limitations regarding the assessment or collection of any Tax (except with respect to be canceled or terminated without notice to Purchaser, except routine extensions in the ordinary and usual course of business) or (v) apply for or pursue any Tax ruling;
(gn) make any capital expenditure that is not contemplated by the capital expenditure budget set forth in Part 5.1(n) of the Disclosure Schedule (a “Non-Budgeted Capital Expenditure”), except as may be required as a result of a change in law or in generally accepted accounting principles, neither that the Company nor (i) may make any Non-Budgeted Capital Expenditure that does not individually exceed $1,000,000 in amount, and (ii) may make Non-Budgeted Capital Expenditures that, when added to all other Non-Budgeted Capital Expenditures made by the Company since the date of this Agreement, would not exceed $3,400,000 in the aggregate;
(o) make or offer to make any acquisition of any Person or a business or division of any Person;
(p) make any loans to, advances or capital contributions to any other Person other than (i) loans, advances or capital contributions solely involving one or more of the Company and the wholly owned Subsidiaries of the Company, or (ii) advances for travel and other out-of-pocket expenses to officers, directors or employees of the Acquired Companies in the ordinary course of business, consistent with past practice;
(q) engage in any transaction with, or enter into any agreement, arrangement or understanding with any affiliate of the Company or other person covered by Item 404 of Regulation S-K promulgated under the Exchange Act;
(r) (i) enter into any new material line of business, or (ii) open a new office of the Acquired Companies in any country where no Acquired Company has an office as of the date hereof;
(s) (i) settle any Legal Proceeding before or threatened to be brought before a Governmental Entity, other than monetary settlements not in excess of $250,000 individually, or $1,000,000 in the aggregate (provided that such settlements do not involve any non-de minimis injunctive or equitable relief or impose non-de minimis restrictions on the business activities of the Acquired Companies, Parent or any of its subsidiaries Subsidiaries) or (ii) waive any material right with respect to any material claim held by the Acquired Companies in respect of any Legal Proceeding brought or threatened in writing to be brought before a Governmental Entity, in each case, other than Legal Proceedings related to the transactions contemplated by this Agreement, which shall change instead be governed by Section 5.15;
(t) terminate, cancel or make any material changes to the structure, limits or terms and conditions of any Insurance Policies, including allowing the Insurance Policies to expire without renewing such Insurance Policies or obtaining comparable replacement coverage; or
(u) authorize, agree to take or enter into a binding agreement to take any of the accounting practices or principles used by it;
actions described in clauses (ha) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company through (other than the Merger and other than in compliance with Section 9.4(a)); and
(it) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedabove.
Appears in 1 contract
Samples: Merger Agreement (Rosetta Stone Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time (unless Purchaser Parent shall otherwise consent agree in writing and except as otherwise permitted contemplated by this AgreementAgreement or as set forth in the Disclosure Letter):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees and business associates;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarysubsidiaries; (ii) amend the Certificate its Articles or its bylaws By-Laws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares or Preferred Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares or Preferred Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the WarrantsPlans; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries Company; or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 any manner not reflected in the aggregate capital budget of the Company attached to the Disclosure Letter or make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets any business or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)entity;
(d) other than (i) the employment agreements entered into in connection with this Agreement, (ii) as otherwise provided herein, (iii) as required by law or (iv) as required under an existing plan as of the date hereof, neither the Company nor any of its subsidiaries shall (A) grant any severance or termination pay to, or enter into any employment or severance agreement with with, any director, officer or other employee of the Company or such subsidiaries; or (B) establish, adopt, enter into, make any such subsidiary; and neither new grants or awards (or accelerate the Company nor vesting, or increase the value of any benefit) under, or amend, any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, employee stock ownership, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of its subsidiaries shall establish,any directors, officers or employees;
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaserbusiness, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any material tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserthe prior written approval of Parent, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall (i) terminate the employment of any Employee who is covered by a change any of the accounting practices in control, employment, termination or principles used by it;similar agreement, except for Cause (as defined in such agreements) or (ii) permit circumstances to exist that would provide such Employee with Good Reason (as defined in such agreements) to terminate employment; and
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Except as contemplated by this Agreement, the Company covenants and agreesDisclosure Schedule, as to itself and its subsidiariesor with the prior written consent of Reitco, that, prior during the period from the date of this Agreement to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) the business of Time, the Company will, and will cause each of its subsidiaries shall be conducted Subsidiaries to, conduct its operations in all material respects only in the ordinary and usual course of business consistent with past practice and in compliance in all material respects with all applicable law and, to the extent consistent therewith, will use its reasonable efforts, and will cause each of its Subsidiaries to use its best efforts, to preserve intact the business organization of the Company and each of its subsidiaries shall use its commercially reasonable efforts Subsidiaries, to keep available the services of their present officers and key employees, and to preserve its the goodwill of those having business organization intact relationships with it. Without limiting the generality of the foregoing and maintain
(b) except as otherwise contemplated by this Agreement or Section 6.1 of the Company shall Disclosure Schedule, the Company will not, and will not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries Subsidiaries to, prior to sellthe Effective Time, without the prior written consent of Reitco:
(a) adopt any amendment to its Certificate of Incorporation or Bylaws or comparable organizational documents;
(i) issue, pledge or agree sell, or authorize the issuance, pledge or sale of additional shares of capital stock of any class (except upon exercise of outstanding Options), or securities convertible into capital stock of any class, or any rights, warrants or options to sell acquire any convertible securities or pledge capital stock, or any stock or other securities owned by such subsidiary; in respect of, in lieu of, or in substitution for, shares of Company Common Stock outstanding on the date hereof or (ii) amend the Certificate or its bylaws or amend, waive or otherwise modify any of the terms of any option, warrant or terminate stock option plan of the Rights AgreementCompany or any of its Subsidiaries, including without limitation, the Options or redeem the Rights issued pursuant thereto; Option Plan;
(iii) split, combine or reclassify the outstanding Shares; or (ivc) declare, set aside or pay any dividend payable or other distribution (whether in cash, stock securities or property with or any combination thereof) in respect to of any class or series of its capital stock other than between any wholly-owned Subsidiary of the SharesCompany and the Company or any other wholly-owned Subsidiary of the Company;
(cd) neither the Company nor any of its subsidiaries shall (i) issuesplit, sellcombine, pledgesubdivide, dispose of reclassify or encumber any additional shares ofredeem, purchase or otherwise acquire, or securities convertible into propose to redeem or exchangeable for, purchase or options, warrants, calls, commitments or rights of any kind to otherwise acquire, any shares of its capital stock of any class of the Companystock, its subsidiaries or any of its other property securities;
(e) increase the compensation or assets other thanfringe benefits payable or to become payable to its directors, in officers or employees (whether from the case Company or any of its Subsidiaries), or pay any benefit not required by any existing plan or arrangement (including, without limitation, the Companygranting of stock options, Shares issuable stock appreciation rights, shares of restricted stock or performance units) or grant any severance or termination pay to (except pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transferexisting agreements or policies), leaseor enter into any employment or severance agreement with, licenseany director, guarantee, sell, mortgage, pledge, dispose of officer or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock employee of the Company or any of its subsidiaries Subsidiaries or establish, adopt, enter into, or amend any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, savings, welfare, deferred compensation, employment, termination, severance or other employee benefit plan, agreement, trust, fund, policy or arrangement for the benefit or welfare of any directors, officers or current or former employees, except in each case (i) to the extent required by applicable law or regulation, or (ivii) for annual raises and/or bonuses consistent with past practice;
(i) except for sales of inventory, sell, pledge, lease, dispose of, grant, encumber, or otherwise authorize the sale, pledge, disposition, grant or encumbrance of any assets of the Company or any of the Subsidiaries, except for sales in the ordinary course of business of the Company or (ii) except for (A) purchases of inventory and supplies in the ordinary course of business, (B) capital expenditures in excess accordance with the Company's 1998 capital expenditure budget and (C) completion of $50,000 individually or $100,000 pending acquisitions identified in writing to Reitco in connection with the execution of this Agreement on terms substantially as set forth in the aggregate applicable letter of intent or make any acquisition of definitive agreement, as the case may be, acquire (including, without limitation, by merger, consolidation consolidation, lease or acquisition of stock or assets) any corporation, partnership, other business organization or any division thereof (or a substantial portion of the assets thereof) or any other assets, except for such acquisitions which, individually or in the aggregate, do not exceed $50,000;
(g) (i) incur, assume or pre-pay any debt, except that the Company and its Subsidiaries may incur or pre-pay debt in the ordinary course of business consistent with past practice under existing lines of credit and may incur indebtedness to fund the acquisitions described in Section 6.1(f), (ii) assume, guarantee, endorse or any investment inotherwise become liable or responsible (whether directly, assets continentally or stock otherwise) for the obligations of any other person or entity (other than acquisitions of assets Person except in the ordinary course of business consistent with past practice), or (iii) make any loans, advances or capital contributions to, or investments in, any other Person except in the ordinary course of business consistent with past practice and except for loans, advances, capital contributions or investments between any wholly-owned Subsidiary of the Company and the Company or another wholly-owned Subsidiary of the Company;
(dh) neither the Company nor any authorize, recommend, propose or announce an intention to adopt a plan of its subsidiaries shall grant any severance complete or termination pay to, partial liquidation or enter into any employment or severance agreement with any director, officer or other employee dissolution of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Subsidiaries;
(ei) neither the Company nor make any of its subsidiaries shall tax elections or settle or compromise any federal or state income tax liability with Tax authorities;
(j) pay, discharge or satisfy any material claims claims, liabilities or litigation orobligations (absolute, except accrued, asserted, unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary and usual course of business and consistent with past practice of liabilities reflected or reserved against in the consent consolidated financial statements of Purchaserthe Company;
(k) enter into any collective bargaining agreement;
(l) take any action, other than reasonable and usual actions in the ordinary course of business and consistent with past practice, with respect to accounting policies or procedures, unless required by GAAP or the SEC;
(m) modify, amend or terminate any of its material the Company Material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessbusiness consistent with past practice;
(gn) except as may be required as a result take, or agree to commit to take, any action that would make any representation or warranty of a change in law or in generally accepted accounting principles, neither the Company nor contained herein inaccurate in any respect at, or as of its subsidiaries shall change any time prior to, the Effective Time;
(o) engage in any transaction with, or enter into any agreement, arrangement, or understanding with, directly or indirectly, any of the accounting practices Company's affiliates which involves the transfer of consideration or principles used by ithas a financial impact on the Company, other than pursuant to such agreements, arrangements, or understandings existing on the date of this Agreement (which are set forth on Section 6.1 of the Company Disclosure Schedule);
(hp) neither the Company nor close, shut down, or otherwise eliminate any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization the Company's golf courses located on any of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
Properties, except for such closures, shutdowns or eliminations which are (i) neither the Company nor any required by action, order, writ, injunction, judgment or decree or otherwise required by law, or (ii) due to acts of its subsidiaries will authorize God or other force majeure events; or
(q) enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations foregoing.
(r) take any other action (or warranties fail to take any action) that would be inconsistent with Reitco's continued qualification as a REIT after the Effective Time under the Code and the rules and regulations promulgate thereunder; or
(s) directly or indirectly through a Subsidiary enter into any agreement, or participate in active negotiations with any third party, relating to any business transaction the reasonably foreseeable effect of which would be to delay the Company contained in this Agreement to be untrue Effective Time beyond June 15, 1998, prevent the Effective Time from occurring or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto Merger not being satisfiedtreated as, or as part of, a tax-free reorganization for federal income tax purposes.
Appears in 1 contract
Samples: Merger Agreement (Meditrust Corp)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this Agreement, or (ii) as agreed in writing by Parent, after the date hereof, and prior to the Effective Time time the directors of the Purchaser have been elected to, and shall constitute a majority of, the Board of Directors of the Company pursuant to Section 1.3 (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreementthe "Appointment Date"):
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course of business and consistent with past practice and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its business organization organizations and business organizations of its Subsidiaries intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not will not, directly or indirectly, (i) sell except upon exercise of employee stock options, pursuant to which up to 517,117 Shares may be issued, outstanding on the date hereof, issue, sell, transfer or pledge or agree to sell sell, transfer or pledge any treasury stock of the Company or other securities owned by it or permit any capital stock of any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities Subsidiaries beneficially owned by such subsidiary; it, (ii) amend the its Certificate of Incorporation or its bylaws By-Laws or amend, modify similar organizational documents; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, subdivide, combine or reclassify the outstanding Shares; Shares or (iv) declare, set aside Preferred Stock or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock other than dividends paid by Subsidiaries of the Company to the Company or any of its wholly-owned Subsidiaries in the ordinary course of business; (ii) issue, sell, pledge, grant, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than Shares reserved for issuance on the case of the Company, Shares issuable date hereof pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable hereof, pursuant to the Warrantswhich up to 517,117 Shares may be issued; (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice; or (iiiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) grant any severance increase in the compensation payable or termination pay toto become payable by the Company or any of its Subsidiaries to any of its executive officers or employees, enter into any contract or other binding commitment in respect of any such increase with any of its directors, officers or other employees or any director, officer or other employee of its Subsidiaries, and not establish, adopt, enter into, make any new grants or awards under or amend, any collective bargaining agreement; (ii)(A) adopt any new, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan, agreement or arrangement; or (iii) enter into any employment or severance agreement with or, except in accordance with the existing written policies of the Company, grant any directorseverance or termination pay to any officer, officer director or other employee of the Company or any such subsidiaryof its Subsidiaries; and neither provided, however, that (i) prior to consummation of the Offer, the Company nor any may enter into severance agreements with the individuals set forth in Section 5.1(d) of its subsidiaries the Company Disclosure Schedule (the "Designated Employees") in the form as approved by the Company's Board of Directors, (ii) the aggregate cost of payments and benefits provided to the Designated Employees pursuant to the terms of such severance agreements (unless otherwise amended with the written consent of, or at the written direction of, Parent or Purchaser) shall establish,not exceed $2,000,000 in the aggregate, and (iii) with respect to the severance plan described in Section 3.4 of the Company Disclosure Schedule that covers individuals other than the Designated Employees (the "Nondesignated Employees"): (a) the implementation of such plan and the entering into of agreements with Nondesignated Employees shall be subject to the prior written consent of the Purchaser, which consent shall not be unreasonably withheld (with reasonableness to be determined based upon Purchaser's reasonable business objectives and consistent with Purchaser's past practice), and (b) the aggregate cost of payments and benefits provided to the Nondesignated Employees pursuant to the terms 21 27 of such severance agreements (unless otherwise amended with the written consent of, or at the written direction of, Parent or Purchaser) shall not exceed $1,000,000 in the aggregate;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserterminated, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(f) neither the Company nor any of its Subsidiaries shall enter into any contracts or transactions relating to the purchase of assets that exceed $1,000,000 in the aggregate;
(g) except as may be neither the Company nor any of its Subsidiaries shall change any of the accounting methods used by it unless required as a result of a change in law or in generally accepted accounting principlesby GAAP, neither the Company nor any of its subsidiaries Subsidiaries shall make any material Tax election except in the ordinary course of business consistent with past practice, change any material Tax election already made, adopt any material Tax accounting method except in the ordinary course of business consistent with past practice, change any material Tax accounting method unless required by GAAP, enter into any closing agreement, settle any Tax claim or assessment or consent to any Tax claim or assessment or any waiver of the accounting practices statute of limitations for any such claim or principles used by itassessment;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
Subsidiaries shall: (i) neither the Company nor incur or assume any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.long-term debt;
Appears in 1 contract
Samples: Merger Agreement (Omnicare Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Except (unless Purchaser shall otherwise consent in writing and except a) as otherwise permitted contemplated by this Agreement):, (b) as set forth in Section 5.1 of the Seller Disclosure Schedule, and (c) as may be consented to by Purchaser in writing (which consent shall not be unreasonably delayed), the Company shall and shall cause the Company Subsidiary to, comply with the following from the date hereof until the earlier of the termination of this Agreement in accordance with its terms or the Closing Date:
(ai) the business of the Company and its subsidiaries The Purchased Business shall be conducted only in the ordinary and usual course andof business consistent with past practice and Sellers, to the extent consistent therewith, each of the Company and its subsidiaries the Company Subsidiary shall each use its their commercially reasonable efforts to maintain their relationships with customers, resellers, suppliers, vendors, employees, agents and others, and keep available to Purchaser the services of the present Company Employees and preserve its for Purchaser the goodwill of customers, resellers, suppliers, vendors, employees, agents and others having business organization intact and maintainrelations with the Purchased Business.
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither Neither the Company nor the Company Subsidiary shall (A) amend, modify, repeal or propose to do so, or permit or consent to any amendment, modification or repeal of its subsidiaries shall certificate of incorporation or bylaws or similar organizational documents, (iB) issue, sell, transfer, pledge, dispose of or encumber any additional shares ofof any class or series of its capital stock, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of any class or series of its capital stock, (C) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to any shares of any class or series of the Companyits capital stock, (D) split, combine or reclassify any shares of any class or series of its subsidiaries stock, or any other property (E) redeem, purchase or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) otherwise acquire directly or indirectly by redemption or otherwise any shares of any class or series of its capital stock, or any instrument or security which consists of or includes a right to acquire such shares. Notwithstanding the capital stock of foregoing, however, the Company may distribute cash to Go2Net or any of its subsidiaries or (iv) authorize capital expenditures Parent in excess of $50,000 individually the amount held on behalf of merchants pending disbursement or $100,000 held in reserve for eCheck and Integrated Payment Solution related transactions as of the aggregate or make any acquisition of Closing Date.
(by mergeriii) Neither the Company nor the Company Subsidiary shall, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except in the ordinary course of business consistent with past practice);practice (A) create, incur, assume, guarantee, endorse, refinance, modify, extend, renew or otherwise become liable for any Indebtedness, obligation or other liability, (B) pay, agree to cancel or pay, or otherwise provide for a complete or partial discharge in advance of a scheduled payment date with respect to any Indebtedness, obligation or other liability, (C) waive, cancel or compromise any right to receive any direct or indirect payment or other benefit under any Indebtedness, obligation or other liability owing to the Purchased Business, (D) sell, lease or otherwise dispose of any material assets, or (E) grant any extensions of credit, other than accounts receivable in the ordinary course of business consistent with past practices.
(div) neither Neither the Company nor the Company Subsidiary shall (A) amend, terminate or waive any material right under any Material Contract, (B) merge or consolidate with any Person, (C) purchase any capital stock of or interest in any Person, (D) purchase assets constituting a business, or (E) create or suffer the imposition of any Encumbrance upon any of its subsidiaries their assets, tangible or intangible, except for Permitted Encumbrances, (F) make any change in their pricing policies or payment or credit policies; or (G) fail to pay any creditor any amount owed to such creditor when due, other than consistent with past payment practices.
(v) None of Sellers, the Company or the Company Subsidiary shall grant (A) make any change in the compensation (including severance compensation) or termination pay to, bonuses payable or enter into to become payable to any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
Employees (e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except other than normal recurring increases in the ordinary and usual course of business disclosed on Section 5.1(b)(v) of the Seller Disclosure Schedule or pursuant to plans, programs or agreements existing on the date hereof and disclosed on Section 5.1(b)(v) of the Seller Disclosure Schedule), including the establishment or adoption of any employee benefit plan, except those adopted by Parent on a company-wide basis, or (B) pay or agree to pay any bonus or other compensation to any Person in connection with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;Transactions.
(fvi) neither the The Company nor shall not adopt or become a party to any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); andCompany.
(ivii) Neither the Company nor the Company Subsidiary shall change in any material respect any of the accounting methods used by it unless required by GAAP, or make or change any Tax election that would be reasonably likely to adversely affect in any material respect (relative to the Purchased Business) the Tax liability or Tax Attributes of the Company or the Company Subsidiary.
(viii) Neither the Company nor the Company Subsidiary shall institute, pay, discharge, settle or satisfy any litigation or any claims, liabilities or obligations which are material to the Purchased Business.
(ix) Neither the Company nor the Company Subsidiary shall make any capital expenditures exceeding $50,000 in the aggregate.
(x) Other than transactions in connection with intercompany cash management and transfers, neither the Company nor any of its subsidiaries will authorize or the Company Subsidiary shall enter into any transaction other than on an agreement arms' length basis.
(xi) None of Sellers, the Company or the Company Subsidiary shall hire or retain any person as a Company Employee who does not serve as a Company Employee on the date of this Agreement.
(xii) Neither the Company nor the Company Subsidiary shall enter into any agreement, contract, commitment or arrangement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. (a) The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to during the period from the date of this Agreement through the earlier of the Effective Time or the date of termination of this Agreement, except: (unless Purchaser i) to the extent Parent shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) the Company which consent shall not (i) sell be unreasonably withheld, delayed or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiaryconditioned); (ii) amend as set forth in Section 5.01(a) of the Certificate Company Disclosure Letter; or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) as expressly required by this Agreement, the Company shall (A) use its reasonable best efforts to (1) conduct its business in the ordinary course of business, (2) preserve intact its present business organization, (3) maintain satisfactory relations with and keep available the services of its current officers and other key employees and (4) preserve existing relationships with material customers, lenders, suppliers, distributors and others having material business relationships with the Company and (B) not:
(1) amend the Company Charter Documents except as required by Section 6.02(f) below;
(2) split, combine combine, subdivide or reclassify the outstanding Sharesany shares of its capital stock; or (iv) declare, set aside or pay any dividend (whether payable in cash, stock or property property) with respect to any shares of its capital stock; provided however that on the Sharesmorning of the Closing Date, before the Closing itself, the Company shall distribute to the Shareholders’ Account, an amount equal to all Company Cash on hand as of such day (the “Pre-Closing Consideration”);
(c) neither the Company nor any of its subsidiaries shall (i3) issue, sell, pledge, transfer, deliver, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments options or rights of any kind to acquire, any shares of its capital stock, voting securities, phantom stock, phantom stock rights, stock based performance units or other securities that derive their value by reference to such capital stock or voting securities, other than the issuance of any class Company Shares upon the exercise of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; Company Options;
(ii4) transfer, leaselease or license to any third party, licenseor subject to an Encumbrance (except for Permitted Encumbrances), guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify of the Company other than: (i) any indebtedness or other liability other than license agreement with a third party with respect to rapid onset intravenous Clopidogrel, subject to the prior approval of Parent, which approval shall not be unreasonably withheld; (i) sales of inventory in the ordinary and usual course of business; (ii) licenses, sales, or other provisions for the commercialization of technology in the ordinary course of business, including without limitation such agreements or provisions with or to Merck, Sharp and Dohme Corp., subject to the prior approval of Parent, which approval shall not be unreasonably withheld; and (iii) acquire directly or indirectly by redemption dispositions of obsolete assets;
(5) repurchase, redeem or otherwise acquire or offer to repurchase, redeem or otherwise acquire any shares of its capital stock;
(6) acquire (whether pursuant to merger, stock or asset purchase or otherwise) or lease (i) any asset or assets, except for purchases of raw materials, equipment and supplies in the ordinary course of business, or (ii) any equity interests in any Person or any business or division of any Person (except for marketable securities acquired by the Company from time to time in connection with its normal cash management activities);
(7) incur, issue, repurchase, modify or assume any Indebtedness or guarantee any such Indebtedness;
(8) make any loans, advances or capital stock contributions to, or investments in, any other Person other than (i) advances to employees in respect of travel and other expenses in the ordinary course of business, and (ii) investments made by the Company in marketable securities in connection with its normal cash management activities;
(9) (i) increase benefits under any Company Plan, except as required by applicable Legal Requirements, (ii) increase or otherwise change the method for funding or insuring benefits under any Company Plan, except as required by applicable Legal Requirements, (iii) (A) establish, adopt, enter into, amend or terminate any Company Plan that is an “employee benefit plan” as defined in Section 3(3) of ERISA or other any other arrangement that would be an employee benefit plan under ERISA if it were in existence as of the date of this Agreement, except as required by applicable Legal Requirements, or (B) establish, adopt, enter into, amend or terminate any collective bargaining agreement, Company Plan that is not an employee benefit plan under ERISA or any plan, agreement, program, policy, trust, fund or other arrangement that would be a Company Plan that is not an employee benefit plan under ERISA if it were in existence as of its subsidiaries or (iv) authorize capital expenditures in excess the date of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by mergerthis Agreement, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except in the ordinary course of business consistent with past practiceor as required by applicable Legal Requirements (including, without limitation, Section 409A of the Code);
, (div) neither grant any increase in the rates of salaries, compensation or fringe or other benefits payable to any Executive (other than as required by applicable Legal Requirements or pursuant to non-discretionary provisions of Contracts in effect as of the date hereof), (v) grant any increase in the rates of salaries, compensation or fringe or other benefits payable to any employee, except increases that are required by Legal Requirements or pursuant to non-discretionary provisions of Contracts in effect as of the date hereof, or normal annual increases in non-executives’ salaries taking effect in January of 2011, (vi) grant or pay any bonus of any kind or amount whatsoever to any current or former director or officer or any employee of the Company nor (other than pursuant to the non-discretionary provisions of Contracts in effect as of the date of this Agreement and employee bonuses for calendar year 2010 which the Company shall pay before Closing in accordance with Company’s 2010 Bonus Policy, and all of which shall be taken account of in calculations of Company Cash and working capital) or (vii) grant or pay any of its subsidiaries shall grant any stay or severance or termination pay to, or enter into increase in any employment manner the severance or severance agreement with termination pay of any current or former director, officer officer, employee or other employee consultant of the Company other than as required by applicable Legal Requirements, or any such subsidiary; and neither the Company nor any pursuant to non-discretionary provisions of its subsidiaries shall establish,Contracts in effect as of November 1, 2010;
(e10) neither the Company nor any of its subsidiaries shall settle or compromise any material claims Legal Proceeding (whether or litigation ornot commenced before the date of this Agreement), except other than settlements or compromises of Legal Proceedings where the amount paid (after giving effect to insurance proceeds actually received) in settlement or compromise does not exceed the ordinary and usual course of business and with Company’s reserves on its books therefor by more than $10,000, or for any Legal Proceeding for which the consent of PurchaserCompany has not yet reserved, modifyin an amount therefor that does not exceed $20,000;
(11) enter into any new, or amend or prematurely terminate any of its material Contracts current, Company Contract or waive, release or assign any material rights or claimsclaims under any Company Contract (except (i) in the ordinary course of business or (ii) where the failure to amend or terminate a Company Contract would, in the reasonable judgment of the Company Board, have a Company Material Adverse Effect);
(f12) neither the Company nor change any of its subsidiaries shall methods of accounting or accounting practices in any material respect, other than changes required by GAAP or Legal Requirements;
(13) make any tax material Tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, (except for elections made in the ordinary and usual course of business);
(g14) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor make any of its subsidiaries shall change any of the accounting practices or principles used by itcapital expenditures;
(h15) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, liquidation or dissolution, merger, consolidation, restructuring, recapitalization, ;
(16) take any action that is intended or other reorganization would reasonably be expected to result in any of the Company (other than conditions to the Merger and other than set forth in compliance with Section 9.4(a))Article VI not being satisfied on or before the Outside Date; andor
(i17) neither the Company nor any of its subsidiaries will authorize or enter into an any agreement or otherwise make any commitment to do any of the foregoing foregoing.
(b) Without in any way limiting any party’s rights or take any action obligations under this Agreement, the parties understand and agree that would knowingly cause any of the representations or warranties of the Company (i) nothing contained in this Agreement shall give Parent or Merger Sub, directly or indirectly, the right to be untrue control or incorrect or would result in any direct the Company’s operations before the Effective Time, and (ii) before the Effective Time, the Company shall exercise, consistent with the terms and conditions of the Offer Conditions set forth in Annex A hereto not being satisfiedthis Agreement, complete control and supervision over its operations.
Appears in 1 contract
Interim Operations of the Company. The Company covenants From and agrees, as to itself and its subsidiaries, that, prior to after the Effective Time date hereof until the Closing Date (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by or earlier termination of this Agreement):
(a) the business of ), Honeywell shall cause the Company and its subsidiaries shall be conducted only Subsidiaries to conduct their respective businesses in the ordinary course consistent with past practice and usual course and, to the extent consistent therewith, each of the Company in compliance in all material respects with all applicable Laws and its subsidiaries shall use its their commercially reasonable efforts to preserve intact the assets of, and the business organizations and relationships with employees and third parties having material business dealings with, the Company and its business Subsidiaries. Without limiting the generality of the foregoing, except (1) as otherwise expressly required by this Agreement (including the actions contemplated by Section 10.10(a) and Section 10.11), (2) for actions approved in advance by Purchaser in writing (which approval shall not be unreasonably withheld or delayed), or (3) as set forth on Section 5.1 of the Disclosure Schedule, from and after the date hereof until the Closing Date (or earlier termination of this Agreement), Honeywell shall cause the Company and its Subsidiaries not to take any of the following actions:
(a) adopt any change in their respective certificates of incorporation or bylaws or other similar organization intact and maintainor governing documents;
(b) adopt a plan or agreement of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company shall not or any of its Subsidiaries;
(c) (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to issue, sell, pledge transfer, pledge, dispose of or agree to sell encumber the Shares or pledge any shares of capital stock or other securities owned by such subsidiary; of the Subsidiaries of the Company, (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine combine, subdivide or reclassify the outstanding Shares; Shares or any shares of capital stock of the Subsidiaries of the Company, (iviii) declare, set aside or pay any dividend or other distribution, other than dividends or other distributions payable in cashcash on or prior to the Closing, stock or property with respect to the SharesShares or any shares of capital stock of the Subsidiaries of the Company or (iv) redeem, purchase or otherwise acquire directly or indirectly the Shares or any shares of capital stock of the Subsidiaries of the Company;
(cd) neither the Company nor any of its subsidiaries shall except as required by applicable Law, (i) issueadopt, sellestablish or enter into an agreement to adopt or establish any plan, pledgepolicy, dispose of agreement or encumber any additional shares of, arrangement that would be a Plan if established or securities convertible into adopted on or exchangeable for, or options, warrants, calls, commitments or rights of any kind prior to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; hereof, (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber increase the benefits under any assets or incur Plans or modify any indebtedness Plan where such modification has a cost impact on the Company or other liability its Subsidiaries or (iii) increase the salary or bonus payable to any employee of the Company or its Subsidiaries other than in the ordinary and usual course of businessbusiness consistent with past practice; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of PROVIDED, HOWEVER, that nothing in this Agreement shall prevent the Company or any of its subsidiaries Subsidiaries from entering into employment agreements with new employees or severance agreements (ivother than officers or directors or other key employees) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate ordinary course of business consistent with past practice; PROVIDED, FURTHER, that no such agreements with new employees or make severance agreement shall provide for benefits upon or following a "change of control"; and PROVIDED, FURTHER, that the cost impact of all actions permitted pursuant to this clause (d) shall not exceed $250,000 in the aggregate, excluding any actions required by applicable Law;
(e) enter into or consummate any transaction involving the acquisition of (by mergerthe business, consolidation or acquisition of stock or assets)stock, or any investment in, material assets or stock other properties of any other person or entity Person (other than acquisitions of inventory or other business assets in the ordinary course of business consistent with past practice);
(df) neither sell, lease, license or otherwise dispose of any material amount of assets, tangible or intangible, or property, except pursuant to existing Material Contracts and except for sales of inventory or other business assets in the ordinary course of business consistent with past practice;
(g) other than in the ordinary course of business consistent with past practice or as otherwise required by the Code or applicable Laws, (i) make or rescind any material Tax election with respect to the Company nor or its Subsidiaries or file any amended Tax Returns, (ii) change any of its subsidiaries shall grant material methods of reporting income or deductions for Tax purposes, (iii) compromise any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee Tax liability of the Company or any such subsidiary; and neither of its Subsidiaries that is material to the Company nor and its Subsidiaries or (iv) issue a waiver to extend the period of limitations for the payment or assessment of any of its subsidiaries shall establish,Tax;
(ei) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except other than in the ordinary and usual course of business and consistent with past practice, incur any Indebtedness, (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the consent obligations of Purchaserany other Person, modifyexcept for assumptions, amend guarantees or terminate endorsements of the ordinary course obligations of any Subsidiary of the Company, (iii) make any loans, advances or capital contributions to or investments in any other Person (other than to Subsidiaries of the Company or customary loans or advances to employees, in each case in the ordinary course of business consistent with past practice) or (iv) mortgage or pledge any of its material Contracts assets, tangible or waiveintangible, release or assign create or suffer to exist any material rights or claimsEncumbrance thereupon (other than Permitted Encumbrances);
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(gi) except as may be required as a result of a change in law Law or in generally accepted accounting principlesGAAP, neither the Company nor any of its subsidiaries shall change any of the accounting principles or practices or principles (including the Specified Accounting Policies and any procedures with respect to the payment of accounts payable and collection of accounts receivable) used by itthe Company and its Subsidiaries;
(hj) neither manage working capital other than in the Company nor ordinary course of business consistent with past practice, including not extending the payment of accounts payable, accelerating the collection accounts receivable or failing to maintain and manage inventory levels, in each case, other than in the ordinary course of business consistent with past practice;
(k) enter into, terminate, modify or amend or waive any pricing provision or other material provisions of, any Material Contract;
(l) change the material terms and conditions of their business relationships with Key Customers or Key Suppliers;
(m) temporarily or permanently (i) terminate or close any facility or (ii) disrupt production or call center functioning;
(n) write up or down of any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization the assets of the Company (or its Subsidiaries individually or in the aggregate in excess of $2,500,000 other than the Merger and other than in compliance with Section 9.4(a)); andas may be required by GAAP or applicable Laws;
(io) neither the Company nor settle, discharge or compromise any of its subsidiaries will authorize material action, claim, action, suit, investigation or proceeding or enter into an agreement any material consent decree, injunction or similar restraint or form of equitable relief in settlement thereof;
(p) incur or commit to do any capital expenditures other than capital expenditures incurred or committed to in the ordinary course of business consistent in all material respects with the 2005 capital expenditure budget attached as Section 5.1(p) of the Disclosure Schedule or enter into any new line of business;
(q) make any material purchase commitment not in the ordinary course of business consistent with past practice; or
(r) authorize, or agree or commit to do, whether in writing or otherwise, any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, from and after date hereof and prior to the Effective Time Closing Date, except (unless Purchaser shall otherwise consent a) as expressly provided in writing and except this Agreement or as otherwise permitted required to consummate the transactions contemplated by this Agreement):, (b) as set forth in Schedule 6.1 hereof, or (c) as may be agreed in writing in advance by the Buyer:
(ai) the business of the Company and its subsidiaries shall be conducted only in the ordinary Ordinary Course of Business, and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its the business organization intact of the Company intact, keep available the services of the current officers and maintainemployees of the Company and maintain the existing relations with franchisees, customers, suppliers, creditors, business partners and others having business dealings with the Company, to the end that the goodwill and ongoing business of the Company shall be unimpaired in any materially adverse manner at the Closing Date. The Company shall not institute any new methods of manufacture, purchase, lease, management, accounting or operation, or engage in any transaction or activity, other than changes in the Ordinary Course of Business;
(bii) the Company shall not not: (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (iiA) amend the Certificate or its bylaws or amendGoverning Documents, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (iB) issue, sell, transfer, pledge, dispose of or encumber any additional shares ofclass of its Equity Interests or Voting Debt, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of any class or series of its capital stock, Equity Interests or Voting Debt, (C) declare, set aside or pay any dividend or other distribution payable in cash, stock of or property with respect to any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the WarrantsEquity Interests; (iiD) transfersplit, leasecombine or reclassify or vary the rights attached to any Equity Interests; or (E) redeem, license, guarantee, sell, mortgage, pledge, dispose of purchase or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) otherwise acquire directly or indirectly by redemption any Equity Interests or otherwise any shares instrument or security which consists of the capital stock of or includes a right to acquire any Equity Interests;
(iii) the Company shall not organize any new Subsidiary or acquire any Equity Interests of its subsidiaries or any other Person;
(iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
not (eA) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Material Contracts or waive, release or assign any material rights or claims, except in the Ordinary Course of Business or (B) enter into a Change of Control Agreement;
(fv) neither the Company nor shall not: (A) except as set forth in Schedule 6.1, (x) incur or assume any long-term Indebtedness, or (y) except in the Ordinary Course of Business, incur or assume short-term Indebtedness, in each case from the date hereof until the Closing; (B) except in the Ordinary Course of Business, pay, repay, discharge, purchase, repurchase or satisfy any Indebtedness issued or guaranteed by the Company, except as required by the terms thereof or this Agreement; (C) modify the terms of any Indebtedness or other liability, (D) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person (other than the Company), except as described in Schedule 6.1 as being in the Ordinary Course of Business; (E) except in the Ordinary Course of Business, make any loans, advances or capital contributions to, or investments in, any other Person; (F) enter into any material commitment or transaction (including any capital expenditure or any purchase, sale or lease of assets or real estate); (G) except in the Ordinary Course of Business, write down the value of any inventory or write off as uncollectible any notes or accounts receivable; or (H) dispose of or permit to lapse any rights to any material Company Intellectual Property;
(vi) the Company shall not lease, license, mortgage, pledge or encumber any assets other than in the Ordinary Course of Business, or transfer, sell or dispose of any assets other than in the Ordinary Course of Business;
(vii) the Company shall not make any change in the compensation payable or to become payable to any of its subsidiaries shall officers, directors, employees, agents or consultants (other than normal recurring increases in the Ordinary Course of Business with respect to employees who earn less than $50,000 per year) or to Persons providing management services, or enter into or amend any employment, severance, consulting, termination or other Contract with, or employee benefit plan for, or make any tax election loan or advance in excess of $25,000 individually, or $50,000 in the aggregate for any number of loans, to any of its officers, directors, employees, Affiliates, agents or consultants or make any change in its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to an employee benefit plan or otherwise;
(viii) the Company shall not (A) pay or make any accrual or arrangement for payment of any pension, retirement allowance or other employee benefit pursuant to any existing plan, Contract or arrangement to any officer, director, employee or Affiliate, or pay or agree to pay or make any accrual or arrangement for payment to any officer, director, employee or Affiliate of any amount relating to unused vacation days, except to the extent the Company is obligated to do so on the date hereof or, in the case of employees only, would, in the Ordinary Course of Business, make such payment, accrual or arrangement (B) adopt or pay, grant, issue, accelerate or accrue salary or other payments or benefits pursuant to any Benefit Plan, or any employment or consulting Contract with or for the benefit of any director, officer, employee, agent or consultant, whether past or present, except to the extent the Company is obligated to do so on the date hereof (or will be obligated based upon consummation of the transactions contemplated by this Agreement), or (C) amend in any material respect any such plan, Contract or arrangement in a manner inconsistent with the foregoing;
(ix) the Company shall not permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to Purchaserthe Buyer, except policies which are replaced without any material diminution of or gaps in the ordinary and usual course of businesscoverage;
(gx) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor shall not enter into any Contract or transaction, or related series of Contracts or transactions (A) involving the expenditure in excess of $25,000 relating to the purchase of assets other than in the Ordinary Course of Business, (B) containing any restrictive covenants or limits on the ability of the Company to conduct business in any jurisdiction, or (C) which relates to any joint venture or similar arrangement with respect to any material research and development, distribution or supply agreement, other than in the Ordinary Course of Business;
(xi) the Company shall not pay, repurchase, discharge or satisfy any of its subsidiaries shall change any Liabilities (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the Ordinary Course of Business, of Liabilities reflected or reserved against in, or contemplated by, the accounting practices Financial Statements or principles used by itincurred since the Balance Sheet Date in the Ordinary Course of Business;
(hxii) neither the Company nor shall not adopt or pass any resolution in respect of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company;
(xiii) the Company 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 set forth in Article VII and Article VIII not being satisfied, or would make any representation or warranty in respect of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Closing Date, or that would materially impair the ability of the Company, the Buyer or the Sellers to consummate the Closing in accordance with the terms hereof or materially delay such consummation;
(xiv) the Company shall not materially change any method of reporting income, deductions or other than material items for income Tax purposes, make or change any material election with respect to Taxes, agree to or settle any material claim or assessment in respect of Taxes, or agree to an extension or waiver of the Merger and limitation period to any material claim or assessment in respect of Taxes, other than in compliance with Section 9.4(a))the Ordinary Course of Business;
(xv) the Company shall not settle or knowingly compromise any pending or threatened suit, action, or claim which would require the payment by or to the Company of more than $10,000 or would impose a restriction on the business, assets or operations of the Company following the Closing Date;
(xvi) the Company shall not, other than in the Ordinary Course of Business, (A) accelerate, or accept payment at a discount, of any accounts receivable or trade receivables or (B) delay any payment of any accounts payable beyond the respective payment deadlines; and
(ixvii) neither the Company nor any of its subsidiaries will authorize or shall not enter into an agreement any Contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause authorize, recommend, propose or announce an intention to do, any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Except (unless Purchaser shall otherwise consent in writing and except a) as otherwise permitted contemplated by this Agreement):, (b) as set forth in Section 5.1 of the Seller Disclosure Schedule, and (c) as may be consented to by Purchaser in writing (which consent shall not be unreasonably delayed), the Company shall and shall cause the Company Subsidiary to, comply with the following from the date hereof until the earlier of the termination of this Agreement in accordance with its terms or the Closing Date:
(ai) the business of the Company and its subsidiaries The Purchased Business shall be conducted only in the ordinary and usual course andof business consistent with past practice and Sellers, to the extent consistent therewith, each of the Company and its subsidiaries the Company Subsidiary shall each use its their commercially reasonable efforts to maintain their relationships with customers, resellers, suppliers, vendors, employees, agents and others, and keep available to Purchaser the services of the present Company Employees and preserve its for Purchaser the goodwill of customers, resellers, suppliers, vendors, employees, agents and others having business organization intact and maintainrelations with the Purchased Business.
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither Neither the Company nor the Company Subsidiary shall (A) amend, modify, repeal or propose to do so, or permit or consent to any amendment, modification or repeal of its subsidiaries shall certificate of incorporation or bylaws or similar organizational documents, (iB) issue, sell, transfer, pledge, dispose of or encumber any additional shares ofof any class or series of its capital stock, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of any class or series of its capital stock, (C) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to any shares of any class or series of the Companyits capital stock, (D) split, combine or reclassify any shares of any class or series of its subsidiaries stock, or any other property (E) redeem, purchase or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) otherwise acquire directly or indirectly by redemption or otherwise any shares of any class or series of its capital stock, or any instrument or security which consists of or includes a right to acquire such shares. Notwithstanding the capital stock of foregoing, however, the Company may distribute cash to Go2Net or any of its subsidiaries or (iv) authorize capital expenditures Parent in excess of $50,000 individually the amount held on behalf of merchants pending disbursement or $100,000 held in reserve for eCheck and Integrated Payment Solution related transactions as of the aggregate or make any acquisition of Closing Date.
(by mergeriii) Neither the Company nor the Company Subsidiary shall, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except in the ordinary course of business consistent with past practice);practice (A) create, incur, assume, guarantee, endorse, refinance, modify, extend, renew or otherwise become liable for any Indebtedness, obligation or other liability, (B) pay, agree to cancel or pay, or otherwise provide for a complete or partial discharge in advance of a scheduled payment date with respect to any Indebtedness, obligation or other liability, (C) waive, cancel or compromise any right to receive any direct or indirect payment or other benefit under any Indebtedness, obligation or other liability owing to the Purchased Business, (D) sell, lease or otherwise dispose of any material assets, or (E) grant any extensions of credit, other than accounts receivable in the ordinary course of business consistent with past practices.
(div) neither Neither the Company nor the Company Subsidiary shall (A) amend, terminate or waive any material right under any Material Contract, (B) merge or consolidate with any Person, (C) purchase any capital stock of or interest in any Person, (D) purchase assets constituting a business, or (E) create or suffer the imposition of any Encumbrance upon any of its subsidiaries their assets, tangible or intangible, except for Permitted Encumbrances, (F) make any change in their pricing policies or payment or credit policies; or (G) fail to pay any creditor any amount owed to such creditor when due, other than consistent with past payment practices.
(v) None of Sellers, the Company or the Company Subsidiary shall grant (A) make any change in the compensation (including severance compensation) or termination pay to, bonuses payable or enter into to become payable to any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
Employees (e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except other than normal recurring increases in the ordinary and usual course of business disclosed on Section 5.1(b)(v) of the Seller Disclosure Schedule or pursuant to plans, programs or agreements existing on the date hereof and disclosed on Section 5.1(b)(v) of the Seller Disclosure Schedule), including the establishment or adoption of any employee benefit plan, except those adopted by Parent on a company-wide basis, or (B) pay or agree to pay any bonus or other compensation to any Person in connection with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;Transactions.
(fvi) neither the The Company nor shall not adopt or become a party to any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); andCompany.
(ivii) Neither the Company nor the Company Subsidiary shall change in any material respect any of the accounting methods used by it unless required by GAAP, or make or change any Tax election that would be reasonably likely to adversely affect in any material respect (relative to the Purchased Business) the Tax liability or Tax Attributes of the Company or the Company Subsidiary.
(viii) Neither the Company nor the Company Subsidiary shall institute, pay, discharge, settle or satisfy any litigation or any claims, liabilities or obligations which are material to the Purchased Business.
(ix) Neither the Company nor the Company Subsidiary shall make any capital expenditures exceeding $50,000 in the aggregate.
(x) Other than transactions in connection with intercompany cash management and transfers, neither the Company nor any of its subsidiaries will authorize or the Company Subsidiary shall enter into any transaction other than on an agreement arms’ length basis.
(xi) Neither the Company nor the Company Subsidiary shall enter into any agreement, contract, commitment or arrangement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Stock Sale Agreement (Infospace Inc)
Interim Operations of the Company. The Company covenants and agrees, agrees as to itself and its subsidiaries, Subsidiaries that, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted expressly contemplated by this Agreement):Agreement or as set forth in Section 6.1. of the Company Disclosure Schedule), without the prior written consent of Parent, which consent shall not be unreasonably withheld or delayed:
(a) the business of the Company its and its subsidiaries Subsidiaries' businesses shall be conducted only in all material respects in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintaincourse;
(b) it and its Subsidiaries shall use their reasonable best efforts to preserve intact in all material respects their present business organizations, to keep available the Company services of its key officers and employees, to maintain its assets and properties in good working order and condition, ordinary wear and tear excepted, to maintain insurance on its tangible assets and businesses in such amounts and against such risks and losses as are currently in effect, to maintain existing relations and goodwill with contract parties, customers, suppliers, distributors, creditors, lessors, employees and business associates, and to comply in all material respects with all Laws;
(c) it shall not (i) sell issue, sell, pledge, dispose of or pledge or agree to sell or pledge encumber any capital stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarySubsidiaries; (ii) amend the Certificate its articles of incorporation or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoby-laws; (iii) split, combine or reclassify the its outstanding Sharesshares of stock; or (iv) authorize, declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than intercompany transactions in the ordinary course of business consistent with respect past practice; or (v) repurchase, redeem or otherwise acquire, except in connection with any of the Company Stock Plans, or permit any of its Subsidiaries to the Sharespurchase or otherwise acquire, any shares of its stock or any securities convertible into or exchangeable or exercisable for any shares of its stock;
(cd) neither the Company it nor any of its subsidiaries shall Subsidiaries shall: (i) except as permitted under Section 6.1.(e), issue, sell, pledge, dispose of or encumber any additional (A) shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, acquire any shares of of, its capital stock of any class of the Company, its subsidiaries or (B) securities convertible into or exchangeable for any other property or assets (other than, in the case of the Company, than Shares issuable pursuant to options outstanding on the date hereof under any of the Company Stock Plans and shares Shares issuable pursuant to the Warrantsupon exercise of warrants); (ii) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other material property or assets or take any action to incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessmaterial indebtedness; (iii) acquire directly make or indirectly by redemption authorize or otherwise commit for any shares of capital expenditures other than in amounts less than $500,000 in the capital stock of the Company or any of its subsidiaries or aggregate; (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise terminate any material claims contract, license or litigation or, except permit if such action is not in the ordinary and usual course of business and consistent with the consent of Purchaserpast practices, modify, (v) amend or terminate modify in any of its material Contracts or waive, release or assign materially adverse way any material rights contract, license or claimspermit, (vi) enter into any agreement with any Affiliate of the Company if such action is not on an arm's length basis, or (vii) make any acquisition of, or investment in, the assets or stock of any other Person or entity (other than a Subsidiary) except for ordinary course investment activities or as otherwise permitted by Section 6.1.(a);
(fe) neither the Company it nor any of its subsidiaries Subsidiaries shall terminate, establish, adopt, enter into, make any tax election new grants or permit awards under, amend or otherwise modify, any insurance policy naming it as a beneficiary Company Compensation and Benefit Plans or a loss payable payee to be canceled increase the salary, wage, bonus or terminated without notice to Purchaser, other compensation of any employees except increases for employees of the Company occurring in the ordinary and usual course of businessbusiness (which shall be limited to, (i) regular grants of options and shares of capital stock under the Company Stock Plans and the Directors' Compensation Plan pursuant to the terms of such plans, the number of Company Options subject to and the recipient of each such grant to be determined in consultation with Parent; provided that the maximum number of Shares issuable pursuant to such options shall be calculated in accordance with past practice and the terms of the Company Stock Plans and shall not exceed 25,000 Shares, (ii) grants and payment of awards under any management incentive plans in accordance with the terms of such plans, and (iii) salary increases for those employees who have a rank of vice president or higher in accordance with the Company's normal salary guidelines and salary increases for other employees which do not exceed, in the aggregate, 4.0% of their aggregate current salaries), except as necessary to comply with Section 6.13.(a)(i) and provided, however, that the Company reserves the right to make payments in connection with the retention of key employees, which payments shall not exceed $200,000 in the aggregate (it being understood that the Company will adjust such bonuses, to the extent reasonable, to take into account Parent's desires to retain certain employees permanently and certain employees for a period beyond closing);
(f) neither it nor any of its Subsidiaries shall pay, discharge, settle or satisfy any claims, liabilities or obligations except (i) in the ordinary course of business and consistent with past practice or (ii) ordinary course repayment of indebtedness or payment of contractual obligations when due;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company it nor any of its subsidiaries Subsidiaries shall make or change any of the accounting practices Tax election, settle any material audit or principles used by itfile any material amended tax returns;
(h) neither the Company it nor any of its subsidiaries Subsidiaries shall adopt a plan of complete enter into any agreement containing any provision or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization covenant limiting in any material respect the ability of the Company or any Subsidiary or affiliate to (i) sell any products or services of or to any other than person, (ii) engage in any line of business or (iii) compete with or to obtain products or services from any person or limiting the Merger and other than in compliance with Section 9.4(a)); andability of any person to provide products or services to the Company or any of its Subsidiaries or Affiliates;
(i) neither the Company it nor any of its subsidiaries Subsidiaries shall take any action that would cause any of its representations and warranties herein to become untrue in any material respect; and
(j) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except with the prior written consent of the Parent which shall not be unreasonably withheld, conditioned or delayed, for the matters set forth in Section 5.1 of the Company Disclosure Schedule and as expressly contemplated by this Agreement, after the date of this Agreement, and prior to the Effective Time earlier of (unless Purchaser shall otherwise consent x) the termination of this Agreement in writing accordance with Article VIII and except as otherwise permitted by this Agreement):(y) the time the designees of Parent constitute a majority of the Company Board of Directors:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary course of business consistent with past practice, and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its present business organization intact intact, to keep available the services of its current officers, key employees and maintainconsultants, and to maintain good relations with customers, suppliers, contractors, distributors and others having significant business dealings with it;
(b) neither the Company shall not nor any of its Subsidiaries shall, (i) sell directly or pledge or agree indirectly, except for the issuance of Shares upon the exercise of the Options outstanding on the date of this Agreement pursuant to sell the terms of such Options, issue, sell, modify, transfer, dispose of, encumber or pledge any shares of capital stock of the Company or any capital stock or other securities owned by it or permit equity interests of any of its subsidiaries the Company’s Subsidiaries, securities convertible into or exchangeable for, or options, warrants or rights of any kind to sell, pledge or agree to sell or pledge acquire any shares of such capital stock or other securities owned by such subsidiaryequity interests or any other ownership interest; (ii) amend the or otherwise change its Certificate of Incorporation or its bylaws Bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretosimilar organizational documents; (iii) split, combine combine, reclassify, subdivide or reclassify the outstanding Sharesredeem, or purchase or otherwise acquire, directly or indirectly, any of its capital stock or other equity interests; or (iv) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Sharesits capital stock;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries will (i) issue, sell, pledge, dispose of incur or encumber assume any additional shares of, indebtedness or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of issue any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantsdebt securities; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person (but not including intracompany transactions); (iii) make any loans, advances or capital contributions to, or investments in, any other Person; (iv) acquire (by merger, consolidation, acquisition of stock or assets or otherwise) any corporation, partnership or other business organization or division thereof or any equity interest therein; (v) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any of its assets or incur or modify any indebtedness or other liability properties, other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice), or allow to lapse or become invalid, abandon or create an Lien on any Intellectual Property that, individually or in the aggregate, is material to the Company and/or any of its Subsidiaries’ business;
(d) neither the Company nor any of its subsidiaries Subsidiaries shall grant (i) change the compensation or benefits payable or to become payable to any severance of its officers or its directors or in any material respect its employees, agents or consultants other than in the ordinary course of business consistent with past practice or pursuant to a contract entered into prior to the date hereof; (ii) enter into, extend or amend any employment, collective bargaining, severance, consulting, termination pay to, or enter into any employment or severance agreement with any director, officer or other agreement or employee benefit plan; or (iii) make any loans or advances to any of its officers, directors, employees, agents, consultants or affiliates or change its existing borrowing or lending arrangements for or on behalf of any of such persons pursuant to an employee benefit plan or otherwise;
(e) except as may be required pursuant to the terms of a Company Plan as in effect as of the date of this Agreement, applicable Law or the terms of any Company or any such subsidiary; and Plan prior to the date hereof, neither the Company nor any of its subsidiaries Subsidiaries shall establish,
(ei) neither pay or arrange for payment of any pension, retirement allowance or other employee benefit pursuant to any existing plan, agreement or arrangement to any officer, director, employee or affiliate or pay or make any arrangement for payment to any officers, directors, employees or affiliates of the Company nor or any of its subsidiaries shall settle or compromise Subsidiaries of any material claims or litigation oramount relating to unused vacation days, except payments and accruals made to employees other than executive officers, in the ordinary and usual course of business and consistent with past practice; (ii) except as may be required pursuant to the consent terms of Purchasera Company Plan as in effect as of the date of this Agreement, modifyapplicable Law or the terms of any Company Plan prior to the date hereof, adopt or pay, grant, issue, accelerate or accrue salary or other payments, benefits or awards pursuant to any Company Plan or any other pension, profit-sharing, bonus, extra compensation, incentive, deferred compensation, stock purchase, stock option, stock appreciation right, restricted stock, restricted stock unit, group insurance, severance pay, retention, change in control, retirement or other employee benefit plan, policy, program, agreement or arrangement, or any employment or consulting agreement with or for the benefit of any current or former director, consultant, officer or employee, whether past or present, or (iii) amend in any respect any such existing plan, agreement or terminate any of its material Contracts or waive, release or assign any material rights or claimsarrangement other than an amendment necessary to comply with applicable Law;
(f) neither the Company nor any of its subsidiaries shall make Subsidiaries will (i) modify, extend, amend or terminate any tax election Material Contract to which the Company or permit any insurance policy naming it as of its Subsidiaries is a beneficiary party or a loss payable payee to by which the Company or any of its Subsidiaries or any of their respective properties or assets may be canceled bound; (ii) waive, release or terminated without notice to Purchaser, except in the ordinary and usual course assign any rights or claims under any of businesssuch Contracts; or (iii) enter into any Material Contract;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall, except as necessary in the ordinary course of business consistent with past practice, grant or acquire, agree to grant to or acquire from any Person, or dispose of the accounting practices or principles used by itpermit to lapse any rights to, any Intellectual Property, or disclose or agree to disclose to any Person, other than representatives of Purchaser and Parent, any trade secret or other confidential information;
(h) neither the Company nor any of its subsidiaries shall Subsidiaries will (i) change any of the accounting methods used by it except for such changes required by GAAP or applicable Law or (ii) make any Tax election or change or revoke any Tax election already made, adopt any Tax accounting method, change any Tax accounting method, enter into any closing agreement or settle any claim or assessment relating to Taxes or consent to any claim or assessment relating to Taxes or any waiver of the statute of limitations for any such claim or assessment;
(i) neither the Company nor any of its Subsidiaries will pay, discharge or satisfy any material claims, liabilities or obligations (whether absolute, accrued, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, in the ordinary course of business consistent with past practice, or of claims, liabilities or obligations reflected or reserved against in the Financial Statements of the Company for the period ended December 31, 2007 or incurred since December 31, 2007 in the ordinary course of business consistent with past practice;
(j) neither the Company nor any of its Subsidiaries will (i) settle or commence any action, suit, claim, litigation or other proceeding involving an amount in excess of $500,000 or, in the aggregate, an amount in excess of $2,000,000 or (ii) enter into any consent decree, injunction or other similar restraint or form of equitable relief in settlement of any action, suit, claim, litigation or other proceeding;
(k) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries (other than the Merger and other than in compliance with Section 9.4(aMerger)); and;
(il) neither the Company nor any of its subsidiaries Subsidiaries will authorize take or permit any action that could result in any of the conditions to the Merger set forth in Article VII or any of the conditions to the Offer set forth in Annex I not being satisfied or that could delay the consummation of, or impair the ability of the Company to consummate, the Transactions in accordance with the terms of this Agreement;
(m) neither the Company nor any of its Subsidiaries shall enter into, amend, modify or supplement any agreement, transaction, commitment or arrangement with any officer or director (or any affiliate of any of the foregoing);
(n) neither the Company nor any of its Subsidiaries shall make any capital expenditure which is not in all material respects in accordance with the annual budget for the fiscal year 2008, a true and correct copy of which is attached to Section 5.1(n) of the Company Disclosure Schedule; and
(o) neither the Company nor any of its Subsidiaries will enter into an agreement any agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (OAO Severstal)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as contemplated by this Agreement, (ii) as disclosed in Section 6.1 of the Company Disclosure Schedule or (iii) as consented to in writing by Acquisition Company, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):purchase of Shares pursuant to the Offer:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted con ducted only in the ordinary and usual course of business and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve in all material respects its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees and business associates;
(b) the Company shall not not, directly or indirectly, (i) sell amend its certificate of incorporation, by-laws or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellsimilar organizational documents, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, Agreement or redeem the Rights rights issued pursuant thereto; thereunder or (iii) split, combine or reclassify the outstanding Shares; Company Common Stock or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) issuedeclare, sellset aside or pay any dividend or other distribution payable in cash, pledgestock or property with respect to its capital stock (other than regular quarterly dividends not in excess of $.0625 per share of Company Common Stock made in the ordinary course consistent with past practice or dividends from any Subsidiary of the Company to the Company or any other Subsidiary of the Company), dispose of (ii) issue or encumber sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options the exercise of Company Stock Options outstanding on the date hereof under the Stock Plans and shares issuable issuances pursuant to the Warrants; Rights Agreement, (iiiii) transfer, lease, license, guaranteeacquire, sell, mortgage, pledge, lease or dispose of or encumber any assets or incur or modify any indebtedness or other liability in excess of $1 million, other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or , (iv) authorize capital expenditures in excess of $50,000 individually incur or $100,000 in the aggregate or make modify any acquisition of (by mergermaterial debt, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in 28 38 the ordinary and usual course of business and with the consent of Purchaseror (v) redeem, modify, amend purchase or terminate otherwise acquire directly or indirectly any of its material Contracts or waive, release or assign any material rights or claimscapital stock;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.
Appears in 1 contract
Interim Operations of the Company. The Company covenants Between the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, the Company shall, and shall cause each of its Subsidiaries to (unless Purchaser Parent shall otherwise consent approve in writing and or except as otherwise permitted contemplated by this Agreement):
(a) the business of Agreement or disclosed in the Company and Disclosure Letter): (i) conduct its subsidiaries shall be conducted only business in all material respects in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, each use reasonable best efforts to (x) preserve intact its business organization, (y) keep available the services of its officers and employees and (z) maintain its existing relations and goodwill with customers, suppliers, regulators, distributors, creditors, lessors and others having business dealings with it; provided that the failure of any officer or employee of the Company and or its subsidiaries shall use its commercially reasonable efforts Subsidiaries to preserve its business organization intact and maintain
(b) remain an officer or employee of the Company or its Subsidiaries shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any constitute a breach of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarythis covenant; (ii) not (A) amend the Restated Certificate of Incorporation or its bylaws or amend, modify or terminate By-laws of the Rights Agreement, or redeem the Rights issued pursuant theretoCompany; (iiiB) split, combine combine, subdivide or reclassify the its outstanding Sharesshares of capital stock or other equity securities; or (ivC) declare, set aside or pay any dividend or distribution payable in cash, stock or property with in respect to the Shares;
(c) neither the Company nor of any of its subsidiaries shall (i) issue, sell, pledge, dispose shares of capital stock or encumber any additional shares ofother equity securities, or securities convertible into into, exercisable for or exchangeable for, any of its shares of capital stock or optionsother equity securities, warrantsother than (x) quarterly cash dividends of $.27 per share in respect of the outstanding shares of Company Common Stock, callsdeclared, commitments set aside and paid at such times during the quarter as is consistent with past practice, and (y) dividends and distributions by wholly owned Subsidiaries of the Company; (D) repurchase, redeem or rights otherwise acquire or permit any of any kind its Subsidiaries to purchase, redeem or otherwise acquire, any shares of its capital stock or other equity securities, or securities convertible into, exercisable for or exchangeable for, any of its shares of capital stock or other equity securities (it being understood that this clause (D) shall not prohibit the exercise, exchange or conversion of Company Equity Equivalent Securities); or (E) enter into any class agreement or letter of the Companyintent, its subsidiaries agreement in principle or any other property similar arrangement to sell, transfer or assets other thanotherwise dispose of, or purchase or otherwise acquire, in the case aggregate, a material amount of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur properties or modify any indebtedness material business by merger, consolidation, transfer or other liability other than in the ordinary and usual course acquisition of businessshares of capital stock or otherwise; (iii) acquire directly or indirectly by redemption or otherwise not take any shares of action that to the capital stock knowledge of the Company would prevent the business combination to be effected pursuant to the Parent Merger from qualifying for pooling of interests accounting treatment under GAAP and the rules and regulations of the SEC or would prevent the business combination to be effected pursuant to the Parent Merger or the Alternative Merger, as applicable, from qualifying as a "reorganization" within the meaning of Section 368 of the Code; (iv) except as required by applicable law or pursuant to contractual obligations in effect as of the date of this Agreement, not (A) execute, establish, adopt or amend, or accelerate rights or benefits under, any agreement relating to severance or change-in-control, any Company Employee Plan, any employment or consulting agreement with current or former officers or directors or any collective bargaining agreement, (B) increase the compensation payable or to become payable to any of its subsidiaries officers, directors or employees (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets except for increases in the ordinary course of business consistent with past practicepractices);
, (dC) neither the Company nor any of its subsidiaries shall grant any severance or termination pay toto any officer or director of the Company, or enter into (D) grant any employment or severance agreement with any director, officer stock options or other employee equity related awards; A-34 36 (v) not issue, deliver, grant, sell, pledge or otherwise dispose of shares of any class of its capital stock, other equity securities, or any securities convertible, exercisable or exchangeable for or into, any such shares or other equity securities, except upon the exercise, exchange or conversion of Company Equity Equivalent Securities; (vi) not change its accounting policies, practices or methods except as required by GAAP or by the rules and regulations of the SEC; (vii) not (x) take any action to amend the Company Rights Agreement, (y) redeem the rights subject to the Company Rights Agreement, or (z) take any action to render inapplicable, or to exempt any third party from, any provision of the Restated Certificate of Incorporation of the Company or any such subsidiarystatute referred to in Section 6.15; and neither (viii) not take any action that would be reasonably likely to result in any of the conditions set forth in Article VII of this Agreement not being satisfied or that would impair the ability of the Company nor to consummate the transactions contemplated hereby in accordance with the terms hereof or delay such consummation; (ix) not take any action to cause the shares of Company Common Stock to cease to be listed on the NYSE; (x) not waive any of its subsidiaries shall establish,
rights under, or release any other party from such other party's obligation under, or amend any provision of any standstill agreement; (exi) neither not issue, deliver, grant, sell, pledge or otherwise dispose of any bonds, debentures, notes or other indebtedness, in each case having the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and right to vote together with the consent of Purchaser, modify, amend or terminate Company's stockholders on any of its material Contracts or waive, release or assign any material rights or claims;
matter; and (fxii) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or not enter into an agreement any commitments or agreements to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time (unless Purchaser shall otherwise consent agree in writing and except as otherwise permitted expressly contemplated by this AgreementAgreement or in the Disclosure Letter):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees and business associates;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarysubsidiaries; (ii) amend the Certificate or its bylaws or the Bylaws or, except as otherwise contemplated herein (including Section 7.2), amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares or Preferred Shares;
(c) except as set forth in Section 7.1(c) of the Disclosure Letter, neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, Company or its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to or upon conversion of the Notes or Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) license or otherwise transfer to any third party any rights to the TheraSys Program or related software; (iv) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries Company; or (ivv) authorize capital expenditures in excess of $50,000 individually or $100,000 1,000,000 in the aggregate not disclosed in the Disclosure Letter or make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock of any other person or entity (other than ordinary course acquisitions of assets supplies used in the ordinary course day-to-day operations of business consistent with past practice)the Company;
(d) neither the Company nor any of its subsidiaries shall increase in any manner the compensation of, grant any severance or termination pay to, or enter into or amend or renew any employment or severance agreement with, any Director, Consultant or employee, provided, that, the Company and its subsidiaries may in the ordinary course of business consistent with any directorpast practice (including, without limitation, as to timing), grant increases in the compensation of non-officer employees and increases of not more than 10% or other employee $15,000 in compensation of officers of the Company or any such subsidiary; and who are not executive officers of the Company;
(e) neither the Company nor any of its subsidiaries shall establish,, adopt, enter into, make any Compensation and Benefit Plans, or voluntarily accelerate the vesting of any stock options, restricted stock or other compensation or benefit;
(ef) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation involving payments by the Company of $100,000 in any single instance or related instances, or that otherwise are material or, except in the ordinary and usual course of business and with the consent of Purchaserbusiness, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(fg) neither the Company nor any of its subsidiaries subsidiary shall make any tax Tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take foregoing; and
(i) neither the Company nor any action that would knowingly cause of its subsidiaries will amend any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedNon-Competes.
Appears in 1 contract
Samples: Merger Agreement (Theratx Inc /De/)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except as (i) required by this Agreement, (ii) required by applicable law, (iii) required by any Material Contract or Identified Contract or by any Plan disclosed on Schedule 3.9(b), in each case to the extent such requirement is specifically described on Schedule 5.1(iii) or (iv) agreed to in writing by MergerCo, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Time:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its business organization and the business organization of its Subsidiaries intact and maintainmaintain existing relations with customers, suppliers, employees and creditors;
(b) the Company shall not amend its Articles of Organization or By- Laws;
(ic) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) Company shall not declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock (except for cash dividends on Company Common Stock in the Shares;
(c) ordinary course of business consistent with past practice); and neither the Company nor any of its subsidiaries Subsidiaries shall (i) issue, sell, grant, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries Company or any other property or assets other than, in the case of the Company, Shares issuable its Subsidiaries (except pursuant to the exercise of stock options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantsextent contemplated by this Agreement); (ii) transferincur any long term indebtedness (whether evidenced by a note or other instrument, pursuant to a financing lease, licensesale-leaseback transaction, guarantee, sell, mortgage, pledge, dispose of or encumber any assets otherwise) or incur or modify any short-term indebtedness or other liability other than under lines of credit existing on the date hereof, except for borrowings under existing credit facilities or lines of credit in the ordinary and usual course of businessbusiness consistent with past practice; (iii) redeem, purchase or otherwise acquire directly or indirectly any of its capital stock or other securities; or (iv) enter into or amend in any material respect any Lease, Material Contract or Identified Contract;
(d) neither the Company nor any of its Subsidiaries shall
(i) except for normal salary increases in the ordinary course of business consistent with past practice, grant any increase in the compensation or benefits payable or to become payable by redemption the Company or otherwise any shares of its Subsidiaries to any officer or other management employee of the capital Company or any Subsidiary; (ii) adopt, enter into or amend or increase, or accelerate the payment or vesting of the amounts, benefits or rights payable or accrued or to become payable or accrued under, any bonus, incentive or deferred compensation, severance, termination, change in control, retention, stock option or other equity based or other material employee compensation or benefit plan, agreement or policy; or (iii) enter into or amend in any material respect any employment, severance, retention or collective bargaining agreement or, except in accordance with the existing written policies of the Company or existing contracts or agreements, grant any severance or termination pay to any officer, director or employee of the Company or any of its subsidiaries Subsidiaries;
(e) neither the Company nor its Subsidiaries shall change the accounting principles used by it unless required by GAAP;
(f) neither the Company nor any of its Subsidiaries shall acquire or (iv) authorize capital expenditures agree to acquire, by merging or consolidating with, by purchasing an equity interest in excess or a portion of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets)assets of, or by any investment inother manner, any business or any corporation, partnership, association or other business organization or division thereof, or otherwise acquire or agree to acquire any assets or stock of any other person or entity Person (other than acquisitions the purchase of assets in the ordinary course of business consistent with past practice);
(dg) neither the Company nor any of its subsidiaries Subsidiaries shall grant any severance sell, lease, exchange, mortgage, pledge, transfer or termination pay tootherwise dispose of, or enter into any employment agree to sell, lease, exchange, mortgage, pledge, transfer or severance agreement with any directorotherwise dispose of, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orAssets, except in the ordinary and usual course of business and consistent with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by itpast practice;
(h) neither the Company nor its Subsidiaries shall enter into any of its subsidiaries shall adopt a plan of complete material arrangement, agreement or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalizationcontract, or any material amendment, supplement, waiver or other reorganization modification in respect of the Company any existing arrangement, agreement or contract, with any third party (other than customers in the Merger and other ordinary course of business) that provides for an exclusive arrangement with that third party or is substantially more restrictive on the Company or its Subsidiaries or substantially less advantageous to the Company or its Subsidiaries than in compliance with Section 9.4(a))arrangements, agreements or contracts existing on the date hereof; and
(i) neither the Company nor any of its subsidiaries Subsidiaries shall make any material Tax election, amend any Tax Return or settle or compromise any material federal, state, local or foreign Tax liability; and
(j) neither the Company nor any of its Subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The From the date hereof through the Effective Time, the Company covenants and agrees, as to itself agrees that its business and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company it and its subsidiaries Subsidiaries shall use its commercially their respective best reasonable efforts to preserve its business organization intact and maintainmaintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates. Without limiting the generality of the foregoing, except as otherwise set forth in Section 7.1(a) of the Company Disclosure Letter, the Company covenants and agrees as to itself and its Subsidiaries that, from the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed, and except as otherwise expressly contemplated by this Agreement or by Law):
(bi) the Company it shall not (ix) sell issue, sell, pledge, dispose of or pledge or agree to sell or pledge encumber any capital stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarySubsidiaries; (iiy) amend its articles of incorporation or by-laws or the Certificate or comparable governing instruments of any of its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoSubsidiaries; (iiiz) split, combine or reclassify the its outstanding Sharesshares of capital stock; or (ivaa) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly-owned Subsidiaries to it or a wholly-owned Subsidiary or (bb) repurchase, redeem or otherwise acquire any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock, except, in connection with respect the Stock Plans, or permit any of its Subsidiaries to the Sharespurchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(cii) neither the Company it nor any of its subsidiaries Subsidiaries shall (ix) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any Voting Debt or any other property or assets (other than, in the case of the Company, than Shares issuable pursuant to options (whether or not vested) outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the WarrantsPlans); (iiy) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness for borrowed money or guarantee any such indebtedness or other liability other than in the ordinary and usual course of business; (iiiz) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or means, make any significant acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock (whether by way of any merger, consolidation, tender offer, share exchange or other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practiceactivity);
(diii) neither the Company it nor any of its subsidiaries Subsidiaries shall grant terminate, establish, adopt, enter into, make any severance new grants or termination pay toawards under, amend or otherwise modify, any Compensation and Benefit Plans, or enter into any employment or severance agreement with any directorincrease the salary, officer wage, bonus or other employee compensation of the Company any employees except for grants or any such subsidiary; awards or increases under existing Compensation and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except Benefit Plans occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and with related compensation and benefit increases), annual reestablishment of Compensation and Benefit Plans and the consent provision of Purchaser, modify, amend individual compensation or terminate any benefit plans and agreements for newly hired or appointed officers and employees of the Company and its material Contracts Subsidiaries or waive, release except for actions necessary to satisfy existing contractual obligations under Compensation and Benefit Plans or assign any material rights or claims;agreements existing as of the date hereof; and
(fiv) neither the Company it nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries Subsidiaries will authorize or enter into an agreement to do any of anything prohibited by the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly provided in this Agreement or (ii) with the prior written consent of Parent, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Time:
(a) the business of the Company and its subsidiaries shall Subsidiaries will be conducted only in the ordinary and usual customary course and, to the extent consistent therewith, with past practice and each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not (i) sell will not, directly or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellindirectly, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Company Common Stock, or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries Subsidiaries shall (i) amend its certificate of incorporation or by-laws or similar organizational documents; (ii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock; (iii) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof, in accordance with their present terms; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice; or (iiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries Subsidiaries shall (i) grant any increase in the compensation payable or to become payable (including without limitation salaries, bonuses, shares of the Company Common Stock or Rights to acquire the Company Common Stock or any other security of the Company or any of its Subsidiaries) by the Company or any of its Subsidiaries to any of its officers, directors, employees, agents or consultants (other than increases for non-officer employees in the ordinary course of business consistent with past practice); (ii) adopt or enter into any new plan, policy, agreement or arrangement that would constitute a Company Benefit Plan, or amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing Company Benefit Plan; (iii) enter into any, or amend any existing, employment or severance agreement with or, except in accordance with the existing written policies of the Company previously delivered to Parent, grant any severance or termination pay toto any officer, or enter into any employment or severance agreement with any director, officer employee, agent or other employee consultant of the Company or any such subsidiaryof its Subsidiaries; and neither the Company nor or (iv) make any loans to any of its subsidiaries shall establish,officers, directors, employees, agents or consultants or make any changes in its existing borrowing or lending arrangements for or on behalf of any of such persons, whether contingent on the Merger or otherwise;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts the Company Agreements or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries Subsidiaries shall change license or otherwise transfer, dispose of, permit to lapse or otherwise fail to preserve any of the accounting practices Company’s or principles used by itany of its Subsidiaries’ Intellectual Property Rights, or dispose of or disclose to any person any trade secret, formula, process or know-how not theretofore a matter of public knowledge, except in the ordinary course of business and consistent with past practice;
(h) neither the Company nor any of its subsidiaries Subsidiaries shall cancel any debts or waive, release or relinquish any contract rights or other rights of substantial value, except settlements of accounts receivable in the ordinary course of business and consistent with past practice;
(i) neither the Company nor any of its Subsidiaries shall: (i) incur or assume any long-term debt except for amounts set forth in the Company’s budget previously delivered to Parent and, except in the ordinary course of business consistent with past practice, incur or assume any short-term indebtedness in amounts not consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in the ordinary course of business and consistent with past practice; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned Subsidiaries of the Company or customary advances to employees for travel and business expenses in the ordinary course of business and consistent with past practice; provided, however, the Company shall not make any advance for travel and business expenses in an amount over one thousand dollars ($1,000) without the prior written consent of Parent); (iv) enter into any material commitment or transaction (including, but not limited to, any borrowing, capital expenditure or purchase, sale or lease of assets) other than capital expenditures pursuant to the Company’s capital expenditures budget previously delivered to Parent and other capital expenditures that do not exceed thirty-five thousand dollars ($35,000) in the aggregate as of the date hereof; or (v) without the prior written consent of Parent, which shall not be unreasonably withheld, enter into any new obligation to any third party in an amount over thirty-five thousand dollars ($35,000) or enter into any new obligations to any third party or parties in the aggregate amount over two hundred thousand dollars ($200,000); provided, however, that notwithstanding the foregoing Company may, in the ordinary course of business and consistent with past practice, enter into new obligations with third parties for normal recurring services and fees, such as utilities, regulatory filing fees, taxes and similar items, without such consent of Parent;
(j) neither the Company nor any of its Subsidiaries shall (i) change any of the accounting principles used by it unless required by GAAP; or (ii) take or allow to be taken any action which would jeopardize qualification of the Merger as a reorganization within the meaning of Section 368(a) of the Code;
(k) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations (i) in the ordinary course of business and consistent with past practice, or claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries, (ii) incurred in the ordinary course of business and consistent with past practice or (iii) which are legally required to be paid, discharged or satisfied (provided that if such claims, liabilities or obligations referred to in this clause (iii) are legally required to be paid and are also not otherwise payable in accordance with clauses (i) or (ii) above, the Company will notify Parent in writing if such claims, liabilities or obligations exceed, individually or in the aggregate, $35,000 in value, reasonably in advance of their payment);
(l) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries or any agreement relating to an Alternative Transaction (other than the Merger and other than as defined in compliance with Section 9.4(a5.6(a) hereof)); and;
(im) neither the Company nor any of its subsidiaries Subsidiaries will authorize take, or agree to commit to take, any action that would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time;
(n) neither the Company nor any of its Subsidiaries will voluntarily make or agree to make any changes in Tax accounting methods, waive or consent to the extension of any statute of limitations with respect to Taxes, or consent to any assessment of Taxes, or settle any judicial or administrative proceeding affecting Taxes; and
(o) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Valicert Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees --------------------------------- that, prior to the Effective Time (unless Purchaser shall otherwise consent agree in writing and except as otherwise permitted contemplated by this Agreement):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain satisfactory relations with customers, suppliers, employees and business associates, in each case in all material respects.
(b) the Company shall not (i) sell sell, pledge, dispose of or pledge encumber or agree to sell or pledge any stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarysubsidiaries; (ii) amend the its Certificate or its bylaws By-Laws or amend, modify increase or terminate propose to increase the Rights Agreement, or redeem number of directors of the Rights issued pursuant theretoCompany; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;.
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantsany Company Option Plan; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability involving an amount in excess of $100,000 in the aggregate other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize incur any indebtedness for borrowed money (except for working capital expenditures under the Company's existing credit facilities and refinancings of existing debt that permit prepayment of such debt without penalty) involving an amount in excess of $50,000 individually or $100,000 in the aggregate or assume or endorse the obligations of any other person or entity; (v) make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock of any other person or entity (involving an amount in excess of $100,000 in the aggregate other than acquisitions in the ordinary and usual course of assets business or (vi) make or authorize any capital expenditure in excess of $500,000 in the aggregate.
(d) except for normal increases in the ordinary course of business that are consistent with past practice);
practices and that, in the aggregate, do not result in a material increase in benefits or compensation expense, adopt or amend (dexcept as may be required by law or as provided in this Agreement) neither the Company nor any of its subsidiaries shall grant any bonus, profit sharing, compensation, severance, termination, stock option, stock appreciation right, restricted stock, pension, retirement, deferred compensation, employment, severance or termination pay toother employee benefit agreements, trusts, plans, funds or enter into any employment other arrangements for the benefit or severance agreement with welfare of any director, officer or other employee, or increase in any manner the compensation or fringe benefits of any director, officer or employee or pay any benefit not required by any existing plan or arrangement (including, without limitation, the granting of stock options, stock appreciation rights, shares of restricted stock or performance units) or enter into any contract, agreement, commitment or arrangement to do any of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,foregoing.
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orshall, except in the ordinary and usual course of business and with the consent of Purchaserbusiness, enter into any material agreement or modify, amend or terminate any of its material Contracts agreements or waive, release or assign any material rights or claims;claims thereunder.
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Millipore Corp)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as contemplated by this Agreement, (ii) as disclosed in Section 5.1 of the Company Disclosure Letter or (iii) as agreed in writing by Parent, after the date hereof, and prior to the Effective Time (unless time the directors of the Purchaser have been elected to, and shall otherwise consent in writing and except as otherwise permitted by this Agreement):constitute a majority of, the Board of Directors of the Company pursuant to Section 1.3:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course of business and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve in all material respects its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees and business associates;
(b) each of the Company shall not and its Subsidiaries will not, directly or indirectly, (i) sell amend its Certificate of Incorporation or pledge By-laws or agree to sell similar organizational documents or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the its outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Sharescapital stock;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) issuedeclare, sellset aside or pay any dividend or other distribution (whether payable in cash, pledge, dispose stock or property) with respect to its capital stock (other than dividends from any Subsidiary of the Company to the Company or encumber any other Subsidiary of the Company); (ii) issue or sell any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options the exercise of Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiii) transfersell, lease, license, guarantee, sell, mortgage, pledge, license or dispose of or encumber any assets or incur or modify any indebtedness or other liability properties, other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually incur or $100,000 in the aggregate or make modify any acquisition of (by mergermaterial debt, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
; (dv) neither the Company nor license or sublicense any of its subsidiaries shall grant any severance asset or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee property of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, Subsidiary except in the ordinary and usual course of business and consistent with the consent past practice on a basis that results in a positive current royalty net of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither royalties due by the Company nor or any Company Subsidiary on account of its subsidiaries shall make any tax election sales by the licensee or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a))sublicensee; and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.or
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except as expressly provided in this Agreement, or with the prior written consent of Parent, which consent shall not be unreasonably withheld, conditioned, or delayed, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Time:
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual customary course consistent with past practice, including, taking all reasonable measures to protect the confidentiality of the Company's and its subsidiaries' Trade Secrets, and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not (i) sell will not, directly or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellindirectly, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Company Shares; , or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the Sharessubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall shall: (i) amend its articles of incorporation or bylaws or similar organizational documents; (ii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock; (iii) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice, or incur or modify any material Indebtedness; or (iiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption any of its capital stock;
(d) neither the Company or otherwise any shares of its subsidiaries shall: (i) increase the capital stock compensation or benefits payable to any director, officer, other employee or consultant of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by mergersubsidiaries, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
; (dii) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, to (or enter into amend any employment or severance agreement with such existing arrangement with) any director, officer or officer, other employee or consultant of the Company or any of its subsidiaries; (iii) enter into any employment, deferred compensation or other similar agreement (or amend any such subsidiary; and neither existing agreement) with any director, officer, other employee or contractor of the Company nor or any of its subsidiaries; (iv) increase any benefits payable under any existing severance or termination pay policies or agreements or employment agreements; or (v) permit any director, officer, other employee or contractor of the Company or any of its subsidiaries shall establish,who is not already a party to an agreement or a participant in a plan providing benefits upon or following a "change in control" to become a party to any such agreement or a participant in any such plan, other than pursuant to a pre-existing contractual commitment or as required by applicable Law;
(e) neither the Company nor any of its subsidiaries shall settle shall: (i) adopt any new Benefit Plan, terminate any Benefit Plan or compromise modify any material claims Benefit Plan in a way that could result in additional cost to Parent, the Company or litigation orany of their respective subsidiaries, except for any amendments to a Benefit Plan required to maintain its qualified plan status under Section 401(a) of the Code; (ii) modify any actuarial cost method, assumption or practice used in determining benefit obligations, annual expense and funding for any Benefit Plan, except to the ordinary and usual course extent required by GAAP; (iii) subject to any ERISA fiduciary obligation, modify the investment philosophy of business and the Benefit Plan trusts or maintain an asset allocation which is not consistent with such philosophy; (iv) subject to any ERISA fiduciary obligation, enter into any outsourcing agreement, or any other material contract relating to the Benefit Plans or management of the Benefit Plan trusts; (v) grant any ad hoc pension increase; or (vi) establish any new or fund any existing "rabbi" or similar trust (except in accordance with the consent current terms of Purchaserany Benefit Plan), modifyor enter into any other arrangement for the purpose of securing non-qualified retirement benefits, amend termination benefits or terminate any of its material Contracts or waive, release or assign any material rights or claimsdeferred compensation;
(f) neither the Company nor any of its subsidiaries shall make modify, amend or terminate any tax election of the Company Agreements or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice;
(g) neither the Company nor any of its subsidiaries shall permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(gh) except neither the Company nor any of its subsidiaries shall: (i) incur Indebtedness; provided, however, the Company may incur Indebtedness, if such Indebtedness is incurred on an arm's length basis with nationally recognized financial institutions and such Indebtedness does not exceed $500,000 in net debt and is incurred in the ordinary course of business consistent with past practice; (ii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly-owned subsidiaries of the Company); or (iii) enter into any material commitment or transaction (including any borrowing, capital expenditure or purchase, sale or lease of assets) requiring a capital expenditure by the Company or its subsidiaries other than capital expenditures pursuant to the Company's capital expenditures budget previously furnished to Parent and other capital expenditures that do not exceed $50,000 in the aggregate since June 30, 2001;
(i) neither the Company nor any of its subsidiaries shall change any method of reporting income, deductions or other items for income Tax purposes, make or change any election with respect to Taxes, agree to or settle any claim or assessment in respect of Taxes, or agree to an extension or waiver of the limitation period to any claim or assessment in respect of Taxes, other than in the ordinary course of business consistent with past practice or as may be required as a result of a change in law or in generally accepted accounting principles, by Law;
(j) neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by itit unless required by GAAP;
(hk) neither the Company nor any of its subsidiaries shall adopt a plan pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of complete any such claims, liabilities or partial liquidationobligations, dissolution(i) in the ordinary course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated subsidiaries, (ii) incurred in the ordinary course of business and consistent with past practice or (iii) which are legally required to be paid, discharged or satisfied (provided that if such claims, liabilities or obligations referred to in this clause (iii) are legally required to be paid and are also not otherwise payable in accordance with clauses (i) or (ii) above, the Company will notify Parent in writing reasonably in advance of their payment if such claims, liabilities or obligations exceed, individually or in the aggregate, $25,000 in value);
(i) acquire (by merger, consolidation, restructuringor acquisition of stock or assets) any corporation, recapitalization, partnership or other reorganization business organization or division thereof or make any investment in another entity (other than an entity which is a wholly-owned subsidiary of the Company (other than as of the Merger date hereof and other than incorporation of a wholly-owned subsidiary of the Company) or (ii) sell, pledge, dispose of, or encumber or authorize or propose the sale, pledge, disposition or encumbrance of any assets of the Company or any of its subsidiaries, except in compliance the ordinary and customary course of business consistent with Section 9.4(a)); andpast practice;
(im) take any action which it believes when taken could reasonably be expected to adversely affect or delay in any material respect the ability of any of the parties hereto to obtain any approval of any Governmental Authority required to consummate the transactions contemplated hereby;
(n) take any action to cause the Company Shares to cease to be quoted on the Nasdaq National Market prior to the Closing Date;
(o) neither the Company nor any of its subsidiaries will authorize take, or agree to commit to take, any action that would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time; and
(p) neither the Company nor any of its subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this Agreement, (ii) as set forth in Section 6.1 of the Company Disclosure Schedule (indicating the appropriate subsection for each such disclosure) or (iii) as expressly consented to in writing by Parent, after the date hereof and prior to the Effective Time earlier of (unless Purchaser x) the termination of this Agreement in accordance with Article IX and (y) the time the designees of Parent have been elected to, and shall otherwise consent in writing and except as otherwise permitted by this Agreementconstitute a majority of, the Company Board of Directors pursuant to Section 2.3 (the "APPOINTMENT DATE"):
(a) the business of the Company and its subsidiaries the Company Subsidiaries shall be conducted only in the ordinary course of business consistent with past practice, and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries the Company Subsidiaries shall use its commercially reasonable best efforts to preserve its present business organization intact and maintainmaintain satisfactory relations with customers, suppliers, employees, sales associates, contractors, distributors and others having business dealings with it;
(b) the Company shall not not, directly or indirectly, (i) sell except upon exercise of the Options outstanding on the date hereof, issue, sell, transfer or pledge or agree to sell sell, transfer or pledge any capital stock or other securities owned by it equity interests of the Company or permit any of its subsidiaries to sellCompany Subsidiary, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate its articles of organization or its bylaws or amend, modify similar organizational documents; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Shares or any outstanding capital stock of the Company;
(ivc) neither the Company nor any Company Subsidiary shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
its capital stock; (c) neither the Company nor any of its subsidiaries shall (iii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries Company or any Company Subsidiaries, other property or assets other than, in than Shares reserved for issuance on the case date hereof pursuant to the exercise of the Company, Shares issuable pursuant to options Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets of its material assets, or incur or modify any indebtedness material Indebtedness or other liability material liability, other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice); or (iv) redeem, purchase or otherwise acquire any shares of any class or series of its capital stock, or any instrument or security which consists of or includes a right to acquire such shares;
(d) neither the Company nor any of its subsidiaries Company Subsidiary shall grant make any severance change in the compensation or termination pay to, benefits payable or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor to become payable to any of its subsidiaries shall establish,officers, directors, employees, sales associates, agents or consultants (other than increases in wages to employees who are not directors or affiliates, in the ordinary course of business consistent with past practice) or to persons providing management services, enter into, amend or waive any employment, severance, consulting, termination, non-competition or other agreement or employee benefit plan or make any loans to any of its officers, directors, employees, sales associates, affiliates, agents or consultants or make any change in its existing borrowing or lending arrangements for or on behalf of any of such persons pursuant to an employee benefit plan or otherwise;
(e) neither the Company nor any Company Subsidiary shall pay or make any accrual or arrangement for payment of its subsidiaries shall settle any pension, retirement allowance or compromise other employee benefit pursuant to any material claims existing plan, agreement or litigation orarrangement to any officer, director, employee or affiliate or pay or agree to pay or make any accrual or arrangement for payment to any officers, directors, employees or affiliates of the Company of any amount relating to unused vacation days, except payments and accruals made in the ordinary and usual course of business and consistent with past practice; adopt or pay, grant, issue, accelerate or accrue salary or other payments or benefits pursuant to any pension, profit-sharing, bonus, extra compensation, incentive, deferred compensation, stock purchase, stock option, stock appreciation right, group insurance, severance pay, retirement or other employee benefit plan, agreement or arrangement, or any employment or consulting agreement with or for the benefit of any Company director, officer, employee, agent or consultant, whether past or present, or amend in any material respect any such existing plan, agreement or arrangement in a manner inconsistent with the consent of Purchaserforegoing;
(f) the Company will not enter into any Company Agreement that would be a Material Company Agreement and will not, in any material respect, modify, amend or terminate any of its material Contracts or Material Company Agreement, and neither the Company nor any Company Subsidiary shall waive, release or assign any material rights or claimsclaims under any Material Company Agreement;
(fg) neither the Company nor any of its subsidiaries shall make any tax election or Company Subsidiary will permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by itParent;
(h) neither the Company nor any Company Subsidiary will (i) incur or assume any Indebtedness other than in the ordinary course of business consistent with past practice pursuant to capital leases, chattel lines of credit and Indebtedness incurred under the Warehouse Credit Agreement and the Revolving Facility; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person; (iii) except for first and second mortgage loans made in the ordinary course of business by the Mortgage Company, make any loans, advances or capital contributions to, or investments in, any other Person; (iv) enter into any material commitment or transaction (including, but not limited to, any borrowing, capital expenditure or purchase, sale or lease of assets or real estate); or (v) dispose of or permit any Encumbrance upon any material assets of the Company or any Company Subsidiary;
(i) neither the Company nor any Company Subsidiary will (i) change any of the accounting methods used by it materially affecting its subsidiaries shall assets, liabilities or business, except for such changes required by GAAP or (ii) make or change any Tax election, change an annual accounting period, adopt or change any accounting method, file any amended Tax Returns, enter into any closing agreement, settle or consent to any Tax Claim, surrender any right to claim a refund of Taxes, or consent to any extension or waiver of the limitation period applicable to any Tax Claim;
(j) neither the Company nor any Company Subsidiary will pay, discharge or satisfy any claims, liabilities or obligations (whether absolute, accrued, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, in the ordinary course of business consistent with past practice, or of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the Financial Statements (or the notes thereto) and the Interim Financial Statements of the Company;
(k) neither the Company nor any Company Subsidiary will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any Company Subsidiary (other than the Merger and other than in compliance with Section 9.4(aMerger)); and;
(il) neither the Company nor any Company Subsidiary will take, or agree in writing or otherwise to take, any action that would or is reasonably likely to result in any of its subsidiaries the conditions to the Merger set forth in Article VIII or any of the Offer Conditions not being satisfied, or would make any representation or warranty of the Company contained herein inaccurate in any material respect at, or as of any time prior to, the Effective Time, or that would materially impair the ability of the Company to consummate the Merger in accordance with the terms hereof or materially delay such consummation; and
(m) neither the Company nor any Company Subsidiary will authorize or enter into an agreement any written agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause authorize, recommend, propose, in writing or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Cendant Corp)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except as expressly provided in this Agreement, or with the prior written consent of Parent, which consent shall not be unreasonably withheld, conditioned, or delayed, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Time:
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual customary course consistent with past practice, including, taking all reasonable measures to protect the confidentiality of the Company's and its subsidiaries' Trade Secrets, and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not (i) sell will not, directly or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellindirectly, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Company Shares; , or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the Sharessubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall shall: (i) amend its articles of incorporation or bylaws or similar organizational documents; (ii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock; (iii) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice, or incur or modify any material Indebtedness; or (iiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption any of its capital stock;
(d) neither the Company or otherwise any shares of its subsidiaries shall:
(i) increase the capital stock compensation or benefits payable to any director, officer, other employee or consultant of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by mergersubsidiaries, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
; (dii) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, to (or enter into amend any employment or severance agreement with such existing arrangement with) any director, officer or officer, other employee or consultant of the Company or any of its subsidiaries; (iii) enter into any employment, deferred compensation or other similar agreement (or amend any such subsidiary; and neither existing agreement) with any director, officer, other employee or contractor of the Company nor or any of its subsidiaries; (iv) increase any benefits payable under any existing severance or termination pay policies or agreements or employment agreements; or (v) permit any director, officer, other employee or contractor of the Company or any of its subsidiaries shall establish,who is not already a party to an agreement or a participant in a plan providing benefits upon or following a "change in control" to become a party to any such agreement or a participant in any such plan, other than pursuant to a pre-existing contractual commitment or as required by applicable Law;
(e) neither the Company nor any of its subsidiaries shall settle shall: (i) adopt any new Benefit Plan, terminate any Benefit Plan or compromise modify any material claims Benefit Plan in a way that could result in additional cost to Parent, the Company or litigation orany of their respective subsidiaries, except for any amendments to a Benefit Plan required to maintain its qualified plan status under Section 401(a) of the Code; (ii) modify any actuarial cost method, assumption or practice used in determining benefit obligations, annual expense and funding for any Benefit Plan, except to the ordinary and usual course extent required by GAAP; (iii) subject to any ERISA fiduciary obligation, modify the investment philosophy of business and the Benefit Plan trusts or maintain an asset allocation which is not consistent with such philosophy; (iv) subject to any ERISA fiduciary obligation, enter into any outsourcing agreement, or any other material contract relating to the Benefit Plans or management of the Benefit Plan trusts; (v) grant any ad hoc pension increase; or (vi) establish any new or fund any existing "rabbi" or similar trust (except in accordance with the consent current terms of Purchaserany Benefit Plan), modifyor enter into any other arrangement for the purpose of securing non-qualified retirement benefits, amend termination benefits or terminate any of its material Contracts or waive, release or assign any material rights or claimsdeferred compensation;
(f) neither the Company nor any of its subsidiaries shall make modify, amend or terminate any tax election of the Company Agreements or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice;
(g) neither the Company nor any of its subsidiaries shall permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(gh) except neither the Company nor any of its subsidiaries shall: (i) incur Indebtedness; provided, however, the Company may incur Indebtedness, if such Indebtedness is incurred on an arm's length basis with nationally recognized financial institutions and such Indebtedness does not exceed $500,000 in net debt and is incurred in the ordinary course of business consistent with past practice; (ii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly-owned subsidiaries of the Company); or (iii) enter into any material commitment or transaction (including any borrowing, capital expenditure or purchase, sale or lease of assets) requiring a capital expenditure by the Company or its subsidiaries other than capital expenditures pursuant to the Company's capital expenditures budget previously furnished to Parent and other capital expenditures that do not exceed $50,000 in the aggregate since June 30, 2001;
(i) neither the Company nor any of its subsidiaries shall change any method of reporting income, deductions or other items for income Tax purposes, make or change any election with respect to Taxes, agree to or settle any claim or assessment in respect of Taxes, or agree to an extension or waiver of the limitation period to any claim or assessment in respect of Taxes, other than in the ordinary course of business consistent with past practice or as may be required as a result of a change in law or in generally accepted accounting principles, by Law;
(j) neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by itit unless required by GAAP;
(hk) neither the Company nor any of its subsidiaries shall adopt a plan pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of complete any such claims, liabilities or partial liquidationobligations, dissolution(i) in the ordinary course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated subsidiaries, (ii) incurred in the ordinary course of business and consistent with past practice or (iii) which are legally required to be paid, discharged or satisfied (provided that if such claims, liabilities or obligations referred to in this clause (iii) are legally required to be paid and are also not otherwise payable in accordance with clauses (i) or (ii) above, the Company will notify Parent in writing reasonably in advance of their payment if such claims, liabilities or obligations exceed, individually or in the aggregate, $25,000 in value);
(i) acquire (by merger, consolidation, restructuringor acquisition of stock or assets) any corporation, recapitalization, partnership or other reorganization business organization or division thereof or make any investment in another entity (other than an entity which is a wholly-owned subsidiary of the Company (other than as of the Merger date hereof and other than incorporation of a wholly-owned subsidiary of the Company) or (ii) sell, pledge, dispose of, or encumber or authorize or propose the sale, pledge, disposition or encumbrance of any assets of the Company or any of its subsidiaries, except in compliance the ordinary and customary course of business consistent with Section 9.4(a)); andpast practice;
(im) take any action which it believes when taken could reasonably be expected to adversely affect or delay in any material respect the ability of any of the parties hereto to obtain any approval of any Governmental Authority required to consummate the transactions contemplated hereby;
(n) take any action to cause the Company Shares to cease to be quoted on the Nasdaq National Market prior to the Closing Date;
(o) neither the Company nor any of its subsidiaries will authorize take, or agree to commit to take, any action that would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time; and
(p) neither the Company nor any of its subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Agreement and Plan of Merger
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to from the date hereof until the Effective Time (unless Purchaser Time, without the prior written approval of Parent, which approval shall otherwise consent in writing not be unreasonably withheld, delayed or conditioned, the Company shall not, and except as otherwise permitted by this Agreement):shall not permit any of its Subsidiaries to, directly or indirectly, do or agree to do, any of the following:
(a) conduct the business of the Company and its subsidiaries shall be conducted only Subsidiaries in a manner other than in the ordinary and usual course and, to the extent consistent therewith, and each of the Company and its subsidiaries shall Subsidiaries shall, subject to the other restrictions contained in this Agreement, use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business associates;
(b) the Company shall not directly or indirectly, (i) sell except upon exercise of Options or other rights to purchase Shares outstanding on the date hereof, issue, sell, transfer or pledge or agree to sell sell, transfer or pledge any treasury stock of the Company or other securities owned by it or permit any capital stock of any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities Subsidiaries beneficially owned by such subsidiaryit; (ii) amend the its or any of its Subsidiaries' Certificate of Incorporation or its bylaws By-laws or amend, modify similar organizational documents; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Shares or any outstanding capital stock, or authorize or create a new class of capital stock, of any of the Subsidiaries of the Company;
(ivc) other than the payment of dividends or other distributions by Subsidiaries to the Company or to other Subsidiaries: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property property, with respect to its capital stock or enter into any agreement with respect to the Shares;
(c) neither the Company nor any voting of its subsidiaries shall capital stock; (iii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquireacquire (or stock appreciation rights with respect to), any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than Shares reserved for issuance on the case of the Company, Shares issuable date hereof pursuant to options the exercise of Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiii) except as disclosed in Section 5.1(c) of the Company Letter, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures having a value in excess of $50,000 individually 250,000 (or $100,000 in authorize any of the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assetsforegoing), or any investment in, assets or stock of any other person or entity (other than acquisitions pursuant to existing contracts or commitments or the sale or purchase of assets goods in the ordinary course of business consistent with past practice), or enter into any commitment or transaction outside the ordinary course of business consistent with past practice; or (iv) redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock;
(d) neither except as disclosed in Section 5.1(d) of the Company nor Letter, make any change in the compensation payable or to become payable to any of its subsidiaries shall grant any severance officers, directors, agents or termination pay toconsultants, or to Persons providing management services, provided that changes in compensation payable to other employees may be made in the ordinary course of business consistent with past practice (provided individual increases in employee compensation do not exceed 5% per annum), enter into or amend any employment or severance agreement with any directoremployment, officer severance, consulting, termination or other employee of the Company employment-related agreement, arrangement or Benefit Plan or make any such subsidiary; and neither the Company nor loans to any of its subsidiaries shall establish,officers, directors, employees, affiliates, agents or consultants or make any change in its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to a Benefit Plan or otherwise, other than the hiring of non-management personnel in the ordinary course of business each having an annual salary not in excess of $75,000;
(e) neither except (i) pursuant to Benefit Plans existing at the date hereof, or as disclosed in Section 3.11(a) of the Company nor Letter, (ii) as required by any law, rule or regulation of its subsidiaries shall settle any Governmental Entity, (iii) as disclosed in Section 5.1(e) of the Company Letter, and (iv) pursuant to Section 2.4 hereof, pay or compromise make, or amend or agree to amend any material claims Benefit Plan, agreement or litigation orarrangement existing at the date hereof to provide for any accrual or arrangement for payment of any pension, except in retirement allowance or other employee benefit pursuant to any existing Benefit Plan, agreement or arrangement to any officer, director, employee or affiliate or pay or agree to pay or make any accrual or arrangement for payment to any officers, directors, employees or affiliates of the ordinary and usual course Company of business and any amount relating to unused vacation days, adopt or pay, grant, issue, accelerate, or accrue salary or other payments or benefits pursuant to any pension, profit-sharing, bonus, extra compensation, incentive, deferred compensation, stock purchase, stock option, stock appreciation right or other stock-based incentive, group insurance, severance pay, retirement or other employee benefit plan, agreement or arrangement, or any employment or consulting agreement with or for the consent benefit of Purchaserany director, officer, employee, agent or consultant, whether past or present;
(f) modify, amend or terminate any of its material Contracts Company Agreement or waive, release or assign any material rights or claims, except in each case in the ordinary course of business consistent with past practice;
(fg) neither cancel or terminate any material insurance policy naming the Company nor or any of its subsidiaries shall make any tax election or permit any insurance policy naming it Subsidiaries as a beneficiary or a loss payable payee to be canceled or terminated without notice to PurchaserParent;
(i) except in the ordinary course of business under lines of credit in existence on the date hereof, incur or assume any indebtedness, in each case for borrowed money, in a principal amount in excess of $250,000 in the aggregate for the Company and its Subsidiaries taken as a whole; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for any obligations of any other Person (other than, with respect to (x) the Company, any Subsidiary or (y) any Subsidiary, the Company or any other Subsidiary) except in the ordinary course of business or make any loans, advances or capital contributions to, or investments in, any other Person (other than, with respect to (1) the Company, any Subsidiary or (2) any Subsidiary, the Company or any other Subsidiary), except for any such matter undertaken in the ordinary course of business consistent with past practice PROVIDED, in any event, that such obligations, loans, advances, contributions or investments do not exceed $50,000 individually and $250,000 in the aggregate; (iii) make any commitments for, or make or authorize any, capital expenditures other than in amounts less than $150,000 individually and $500,000 in the aggregate other than as disclosed in Section 5.1(h) of the Company Letter or (iv) acquire (including, without limitation, by merger, consolidation, or acquisition of stock or assets) any interest in any Person or any division thereof or any assets, except in the ordinary and usual course of businessbusiness consistent with past practice;
(gi) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall (i) change any of the accounting practices methods, policies or principles procedures used by itit unless required by GAAP or (ii) except as required by applicable law, make any Tax election or change any Tax election already made, adopt any Tax accounting method, change any Tax accounting method unless required by applicable law, enter into any tax allocation agreement, tax sharing agreement, tax indemnity agreement or closing agreement, settle any Tax claim or assessment or consent to any Tax claim or assessment or any waiver of the statute of limitations for any such claim or assessment;
(hi) neither pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations in the ordinary course of business or any such payment, discharge or satisfaction that the Company nor or any of its subsidiaries shall Subsidiaries is required to make by any law, rule or regulation of any Governmental Entity or by any contractual obligation not prohibited by this Section 5.1, PROVIDED such payment, discharge or satisfaction does not exceed $250,000 in the aggregate (ii) pre-pay any long-term debt, except in the ordinary course of business in an amount not to exceed $250,000 in the aggregate for the Company and its Subsidiaries taken as a whole, (iii) accelerate or delay collection of notes or accounts receivable in advance of or beyond their regular due dates or the dates when the same would have been collected in the ordinary course of business consistent with past practice, (iv) except as disclosed in Section 5.1(j) of the Company Letter, delay or accelerate payment of any account payable or in advance of its due date or the date such liability would have been paid in the ordinary course of business consistent with past practice, or (v) vary the inventory practices of the Company or its Subsidiaries in any material respect from past practices;
(k) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries (other than the Mergers);
(i) knowingly take, or agree to commit to take, any action that would reasonably be expected to result in any of the conditions to the Mergers not being satisfied, or that would give rise to a right of termination of this Agreement for Parent or Merger Subsidiary pursuant to Section 8.1 hereof or (ii) enter into any agreement or take any other action that would present a material risk of delaying the Mergers or that would require a consent of a third party for the consummation of the Mergers;
(m) enter into any agreement that would have the effect of subjecting Parent, the Surviving Corporation or any of their affiliates to any non-compete or other material restrictions on their respective businesses following the Closing;
(n) waive, release, assign, settle or compromise any material litigation or arbitration;
(o) write up, write down or write off the book value of any assets, individually or in the aggregate, for the Company and its Subsidiaries taken as a whole, in excess of $150,000, except for depreciation and amortization in accordance with GAAP consistently applied and except for the write down of obsolete inventory in the ordinary course of business;
(p) take any action to exempt or make not subject to (A) the provisions of Section 203 of the Delaware Law, or (B) any other state takeover law or state law that purports to limit or restrict business combinations or the ability to acquire or vote shares, any Person (other than Parent, Merger Subsidiary and any subsidiaries of Parent) or any action taken thereby, which Person or action would have otherwise been subject to the restrictive provisions thereof and not exempt therefrom;
(q) except to the extent disclosed in compliance with Section 9.4(a5.1(q) of the Company Letter, (i) effect a plant closing or mass layoff affecting any site of employment or one or more facilities or operating units within any site of employment or facility of the Company or any Subsidiary without the prior written consent of Parent or (ii) terminate more than forty-nine (49) employees within a site of employment or facility of the Company or any Subsidiary or operating unit within a site of employment or facility or operating unit of the Company or any Subsidiary without providing prior written notice to Parent. For the purposes of this Section 5.1(q)), "plant closing," "operating unit," and "employment loss" shall have the meanings ascribed to such terms in Section 3.18 of this Agreement; and
(ir) neither the Company nor any of its subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Miltope Group Inc)
Interim Operations of the Company. The Company --------------------------------- covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time Closing Date (unless the Purchaser shall otherwise consent agree in writing and except as otherwise permitted contemplated by this Agreement):), except as contemplated by this Agreement:
(ai) the business of the Company and its subsidiaries Subsidiaries shall be conducted in all material respects only in the ordinary and usual course and, to the extent consistent therewith, and each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, governmental agencies, suppliers, employees, distributors and business associates in all material respects;
(bii) the Company shall not (ia) sell or pledge or agree to sell or pledge any stock or other securities ownership interest owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any Subsidiaries (other than in connection with the exercise of currently outstanding stock or other securities owned by such subsidiaryoptions); (iib) amend the its Certificate of Incorporation or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoBylaws; (iiic) split, combine or reclassify the outstanding Sharesshares of its voting securities; or (ivd) declare, set aside or pay any dividend payable in cash, stock or property with respect to the SharesCommon Stock or the Preferred Stock or (e) increase the number of members of the Board of Directors of the Company;
(ciii) neither the Company nor any of its subsidiaries Subsidiaries shall (ia) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments commits or rights of any kind to acquireacquire any securities or ownership interest in another Person, including any shares share of its capital stock or other ownership interest of any class of the Company, Company or its subsidiaries Subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantsassets; (iib) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets material to the Company and its Subsidiaries taken as a whole, or incur or modify any indebtedness or other liability other than material to the Company and its Subsidiaries taken as a whole, except in the ordinary and usual course of its business; (iiic) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or of any of its subsidiaries class; or (ivd) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate aggregate, except in the ordinary course of business, or make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock of any other person or entity (other than acquisitions in excess of assets $100,000 in the ordinary course of business consistent with past practice);aggregate.
(div) except as disclosed in Schedule 6(a)(iv) neither the Company nor any of its subsidiaries Subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with with, any director, officer or other employee of the Company or any such subsidiaryits Subsidiaries; and neither the Company nor any of its subsidiaries Subsidiaries shall establish,, adopt, enter into or amend any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any directors, officers or employees;
(ev) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its contracts material Contracts to the Company and its Subsidiaries taken as a whole or waive, release or assign any similarly material rights or claims;.
(fvi) neither the Company nor any of its subsidiaries Subsidiaries shall make take any tax election action that will cause any representation or permit any insurance policy naming it as a beneficiary or a loss payable payee warranty contained in this Agreement to be canceled or terminated without notice to Purchaser, except in the ordinary become no longer true and usual course of business;correct; and
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(hvii) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries Subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants Following the date hereof and agrees, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and Closing, except as otherwise expressly permitted by this Agreement):Agreement or consented to or approved by Newco in writing, the Company agrees that, and each Seller shall use its reasonable best efforts to ensure that:
(a) the business of the Company and its subsidiaries the Subsidiaries shall be conducted operate their business only in the ordinary and usual course and, to the extent consistent therewith, each of the Company with past practice and its subsidiaries shall use its commercially reasonable best efforts which are consistent with past practice to preserve its their properties (including, without limitation, intellectual property rights) and business organization intact and maintainrelationships with suppliers, customers, employees, creditors, sublessees, licensees and other Persons with whom they have commercial dealings;
(b) the Company shall not (i) sell amend its articles of incorporation or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiaryby-laws; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Sharesshares of capital stock of the Company; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (iiii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries Company or any other property Subsidiary, except that (A) the Company may issue or assets other than, reserve for issuance additional shares of Preferred Stock to pay dividends on the Preferred Stock in accordance with the case Statement of Resolution of the CompanyPreferred Stock and (B) the Company may issue shares of Common Stock upon exercise of any Employee Options; or (iv) declare, Shares issuable pursuant set aside -42- 47 or pay any dividend payable in cash, stock or property with respect to options outstanding any class of capital stock other than dividends payable on Preferred Stock;
(c) neither the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; Company nor any Subsidiary shall (iii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber create any assets Encumbrance with respect to any individual capital asset of the Company or any Subsidiary if the greater of the book value and the fair market value of such capital asset exceeds $1,000,000, other than Permitted Encumbrances; (ii) incur or modify any indebtedness for money borrowed or other liability guarantee thereof, including without limitation capitalized lease obligations, in excess of $500,000 other than indebtedness incurred under the credit facilities of the Company in effect on the date hereof in the ordinary and usual course of businessbusiness consistent with past practice; (iii) acquire directly or indirectly indirectly, by redemption repurchase or otherwise any shares of the capital stock of the Company or any of its subsidiaries or Subsidiary except as contemplated by this Agreement; (iv) except as expressly contemplated by the Company's business plan for the fiscal year ending January 2, 1999 (the "Business Plan"), a copy of which was previously delivered to Newco, authorize any capital expenditures expenditure in excess of $50,000 500,000 individually or $100,000 1,000,000 in the aggregate aggregate; or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(gv) except as may be required as a result of a change in law expressly contemplated by the Business Plan, enter into or in generally accepted accounting principles, neither the Company nor renew any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, lease or other reorganization commitment in respect of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize real or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement personal property to be untrue performed over a period exceeding one year where the present value of payments to be made thereunder exceeds $250,000 individually or incorrect or would result $1,000,000 in any of the Offer Conditions set forth in Annex A hereto not being satisfied.aggregate;
Appears in 1 contract
Samples: Recapitalization Agreement (Eye Care Centers of America Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time except (unless Purchaser shall otherwise consent in writing and except i) as otherwise permitted expressly contemplated by this Agreement):
, (ii) as set forth in Section 5.1 of the Company Disclosure Schedule or (iii) as agreed in writing by Parent (such consent in the case of clauses (a) - (c), (e) - (i), (k), (m) and (n) not to be unreasonably withheld, and provided that any debt, obligation or liability contemplated by clause (g) is immediately prepayable without cost), the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course course, consistent with past practice, and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) maintain its existing relations with customers, suppliers, employees, creditors and business partners and neither the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; shall:
(iia) amend the Certificate its certificate of incorporation or its bylaws by-laws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; similar organizational documents;
(iii) split, combine or reclassify the outstanding Shares; or (ivi) declare, set aside or pay any dividend payable in cash, stock or property other distribution with respect to the Shares;
its capital stock, (cii) neither the Company nor redeem, purchase or otherwise acquire directly or indirectly any of its subsidiaries shall capital stock other than existing Company Options; (iiii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries (or any rights to acquire such securities), other property or assets other than, in than Company Common Shares issued upon the case exercise of the Company, Shares issuable pursuant to options Company Options outstanding on the date hereof under in accordance with the Stock Plans and shares issuable pursuant terms of such Company Options as in effect on the date hereof or (iv) split, combine or reclassify its outstanding capital stock;
(c) acquire or agree to the Warrants; acquire, any material assets or securities either by purchase, merger or otherwise;
(iid) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability securities other than in the ordinary and usual course of businessbusiness and consistent with past practice; (iii) acquire directly or indirectly by redemption authorize, propose or otherwise announce an intention to authorize or propose, or enter into an agreement with respect to, any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity business combination (other than acquisitions of assets in the ordinary course of business consistent with past practiceMerger);
(di) neither grant any increase in the Company nor compensation payable or to become payable to any of its subsidiaries shall grant executive officers or key employees, (ii)(A) adopt any severance or termination pay tonew, or (B) amend or otherwise increase, or, except as required pursuant to agreements existing on the date hereof, accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan agreement or arrangement, (iii) enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in accordance with the existing written agreements, grant any severance or termination pay to any officer, director or employee other than if paid at Closing and deemed to be Expenses for purposes hereof or (iv) except in the ordinary and usual course of business and business, consistent with past practice, increase the consent compensation or benefits of Purchaser, any employee;
(f) modify, amend or terminate or enter into any of its material Contracts contract or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) (i) incur or assume any long-term debt, or except as may be required as a result in the ordinary course of a change business, incur or assume any short-term indebtedness in law amounts not consistent with past practice; (ii) incur or modify any material indebtedness or other liability; (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in generally accepted accounting principlesthe ordinary course of business and consistent with past practice; or (iv) make any loans, neither advances or capital contributions to, or investments in, any other person (other than to wholly owned subsidiaries of the Company nor any or customary loans or advances to employees in accordance with past practice); PROVIDED, that the Company may take action in the case of its subsidiaries shall either subclause of this clause (g)(i) or (ii) without the consent of Parent so long as such items are prepayable at no cost to Parent;
(h) change any of the accounting practices or principles methods used by itit unless required by GAAP;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, in the ordinary course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company nor and its consolidated subsidiaries and other than payments made in connection with this Agreement and the transactions contemplated hereby;
(j) transfer, lease, license, sell, mortgage, pledge, dispose of, or encumber, directly or indirectly, any Channel or any interest in any SMR Channel listed in Section 3.15(c) of its subsidiaries will authorize the Company Disclosure Schedule;
(k) except as expressly contemplated by this Agreement, engage in any transactions with any stockholders or other affiliates of the Company or enter into an agreement any agreements with such stockholders or affiliates;
(l) fail to do any of the foregoing or take any action required actions (consistent with applicable law) in order to maintain its Licenses, including, but not limited to, any build-out and loading requirements, filings or any requirements that would knowingly cause payments be made. For purposes of this clause (l), "required" shall mean reasonably required in order to maintain such licenses, including as a result of any of the representations changes in law or warranties of the Company contained in this Agreement to be untrue regulation, industry practices, enforcement practices, notices from relevant Governmental Entities or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.otherwise;
Appears in 1 contract
Samples: Merger Agreement (International Wireless Communications Holdings Inc)
Interim Operations of the Company. The Company --------------------------------- covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this agreement, (ii) as set forth in Section 5.1 of the Company Disclosure Schedule, or (iii) as agreed in writing by Parent, after the date hereof, and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):consummation of the Offer:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not not, directly or indirectly, (i) sell sell, transfer or pledge or agree to sell sell, transfer or pledge any treasury stock of the Company or other securities owned by it or permit any capital stock of any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities Subsidiaries beneficially owned by such subsidiaryit; (ii) amend the Certificate its certificate of incorporation or its bylaws by-laws or amend, modify similar organizational documents; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Shares or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock (except dividends from a wholly-owned Subsidiary to the Company); (ii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than shares reserved for issuance on the case of the Company, Shares issuable date hereof pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice, or incur or modify any material indebtedness or other liability, other than in the ordinary and usual course of business and consistent with past practice; or (iiiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) grant any severance increase in the compensation payable or termination pay toto become payable by the Company or any of its Subsidiaries to any of its executive officers or key employees; or (ii)(A) adopt any new, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan, agreement or arrangement, including, without limitation, the Option Plan; or (iii) enter into any employment or severance agreement with or, except in accordance with the existing written policies of the Company, grant any directorseverance or termination pay to any officer, officer director or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Subsidiaries;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts contracts or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any long-term debt, or except in the ordinary course of business, incur or assume any short-term indebtedness, any such short-term indebtedness to be in amounts consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in the ordinary course of business and consistent with past practice; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than (1) to wholly owned Subsidiaries of the accounting practices Company, (2) pursuant to existing commitments which are listed in Section 3.16 of the Company Disclosure Schedule, or principles used by it;(3) in the ordinary course of business consistent with past practice); or (iv) enter into any commitment or transaction (including, but not limited to, any capital expenditure or purchase or lease of assets or real estate) involving more than $150,000 for any one expenditure, commitment or transaction (other than pursuant to existing commitments listed in Section 3.16 of the Company Disclosure Schedule).
(h) neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting methods used by it unless required by GAAP;
(i) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business and consistent with past practice, of claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries;
(j) neither the Company nor any of its Subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries (other than the Merger and other than in compliance with Section 9.4(aMerger)); and;
(ik) neither the Company nor any of its subsidiaries will authorize Subsidiaries shall take, or agree to commit to take, any action that would or is reasonably likely to result in any of the conditions to the Offer set forth in Annex A or any of the conditions to the Stock Purchase set forth in Article VI not being satisfied, or would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Offer Closing Date, or that would materially impair the ability of the Company to consummate the Offer or the Stock Purchase in accordance with the terms hereof or materially delay such consummation; and
(l) neither the Company nor any of its Subsidiaries shall enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, (i) except as expressly provided in this Agreement, and (ii) during the period prior to the consummation of Offer, except with the prior written consent of Parent, and (iii) during the period following the consummation of the Offer and prior to the Effective Time Time, except with the authorization of the Board of Directors of the Company, including the affirmative vote of a majority of the Continuing Directors, and (unless Purchaser shall otherwise consent in writing iv) following consummation of the Offer and prior to the Effective Time, except as otherwise permitted for prepayments by this Agreement):Parent of indebtedness of the Company and the advancement of funds by Parent to the Company on the terms and condi- tions, and at the interest rate, and for the purposes for which borrowing may be made, under the Company's existing credit facility:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course of business consistent with past practice and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not (i) sell will not, directly or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellindirectly, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Company Common Stock, or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) amend its certificate of incorporation or by-laws or similar organizational documents; (ii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock other than dividends paid by the Company's Subsidiaries to the Company or its Subsid- iaries; (iii) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to exercise of stock-based awards or options outstanding out- standing on the date hereof under as disclosed in Section 3.2 or in Section 5.1(c) of the Stock Plans and shares issuable pursuant to the WarrantsCompany Disclosure Schedule; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iiia) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)practice or (b) pursuant to existing agreements disclosed in Section 5.1(c) of the Company Disclosure Schedule; or (v) redeem, purchase or otherwise acquire directly or indirectly any of its capital stock;
(d) except as disclosed in Section 5.1(d) of the Company Disclosure Schedule, neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) except as otherwise provided in this Agreement and except for normal, regularly scheduled increases for non-officer employees consistent with past practice or pursuant to the terms of existing collective bargaining agreements, grant any increase in the compensation payable or to become payable by the Company or any of its Subsidiaries to any officer or employee (including through any new award made under, or the exercise of any discretion under, any Benefit Plan (ii) adopt any new, or amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan agreement or arrangement; (iii) enter into any, or amend any existing, employment or severance agreement with or, grant any severance or termination pay toto any officer, or enter into any employment or severance agreement with any director, officer employee or other employee consultant of the Company or any such subsidiaryof its Subsidiaries; and neither or (iv) make any additional contributions to any grantor trust created by the Company nor to provide funding for non-tax-qualified employee benefits or compensation; or (v) provide any severance program to any Subsidiary which does not have a severance program as of its subsidiaries shall establish,the date of this Agreement;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts the Company Agreements or waive, release or assign any material rights or claims, except in the ordinary course of business consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness consistent with past practice;
(g) except as may be required as a result set forth in Section 5.1(g) of a change in law or in generally accepted accounting principlesthe Company Disclosure Schedule, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any debt except for borrowings under existing credit facilities in the ordinary course consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in the ordinary course of business consistent with past practice; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned Subsidiaries of the accounting practices Company or principles used by itcustomary loans or advances to employees in accordance with past practice); or (iv) enter into any material commitment (including, but not limited to, any leases, capital expenditure or purchase of assets) other than purchases of inventory in the ordinary course of business consistent with past practice;
(h) neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting principles used by it unless required by GAAP;
(i) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, (x) reflected or reserved against in the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries, (y) incurred in the ordinary course of business consistent with past practice or (z) which are legally required to be paid, discharged or satisfied;
(j) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuringrestruc- turing, recapitalization, recapitalization or other material reorganization of the Company or any of its Subsidiaries or any agreement relating to a Takeover Proposal (as defined in Section 5.6) (other than the Merger and other than in compliance with Section 9.4(aMerger)); and;
(ik) neither the Company nor any of its subsidiaries Subsidiaries will authorize take, or agree to commit to take, any action that would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time;
(l) neither the Company nor any of its Subsidiaries will engage in any transaction with, or enter into any agreement, arrangement, or understanding with, directly or indirectly, any of the Company's affiliates, including, without limitation, any transactions, agreements, arrangements or understandings with any affiliate or other Person covered under Item 404 of Regulation S-K under the Securities Act that would be required to be disclosed under such Item 404, other than 50 pursuant to such agreements, arrangements, or understandings existing on the date of this Agreement (which are set forth on Section 5.1(l) of the Company Disclosure Schedule);
(m) close, shut down, or otherwise eliminate any of the Company's stores other than in the ordinary course of business consistent with past practice;
(n) change the name of or signage at any of the Company's stores;
(o) close, shut down, or otherwise eliminate any of the Company's distribution centers;
(p) move the location, close, shut down or otherwise eliminate the Company's headquarters, or effect a general staff reduction at such headquarters;
(q) change or modify in any material respect the Company's existing advertising program and policies;
(r) except as set forth in Section 5.1(r) of the Company Disclosure Schedule, enter into any new lease (other than renewals of existing leases after consultation with Parent) or purchase or acquire or enter into any agreement to purchase or acquire any real estate;
(s) neither the Company nor any of its Subsidiaries will incur any liabilities or obligations of any nature, whether or not accrued, contingent or otherwise, that have, or would be reasonably likely to have, a material adverse effect on the Company and its Subsidiaries; and
(t) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Rite Aid Corp)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, after the date of this Agreement and prior to the Effective Time (Time, unless Purchaser shall otherwise consent in writing and except as otherwise expressly contemplated or permitted by this Agreement):Agreement (including by Section 5.2 hereof), set forth on Section 5.1 of the Company Disclosure Letter, required by applicable Law, or consented to in writing by Parent, which consent shall not be unreasonably withheld or delayed by Parent:
(a) the Company and its Subsidiaries will conduct business only in the ordinary course of business consistent with past practices, and the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its their commercially reasonable efforts to maintain and preserve its intact their respective business organization intact organizations and maintainto maintain their significant beneficial relationships with suppliers, contractors, distributors, customers, landlords, licensors, licensees and others having a material business relationship with them;
(b) the Company shall will not (i) sell amend its Articles of Incorporation or pledge Regulations and the Company’s Subsidiaries will not amend their articles or agree to sell or pledge any stock certificate of incorporation, regulations, bylaws or other securities owned by it or permit any of its subsidiaries to sellcomparable charter documents, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend in each case as in effect on the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Sharesdate hereof;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries will (i) declare, set aside or pay any dividend or other distribution (including any constructive or deemed distribution), whether payable in cash, stock or other property, with respect to its capital stock, or otherwise make any payments to its shareholders in their capacity as such, (ii) issue, sell, grant, transfer, pledge, dispose of, encumber, reprice or accelerate the vesting of or encumber authorize or propose to issue, sell, grant, transfer, pledge, dispose of, encumber, reprice or accelerate the vesting of any additional shares ofof capital stock, Options, Share Units or securities convertible into other Rights of the Company or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its Subsidiaries (including treasury stock), other than an issuance of capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options the exercise or vesting of Options, Share Units and/or other Rights outstanding on the date hereof under of this Agreement or other than the Stock Plans and shares issuable accelerated vesting or settlement of Options, Share Units or other Rights outstanding on the date of this Agreement pursuant to the Warrants; (ii) transferterms of the applicable Company Share Plan or award agreement, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly split, combine, subdivide or indirectly by redemption reclassify the Shares or otherwise any shares of the other outstanding capital stock of the Company or any of the Subsidiaries of the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any shares of capital stock or other Rights of the Company or any of its subsidiaries Subsidiaries or (iv) authorize redeem, purchase or otherwise acquire, directly or indirectly, any capital expenditures stock or other Rights of the Company or any of its Subsidiaries, other than transactions involving Options, Share Units or other Rights outstanding on the date hereof pursuant to the terms of the applicable Company Share Plan or award agreement;
(d) except to the extent provided for in excess a written contract, a Company Plan or any other agreement, plan, practice or policy (including the current compensation policy for the Company’s directors ) in existence as of $50,000 individually the date of this Agreement or $100,000 by applicable Law, neither the Company nor its Subsidiaries will (i) grant or increase any severance or termination pay to any current or former director, executive officer or any other employee of the Company or its Subsidiaries (it being understood that the hiring of a new employee who is subject to the existing severance and termination policies of the Company shall not constitute the grant or increase of any severance or termination pay), (ii) execute or amend any employment, deferred compensation or other similar agreement (or any amendment to any such existing agreement) with any such director, executive officer or employee of the Company or any of its Subsidiaries, (iii) amend or otherwise increase the benefits payable under any existing severance or termination pay policies or agreements or any other employment or consulting agreements, (iv) increase the compensation, bonus or other benefits of current or former directors or executive officers of the Company or any of its Subsidiaries, or, other than in the aggregate ordinary course of business, of any employee, agent, consultant or make any acquisition Affiliate of (by merger, consolidation or acquisition of stock or assets), the Company or any investment inof its Subsidiaries, assets (v) promote any executive officers or stock of any other person or entity (other than acquisitions of assets employees, except in the ordinary course of business consistent with past practice);
or as the result of the termination or resignation of any executive officer or employee, (dvi) neither the enter into, adopt, establish, amend or terminate any Company nor Plan, (vii) execute or amend any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance collective bargaining agreement with any directorlabor organization, officer or other (viii) take any action that would result in incurring any obligation relating to (A) any material increase in any benefits otherwise payable under any Company Plan, or (B) any payment or benefit becoming due to any employee of the Company or its Subsidiaries under any such subsidiary; and neither Company Plan or otherwise which will be characterized as an “excess parachute payment” within the Company nor any meaning of its subsidiaries shall establish,Section 280G(b)(1) of the Code that is subject to the imposition of an excise Tax under Section 4999 of the Code;
(e) neither terminate the employment of any of the executive officers of the Company nor any of or its subsidiaries shall settle or compromise any material claims or litigation orSubsidiaries, except in (i) upon expiration of or pursuant to the ordinary and usual course terms of business and with the consent an executive officer’s employment agreement (as applicable), (ii) for breach of Purchaseran executive officer’s employment agreement (as applicable), modify(iii) for violation of corporate rules or policies or other serious misconduct, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims(iv) upon a criminal conviction;
(f) neither the Company nor any of its subsidiaries shall make Subsidiaries will (i) incur any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee Indebtedness except with respect to be canceled or terminated without notice to Purchaser, except borrowings under the Revolver that are in the ordinary and usual course of businessbusiness and in amounts consistent with past practice, (ii) amend the Revolver to increase the borrowing capacity available to the Company thereunder, (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any Person other than the Company and/or its Subsidiaries in the ordinary course of business or (iv) make any loans, advances or capital contributions to, or investments in, any other Person, except to or for the benefit of the Company and/or its Subsidiaries in the ordinary course of their respective businesses;
(g) except as may be required as neither the Company nor any of its Subsidiaries will (i) make any acquisition either by purchase of stock or securities, merger or consolidation, property transfers, or purchases of any property or assets of any other Person or division thereof other than a result direct or indirect wholly owned Subsidiary of a change the Company, (ii) enter into any material agreement, agreement in law principle, letter of intent, memorandum of understanding or similar contract or agreement with respect to any joint venture, strategic partnership or alliance, or (iii) otherwise make or authorize any capital or other expense expenditure, other than capital or other expense expenditures substantially and materially consistent with the Company’s 2014 Budget;
(h) other than in generally accepted accounting principlesthe ordinary course of business, neither the Company nor any of its subsidiaries shall change Subsidiaries will enter into or amend or modify, in any material respect, or consent to the termination of the accounting practices (other than at its stated expiry date), any Material Contract or principles used by itlease for any current or prospective Leased Real Property;
(hi) neither the Company nor any of its subsidiaries shall Subsidiaries will (i) other than in the ordinary course of business, pay or discharge any claims, Encumbrances or liabilities involving more than $100,000 individually or $250,000 in the aggregate, (ii) settle, compromise, or otherwise resolve any material Action or other material disputed claim, liability, litigation, arbitration, legal proceeding or controversy involving more than $100,000 individually or $250,000 in the aggregate, and where such settlement, compromise, or resolution does not include any “conduct remedy” or injunctive or other similar relief that may reasonably have a restrictive impact on the Company’s business, or (iii) other than in the ordinary course of business, waive any claims of substantial value;
(j) neither the Company nor any of its Subsidiaries will (i) make or file any changes in its reporting for Taxes or accounting methods, principles or practices unless required by a change in GAAP or Law, (ii) make, change or rescind any Tax election, (iii) make any change to its method of reporting income, deductions, or other Tax items for Tax purposes, (iv) file any amended Tax Return (except as required by applicable Law), (v) settle or compromise any Tax liability, (vi) waive or extend the statute of limitations in respect of Taxes, or (vii) enter into any transaction outside the ordinary course of business if such transaction would give rise to a material Tax liability;
(k) except in accordance with or contemplated by Section 5.2, neither the Company nor any of its Subsidiaries will (i) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, business combination, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than this Agreement), (ii) acquire by merging or consolidating with, or by purchasing a substantial equity interest in or portion of the Merger assets of, or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof or (iii) acquire, transfer, lease, license, sell, mortgage, pledge, dispose of or encumber any material assets, other than, in the case of this clause (iii), acquisitions of inventory and other than sales of inventory, and/or the disposal of obsolete equipment or assets, in compliance each case in the ordinary course of business consistent with Section 9.4(a)); andpast practice;
(il) neither the Company nor any of its subsidiaries Subsidiaries shall enter into any agreement, arrangement or commitment that materially limits or otherwise materially restricts the Company or any of its Subsidiaries, or that would reasonably be expected, after the Effective Time, to materially limit or restrict Parent, the Surviving Corporation or any of their respective Subsidiaries or Affiliates (including any successors thereto) from engaging or competing in any line of business or geographic area;
(m) except in accordance with or contemplated by Section 5.2, the Company will authorize not take any action to exempt any Person (other than Parent, Merger Sub or their respective Subsidiaries or Affiliates) from the Takeover Statutes promulgated under Ohio Law;
(n) except in accordance with or contemplated by Section 5.2, neither the Company nor any of its Subsidiaries shall take any action, individually or in the aggregate, that has or would reasonably be expected to (i) have a Material Adverse Effect on the ability of the parties hereto to consummate the Closing, or (ii) prevent, materially delay or materially impede the consummation of the Merger or the other transactions contemplated by this Agreement;
(o) neither the Company nor any of its Subsidiaries will abandon, encumber, convey title (in whole or in part), or exclusively license or sublicense the Company’s Intellectual Property Rights; and
(p) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing actions precluded by Section 5.1(b) through Section 5.1(o) (inclusive), or take to authorize, recommend, propose or announce an intention to do any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedsuch actions.
Appears in 1 contract
Interim Operations of the Company. (a) The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior except as contemplated by this Agreement or as consented to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) Parent or Purchaser, the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course andOrdinary Course of Business, subject to the extent consistent therewith, each of the Company following additional restrictions and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainrequirements:
(bi) the Company shall not not, directly or indirectly, (iA) sell sell, transfer or pledge or agree to sell sell, transfer or pledge any Company Common Stock or any capital stock or -26- 33 other securities of the Company or capital stock or any other securities beneficially owned by it it, either directly or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiaryindirectly; (iiB) amend the Certificate or cause to be amended its bylaws Articles of Incorporation or amend, modify By-Laws; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iiiC) split, combine or reclassify the outstanding Shares; or Company Common Stock;
(ivii) the Company shall not: (A) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
its capital stock; (c) neither the Company nor any of its subsidiaries shall (iB) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries Company or any other property or assets assets, other than, in the case than shares of the Company, Shares issuable Company Common Stock reserved for issuances pursuant to options the exercise of Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiC) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets right to any trademark, service mark xx trade name owned by it or over which it has any right whatsoever; (D) transfer, lease, license, sell, mortgage, pledge, dispose of, purchase, acquire or encumber any (1) real property or (2) any personal property having an aggregate fair market value of $100,000 in a single transaction or a series of related transactions, other than purchases of inventory and sales of products in the Ordinary Course of Business and permitted capital expenditures; (E) incur or modify any indebtedness or other liability other than in liability, provided, however, that the ordinary and usual course Company may make borrowings under the Company's existing line of businesscredit solely for working capital purposes, provided the aggregate borrowings outstanding under such line do not at any time exceed $2,600,000; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (ivF) authorize or make any capital expenditures in excess of $50,000 individually or and $100,000 in the aggregate aggregate; or make (G) redeem, purchase or otherwise acquire, directly or indirectly, any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)its capital stock;
(diii) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, not modify, amend or terminate any of its material Material Contracts or Benefit Plans or waive, release or assign any material rights or claimsclaims under any Material Contract or settle or compromise any material litigation;
(fiv) neither the Company nor any of its subsidiaries shall make any tax election or not permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to Purchaser, except in the ordinary and usual course of businessParent;
(gv) except as may be the Company shall not: (A) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person; (B) make any loans, advances or capital contributions to, or investments in, or acquisitions of, any other Person; or (C) enter into any commitment with respect to any of the foregoing (including, but not limited to, any borrowing, capital expenditure or purchase, sale or lease of assets);
(vi) the Company shall not change any of the accounting methods used by it unless required as a result of by a change in law or GAAP or take any action, other than reasonable and usual actions in generally accepted the Ordinary Course of Business, with respect to accounting principlespolicies or procedures (including, neither without limitation, procedures with respect to the Company nor any payment of its subsidiaries shall change any accounts payable and collection of the accounting practices or principles used by itaccounts receivable);
(hvii) neither the Company nor any of its subsidiaries shall not adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than the Merger Merger);
(viii) make any election or settle or compromise any material federal, state, local or foreign income tax liability;
(ix) pay, discharge or satisfy any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction, of liabilities reflected or reserved against in the Company's balance sheet dated November 27, 1998 as the same may become due and payable by its terms, or subsequently incurred in the Ordinary Course of Business;
(x) the Company shall not take, or agree to commit to take, any action that would make any representation or warranty of the Company contained herein inaccurate in any material respect at, or as of any time prior to, the Effective Time (except for representations made as of a specific date);
(xi) except as required under Section 2.4, the Company shall not amend or change the period (or permit any acceleration, amendment or change) of exercisability of Options granted under any Option Plan or authorize cash payments in exchange for any Options;
(xii) the Company shall not increase the compensation payable or to become payable to its officers, directors or key employees, except in the Ordinary Course of Business or pursuant to obligations under written agreements existing as of the date hereof;
(xiii) except as required by applicable law, the Company shall not except in the Ordinary Course of Business (i.e. pursuant to the Severance policy or practice of the Company existing on the date hereof as disclosed in Schedule 5.1(a)(xiii) annexed hereto), grant any severance or termination pay to, or enter into or amend any employment or severance agreement with, any director or officer of the Company or establish, adopt, enter into, or accelerate, terminate or amend any Benefit Plan;
(xiv) the Company shall use commercially reasonable efforts to preserve intact the business organizations, goodwill, rights, licenses, permits and franchises of the Company and maintain its existing relationships with customers, suppliers and other than in compliance Persons having business dealings with Section 9.4(a))it; and
(ixv) neither the Company nor any of its subsidiaries will authorize or shall not announce an intention, enter into an any formal or informal agreement or otherwise make a commitment to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Penobscot Shoe Co)
Interim Operations of the Company. The Holdings and the Company covenants covenant and agrees, as to itself and its subsidiaries, agree that, after the date hereof and prior to the Effective Time Stock Purchase Closing, and the Company (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):not Holdings) covenants and agrees that, after the date hereof and prior to the
(a) the business of the Company and its subsidiaries and affiliates shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintaincourse;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other equity securities of its subsidiaries owned by it or permit any of its subsidiaries (except for statutory deposits made (to sell, pledge or agree comply with applicable laws and regulations) after 10-day's prior notice thereof to sell or pledge any stock or other securities owned by such subsidiaryPurchaser); (ii) amend the its Certificate of Incorporation or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoBy-Laws; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its subsidiaries, its other than additional purchases of securities from wholly-owned subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) other than in the ordinary course of business consistent with past practice, acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or Company; (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 other than those set forth in the aggregate Company's capital expenditure budget for 1995 as previously delivered to Purchaser (and then only to the extent consistent with budgeted amounts for the then year to date as set forth in such budget); or (v) acquire or make any acquisition of (material investment, whether by mergerpurchase, consolidation contributions to capital, property transfers or acquisition of stock or assets)otherwise, or any investment in, assets or stock of in any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practiceexcluding wholly-owned subsidiaries);
(d) neither the Company nor any of its subsidiaries shall grant any new severance or termination pay to, or enter into any new employment or severance agreement with or arrangement with, any director, person listed on Schedule 7.6 (except as reasonably required to fill officer or other employee of vacancies) having potential payments by the Company of $20,000 or any such subsidiarymore; and neither the Company nor any of its subsidiaries shall establish,, adopt, enter into, amend or terminate any collective bargaining, bonus, profit sharing, thrift, savings, compensation, stock purchase, stock option, restricted stock, pension, retirement, employee stock ownership, deferred compensation or other plan, agreement, trust, fund, policy or arrangement for the benefit of any directors, officers or employees of the Company or any of its subsidiaries;
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation against the Company or any of its subsidiaries where the amount in controversy exceeds $50,000 for an amount greater than any reserve established therefor on the date hereof or, except in accordance with their terms and for amendments, modifications, and terminations which are commercially reasonable and do not have a material adverse effect on the financial condition, cash flows, properties, businesses or results of operations of the Company and its subsidiaries taken as a whole, modify, amend or terminate any of its Material Contracts or, except in the ordinary and usual course of business and consistent with the consent of Purchaserpast practice, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither Holdings nor the Company nor any of its the Company's subsidiaries shall make any tax election or permit cause any insurance policy naming it the Company or any of the Company's subsidiaries as a beneficiary or a loss payable payee to be canceled or terminated without notice as a result of actions or inactions by Holdings, the Company or any of the Company's subsidiaries prior to Purchaser, except in the ordinary and usual course of businessStock Purchase Closing;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither Holdings nor the Company nor any of its the Company's subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing foregoing; and
(h) the Company shall make all filings, and shall take all actions, necessary for the Company to comply with or take any action that would knowingly cause any satisfy the requirements of the representations or warranties Exchange Act (and the rules and regulations promulgated thereunder) as such requirements apply to each of the Company contained in transactions contemplated by this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedAgreement.
Appears in 1 contract
Samples: Stock Purchase and Merger Agreement (Partners Health Plan of Pennsylvania Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly provided in this Agreement or (ii) with the prior written consent of Parent, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):Time:
(a) the business of the Company and its subsidiaries shall Subsidiaries will be conducted only in the ordinary and usual customary course and, to the extent consistent therewith, with past practice and each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not (i) sell will not, directly or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellindirectly, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Company Common Stock, or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries Subsidiaries shall (i) amend its certificate of incorporation or by-laws or similar organizational documents; (ii) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock; (iii) issue, sell, transfer, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable than issuances pursuant to options the exercise of Company Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof, in accordance with their present terms; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice; or (iiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) neither the Company nor any of its subsidiaries Subsidiaries shall (i) grant any increase in the compensation payable or to become payable (including without limitation salaries, bonuses, shares of the Company Common Stock or Rights to acquire the Company Common Stock or any other security of the Company or any of its Subsidiaries) by the Company or any of its Subsidiaries to any of its officers, directors, employees, agents or consultants (other than increases for non-officer employees in the ordinary course of business consistent with past practice); (ii) adopt or enter into any new plan, policy, agreement or arrangement that would constitute a Company Benefit Plan, or amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing Company Benefit Plan; (iii) enter into any, or amend any existing, employment or severance agreement with or, except in accordance with the existing written policies of the Company previously delivered to Parent, grant any severance or termination pay toto any officer, or enter into any employment or severance agreement with any director, officer employee, agent or other employee consultant of the Company or any such subsidiaryof its Subsidiaries; and neither the Company nor or (iv) make any loans to any of its subsidiaries shall establish,officers, directors, employees, agents or consultants or make any changes in its existing borrowing or lending arrangements for or on behalf of any of such persons, whether contingent on the Merger or otherwise;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts the Company Agreements or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries Subsidiaries shall change license or otherwise transfer, dispose of, permit to lapse or otherwise fail to preserve any of the accounting practices Company's or principles used by itany of its Subsidiaries' Intellectual Property Rights, or dispose of or disclose to any person any trade secret, formula, process or know-how not theretofore a matter of public knowledge, except in the ordinary course of business and consistent with past practice;
(h) neither the Company nor any of its subsidiaries Subsidiaries shall cancel any debts or waive, release or relinquish any contract rights or other rights of substantial value, except settlements of accounts receivable in the ordinary course of business and consistent with past practice;
(i) neither the Company nor any of its Subsidiaries shall: (i) incur or assume any long-term debt except for amounts set forth in the Company's budget previously delivered to Parent and, except in the ordinary course of business consistent with past practice, incur or assume any short-term indebtedness in amounts not consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person, except in the ordinary course of business and consistent with past practice; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned Subsidiaries of the Company or customary advances to employees for travel and business expenses in the ordinary course of business and consistent with past practice; provided, however, the Company shall not make any advance for travel and business expenses in an amount over one thousand dollars ($1,000) without the prior written consent of Parent); (iv) enter into any material commitment or transaction (including, but not limited to, any borrowing, capital expenditure or purchase, sale or lease of assets) other than capital expenditures pursuant to the Company's capital expenditures budget previously delivered to Parent and other capital expenditures that do not exceed thirty-five thousand dollars ($35,000) in the aggregate as of the date hereof; or (v) without the prior written consent of Parent, which shall not be unreasonably withheld, enter into any new obligation to any third party in an amount over thirty-five thousand dollars ($35,000) or enter into any new obligations to any third party or parties in the aggregate amount over two hundred thousand dollars ($200,000); provided, however, that notwithstanding the foregoing Company may, in the ordinary course of business and consistent with past practice, enter into new obligations with third parties for normal recurring services and fees, such as utilities, regulatory filing fees, taxes and similar items, without such consent of Parent;
(j) neither the Company nor any of its Subsidiaries shall (i) change any of the accounting principles used by it unless required by GAAP; or (ii) take or allow to be taken any action which would jeopardize qualification of the Merger as a reorganization within the meaning of Section 368(a) of the Code;
(k) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations (i) in the ordinary course of business and consistent with past practice, or claims, liabilities or obligations reflected or reserved against in, or contemplated by, the consolidated financial statements (or the notes thereto) of the Company and its consolidated Subsidiaries, (ii) incurred in the ordinary course of business and consistent with past practice or (iii) which are legally required to be paid, discharged or satisfied (provided that if such claims, liabilities or obligations referred to in this clause (iii) are legally required to be paid and are also not otherwise payable in accordance with clauses (i) or (ii) above, the Company will notify Parent in writing if such claims, liabilities or obligations exceed, individually or in the aggregate, $35,000 in value, reasonably in advance of their payment);
(l) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries or any agreement relating to an Alternative Transaction (other than the Merger and other than as defined in compliance with Section 9.4(a5.6(a) hereof)); and;
(im) neither the Company nor any of its subsidiaries Subsidiaries will authorize take, or agree to commit to take, any action that would make any representation or warranty of the Company contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time;
(n) neither the Company nor any of its Subsidiaries will voluntarily make or agree to make any changes in Tax accounting methods, waive or consent to the extension of any statute of limitations with respect to Taxes, or consent to any assessment of Taxes, or settle any judicial or administrative proceeding affecting Taxes; and
(o) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as ex pressly contemplated by this Agreement, or (ii) as agreed in writing by Parent, after the date hereof, and prior to the Effective Time time the directors designated by Parent have been elected to, and shall constitute a majority of, the Board of Directors of the Company pursuant to Section 1.3 hereof (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreementthe "Appointment Date"):
(a) the business of the Company and each of its subsidiaries Subsidiaries shall be conducted only in the ordinary ordi nary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable best efforts to preserve its business organization organi zation intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not will not, directly or indirectly, (i) sell sell, transfer or pledge or agree to sell sell, transfer or pledge any Company Common Stock, Pre ferred Stock or capital stock or other securities owned by it or permit of any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities Subsidiaries beneficially owned by such subsidiaryit, either directly or indirectly; or (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding SharesCompany Common Stock or any outstanding capital stock of any of the Subsidiaries of the Company;
(c) except for those actions contemplated in Section 1.2 hereof, neither the Company nor any of its Subsidiaries shall: (i) amend its articles of incorpora tion or by-laws or similar organizational documents; or (ivii) declare, set aside or pay any dividend or other distribu tion payable in cash, stock or property with respect to the Shares;
its capital stock; (c) neither the Company nor any of its subsidiaries shall (iiii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrantswar rants, calls, commitments or rights of any kind to acquireac quire, any shares of its capital stock of any class of the CompanyCompany or xxx xx its Subsidiaries, its subsidiaries or any other property or assets other than, in than shares of Company Common Stock reserved for issuance on the case date hereof upon exercise of the Company, Shares issuable outstanding Rights pursuant to options the Rights Agreement or issuances pursuant to the exer cise of Options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantshereof; (iiiv) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business and consistent with past practice), or incur or modify any material indebted ness or other liability, other than in the ordinary and usual course of business and consistent with past prac tice; or (v) redeem, purchase or otherwise acquire di rectly or indixxxxly more than 5,000 Shares of its capi tal stock;
(d) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) grant any severance increase in the com pensation payable or termination pay toto become payable by the Company or any of its Subsidiaries to any of its executive officers or key employees or (A) adopt any new, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compen sation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employ ee benefit plan agreement or arrangement; or (ii) enter into any employment or severance agreement with or, except in accordance with the existing written policies of the Company, grant any directorseverance or termination pay to any officer, officer director or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Subsidiaries;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts contracts or waive, release or assign any material mate rial rights or claims, except in the ordinary course of business and consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to PurchaserParent, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any long-term debt, or except in the ordinary course of business, incur or assume any short-term indebtedness in amounts not consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (wheth er directly, contingently or otherwise) for the obliga tions of any other person, except in the ordinary course of business and consistent with past practice; (iii) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned Subsidiaries of the accounting practices Company or principles used by itcustomary loans or advances to employees in accordance with past practice); or (iv) except for commitments or transactions not in excess of $500,000, enter into any material commitment or transaction (including, but not limited to, any borrow ing, capital expenditure or purchase, sale or lease of assets);
(h) neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting princi ples used by it unless required by GAAP;
(i) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of any such claims, liabilities or obligations, (x) in the ordinary course of business and consistent with past practice, properly reflected or reserved against in, the consolidated finan cial statements (or the notes thereto) as of and for the fiscax xxxr ended March 31, 1998 of the Company and its consolidated Subsidiaries, (y) incurred since March 31, 1998 in the ordinary course of business and consistent with past practice or (z) which are legally required to be paid, discharged or satisfied (provided that if such claims, liabilities or obligations referred to in this clause (z) are legally required to be paid and are also not otherwise payable in accordance with clauses (x) or (y) above, the Company will notify Parent in writing if such claims, liabilities or obligations exceed, individu ally or in the aggregate, $500,000 in value, reasonably in advance of their payment). Notwithstanding the fore going, the Company shall be entitled to pay on a timely basis all reasonable, documented fees and expenses re lated to this Agreement and the transactions contemplated hereby;
(j) neither the Company nor any of its Subsidiaries will adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuringrestruc turing, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries (other than the Merger and other than in compliance with Section 9.4(aMerg er)); and;
(ik) neither the Company nor any of its subsidiaries Subsidiaries will authorize take, or agree to commit to take, any action that would make any representation or warranty of the Company contained herein inaccurate in any material respect at, or as of any time prior to, the Effective Time; and
(l) neither the Company nor any of its Subsidiaries will enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) Time, the business of the Company and its subsidiaries Subsidiaries shall be conducted diligently, in compliance with all applicable laws and only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable best efforts to preserve its business organization intact intact, to maintain its existing relations with customers, suppliers, employees and maintainbusiness associates and to keep available the services of its present officers, agents and employees (nothing herein implying any obligation on the part of the Company to maintain or retain any particular officer, agent or employee). Without limiting the generality of the foregoing, and except as otherwise expressly provided in this Agreement, prior to the Effective Time or the termination of this Agreement, whichever first occurs, the Company will not, and will not permit its Subsidiaries to, without the prior written consent of Purchaser:
(a) amend its Certificate of Incorporation or bylaws;
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Company Shares; or ;
(ivc) declare, set aside or pay or make any dividend or distribution payable in cash, stock stock, right or property with respect to the SharesCompany Shares or adopted any form of stockholder rights plan;
(c) neither the Company nor any of its subsidiaries shall (id) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in the case of the Company, than Company Shares issuable pursuant to options outstanding on the date hereof under any of the Stock Option Plans and shares issuable pursuant to or upon conversion of any of the Warrants; Convertible Debentures;
(iie) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of (other than the disposal of inventory in the ordinary course of business) or encumber any assets with a value in excess of $100,000 in the aggregate for all such transactions (unless such assets are worn-out or obsolete), or incur or modify any indebtedness liability or other liability obligation other than in the ordinary and usual course of business; business or extend any loan, advance, guaranty or indemnification where the effect of such would be, in the aggregate, material to the Company and the Subsidiaries taken as a whole;
(iiif) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or Company;
(ivg) authorize additional capital expenditures not provided for in Section 8.1 of the Disclosure Schedule in excess of $50,000 individually or $100,000 in the aggregate aggregate, or make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, the assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)Person;
(di) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into or modify any employment employment, sales agency, change of control or severance agreement with with, any directordirector or officer of the Company or any Subsidiary, officer or (ii) grant any severance or termination pay to any other employee of the Company or any Subsidiary other than pursuant to existing plans or policies of the Company or its Subsidiaries set forth in Section 5.11 of the Disclosure Schedule or otherwise consistent with past practice, or (iii) enter into or modify in any respect any change of control agreement with any other such subsidiaryemployee of the Company or any Subsidiary, or (iv) enter into or modify in any material respect any employment or sales agency agreement with any other such employee of the Company or any Subsidiary other than in the ordinary course of business and consistent with past practices; and neither the Company nor shall not establish, adopt, enter into or amend in any material respect any plan or arrangement which is or would constitute an Employee Benefit Plan hereunder for the benefit of its subsidiaries shall establish,any directors, officers or employees or increase in any material manner the compensation or fringe benefits of any director, officer or employee, in any case not required by an existing plan or arrangement, or pay any benefit not required by any existing Employee Benefit Plan;
(ei) neither the Company nor any of its subsidiaries shall settle or compromise any material claims claim or litigation involving amounts in excess of $50,000 other than claims relating directly to returns, credits or allowances settled in the ordinary course of business, or, except in the ordinary and usual course of business and with the consent of Purchaserbusiness, modify, amend or terminate any of its material the Contracts or Leases, or waive, release or assign any material rights or claims;
(fj) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it the Company as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(gk) file any registration statement with the SEC or with any blue sky authority relating to the capital stock or other securities of the Company or file an application for quotation with The National Association of Securities Dealers, Inc. (the "NASD") or listing with any national securities exchange;
(l) engage in any sale/leaseback transactions other than in the ordinary and usual course of business;
(m) except as may be required as a result otherwise contemplated by Section 4.2 of a change in law this Agreement, make any grants of stock options under, or in generally accepted accounting principles, neither extend or accelerate the Company nor vesting schedule of any of its subsidiaries shall change stock options granted pursuant to, any of the accounting practices Stock Option Plans or principles used by itany other Employee Benefit Plan;
(hn) neither except to the Company nor extent permitted by Section 8.2, agree to, directly or indirectly, merge or consolidate with, purchase substantially all of the assets of, have substantially all of the Company's assets purchased or otherwise acquire or be acquired by any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalizationPerson; or
(o) take, or other reorganization of the Company (other than the Merger and other than agree in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize writing or enter into an agreement otherwise to do take, any of the foregoing actions, or take any action that which is reasonably likely to prevent the satisfaction of any condition to closing set forth in Article IX hereof, or which would knowingly cause make any of the representations representation or warranties warranty of the Company contained in this Agreement to be untrue or incorrect or would result in any incorrect, as of the Offer Conditions set forth date when made, such that, individually or in Annex A hereto not being satisfiedthe aggregate, it is reasonably likely that there shall be a Material Adverse Effect.
Appears in 1 contract
Samples: Merger Agreement (American City Business Journals Inc)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) From the business of Execution Date until the Company and its subsidiaries shall be conducted only in the ordinary and usual course andClosing, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) the Company shall not except (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sellas described in the Company Disclosure Letter, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend as required by applicable Law or Company Benefit Plan as in effect on the Certificate or its bylaws or amend, modify or terminate the Rights date of this Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; as otherwise contemplated by this Agreement or (iv) declareas Buyer may approve in writing (such approval not to be unreasonably withheld, set aside conditioned or pay delayed), the Company shall not, and shall cause its Subsidiaries not to:
(i) adopt or propose any dividend payable change in cash, stock its Organizational Documents in a manner that would affect Buyer in an adverse manner either as a holder of Common Stock or property with respect to the Sharesrights of Buyer under this Agreement, the Stockholder Agreement or the Section 203 Agreement;
(cii) neither merge or consolidate the Company nor with any other Person, except for any such transactions among wholly owned Subsidiaries of the Company, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) redeem, repurchase or acquire any Common Stock, other than repurchases of Common Stock from employees, officers or directors of the Company or any of its subsidiaries shall Subsidiaries in the ordinary course of business pursuant to any of the Company’s agreements or plans in effect as of the date hereof in respect of equity awards outstanding as of the date of this Agreement (or granted in accordance with Section 5.1(a)(iv)(z) below) in accordance with their terms and, as applicable, the Company Benefit Plans as in effect on the date of this Agreement;
(iv) (i) issue, deliver or sell, pledgeor authorize the issuance, dispose of delivery or encumber any additional shares sale of, any shares of any (A) shares of capital stock or voting securities of the Company or any of its Subsidiaries except for transactions among the Company and its Subsidiaries, (B) securities of the Company or any of its Subsidiaries convertible into or exchangeable for shares of capital stock or voting securities of the Company or any of its Subsidiaries or (C) options or other rights to acquire from the Company or any of its Subsidiaries, or other obligation of the Company or any of its Subsidiaries to issue, any capital stock, voting securities or securities convertible into or exchangeable for, for capital stock or options, warrants, calls, commitments voting securities of the Company or rights of any kind to acquire, any shares of its capital stock of any class of Subsidiaries (the Companyitems in clauses (A), its subsidiaries or any other property or assets other than(B) and (C) being referred to collectively as “Company Securities”, in the case of the Company, Shares issuable pursuant to options outstanding on or “Subsidiary Securities”, in the date hereof under case of any of the Stock Plans and shares issuable pursuant to the Warrants; (ii) transferCompany’s Subsidiaries), lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in (w) the ordinary and usual course issuance of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of Subsidiary Securities to the Company or any other Subsidiary, (x) the issuance of its subsidiaries Company Securities pursuant to any widely distributed offering (an “Offering”), (y) issuances in respect of equity awards under Company Benefit Plans outstanding as of the date of this Agreement in accordance with their terms or issued pursuant to clause (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assetsz), or any investment in, assets or stock (z) grants of any other person or entity (other than acquisitions of assets equity-based awards under Company Benefit Plans to Service Providers in the ordinary course of business consistent with past practice)or (ii) amend any term of any Company Security;
(dv) neither establish, adopt or amend a Company Benefit Plan so as to accelerate the Company nor any vesting or payment of its subsidiaries shall grant any severance compensation or termination pay to, benefits upon the consummation of the Share Issuance or enter into any employment other Transactions (either alone or severance agreement together with any director, officer or other employee of the Company or any such subsidiaryrelated event); and neither the Company nor any of its subsidiaries shall establish,or
(evi) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement agree to do any of the foregoing foregoing.
(b) Buyer shall not take or permit any of its Affiliates to take any action actions that would knowingly cause any would, individually or in the aggregate, reasonably be likely to prevent, materially delay or materially impede the consummation of the representations or warranties Share Issuance.
(c) In the event that the Company issues shares of Common Stock in an Offering after the Execution Date and prior to the Closing, Buyer shall have the right to deliver a notice to the Company within four Business Days of such issuance in which Buyer irrevocably commits to increase the shares of Common Stock to be issued, sold, purchased and accepted at the Closing to a number not to exceed 19.9% of the shares of Common Stock outstanding as of immediately following the consummation of such Offering; it being understood that each additional share of Common Stock shall be issued to Buyer at the price paid per share by the participants in such Offering and the Purchase Price shall be correspondingly increased. Upon delivery and receipt of such notice, Buyer and the Company contained shall take all actions necessary or advisable to amend the definition of Shares and Purchase Price in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedgive effect to such commitment.
Appears in 1 contract
Samples: Stock Purchase Agreement (Navistar International Corp)
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, --------------------------------- agrees that, prior to the Effective Time except (unless Purchaser shall otherwise consent in writing and except i) as otherwise permitted expressly contemplated by this Agreement):, (ii) as set forth in Section 5.1 of the Company Disclosure Schedule or (iii) as agreed in writing by Purchaser, after the execution and delivery of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time:
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable commercial efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not (i) sell not, directly or pledge indirectly, amend its or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge subsidiaries' certificate of incorporation or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amendsimilar organizational documents;
(c) the Company shall not, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; and it shall not permit its subsidiaries to: (iii) split, combine or reclassify the outstanding Shares; or (ivi)(A) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
Company's capital stock or that of its subsidiaries, or (cB) neither the Company nor redeem, purchase or otherwise acquire directly or indirectly any of the Company's capital stock (or options, warrants, calls, commitments or rights of any kind to acquire any shares of capital stock) or that of its subsidiaries shall subsidiaries; (iii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its subsidiaries, its subsidiaries or any other property or assets other than, in than Shares issued upon the case exercise of the Company, Shares issuable pursuant to options Options outstanding on the date hereof under in accordance with the Stock Option Plans as in effect on the date hereof; or (iii) split, combine or reclassify the outstanding capital stock of the Company or of its subsidiaries;
(d) the Company shall not, and it shall not permit its subsidiaries to, acquire or agree to acquire, or dispose of or agree to dispose of, any material assets, either by purchase, merger, consolidation, sale of shares issuable pursuant to in any of its subsidiaries or otherwise;
(e) the Warrants; (ii) Company shall not, and it shall not permit its subsidiaries to, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company Intellectual Property or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by mergermaterial assets, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions pursuant to grants of assets nonexclusive End-User Licenses in the ordinary course of business consistent with past practice);
(df) neither the Company nor its subsidiaries shall: (i) grant any increase in the compensation payable or to become payable by the Company or any of its subsidiaries to any of its officers, directors or key employees, other than regularly scheduled pay increases of not more than 10% per annum; or (ii)(A) adopt any new, or (B) except as contemplated by Section 2.4, amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan, agreement or arrangement; or (iii) enter into or modify or amend any employment or severance agreement with or, except in accordance with the existing policies of the Company set forth in Section 5.1 of the Company Disclosure Schedule or as required by applicable law, grant any severance or termination pay to any officer, director or employee of the Company or any of its subsidiaries; or (iv) enter into any collective bargaining agreement;
(g) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, materially modify, amend or or, without Parent's prior written consent, which consent shall not be withheld unreasonably, terminate any of its material Contracts contracts or waive, release or assign any material rights or claims;
(fh) neither the Company nor any of its subsidiaries shall make shall: (i) incur or assume any tax election indebtedness in amounts not consistent with past practice; (ii) materially modify any indebtedness or permit other liability; (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserother person, except other than immaterial amounts in the ordinary and usual course of businessbusiness consistent with past practice and other than for any subsidiary; (iv) make any loans, advances or capital contributions to, or investments in, any other person (other than to wholly owned subsidiaries of the Company or customary advances to employees in accordance with past practice); or (v) enter into any material commitment or transaction;
(gi) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting methods, practices or principles policies used by itit unless required by GAAP;
(hj) neither the Company nor shall not, and it shall not permit its subsidiaries to, make or agree to make any new capital expenditures in excess of $100,000 in the aggregate;
(k) the Company shall not, and it shall not permit its subsidiaries to, make any material tax election (unless required by law) or settle or compromise any material income tax liability;
(l) the Company shall not, and it shall not permit its subsidiaries to (i) waive the benefits of, or agree to modify in any material manner, any confidentiality, standstill or similar agreement to which the Company or any of its subsidiaries shall adopt is a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalizationparty, or other reorganization of the Company (ii) pay, discharge or satisfy any actions, suits, proceedings or claims, other than the Merger payment, discharge or satisfaction, in each case in complete satisfaction, and with a complete release, of such matter with respect to all parties to such matter, of actions, suits, proceedings or claims that do not result in or create, individually or in the aggregate, a Material Adverse Effect; provided, however, that if the Company determines to make any such payment, discharge or satisfaction, prior to committing to make any such payment, discharge or satisfaction the Company shall give Parent advance written notice of such determination specifying the amount to be paid and any other terms and conditions thereof, and if Parent, within 15 days of such notice, shall instruct the Company not to make or commit to make such payment, discharge or satisfaction, then the Company shall not make or commit to make such payment, discharge or satisfaction; provided, further, however, that, if Parent provides any such instructions, and the proposed resolution of such matter does not or would not by itself result in a Material Adverse Effect, and is in complete satisfaction, and includes a full release, of such matter, with respect to all parties to such matter, without any payment or other obligation of Parent or Purchaser, for purposes of Section 6.3(d), such matter shall not be considered a threatened, or instituted and continuing, action, suit or proceeding, and for purposes of Sections 6.3(a) and (e) any adverse effect against the Company in any such matter shall not be considered or aggregated in determining whether a Material Adverse Effect has occurred; provided, further, however, that, any such proposed payment, discharge or satisfaction shall be considered or aggregated in determining whether a Material Adverse Effect has occurred;
(m) the Company shall not, and it shall not permit its subsidiaries to, commence a lawsuit other than (i) for the routine collection of bills or (ii) in compliance such cases where the Company in good faith determines that the failure to commence suit would result in a material impairment of a valuable aspect of the Company's business, provided that the Company consults with Section 9.4(a))Parent prior to filing such suit;
(n) the Company shall not, and it shall not permit its subsidiaries to, make any payment or incur any liability or obligation for the purpose of obtaining any consent from any third party to the transactions contemplated hereby, other than any payment, obligation or liability that does not create, individually or in the aggregate, a Material Adverse Effect; and
(io) neither the Company nor any of its subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Oracle Corp /De/)
Interim Operations of the Company. The Company covenants and agreesExcept as set forth in Section 5.1 of the Disclosure Schedule, as required pursuant to itself and its subsidiaries, that, prior to the Effective Time (unless Purchaser shall otherwise consent this Agreement or as agreed in writing by Purchaser (which agreement shall not be unreasonably withheld, conditioned or delayed), from the date hereof until the earlier of (A) the valid termination of this Agreement in accordance with Article VIII hereto and (B) the Closing Date, the Company shall, and shall cause the Company Subsidiaries to, (i) conduct their businesses in the ordinary course and (ii) use commercially reasonable efforts (A) to preserve intact their present business organizations and (B) to maintain satisfactory relations with and keep available the services of officers. Without limiting the generality of the foregoing, except as otherwise permitted set forth in Section 5.1 of the Disclosure Schedule, as required pursuant to this Agreement or as agreed in writing by Purchaser (which agreement shall not be unreasonably withheld, conditioned or delayed), from the date hereof until the earlier of (x) the valid termination of this Agreement):Agreement in accordance with Article VIII hereto and (y) the Closing Date, the Company shall not, nor shall it permit any Company Subsidiary to:
(a) amend the business Company Governing Documents or equivalent documents of any Company Subsidiary or amend the terms of any outstanding security of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the or any Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainSubsidiary;
(b) split, combine, subdivide or reclassify any shares of capital stock of the Company shall not or any Company Subsidiary, other than any such transaction by a Company Subsidiary that remains a Company Subsidiary after consummation of such transaction, in the ordinary course of business;
(i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivc) declare, set aside or pay any dividend or other distribution payable in cash, stock or property (or any combination thereof) with respect to the SharesCompany’s capital stock other than dividends or other distributions payable in cash from the Company Subsidiaries to the Company;
(cd) neither the Company nor redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, any of its subsidiaries shall Equity Interests;
(ie) issue, sell, transfer, pledge, dispose of or encumber any additional shares ofof any class or series of its capital stock, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of any class or series of its capital stock;
(f) acquire (whether pursuant to merger, stock or asset purchase or otherwise) in one transaction or any series of related transactions (i) except in the ordinary course of business, any asset having a fair market value in excess of €50,000 or (ii) any Equity Interests in any Person or any business or division of any class Person or all or substantially all of the Companyassets of any Person (or business or division thereof) material to the Company and the Company Subsidiaries taken as a whole, its subsidiaries or any other property or assets other thanand, in the case of the Companyclauses (i) and (ii), Shares issuable except as permitted pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; Section 5.1(l);
(iig) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any assets or incur or modify any indebtedness or other liability of its material assets, other than (i) sales in the ordinary and usual course of business; , (ii) licenses and other dispositions of Intellectual Property in the ordinary course of business and (iii) acquire directly or indirectly by redemption or otherwise any shares dispositions of equipment and property no longer used in the operation of the capital stock of the Company business;
(h) (i) incur or assume any of its subsidiaries long-term or (iv) authorize capital expenditures short-term indebtedness in excess of $€50,000 individually except short-term indebtedness incurred or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets assumed in the ordinary course of business consistent with past practice; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the indebtedness of any other Person, other than with respect to Company Subsidiaries in the ordinary course of business; or (iii) make any loans, advances or capital contributions to, or investments in, any other Person, other than (A) loans, advance or capital contributions to, or investments in, Company Subsidiaries or (B) loans or advances to customers, in the case of (A) or (B), made in the ordinary course of business consistent with past practice;
(di) neither other than as required by applicable law or the Company nor terms of any of its subsidiaries shall agreement, or Employee Benefit Plan existing on the date hereof, make any change in, or accelerate the vesting of, the compensation or benefits payable or to become payable to, or grant any severance or termination pay to, any of its officers, directors or employees or enter into or amend any employment employment, consulting, severance, retention, change in control, termination pay, collective bargaining or severance other agreement with any directorof the foregoing or any equity based compensation, officer pension, deferred compensation, welfare benefits or other employee benefit plan or arrangement, or make any loans to any of its officers, directors or employees or make any material change in its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to an Employee Benefit Plan or otherwise;
(j) extend an offer of employment to a candidate for an officer position or any position with annual compensation equal to or greater than €65,000 without prior consultation with Purchaser;
(k) other than as required by applicable law or the terms of any agreement, an Employee Benefit Plan or other plan, program, policy or arrangement (whether written or unwritten, formal or informal) existing on the date hereof pay, accelerate or make any accrual or arrangement for payment of any pension, retirement allowance or other employee benefit pursuant to any existing plan, agreement or arrangement to, or adopt any new such plan or amend any existing plan with respect to any officer, director, employee or pay or agree to pay or make any accrual or arrangement for payment to any officers, directors, employees or affiliates of the Company or any such subsidiary; and neither Company Subsidiary of any amount relating to unused vacation days;
(l) other than as required by applicable law or the terms of any agreement, Employee Benefit Plan or other plan, program, policy or arrangement (whether written or unwritten, formal or informal) existing on the date hereof or except as publicly disclosed prior to the date hereof, announce, implement or effect any reduction in labor force, lay-off, early retirement program or other program or effort concerning the termination of employment of employees of the Company nor or any Company Subsidiary other than routine terminations of its subsidiaries shall establish,non-executive employees in full compliance with all applicable laws, contracts, or collective bargaining agreements;
(em) neither enter into any agreements that restrict or prohibit, in any material respect, the ability of the Company nor or any of Company Subsidiary to carry on its subsidiaries shall settle business as currently conducted;
(n) amend or compromise modify in a material and adverse respect or terminate any material claims Company Material Contract or litigation or, except enter into any contract that would be a Company Material Contract other than in the ordinary and usual course of business or as otherwise permitted under this Section 5.1 (other than the repayment and with termination of the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsIntercompany Loan Agreement);
(fo) neither settle, pay or discharge any litigation, investigation, arbitration, other than the payment, discharge or satisfaction, in the ordinary course of business, of such claims, liabilities or obligations (i) disclosed in the Financial Statements that would not require any material payment by the Company nor any or the Company Subsidiaries or (ii) incurred in the ordinary course of its subsidiaries shall make any tax election or business since the date of such Financial Statements;
(p) permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without reasonable prior notice to Purchaser, except in the ordinary and usual course of business;
(gq) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles methods used by itit materially affecting its assets, liabilities or business, except for such changes required by GAAP or Regulation S-X promulgated under the Exchange Act, as concurred in by Seller’s independent registered public accountants;
(hr) neither the Company nor make (other than consistent with past practice) or change any of its subsidiaries shall material Tax election, change an annual accounting period, change any accounting method, file any amended material Tax Returns, enter into any closing agreement with respect to material Taxes or settle or consent to any material Tax Claim;
(s) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company;
(t) take any action which would, directly or indirectly, restrict or impair the ability of Purchaser to vote, or otherwise to exercise the rights and receive the benefits of a stockholder with respect to, securities of the Company (other than the Merger and other than in compliance with Section 9.4(a))acquired or controlled or to be acquired or controlled by Purchaser; and
(iu) neither the Company nor any of its subsidiaries will authorize or enter into an agreement any written agreement, contract, binding commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause authorize in writing any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company Subject to any Requirements of Law, each Shareholder shall procure that, and covenants and agrees, as to itself and its subsidiaries, agrees that, prior to after the Effective Time date hereof and until the Closing Date, except (unless Purchaser shall otherwise consent i) as expressly provided in this Agreement, or (ii) as may be agreed in writing and except as otherwise permitted by this Agreement):Purchaser:
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted generally in the same manner as heretofore conducted and only “en bon père de famille”, in the ordinary course of business, and usual course and, the Company and each of its Subsidiaries shall use their best efforts to preserve the extent consistent therewith, each business organization of the Company and its subsidiaries shall use Subsidiaries intact, keep available the services of the current officers, managers and employees of the Company and its commercially reasonable efforts to preserve Subsidiaries and maintain the existing relations with franchisees, customers, suppliers, creditors, business partners and others having business dealings with the Company or its Subsidiaries, in each case with the objective of preserving the goodwill and ongoing business organization intact of the Company and maintainits Subsidiaries (as currently existing);
(b) neither the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit nor any of its subsidiaries to sell, pledge Subsidiaries shall amend its certificates of incorporation or agree to sell or pledge any stock by-laws or other securities owned by such subsidiary; (ii) amend the Certificate constituent or its bylaws or amendgoverning document, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Sharesextent any such modification is not required by law, by the rules or regulations of any Governmental Authority;
(c) neither the Company nor any of its subsidiaries Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its alter the outstanding capital stock of the Company or its Subsidiaries or declare, set aside, make or pay any class of the Company, its subsidiaries dividend; or any other property purchase or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise redeem any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)Subsidiaries;
(d) neither the Company nor any of its subsidiaries Subsidiaries shall grant any severance issue or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor sell any of its subsidiaries shall establish,capital stock or any options, warrants or other rights to purchase any such shares or any securities convertible into or exchangeable for such shares;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle (i) assume, guarantee, endorse or compromise otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any material claims or litigation orother Person (other than a Subsidiary), except in the ordinary and usual course of business and consistent with past practice; (ii) make any loans, advances or capital contributions to, or investments in, any other Person (other than a Subsidiary), except for customer credits granted in the ordinary course of business consistent with past practice; (iii) enter into any capital expenditure, purchase or any other material commitment or transaction in excess of seventy-five thousand (75,000) euros, or any sale or lease of real estate; (iv) take any of the actions or enter into any of the transactions that are referred to in Section 5.15(a)(ii) and Section 5.15(a)(iii) hereof; (v) write down the value of any inventory or write off as uncollectible, any notes or accounts receivable (other than in connection with the consent of Purchaser, modify, amend or terminate any ordinary course of its material Contracts trading activities and consistent with past practice), or waive, release (vi) dispose of or assign permit to lapse any material rights or claimsto any Intellectual Property except in the ordinary course of business consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make be a party to any tax election acquisition, merger, spin-off, consolidation, purchase of stock or permit interest in any insurance policy naming it as a beneficiary corporation, partnership, association or a loss payable payee to be canceled other business organization or terminated without notice to Purchaser, except in enter into or form any material joint-venture or enter into any agreement contemplating any of the ordinary and usual course of businessforegoing;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries Subsidiaries shall make any change in the compensation payable or to become payable to any of its officers, directors, employees, agents or consultants (other than increases of compensation granted in the accounting ordinary course of business consistent with past practices and other than extraordinary bonuses for special non-recurring services related to the Transaction in an aggregate amount not exceeding five hundred thousand (500,000) euros (before social charges) and otherwise within the scope of the 2005 compensation budget of the Company and the Subsidiaries in an aggregate amount not exceeding two hundred thousand (200,000) euros (before social charges) in each case, that will be paid prior to the Closing), or principles used by itto Persons providing management services, or enter into or amend any employment, severance, consulting, termination or other agreement with, or employee benefit plan for, or make any loan or advance to, any of its officers, directors, employees, Affiliates, agents or consultants or make any change in its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to an employee benefit plan or otherwise;
(h) neither the Company nor any of its subsidiaries Subsidiaries shall adopt a plan (i) pay or make any accrual or arrangement for payment of complete or partial liquidationany pension, dissolution, merger, consolidation, restructuring, recapitalization, retirement allowance or other reorganization employee benefit pursuant to any existing plan, agreement or arrangement to any officer, director or employee or pay or agree to pay or make any accrual or arrangement for payment to any officer, director or employee of any amount relating to unused vacation days, except to the extent such payment or accrual is required under the obligations of the Company or any of its Subsidiaries existing on the Offer Date, or (other than ii) amend any such existing plan, agreement or arrangement in a manner inconsistent with the Merger and other than in compliance with Section 9.4(a)); andforegoing;
(i) neither the Company nor any of the Subsidiaries shall enter into or terminate any contract or transaction involving a commitment by or to the Company or any of its subsidiaries will authorize Subsidiaries of more than seventy-five thousand (75,000) euros in any 12-month period; or enter into an a settlement with respect to the Lieusaint Litigation (except with the prior approval of Purchaser which shall not be unreasonably withheld);
(j) except as otherwise contemplated by this Agreement, including without limitation in connection with the required adoption of IFRS and the termination of the Company’s participation in the current convention d’intégration fiscale, neither the Company nor any of its Subsidiaries shall (i) change any of the accounting methods used by it unless required by GAAP or (ii) make any election relating to Taxes, change any election relating to Taxes already made, adopt any accounting method relating to Taxes, change any accounting method relating to Taxes unless required by GAAP, enter into any closing agreement relating to Taxes, settle any claim or assessment relating to Taxes or consent to any claim or assessment relating to Taxes or any waiver of the statute of limitations for any such claim or assessment; and
(k) neither the Company nor any of its Subsidiaries shall enter into any agreement, contract, commitment or arrangement (whether in writing or otherwise) to do any of the foregoing foregoing, or take any action that would knowingly cause authorize, recommend, propose or announce an intention to do, any of the representations or warranties foregoing; it being understood that the provisions of this Section 5.1 shall not prohibit (i) the sale of the Italian Lands (and Purchaser hereby approves the appointment by the Company contained or the selling Subsidiary of a broker in this Agreement order to be untrue or incorrect or would result in any effect the sale of the Offer Conditions set forth Italian Lands), (ii) the sale of BAG and the execution and delivery of the license and non-compete agreement referred to in Annex A hereto Section 2.2(a)(viii), (iii) completion of the Brand Transfers as contemplated by Section 5.4 hereof, (iv) compliance with the obligation to comply with the put rights on Topline, (v) completion of the Social Plan, (vi) the sale of the Melksham facility, (vii) the increase in salary of Topline’s Directeur Général up to a maximum amount of one hundred and fifty thousand (150,000) euros, (viii) obtaining extension or renewal of any existing, or any new, environmental permits, (ix) entering into agreements with customers, suppliers, distributors in the ordinary course of business consistent with past practice, (x) the acquisition or license of software and other Intellectual Property in the ordinary course of business consistent with past practice; or (xi) the entry into short-term leasing arrangements (e.g., 18 months) to cover warehousing requirements resulting from the termination of warehousing at Lieusaint for an incremental per annum cost not being satisfiedexceeding one hundred thousand (100,000) euros for any twelve-month period and any other action expressly permitted or contemplated by this Agreement.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly contemplated by this agreement, (ii) as set forth in Section 4.1 of the Company Disclosure Schedule, or (iii) as agreed in writing by Parent, after the date hereof, and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by consummation of the Merger or the termination of this Agreement)::
(a) the business of the Company and its subsidiaries Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries Subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainmaintain its existing relations with customers, suppliers, employees, creditors and business partners;
(b) the Company shall not not, directly or indirectly, (i) sell sell, transfer or pledge or agree to sell sell, transfer or pledge any treasury stock of the Company or other securities owned by it or permit any capital stock of any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities Subsidiaries beneficially owned by such subsidiaryit; (ii) amend the Certificate its certificate of incorporation or its bylaws by-laws or amend, modify similar organizational documents; or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Shares or (iv) declare, set aside or pay any dividend payable in cash, outstanding capital stock or property with respect to of any of the SharesSubsidiaries of the Company;
(c) neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to its capital stock (except dividends from a wholly-owned Subsidiary to the Company); (ii) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the CompanyCompany or its Subsidiaries, its subsidiaries or any other property or assets other than, in than (x) the case issuance of the Company, Shares issuable pursuant to options outstanding shares reserved for issuance on the date hereof under for the Stock Plans and purpose reserved or (y) the issuance of shares issuable pursuant to the WarrantsGeneral Physics Corporation Profit Investment Plan in the ordinary course of business consistent with past practice but in no event shall the Company issue in any one month shares with an aggregate value (based on the then current market price of the Shares) of more than $125,000; (iiiii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, or encumber any material assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessbusiness and consistent with past practice, or incur or modify in any respect materially adverse to the Company any material indebtedness or other liability, other than in the ordinary and usual course of business and consistent with past practice; or (iiiiv) redeem, purchase or otherwise acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice)stock;
(d) other than in the ordinary and usual course of business and consistent with past practice, neither the Company nor any of its subsidiaries shall Subsidiaries shall: (i) grant any severance increase in the compensation payable or termination pay toto become payable by the Company or any of its Subsidiaries to any of its executive officers or key employees or materially increase the foregoing for any other employees; or (ii)(A) adopt any new, or (B) amend or otherwise increase, or accelerate the payment or vesting of the amounts payable or to become payable under any existing, bonus, incentive compensation, deferred compensation, severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other employee benefit plan, agreement or arrangement, other than the Company Options as provided in Section 1.9; or (iii) enter into any employment or severance agreement with or, except in accordance with the existing written policies of the Company, grant any directorseverance or termination pay to any officer, officer director or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,Subsidiaries;
(e) neither the Company nor any of its subsidiaries Subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Material Contracts or waive, release or assign any material rights or claims, except in the ordinary course of business and consistent with past practice;
(f) neither the Company nor any of its subsidiaries Subsidiaries shall make any tax election or permit any material insurance policy naming it as a beneficiary or a loss payable payee to be canceled cancelled or terminated without notice to Purchaserterminated, except in the ordinary and usual course of businessbusiness and consistent with past practice;
(g) except as may with Parent's consent, which shall not unreasonably be required as a result of a change in law withheld or in generally accepted accounting principlesdelayed, neither the Company nor any of its subsidiaries shall change Subsidiaries shall: (i) incur or assume any debt other than short term debt incurred or assumed in the ordinary course of business in amounts consistent with past practices; (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person or entity, or make any loan, advance or capital contribution to, or investment in, any other person or entity, other than (1) wholly owned Subsidiaries of the accounting practices Company, (2) pursuant to existing commitments under the Material Contracts listed on Section 2.17 to the Company Disclosure Schedule or principles used by it;under any existing contract that is not a Material Contract, or (3) in the ordinary course of business consistent with past practice and in an aggregate amount not to exceed $450,000 at any time outstanding prior to February 1, 2000 and $250,000 at any time outstanding thereafter; (iii) enter into any commitment or transaction with a client involving more than $1,000,000 (other than pursuant to existing commitments under the Material Contracts listed on such Section 2.17 or under any existing contract that is not a Material Contract); or (iv) make any capital expenditure or purchase or lease of assets, securities or real estate in excess of $250,000 for any one expenditure, purchase or lease or $1,000,000 in the aggregate for all such expenditures, purchases or leases (other than pursuant to existing commitments under the Material Contracts listed on such Section 2.17 or under any existing contract that is not a Material Contract).
(h) neither the Company nor any of its subsidiaries Subsidiaries shall change any of the accounting methods used by it unless required by GAAP;
(i) neither the Company nor any of its Subsidiaries shall pay, discharge or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than in the ordinary course of business and consistent with past practice;
(j) neither the Company nor any of its Subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization of the Company or any of its Subsidiaries (other than the Merger and other than or in compliance accordance with Section 9.4(a4.4)); and;
(ik) neither the Company nor any of its subsidiaries will authorize Subsidiaries shall take, or agree to commit to take, any action that would or is reasonably likely to result in any of the conditions to the Merger set forth in Article V not being satisfied, or would make any representation or warranty of the Company, contained herein inaccurate in any respect at, or as of any time prior to, the Effective Time, or that would materially adversely affect the Company or its Subsidiaries, materially impair the ability of the Company to consummate the Merger in accordance with the terms hereof or materially delay such consummation; and
(l) neither the Company nor any of its Subsidiaries shall enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, agrees as to itself and its subsidiaries, Subsidiaries that, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted expressly contemplated by this Agreement):Agreement or as set forth in SECTION 6.1 of the Company Disclosure Schedule), without the prior written consent of Parent:
(a) the business of the Company its and its subsidiaries Subsidiaries' businesses shall be conducted only in all material respects in the ordinary and usual course and(it being understood and agreed that nothing contained herein shall permit the Company to enter into or engage (through acquisition, product extension or otherwise), in any material respect, in any new line of business);
(b) to the extent consistent therewithwith (a) above, each of the Company it and its subsidiaries Subsidiaries shall use its commercially their reasonable best efforts to preserve its their business organization intact and maintainmaintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(bc) the Company it shall not (i) sell issue, sell, pledge, dispose of or pledge or agree to sell or pledge encumber any capital stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarySubsidiaries; (ii) amend the Certificate its certificate of incorporation or its bylaws by-laws or amend, modify or terminate the Company Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the its outstanding Sharesshares of stock; or (iv) authorize, declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock; (v) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its stock or any securities convertible into or exchangeable or exercisable for any shares of its stock; or (vi) take any action inconsistent with respect to carrying out the SharesMerger as promptly as possible except for those actions expressly permitted by this Agreement (including SECTION 6.4 hereof);
(cd) neither the Company it nor any of its subsidiaries shall Subsidiaries shall: (i) except as permitted under SECTION 6.1(e), issue, sell, pledge, dispose of or encumber any additional (A) shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, acquire any shares of of, its capital stock of any class of the Company, its subsidiaries or (B) securities convertible into or exchangeable for any other property or assets (other than, in the case of the Company, than Shares issuable pursuant to options outstanding on the date hereof under any of the Company Stock Plans and shares issuable pursuant to the WarrantsPlans); (ii) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries) or take any action to incur or modify any material indebtedness or other liability other than in the ordinary and usual course of businessmaterial liability; (iii) acquire directly make or indirectly by redemption authorize or otherwise commit for any shares of capital expenditures other than in amounts less than $1 million in the capital stock of the Company or any of its subsidiaries aggregate; or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, the assets or stock of any other person Person or entity (other than acquisitions of assets in the a Subsidiary) except for ordinary course of business consistent with past practice)investment activities or as otherwise permitted by SECTION 6.1;
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company it nor any of its subsidiaries Subsidiaries shall settle terminate, establish, adopt, enter into, make any new grants or compromise awards under, amend or otherwise modify, any material claims Company Compensation and Benefit Plans or litigation orincrease the salary, wage, bonus or other compensation of any employees except increases for employees of the Company occurring in the ordinary and usual course of business (which shall be limited to (i) regular annual grants of options under the Company Stock Plans, the number of Company Options subject to and the recipient of each such grant to be determined in consultation with Parent; provided that the vesting of such options shall not accelerate as a result of the change in control contemplated by the Merger and provided, further, that the maximum number of Shares issuable pursuant to such options shall be calculated in accordance with past practice and the terms of the Company Stock Plans and shall not exceed 10,000 Shares, (ii) grants and payment of awards under any management incentive plans in accordance with the terms of such plans and (iii) salary increases for those employees who have a rank of vice president or higher in accordance with the Company's normal salary guidelines and annual salary pool which, in the aggregate, do not exceed 5% of their aggregate current salaries, and salary increases for other employees which do not exceed, in the aggregate, 5% of their aggregate current salaries) and except reasonable retention arrangements which are necessary for the operation of the Company entered into with the prior written consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsParent;
(f) neither the Company it nor any of its subsidiaries Subsidiaries shall make pay, discharge, settle or satisfy any tax election claims, liabilities or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, obligations except (i) in the ordinary and usual course of businessbusiness in amounts that are not material or (ii) ordinary course repayment of indebtedness or payment of contractual obligations when due;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company it nor any of its subsidiaries Subsidiaries shall make or change any of the accounting practices Tax election, settle any material audit or principles used by itfile any amended tax returns;
(h) neither the Company it nor any of its subsidiaries Subsidiaries shall adopt a plan of complete enter into any agreement containing any provision or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization covenant limiting in any material respect the ability of the Company or any Subsidiary or affiliate to (i) sell any products or services of or to any other than person, (ii) engage in any line of business or (iii) compete with or to obtain products or services from any person or limiting the Merger and other than in compliance with Section 9.4(a)); andability of any person to provide products or services to the Company or any of its Subsidiaries or Affiliates;
(i) neither the Company it nor any of its subsidiaries Subsidiaries shall take any action that would cause any of its representations and warranties herein to become untrue in any material respect; and
(j) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Gliatech Inc)
Interim Operations of the Company. The Company covenants Following the date hereof and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Closing (unless Purchaser shall otherwise consent agree in writing writing), the Company agrees that, and except as otherwise permitted by this Agreement):
(a) the business each Seller shall use all of his power, authority and discretion in respect of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, each Subsidiary to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainensure that:
(ba) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit in any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiarySubsidiary; (ii) amend the its Certificate of Incorporation or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant theretoBy-Laws; (iii) split, combine or reclassify the outstanding Sharesshares of capital stock of the Company; or (iv) declare, set 32 37 aside or pay any dividend payable in cash, stock or property with respect to the Sharesany class of capital stock;
(cb) neither the Company nor any of its subsidiaries Subsidiary shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its of, capital stock of any class of the Company, its subsidiaries Company or any Subsidiary or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrantsassets; (ii) except in the ordinary course of its business as conducted prior to the date hereof, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber create any Encumbrance with respect to any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of businessliability; (iii) acquire directly or indirectly by redemption repurchase or otherwise any shares of the capital stock of the Company or any of its subsidiaries or Subsidiary; (iv) authorize any capital expenditures in excess of $50,000 in the aggregate; (v) except with respect to a sublease agreement with Doctor Portxx xx the Pembxxxx Xxxes, Florida store proposed to be entered into (if such sublease agreement is on customary terms), enter into any new sublease or management or consulting agreement with any Person, including without limitation any doctor of optometry or professional corporation of a doctor of optometry; (vi) enter into or renew any lease or other commitment to be performed over a period exceeding one year where the present value of payments to be made thereunder exceeds, individually or $100,000 in the aggregate or aggregate, $50,000, (vii) make any acquisition of (by merger, consolidation or acquisition of stock or assets)of, or any investment in, assets or stock of any other person or entity (other than acquisitions of assets Person except in the ordinary course of business consistent business; or (viii) enter into any other transaction with past practice)a third party involving assets or consideration having a value in excess of $50,000;
(dc) neither the Company nor any of its subsidiaries Subsidiary shall (i) other than as contemplated in Section 5.9 hereof, grant any severance or termination pay to, or enter into any employment or severance agreement with with, any director, officer Employee or Director or other employee of Person; (ii) increase the compensation payable by the Company or any such subsidiary; and neither Subsidiary to any member of senior management of the Company nor or, except for normal periodic increases in the ordinary course of business, increase the compensation payable by the Company or any of its subsidiaries shall Subsidiary to any other Employee; or (iii) establish,, amend, adopt, enter into, or make any new (or accelerate or otherwise modify any existing) grants or awards under, any Plan or award any bonus to any Employee or consultant;
(ed) neither the Company nor any of its subsidiaries Subsidiary shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, or modify, amend or terminate any of its material Material Contracts or waive, release or assign any material rights or claims;
(fe) neither the Company nor any of its subsidiaries Subsidiary shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of businessterminated;
(gf) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor shall not write down or charge (without simultaneously reprovisioning) any of its subsidiaries shall change any of the accounting practices or principles used by itreserve;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.
Appears in 1 contract
Samples: Stock Purchase Agreement (Eye Care Centers of America Inc)
Interim Operations of the Company. The Sellers and the Company covenants covenant and agrees, as agree to itself operate the Company and its subsidiaries, that, Subsidiaries in the Ordinary Course of Business between the date hereof and the Closing Date and to comply with the following provisions after the date hereof and prior to the Effective Time Closing Date (unless Purchaser shall otherwise consent in writing and except as otherwise permitted expressly contemplated by this Agreement, as set forth in Sellers’ Disclosure Schedules or with the prior written consent of Buyer):
(a) No change will be made in the business certificate of incorporation or the bylaws of the Company and or its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainSubsidiaries;
(b) No change will be made in the authorized, issued or outstanding capital stock of the Company shall not (i) sell or pledge or agree to sell or pledge any its Subsidiaries, no additional shares of such capital stock will be issued and no subscriptions, Options, Warrants or other securities owned by it convertible securities, commitments or permit any agreements relating to the authorized, issued or outstanding capital stock of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate Company or its bylaws Subsidiaries will be issued, granted, created or amendentered into, modify excluding the cancellation or terminate the Rights repurchase of previously-granted Options and Warrants in accordance with their terms as contemplated in this Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither No dividend or other distribution or payment will be declared, set aside, paid or made in respect of shares of the capital stock or Options or Warrants of the Company or its Subsidiaries, nor will the Company or its Subsidiaries, directly or indirectly, retire, redeem or otherwise acquire capital stock, Warrants or Options of the Company or its Subsidiaries or otherwise distribute any profits of the Company or its Subsidiaries, excluding the cancellation or repurchase of previously-granted Options and Warrants in accordance with their terms as contemplated in this Agreement;
(d) Neither the Company nor its Subsidiaries will merge, amalgamate or consolidate with any Person, or acquire all or substantially all of the business or assets of any other Person, or acquire ownership or control of any capital stock, bonds, or other securities of, or any property interest in, Person or acquire control of the management or policies thereof;
(e) Neither the Company nor any of its subsidiaries shall Subsidiaries will:
(i) issueenter into, sellcreate or assume (or in the case of clause (C) permit to exist) (A) any obligation or obligations for borrowed money or the deferred purchase price of any property (including under leases required to be capitalized under GAAP); (B) any security agreement, mortgage, deed of trust, pledge, conditional sale or other title retention agreement or (C) any Lien upon any of its properties or assets whether now owned or hereafter acquired (other than, with respect to tangible property and assets, in the Ordinary Course of Business as heretofore conducted);
(ii) assume, guarantee, endorse or otherwise become liable with respect to the obligations of any Person, except for endorsements for collection of negotiable instruments;
(iii) make any loan or advance to, or assume, guarantee, endorse or otherwise become liable with respect to the capital stock or dividends of, any Person;
(iv) enter into any transaction with or create or assume any obligation or liability to, any stockholder, warrantholder or optionholder of the Company or any Affiliate, agent or relative of any stockholder, warrantholder or optionholder of the Company;
(v) effect any increase or any other change in wages, salaries, commissions, compensation, bonuses, incentives, pension or other benefits payable, or create, enter into or announce any new agreement, plan, program, policy or arrangement to pay pensions, retirement allowances or other employee benefits to any director or employee, whether past or present;
(vi) cancel or compromise any material debt or claim, or waive any rights of substantial value;
(vii) change any of its banking arrangements or grant any powers of attorney;
(viii) make any Tax election or settle or compromise any Tax liability (other than the Tax Accounting Change or, at the direction of Buyer, the reversal of the California Deferred Expense Election); or
(ix) make any capital expenditures, except those made in the Ordinary Course of Business consistent with past practice which do not exceed one hundred thousand dollars ($100,000) in the aggregate.
(f) Other than in the Ordinary Course of Business as heretofore conducted, neither the Company nor its Subsidiaries will sell, lease, abandon, assign, transfer, license or otherwise dispose of or encumber any additional shares ofproperty, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries including Intellectual Property or any other intangible assets or any machinery, equipment or other operating property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or tangible assets), or any investment in, assets or stock of any other person or entity (other than acquisitions of assets in the ordinary course of business consistent with past practice);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as The Company and its Subsidiaries will use commercially reasonable efforts in a result manner consistent with past practice to preserve the business organization of a change in law or in generally accepted accounting principles, neither the Company nor any of and its subsidiaries shall change any Subsidiaries intact and to keep available the services of the accounting practices or principles used by itpresent employees and agents of the Company and its Subsidiaries and to preserve the good will of customers, suppliers, employees, agents, and others having business relations with the Company and its Subsidiaries;
(h) neither the The Company nor any of and its subsidiaries shall adopt a plan of complete Subsidiaries will use their best efforts to maintain all assets owned, leased or partial liquidationregularly used by it in good operating condition and repair, dissolutionordinary wear and tear excepted, merger, consolidation, restructuring, recapitalization, or and will maintain existing insurance coverage on such assets as well as other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a))existing insurance coverage; and
(i) neither The Company and its Subsidiaries will maintain all books, accounts and records in the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedusual and ordinary manner, on a basis consistent with prior years.
Appears in 1 contract
Interim Operations of the Company. The Except (A) as expressly contemplated by this Agreement, (B) as set forth on Section 5.1 of the Company covenants Disclosure Letter, (C) as required by applicable Law, or (D) as consented to in writing by Parent after the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, which consent solely for clauses (unless Purchaser vii), (viii) and (x) (but with respect to clause (x) only as such clause relates to clauses (vii) and (viii)) shall otherwise consent in writing and except as otherwise permitted by this Agreement):not be unreasonably withheld or delayed, the Company agrees that:
(ai) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its Subsidiaries will conduct business organization intact and maintainonly in the ordinary course of business consistent with past practice;
(bii) the Company shall will not (i) sell amend its Articles of Incorporation or pledge or agree to sell or pledge any stock Bylaws and the Company’s Subsidiaries will not amend their certificate of incorporation, bylaws or other securities owned by it comparable charter or permit organizational documents;
(iii) neither the Company nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries will (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivA) declare, set aside or pay any dividend or other distribution (including any constructive or deemed distribution), whether payable in cash, stock or property other property, with respect to its capital stock, or otherwise make any payments to its shareholders in their capacity as such, other than the Shares;
Company’s ordinary course quarterly dividends to holders of Shares in a per Share amount no greater than the Company’s most recently declared dividend, with record and payment dates in accordance with the Company’s customary dividend schedule; (c) neither the Company nor any of its subsidiaries shall (iB) issue, sell, grant, transfer, pledge, dispose of or encumber or authorize or propose to issue, sell, grant, transfer, pledge, dispose of or encumber any additional shares of, of capital stock or securities convertible into other Rights of the Company or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock Subsidiaries (including treasury stock), other than in respect of any class the shares of the Company’s capital stock reserved for issuance on the date of this Agreement and issued pursuant to the exercise or settlement of awards outstanding under the Company Stock Plans as of the date of this Agreement, its subsidiaries (C) split, combine, subdivide or reclassify the Shares or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of the Subsidiaries of the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any shares of capital stock or other Rights of the Company or any of its subsidiaries Subsidiaries, (D) redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other Rights of the Company or any of its Subsidiaries (other than (1) the acquisition by the Company of Shares in connection with the surrender of Shares by holders of Options in order to pay the exercise price of the Options, (2) the withholding of Shares to satisfy Tax obligations with respect to awards granted pursuant to the Company Stock Plans and (3) the acquisition by the Company of Rights in connection with the forfeiture of awards granted pursuant to the Company Stock Plans) or (E) accelerate the vesting of any Options, except as may be required pursuant to the terms of such Options;
(iv) authorize capital expenditures except as required by applicable Law or under the terms of any Company Plan in excess effect as of $50,000 individually the date of this Agreement, the Company will not and will not permit its Subsidiaries to increase the compensation payable or $100,000 in the aggregate to become payable to any of its officers, directors, employees, agents, consultants or make any acquisition of (by merger, consolidation or acquisition of stock or assets)Affiliates, or enter into, establish, amend or terminate any investment inCompany Plans, assets except increases in salaries, wages and benefits of employees who are neither directors or stock officers of any other person the Company, nor segment or entity (other than acquisitions of assets division presidents, made in the ordinary course of business consistent with past practice);
(dv) neither the Company nor any of its subsidiaries shall grant Subsidiaries will, except in the ordinary course of business consistent with past practice (A) incur or assume any severance Indebtedness, (B) assume, guarantee, endorse or termination pay otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person, or (C) make any loans, advances or capital contributions to, or enter into investments in, any employment or severance agreement with any director, officer or other employee Person;
(vi) other than pursuant to agreements in force at the date of this Agreement as set forth in Section 5.1 of the Company Disclosure Letter, make any acquisition of or investment in a business in excess of $2 billion, individually or in the aggregate, either by purchase of stock or securities, merger or consolidation, contributions to capital, loans, advances, property transfers, or purchases of any such subsidiary; and neither property or assets of any other Person other than a direct or indirect wholly owned Subsidiary of the Company nor any of its subsidiaries shall establish,Company;
(evii) neither the Company nor any of its subsidiaries shall Subsidiaries will pay, discharge, waive or settle any claims involved in any Action, other than the payment, discharge, waiver or compromise any material claims settlement of claims, liabilities or litigation or, except obligations (A) in the ordinary and usual course of business and consistent with past practice, (B) reflected or reserved against in, or contemplated by, the consent Financial Statements (or the notes to the Financial Statements) for amounts not in excess of Purchaser, modify, amend those so reflected or terminate any of its material Contracts reserved or waive, release or assign any material rights or claims(C) in an amount not to exceed $20 million in each instance;
(fviii) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall Subsidiaries will materially change any of the accounting methods, principles or practices or principles used by itit unless required by a change in GAAP or Law;
(hix) neither the Company nor any of its subsidiaries shall Subsidiaries will (A) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, business combination, restructuring, recapitalization, recapitalization or other reorganization of the Company (other than this Agreement), or (B) transfer, lease, license, sell, mortgage, pledge, dispose of or encumber any material assets with a minimum value in excess of $50 million, individually or in the Merger and other than aggregate, except that this clause (B) shall not prohibit sales of inventory in compliance the ordinary course of business consistent with Section 9.4(a))past practice; and
(ix) neither the Company nor any of its subsidiaries Subsidiaries will authorize or enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause to authorize, recommend, propose or announce an intention to do any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Interim Operations of the Company. The Company covenants From and agrees, as to itself and its subsidiaries, that, prior to after the Effective Time Date and until the Closing, (i) the Company shall conduct its business and operations in the ordinary course of business consistent with past practice and (ii) unless Purchaser shall otherwise consent Buyer has previously consented in writing thereto (which consent will not be unreasonably withheld, conditioned or delayed), the Company shall not (and except as otherwise permitted by this Agreementthe Sellers shall not permit the Company to):
(a) the business of the Company and its subsidiaries shall be conducted only in the ordinary and usual course andincur any Indebtedness or assume, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) the Company shall not (i) sell guarantee or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by endorse such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock of the Company or any of its subsidiaries or (iv) authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock obligations of any other person or entity (other than acquisitions of assets Person, except for indebtedness incurred in the ordinary course of business consistent with past practice);
(b) except in the ordinary course of business consistent with past practice, (i) acquire, lease or dispose of, any material property or assets, (ii) mortgage or encumber any property or assets other than Permitted Liens, or (iii) expressly cancel any debts owed to or claims held by the Company;
(c) enter into any Contracts that would constitute a Material Contract, except Contracts made in the ordinary course of business consistent with past practice, or amend or terminate any Material Contract;
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement Contracts with any director, officer or other employee Affiliates of the Company or any such subsidiary; and neither Company, except to the Company nor any of its subsidiaries shall establish,extent required by Legal Requirements;
(e) neither terminate any Key Employee; hire, promote or change the compensation of any employee, manager, or officer of the Company; and, except to the extent required by Legal Requirements, enter into, adopt or amend any Contract relating to the compensation or severance of any employee, manager, or officer of the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except other than in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(gf) make any material change to its accounting (including Tax accounting) methods, principles or practices, except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor by GAAP;
(g) make any of amendment to its subsidiaries shall change any of the accounting practices or principles used by itGoverning Documents;
(h) neither declare or pay any dividends or distributions or repurchase any limited liability company interests or other equity interests;
(i) issue or sell any limited liability company interests or other equity interests or options, warrants, calls, subscriptions or other rights to purchase any limited liability company interests or other equity interests of the Company nor any or split, combine or subdivide the limited liability company interests or other equity interests of its subsidiaries shall the Company;
(j) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other reorganization or acquire any other entity or any division thereof or material portion of the assets thereof;
(k) enter into any compromise or settlement of any Claim relating to the Company or its business or assets (i) in which a party seeks an order, injunction or other equitable relief or relief other than money damages which may adversely impact the operation of the Company after the Closing or (other than ii) that involves the Merger and other than payment of money damages in compliance with Section 9.4(a)); andexcess of $5,000;
(il) neither the Company nor enter into any settlement or compromise of its subsidiaries will authorize any Tax audit or enter into an agreement any Tax closing agreement, or make any Tax election (unless required by applicable Legal Requirements) or file any amended Tax Return; or
(m) agree in writing to do take any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained actions described in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedsub-clauses (a) through (l) above.
Appears in 1 contract
Samples: Limited Liability Company Interest Purchase Agreement (Acorn Energy, Inc.)
Interim Operations of the Company. The Company covenants Except (A) as expressly contemplated by this Agreement, (B) as required by applicable Law, or (C) as consented to in writing by Parent after the date of this Agreement and agrees, as to itself and its subsidiaries, that, prior to the Effective Time Time, which consent, solely in the case of clauses (unless Purchaser v), (vi) and (vii) below, shall otherwise consent in writing and except as otherwise permitted by this Agreement):not be unreasonably withheld or delayed, the Company agrees that:
(ai) the business of the Company and its subsidiaries shall be conducted Subsidiaries will conduct business only in the ordinary and usual course and, to the extent of business consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainwith past practice;
(bii) the Company shall will not (i) sell amend its Articles of Incorporation or pledge or agree to sell or pledge any stock Second Amended and Bylaws and the Company’s Subsidiaries will not amend their certificate of incorporation, bylaws or other securities owned by it comparable charter or permit organizational documents;
(iii) neither the Company nor any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; Subsidiaries will (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (ivA) declare, set aside or pay any dividend or other distribution (including any constructive or deemed distribution), whether payable in cash, stock or property other property, with respect to its capital stock, or otherwise make any payments to its shareholders in their capacity as such, other than the Shares;
Company’s ordinary course quarterly dividends to holders of Shares in a per Share amount no greater than the Company’s most recently declared dividend, with record and payment dates in accordance with the Company’s customary dividend schedule; (c) neither the Company nor any of its subsidiaries shall (iB) issue, sell, grant, transfer, pledge, dispose of or encumber or authorize or propose to issue, sell, grant, transfer, pledge, dispose of or encumber any additional shares of, of capital stock or securities convertible into other Rights of the Company or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock Subsidiaries (including treasury stock), other than in respect of any class the shares of the Company, its subsidiaries or any other property or assets other than, in ’s capital stock reserved for issuance on the case date of the Company, Shares issuable this Agreement and issued pursuant to options the exercise of Options outstanding on the date hereof under of this Agreement, (C) split, combine, subdivide or reclassify the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of Shares or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the outstanding capital stock of the Company or any of its subsidiaries the Subsidiaries of the Company or (iv) issue or authorize capital expenditures in excess of $50,000 individually or $100,000 in the aggregate or make any acquisition of (by merger, consolidation or acquisition of stock or assets), or any investment in, assets or stock issuance of any other person securities in respect of, in lieu of or entity in substitution for any shares of capital stock or other Rights of the Company or any of its Subsidiaries or (D) redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other than acquisitions Rights of assets in the ordinary course Company or any of business consistent with past practice)its Subsidiaries;
(div) neither the Company nor any of its subsidiaries shall grant Subsidiaries will (A) incur or assume any severance or termination pay tolong-term Indebtedness, or enter into except in the ordinary course of business, incur or assume any employment short-term Indebtedness in amounts not consistent with past practice, (B) assume, guarantee, endorse or severance agreement with otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation orPerson, except in the ordinary and usual course of business and consistent with the consent of Purchaser, modify, amend past practice or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(fC) neither the Company nor any of its subsidiaries shall make any tax election loans, advances or permit capital contributions to, or investments in, any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, other Person except in the ordinary and usual course of businessbusiness and consistent with past practice;
(gv) except as may be required as make any acquisition or investment in a result business either by purchase of stock or securities, merger or consolidation, contributions to capital, loans, advances, property transfers, or purchases of any property or assets of any other Person other than a change in law direct or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any indirect wholly owned Subsidiary of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalizationCompany, or other reorganization of the Company (otherwise make or authorize any capital expenditure, other than capital expenditures contemplated by the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfied.Company’s existing capital budget;
Appears in 1 contract
Interim Operations of the Company. The Company covenants and agrees, as to itself and its subsidiaries, agrees that, except (i) as expressly provided in this Agreement, (ii) with the prior written consent of Parent or (iii) as set forth on Section 5.1 of the Disclosure Schedule, after the date hereof and prior to the Effective Time (unless Purchaser shall otherwise consent in writing and except as otherwise permitted by this Agreement):
(a) Control Date, the business of the Company and its subsidiaries shall be conducted only in the ordinary course of business consistent with past practice and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially all reasonable efforts to preserve its business organization intact and maintain
preserve and maintain its rights and franchises and its relationships with its customers, suppliers, employees, independent contractors, creditors, business partners and others with whom it deals; the Company, in conducting its business and operations, shall have due regard for the interests of the holders of the Trust Certificates (bas defined in the Voting Trust Agreement) as investors in the Company; and neither the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit nor any of its subsidiaries to sell, pledge shall:
(i) amend its certificate of incorporation or agree to sell by-laws or pledge any stock or other securities owned by such subsidiarysimilar organizational documents; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend or other distribution payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor any of its subsidiaries shall capital stock other than dividends or distributions by the Company's wholly owned subsidiaries; (iiii) split, combine or reclassify any of its capital stock; or (iii) issue, sell, transfer, pledge, dispose of or encumber encumber, or redeem, purchase or otherwise acquire directly or indirectly, any additional shares of, or securities convertible into or exchangeable or redeemable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Companyof, its subsidiaries or any other property ownership or equity interest (including, without limitation, any phantom interest or stock appreciation rights) in, the Company or its subsidiaries other than pursuant to exercises of Company Stock Options, conversions of the Convertible Subordinated Notes, redemptions of Dividend Access Shares and exercises of Warrants, in each case to the extent disclosed pursuant to Section 3.3;
(c) acquire (by merger, consolidation, acquisition of stock or assets or otherwise) any corporation, partnership or other thanbusiness organization or division thereof, or any substantial portion of any assets thereof, other than acquisitions for total value not in excess of $50 million in the case aggregate;
(i) grant any increase in the compensation payable or to become payable by the Company or any of its subsidiaries to any employee other than increases in the Company, Shares issuable pursuant ordinary course of business consistent as to options outstanding on the date hereof under the Stock Plans timing and shares issuable pursuant to the Warrantsamount with past practice; (ii) transferexcept to the extent currently required under applicable law or the terms of the applicable agreement or arrangement, leaseadopt any new, licenseor amend or otherwise increase, guaranteeor accelerate the payment or vesting of the amounts payable or to become payable under any existing, sellbonus, mortgageincentive compensation, pledgedeferred compensation, dispose of or encumber any assets or incur or modify any indebtedness severance, profit sharing, stock option, stock purchase, insurance, pension, retirement or other liability other than in the ordinary and usual course of businessemployee benefit plan agreement or arrangement; (iii) acquire directly enter into any, or indirectly by redemption amend any existing, employment, consulting or otherwise severance agreement with, or grant any shares of the capital stock severance or termination pay to, any officer, director or employee of the Company or any of its subsidiaries subsidiaries, other than pursuant to existing plans or agreements copies of which have been made available to Parent prior to the date hereof; (iv) authorize capital expenditures in excess of $50,000 individually except with respect to the Company's foreign operations, as required by law or $100,000 in the aggregate or existing arrangements, make any acquisition additional contributions to any grantor trust created by the Company to provide funding for non-tax-qualified employee benefits or compensation; or (v) provide any severance program to any subsidiary which does not have a severance program as of the date of this Agreement;
(by mergere) enter into or materially modify any collective bargaining agreement, consolidation including any successor collective bargaining agreement;
(f) enter into, modify or acquisition of stock or assets), or terminate any investment in, assets or stock of any other person or entity (other than acquisitions of assets material Contract except in the ordinary course of business consistent with past practice);
(dg) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise permit any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaserterminated, except in the ordinary and usual course of businessbusiness consistent with past practice;
(gi) Company or customary loans or advances to employees in accordance with past practice); or (iv) make any capital expenditure in excess of $1 million with respect to any individual or series of related capital expenditures or $15 million in the aggregate for all capital expenditures;
(i) change any of its material accounting principles, except as may be required as a result of a change in law or in by generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(hj) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, recapitalization or other material reorganization of the Company or any of its subsidiaries or any agreement (other than a confidentiality agreement pursuant to Section 5.5) relating to an Acquisition Proposal (as defined in Section 5.5);
(k) engage in any transaction with, or enter into any agreement, arrangement, or understanding with, directly or indirectly, any of the Merger and Company's affiliates, other than in compliance the Company or its wholly owned subsidiaries, including, without limitation, any transactions, agreements, arrangements or understandings with Section 9.4(a)); andany affiliate or other Person covered under Item 404 of Regulation S-K under the Securities Act that would be required to be disclosed under such Item 404;
(l) make any material Tax election;
(i) neither pay, discharge or satisfy any claim, liability or obligation (including contingent claims, liabilities and obligations), other than in the ordinary course of business consistent with past practice; or (ii) settle or compromise any litigation (whether or not commenced prior to the date of this Agreement) other than settlements or compromises of litigation not relating to the transactions contemplated hereby and which could not reasonably be expected to prejudice materially the Company nor or its subsidiaries in any other pending or future litigation, where the amount paid (after giving effect to insurance proceeds actually received) in settlement or compromise does not exceed $1 million, provided that the aggregate amount paid in connection with the settlement or compromise of all such litigation matters shall not exceed $5 million;
(n) take any action which would make any of its subsidiaries will authorize the Company's representations and warranties herein untrue or incorrect in a manner that would, or any other action that would, result in any of the conditions set forth in Annex I not being satisfied; or
(o) enter into an agreement agreement, contract, commitment or arrangement to do any of the foregoing foregoing, or take any action that would knowingly cause authorize, recommend, propose or announce an intention to do, or to agree to do, any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (SCH Holdings Corp)
Interim Operations of the Company. The Company covenants and agreesDuring the period from the date of this Agreement through the Closing or the date, if any, on which this Agreement is earlier terminated pursuant to Section 8.1 (the “Pre-Closing Period”), except (u) as to itself and its subsidiariesmay be required by Law, that(w) with the prior written consent of Parent (which consent shall not be unreasonably conditioned, prior to the Effective Time withheld or delayed), (unless Purchaser shall otherwise consent in writing and except x) as otherwise permitted required or specifically contemplated by this Agreement):
, (ay) the business as set forth in Section 6.1 of the Company Disclosure Schedule or (z) with respect to actions or omissions taken by or at the direction of any Purchaser Party or any Designated Representative, the Company shall ensure that the business and its subsidiaries operations of the Acquired Corporations shall be conducted only in the ordinary course of business and usual course andin accordance with past practices, to and in compliance in all material respects with all applicable Law and the extent consistent therewithrequirements of all Company Material Contracts. Without limiting the generality of the foregoing, each except (u) as may be required by Law, (w) with the prior written consent of Parent (which consent shall not be unreasonably conditioned, withheld or delayed), (x) as required or specifically contemplated by this Agreement, (y) as set forth in Section 6.1 of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintain
(b) the Company shall not (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; Disclosure Schedule or (ivz) declare, set aside or pay any dividend payable in cash, stock or property with respect to actions or omissions taken by or at the Shares;
(c) direction of any Purchaser Party or any Designated Representative, including in such person’s capacity as a director, officer or employee of any of the Acquired Corporations, during the Pre-Closing Period, neither the Company nor any of its subsidiaries shall Subsidiaries will:
(a) issue, deliver, sell, grant, dispose of, pledge or otherwise encumber, or authorize or propose the issuance, sale, grant, disposition, pledge or other encumbrance of (i) issue, sell, pledge, dispose of or encumber any additional shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock ownership interest of the Company or any of its subsidiaries Subsidiaries, or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries, or any rights, warrants, options, calls, commitments or any other agreements of any character to purchase or acquire any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for, any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries (collectively, the “Equity Interests”) except for the issuance of shares of capital stock of the Company upon exercise of any Company Stock Option or vesting of Company RSU, in each case outstanding on the date of this Agreement, or the pledge of Equity Interests of the Company or any of the Company’s Subsidiaries to secure indebtedness or other obligations in connection with or related to the Company’s Credit Agreement or (ivii) any other securities of the Company or any of its Subsidiaries in respect of, in lieu of, or in substitution for, Common Stock outstanding on the date hereof;
(b) redeem, purchase or otherwise acquire, or propose to redeem, purchase or otherwise acquire, any outstanding shares of capital stock or other securities of any Acquired Corporations except for the acceptance of shares of Common Stock as payment for the exercise price of Company Stock Options or for withholding taxes in connection with the exercise or settlement of Company Stock Options or Company RSUs;
(c) split, combine, subdivide or reclassify any Common Stock or declare, accrue, set aside for payment or pay any dividend in respect of any Common Stock or otherwise make any payments to stockholders in their capacity as such;
(d) acquire, sell, lease, license or dispose of any material assets or right other than in the ordinary course of business;
(e) (i) incur, issue or assume any indebtedness or guarantee or otherwise become liable for any indebtedness (including increasing the indebtedness under Contracts in existence as of the date hereof) other than pursuant to the Company Credit Agreement or equipment financing incurred in the ordinary course of business; (ii) make any loans, advances (other than expense advances made to directors or officers or other employees in the ordinary course of business and consistent with past practices) or capital contributions to, or investments in, any other Person, other than to the Company or any wholly owned Subsidiary of the Company; or (iii) sell or transfer, or create, assume or suffer to exist any Lien on, any accounts receivable (other than in the ordinary course of business and consistent with past practices);
(f) except as required pursuant to the terms of any Benefit Plans as in effect as of the date hereof or as otherwise required by Law or in the ordinary course of business, (A) increase the compensation or other benefits payable or to become payable to current or former employees, directors or officers of any of the Acquired Corporations, (B) grant any rights to severance or termination pay or other termination benefit, or enter into or amend any employment or severance agreement with, any current or former employees, directors, or officers of any of the Acquired Corporations, (C) enter into any consulting, bonus, retention, retirement or similar agreement with any employee, officer or director of the Company (including any change to performance targets associated therewith), (D) establish, adopt, enter into or amend any collective bargaining agreement, plan, trust, fund, policy or arrangement for the benefit of any current or former employees, directors or officers or any of their beneficiaries, except, in each case, such action with respect to current or former employees that would not result in an increase to the Company in the cost of maintaining such collective bargaining agreement, plan, trust, fund, policy or arrangement; (E) amend or adopt any material Benefit Plans (other than any such adoption or amendment that is not material to and does not materially increase the cost to the Company of maintaining such material Benefit Plan or is required pursuant to the terms of such material Benefit Plan in effect as of the date of this Agreement) or the Company Equity Plans or (F) accelerate the vesting, exercisability or payment of (or waive any performance conditions with respect to), any compensation or benefit (including any equity-based awards), except as otherwise expressly set forth in this Agreement; or (G) grant any additional Company Stock Options;
(g) enter into or become bound by, terminate or materially amend any Company Material Contract, except for the Company Credit Agreement or other than in the ordinary course of business;
(h) change any of its accounting methods unless required by Law or GAAP;
(i) amend or permit the adoption of any amendment to the Organizational Documents or to the charter or other organizational documents of any of the other Acquired Corporations, or form any Subsidiary;
(i) acquire any equity interest or other interest in any other Entity; or (ii) effect or become a party to any merger, consolidation, plan of arrangement, share exchange, business combination, amalgamation, recapitalization, reclassification of shares, stock split, reverse stock split, issuance of bonus shares, division or subdivision of shares, consolidation of shares or similar transaction;
(k) authorize or make any commitment with respect to any single capital expenditures expenditure that is not budgeted in the Company’s current plan approved by the Board as of the date hereof which is in excess of $50,000 individually 500,000 or $100,000 capital expenditures which are, in the aggregate or aggregate, in excess of $1,000,000 for the Acquired Corporations taken as a whole;
(l) make any acquisition pledge of any of its assets or permit any of its assets to become subject to any Liens, except for Permitted Liens or Liens that do not materially detract from the value of such assets or materially impair the operations of any of the Acquired Corporations;
(by mergerm) except in the ordinary course of business, consolidation make or acquisition change any material Tax election, adopt or change any material method of stock Tax accounting, file any material amended Tax Return, enter into any tax allocation agreement, tax sharing agreement, tax indemnity agreement relating to any material Tax, surrender the right to claim a material Tax refund, settle or assets)compromise any claim, notice, audit report, or any investment in, assets or stock assessment in respect of any other person material Tax, consent to any waiver of the statute of limitations period applicable to any material Tax claim or entity assessment, or request any material Tax ruling;
(n) commence any material Legal Proceeding, except (i) in the ordinary course of business, (ii) Legal Proceedings to enforce the terms of this Agreement or the Support Agreement, or (iii) Legal Proceedings in connection with this Agreement, the Support Agreement and the Contemplated Transactions;
(o) subject to Section 6.12, settle any material Legal Proceeding;
(p) (A) enter into a material new line of business directly or indirectly or (B) except as required by applicable Law, change any material policy established by the executive officers of the Company that generally applies to the operations of the Company;
(q) extend, renew or enter into any Contracts containing non-compete or exclusivity provisions that (A) would restrict or limit the operations of the Company and its Subsidiaries or (B) apply to any current or future affiliates of the Company, the Surviving Corporation or Parent;
(r) other than acquisitions of assets in the ordinary course of business consistent with past practice), materially reduce the amount of insurance coverage or fail to renew any material existing insurance policies;
(ds) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise amend in a manner that adversely impacts in any material claims respect the ability to conduct its business, terminate or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign allow to lapse any material rights or claimspermits;
(ft) neither the Company nor any of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except in the ordinary and usual course of business;
(g) except as may be required as a result of a change in law or in generally accepted accounting principles, neither the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by it;
(h) neither the Company nor any of its subsidiaries shall adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization, or other reorganization of the Company merger (other than the Merger and Merger), consolidation or other reorganization (other than in compliance with Section 9.4(a)); and
(i) neither reorganizations involving only wholly owned subsidiaries of the Company nor which would not result in a material increase in the Tax liability of the Company or any of its subsidiaries will authorize or subsidiaries); or
(u) enter into an agreement any Contract to do any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedforegoing.
Appears in 1 contract
Samples: Merger Agreement (Alliance HealthCare Services, Inc)
Interim Operations of the Company. The Prior to the Closing or the earlier termination of this Agreement in accordance with its terms, the Company covenants and agrees, each Subsidiary shall operate in the Ordinary Course of Business. Except as to itself set forth on Schedule 4.1 or as expressly permitted or required by the Transaction Documents and its subsidiaries, thatwithout limiting the foregoing, prior to the Effective Time (Closing or the earlier termination of this Agreement in accordance with its terms, unless Purchaser shall otherwise consent Investor has previously consented in writing thereto (which consent will not be unreasonably withheld, conditioned or delayed), the Company shall not (and except as otherwise permitted by this Agreementshall cause its Subsidiaries not to):
(a) amend, modify, supplement or waive any provisions of the business Pioneer Merger Agreement or fail to comply with any obligation of the Company and its subsidiaries shall be conducted only or the Merger Sub (as defined in the ordinary and usual course and, to the extent consistent therewith, each of the Company and its subsidiaries shall use its commercially reasonable efforts to preserve its business organization intact and maintainPioneer Merger Agreement) therein;
(b) enter into any Contract or make any commitment that would conflict or interfere in any material respect with the Company shall not Company’s obligations under the Transaction Documents;
(c) amend its certificate of incorporation or bylaws or similar organizational documents;
(d) (i) sell or pledge or agree to sell or pledge any stock or other securities owned by it or permit any of its subsidiaries to sell, pledge or agree to sell or pledge any stock or other securities owned by such subsidiary; (ii) amend the Certificate or its bylaws or amend, modify or terminate the Rights Agreement, or redeem the Rights issued pursuant thereto; (iii) split, combine or reclassify the outstanding Shares; or (iv) declare, set aside or pay any dividend payable dividends on, or make any other distributions (whether in cash, securities or other property) in respect of, any of its capital stock (other than dividends and distributions by a direct or indirect wholly-owned Subsidiary of the Company to its parent); (ii) adjust, split, combine or reclassify any of its capital stock or property with issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock or any of its other securities; or (iii) purchase, redeem or otherwise acquire any shares of its capital stock or any other of its securities or any rights, warrants or options to acquire any such shares or other securities, other than repurchases of Common Stock pursuant to existing compensation, benefits, option, restricted share or employment agreements or plans existing on the Sharesdate of this Agreement and disclosed in the Disclosure Schedules hereto;
(c) neither the Company nor any of its subsidiaries shall (ie) issue, sell, pledgegrant, pledge or otherwise dispose of or encumber any additional shares ofof its capital stock, any other voting securities or any securities convertible into or exchangeable for, or optionsany rights, warrants, calls, commitments warrants or rights of any kind options to acquire, any shares such capital stock, voting securities or convertible or exchangeable securities, other than any issuance of its capital stock (A) Common Stock upon exercise of any class of the Company, its subsidiaries or any other property or assets other than, in the case of the Company, Shares issuable pursuant to stock options outstanding on the date hereof under the Stock Plans and shares issuable pursuant to the Warrants; of this Agreement, or (iiB) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any assets or incur or modify any indebtedness or other liability other than in the ordinary and usual course of business; (iii) acquire directly or indirectly by redemption or otherwise any shares of the capital stock or compensatory stock options to employees or directors of the Company or any of its subsidiaries Subsidiaries in the Ordinary Course of Business;
(f) sell, lease, mortgage, pledge, xxxxx x Xxxx on, or otherwise dispose of any of its properties or assets, except in the Ordinary Course of Business;
(i) file, or consent by answer or otherwise to the filing against the Company or any of its Subsidiaries of, a petition for relief or reorganization or arrangement or any other petition in bankruptcy, insolvency, reorganization, moratorium or other similar Law of any jurisdiction, (ii) make an assignment for the benefit of the creditors of the Company or any of its Subsidiaries, (iii) consent to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to the Company or any of its Subsidiaries or with respect to any substantial part of its or their property, or (iv) authorize capital expenditures take any corporate action for the purpose of any of the foregoing;
(h) dissolve, liquidate or wind up;
(i) acquire any interest in excess any Person or enterprise, whether by a purchase of $50,000 individually or $100,000 in the aggregate or make any acquisition assets, purchase of (by stock, merger, consolidation loan or acquisition of stock or assets), or any investment in, assets or stock of any other person or entity otherwise (other than acquisitions of assets in pursuant to the ordinary course of business consistent with past practicePioneer Merger Agreement at the Closing);
(d) neither the Company nor any of its subsidiaries shall grant any severance or termination pay to, or enter into any employment joint venture or severance agreement with any director, officer or other employee of the Company or any such subsidiary; and neither the Company nor any of its subsidiaries shall establish,
(e) neither the Company nor any of its subsidiaries shall settle or compromise any material claims or litigation or, except in the ordinary and usual course of business and with the consent of Purchaser, modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimssimilar agreement;
(fj) neither enter into any line of business other than the lines of business in which the Company nor any and/or its Subsidiaries are currently engaged and other activities or lines of its subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or a loss payable payee to be canceled or terminated without notice to Purchaser, except business reasonably related thereto in the ordinary and usual course of businesseach case;
(gk) except as may be required as a result create, incur, guarantee, assume, or issue any Indebtedness (other than in the Ordinary Course of a change in law Business or in generally accepted accounting principles, neither connection with the Company nor any of its subsidiaries shall change any of the accounting practices or principles used by itFinancing Commitments);
(hl) neither voluntarily delist from any trading market;
(m) implement any employee layoffs that could implicate the Company nor any WARN Act;
(n) except to provide for the appointment of its subsidiaries shall adopt a plan the Preferred Directors (as defined in the Series A Certificate of complete or partial liquidationDesignation), dissolution, merger, consolidation, restructuring, recapitalizationincrease the size of the Board; or
(o) authorize, or other reorganization of the Company (other than the Merger and other than in compliance with Section 9.4(a)); and
(i) neither the Company nor any of its subsidiaries will authorize or enter into an agreement commit to do agree to take, any of the foregoing or take any action that would knowingly cause any of the representations or warranties of the Company contained in this Agreement to be untrue or incorrect or would result in any of the Offer Conditions set forth in Annex A hereto not being satisfiedactions.
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