Interim Period Operations. (a) During the Interim Period, except as set forth in Section 6.01(a) of the Disclosure Schedule, for Emergency Operations, as required by Law or as consented to in advance in writing by the Purchaser, the Seller shall cause each member of the Company Group to (i) conduct the Business in the ordinary course of business, consistent with past practice, (B) and (ii) use its commercially reasonable efforts to (A) preserve intact in all material respects the present business organizations and goodwill of the Business and the present relationships of the Business with material customers, suppliers, vendors and other Persons having business relationships with the Business, (C) comply in all material respects with all applicable Laws and maintain in full force and effect all Permits of the Business and (D) make capital and maintenance expenditures in the ordinary course of business consistent with the capital expenditure budget set forth on Section 1.01(h) of the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFE. (b) Other than (w) as set forth on Section 6.01(b) of the Disclosure Schedule, (x) as required by applicable Law, (y) as expressly permitted or required by this Agreement, or (z) with the prior written consent of the Purchaser (such consent not to be unreasonably withheld, conditioned or delayed with respect to the matters described in Section 6.01(b)(iv), (xiv), and (xx)), the Seller shall not cause or permit any member of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo to: (i) amend or propose to adopt any amendment to the Organizational Documents of any member of the Company Group; (ii) effect any recapitalization, reclassification, equity interest split, combination or similar change in the capitalization of any Company Group member; (iii) acquire or agree to acquire in any manner (whether by merger or consolidation, the purchase of an Equity Interest in or a material portion of the assets (including any material portion of the real property assets) of or otherwise) any business or any corporation, partnership, association or other business organization or division thereof or any other Person, other than in connection with the acquisition of assets in the ordinary course of business; (iv) make any capital expenditures other than as set forth in the Capital Expenditure Budget, the Target AFE or in connection with Emergency Operations; (v) form any non-wholly owned Subsidiaries; (vi) make any material change to any of the Company Group member’s accounting practices, except as may be required by GAAP or other accounting principles or regulatory policy, or the interpretation or enforcement thereof; (vii) (A) fail, directly or indirectly, to continue in full force and effect the insurance coverage under the Insurance Policies applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination of any such policies); (viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time; (ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues; (x) sell, assign, transfer, lease, abandon or dispose of any (A) Company Group member’s assets (including Intellectual Property) that are material to the Business, taken as a whole, or (B) material Real Property (or any interests therein); (xi) mortgage, pledge or subject to a Lien (other than a Permitted Lien) any Company Group member’s assets (including Intellectual Property); (xii) issue, transfer, sell, pledge, deliver, purchase, dispose, redeem or grant any Equity Interests of any Company Group member; (xiii) initiate, compromise or settle any claim or Action in which such Company Group member is a named party, and the amount at issue in such claim or Action is in excess of $100,000, or waive or release any material rights or claims held by the Company Group; (xiv) enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023), or terminate (subject to Sections 6.14 and 6.15), waive the performance of any obligation under or amend, modify or supplement any Material Contract, Lease or Easement, except renewals of Easements in the ordinary course of business; (xv) except as required by the Credit Agreement or this Agreement, unwind or otherwise modify existing xxxxxx or other Derivative Transactions or enter into any new xxxxxx or other Derivative Transactions; (xvi) declare, set aside, make or pay any distribution with respect to any of the Company Group Interests, other than cash distributions that are either Permitted Leakage or are included in the Leakage Amount; (xvii) cancel any Indebtedness owed to the Company Group or waive any claims or rights of value; (xviii) enter into any agreement that restricts in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of business; (xix) (A) create, incur, guarantee or assume any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts under any Company Benefit Plan (as in effect on the Signing Date or as amended as permitted by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advances, or capital contributions to, or investments in, any Person other than a member of the Company Group; (xx) other than as required by the terms of a Company Benefit Plan, (A) increase the compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees or to any current or former officers, directors, or independent contractors of any member of the Company Group, other than with respect to amounts that constitute Transaction Expenses, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement that would be a Company Benefit Plan if in effect on the Signing Date), excluding such establishment or amendments made in connection with open enrollment periods; (C) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period not in excess of thirty (30) days or without penalty; (xxi) enter into any Contract described in Section 6.01(b)(xxi) of the Disclosure Schedule; or (xxii) authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(b). (c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c). (d) Nothing in this Agreement shall be construed to (i) limit the Seller’s or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Kinetik Holdings Inc.)
Interim Period Operations. (a) During Except as required or expressly permitted hereby, or as consented to by Buyer (which consent shall not be unreasonably withheld, conditioned or delayed), or as otherwise set forth in Schedule 6.01, during the Interim Period, except as set forth in Section 6.01(a) of the Disclosure Schedule, for Emergency Operations, as required by Law or as consented to in advance in writing by the Purchaser, the Seller shall will cause each member of the Company Group to (i) conduct the Business in the ordinary course of business, consistent with past practice, (B) and (ii) use its commercially reasonable efforts to (A) preserve intact in all material respects the present business organizations and goodwill of the Business and the present relationships of the Business with material customers, suppliers, vendors and other Persons having business relationships with the Business, (C) comply in all material respects with all applicable Laws and maintain in full force and effect all Permits of the Business and (D) make capital and maintenance expenditures operate in the ordinary course of business consistent with past practice and in material compliance with all applicable Laws. Without limiting the capital expenditure budget set forth on Section 1.01(h) of the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFE.
(b) Other than (w) foregoing, except as set forth on Section 6.01(b) of the Disclosure Schedule, (x) as otherwise required or permitted hereby or required by applicable Law, (y) as expressly permitted or required by this Agreement, or (z) with Seller will cause the prior written Company not to undertake any of the following during the Interim Period without the consent of the Purchaser Buyer (such which consent shall not to be unreasonably withheld, conditioned or delayed with respect to the matters described in Section 6.01(b)(iv), (xiv), and (xx)), the Seller shall not cause or permit any member of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo to:delayed):
(i) amend or propose to adopt any amendment to the Organizational Documents of any member of the Company Groupchange in its Charter Documents;
(ii) effect fail to maintain its limited liability company existence, or consolidate with any recapitalizationother Person or acquire (by merger, reclassificationconsolidation, equity interest split, combination acquisition of stock or similar change in Assets or otherwise) the capitalization Assets of any Company Group memberother Person;
(iii) acquire sell, transfer or agree to acquire in otherwise dispose of any manner (whether by merger or consolidation, the purchase of an Equity Interest in or a material portion Assets of the assets (including any material portion of the real property assets) of or otherwise) any business or any corporation, partnership, association or other business organization or division thereof or any other PersonCompany, other than in connection with the acquisition dispositions of assets in the ordinary course of businessobsolete, immaterial or worthless Assets;
(iv) make split, combine or reclassify any capital expenditures other than as set forth Equity Interests in the Capital Expenditure Budget, the Target AFE or in connection with Emergency OperationsCompany;
(v) form transfer, issue, sell or otherwise dispose, or repurchase, redeem or otherwise acquire, any non-wholly owned SubsidiariesEquity Interests in the Company;
(vi) make liquidate, dissolve, recapitalize, reorganize or otherwise wind up all or any material change to any portion of the Company Group member’s accounting practices, except as may be required by GAAP or other accounting principles or regulatory policy, or the interpretation or enforcement thereofBusiness;
(vii) (A) fail, directly purchase any securities or indirectly, to continue in full force and effect the insurance coverage under the Insurance Policies applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination assets of any such policies)Person;
(viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim Contract that would be a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective TimeMaterial Contract;
(ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues;
(x) sell, assign, transfer, lease, abandon or dispose of any (A) Company Group member’s assets (including Intellectual Property) that are material to the Business, taken as a whole, or (B) material Real Property (or any interests therein);
(xi) mortgage, pledge or subject to a Lien (other than a Permitted Lien) any Company Group member’s assets (including Intellectual Property);
(xii) issue, transfer, sell, pledge, deliver, purchase, dispose, redeem or grant any Equity Interests of any Company Group member;
(xiii) initiate, compromise or settle any claim or Action in which such Company Group member is a named party, and the amount at issue in such claim or Action is in excess of $100,000, or waive or release any material rights or claims held by the Company Group;
(xiv) enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023), or terminate (subject to Sections 6.14 and 6.15), waive the performance of any obligation under or amend, modify or supplement any Material Contract, Lease or Easement, except renewals of Easements in the ordinary course of business;
(xv) except as required by the Credit Agreement or this Agreement, unwind or otherwise modify existing xxxxxx or other Derivative Transactions or enter into any new xxxxxx or other Derivative Transactions;
(xvi) declare, set aside, make or pay any distribution with respect to any of the Company Group Interests, other than cash distributions that are either Permitted Leakage or are included in the Leakage Amount;
(xvii) cancel any Indebtedness owed to the Company Group or waive any claims or rights of value;
(xviii) enter into any agreement that restricts in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of business;
(xix) (A) create, incur, guarantee or assume any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts under any Company Benefit Plan (as in effect on the Signing Date or as amended as permitted by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advances, advances or capital contributions to, or investments in, any Person other than a member Person;
(x) incur (or enter into any agreement for the incurrence of) any Indebtedness;
(xi) cancel or compromise any debt or claim or waive or release any material right of the Company Groupthat could be reasonably expected (due to the nature of the claims involved or the scope of their applicability to the Business or the Company’s operations) to involve amounts of $75,000 or more in value;
(xxxii) other than settle or compromise any action, suit, investigation or proceeding against the Company that could be reasonably expected (due to the nature of the claims involved or the scope of their applicability to the Business or the Company’s operations) to involve amounts of $125,000 or more in value, except for any cases in which the amount paid in settlement does not exceed the amount reserved against such matter in the Financial Statements (or the notes thereto);
(xiii) except as may be required by to meet the terms requirements of GAAP, change any accounting method or practice in a Company Benefit Planmanner that is inconsistent with past practice;
(xiv) make any settlement of or compromise any Tax Claim, (A) increase the compensationchange any Tax election or Tax method of accounting, incentives make any new Tax election, adopt any new Tax method of accounting, file any amended Tax Return or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, consent to any Available Employees extension or waiver of the limitation period applicable to any current claim or former officers, directors, or independent contractors of any member of the Company Group, other than assessment with respect to amounts that constitute Transaction ExpensesTaxes; in each case, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement a way that would be a materially and adversely affect the Company Benefit Plan if after the Closing;
(xv) fail to maintain insurance coverage substantially equivalent to its existing insurance coverage of the Company’s Assets as in effect on the Signing Date), excluding Effective Date unless such establishment or amendments made in connection with open enrollment periods; (C) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period insurance coverage is not in excess of thirty (30) days or without penaltyavailable on commercially reasonable terms;
(xxixvi) enter into fail to comply in all material respects with applicable Laws;
(xvii) make any Contract described in Section 6.01(b)(xxicommitment for any capital expenditure greater than $100,000 to be made following the date hereof other than as set forth on Schedule 6.01(a);
(xviii) declare or pay any non-cash dividend or distribution to Seller or any of the Disclosure Scheduleits Affiliates; or
(xxiixix) authorize, resolve, agree or commit to takedo any of the foregoing.
(b) Notwithstanding the foregoing, or the Company may take commercially reasonable actions with respect to emergency situations; provided that Seller shall cause the Company to be taken, or delegate to promptly inform Buyer of any other Person, any action described in this Section 6.01(b)such actions taken outside the ordinary course of business.
(c) Other than (xSchedule 6.01(c) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent sets forth all of the accounts payable and/or accounts receivable between the Company, on the one hand, and a Non-Company Affiliate, on the other hand, as of the Effective Date (collectively, the “Affiliate Payables”). Notwithstanding anything in this Agreement to the contrary, at or prior to Closing, Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to and not the Organizational Documents of Purchaser (in a manner that would require Company, will pay all Transaction Expenses and Seller may cause the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause Affiliate Payables to be taken, or delegate to any other Person, any action described paid in this Section 6.01(c)full.
(d) Nothing Notwithstanding the foregoing in this Agreement shall be construed to Section 6.01 and except as otherwise provided in Section 9.01, (i) limit the Seller’s or the Company Group’s discretion may pay cash dividends, and/or make cash distributions to operate Seller, the Business Seller Members or their Affiliates and (ii) to the extent any cash remains in the ordinary courseCompany as of immediately prior to the Closing, consistent with pre-Signing Date business practicesthe Company may cause any or all of such cash to be distributed to Seller, operations the Seller Members or their Affiliates, in each case of the foregoing clauses (i) and activities(ii) without any reduction in or set off to the Purchase Price. Furthermore, to the extent cash (other than any cash received by the Company as insurance proceeds pursuant to Section 9.01(f)) remains in the Company as of the Closing and has not been distributed to Seller, the Seller Members or their Affiliates prior to the Closing, then Buyer shall cause the Company promptly to distribute such all cash to Seller immediately after Closing without any reduction in or set off to the Purchase Price.
(e) Notwithstanding the foregoing in this Section 6.01, Seller shall cause the Company to make the capital expenditures during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closingset forth on Schedule 6.01(e).
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (USD Partners LP)
Interim Period Operations. (a) During the Interim Period, except as set forth in Section 6.01(aExcept (i) of the Disclosure Schedule, for Emergency Operations, as required by Law or as consented to in advance in writing by the Purchaser, the Seller shall cause each member Requirements of the Company Group to (i) conduct the Business in the ordinary course of business, consistent with past practiceLaw, (B) and (ii) use its commercially reasonable efforts to (A) preserve intact in all material respects the present business organizations and goodwill of the Business and the present relationships of the Business with material customers, suppliers, vendors and other Persons having business relationships with the Business, (C) comply in all material respects with all applicable Laws and maintain in full force and effect all Permits of the Business and (D) make capital and maintenance expenditures in the ordinary course of business consistent with the capital expenditure budget set forth on Section 1.01(h) of the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFE.
(b) Other than (w) as set forth on Section 6.01(b) of the Disclosure ScheduleSchedule 5.4, (xiii) as required otherwise contemplated by applicable Law, (y) as expressly permitted or required by necessary to effectuate this AgreementAgreement and the transactions contemplated hereby, or (ziv) with the prior written consent approval of the Purchaser Buyer (such consent which approval shall not to be unreasonably withheld, conditioned or delayed with respect delayed), during the Interim Period Sellers shall cause the Company to operate and carry on its business only in the ordinary course and substantially as operated prior to the matters described in Section 6.01(b)(iv)date of this Agreement and use its reasonable efforts to preserve the goodwill of the suppliers, (xiv)contractors, licensors, employees, customers, distributors and others having business relations with the Company. Without limiting the generality of the foregoing, Sellers shall not, and (xx)), the Seller shall not cause or permit any member of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo to:
(i) amend make any material change in the nature of its business or propose to adopt any amendment to the Organizational Documents of any member of the Company Groupoperations;
(ii) effect make any recapitalization, reclassification, equity interest split, combination capital expenditures or similar change enter into any contract or commitment for capital expenditures in excess of $25,000 in the capitalization of any Company Group memberaggregate;
(iii) acquire or agree to acquire in enter into any manner (whether by merger or consolidation, contract for the purchase or lease of an Equity Interest in real property;
(iv) initiate or a material portion of the assets (including settle any material portion of the real property assets) of or otherwise) any business or any corporation, partnership, association or other business organization or division thereof or any other Person, Action other than in connection with the acquisition of assets in the ordinary course of business;
(ivv) make sell, lease (as lessor), transfer or otherwise dispose of, or mortgage or pledge, or impose or suffer to be imposed any capital expenditures Encumbrance on, any of its assets, other than as set forth (x) the sale of Mortgage Loans and Servicing Rights in the Capital Expenditure Budgetordinary course of business, the Target AFE or in connection with Emergency Operations;
and (vy) form any non-wholly owned SubsidiariesPermitted Encumbrances;
(vi) make any material change to any of the Company Group member’s accounting practicescreate, except as may be required by GAAP incur or other accounting principles or regulatory policyassume, or the interpretation agree to create, incur or enforcement thereof;
assume, any indebtedness for borrowed money or enter into, as lessee, any capitalized lease obligations (vii) (A) failas defined in Statement of Accounting Standards Codification Topic 840), directly or indirectly, to continue in full force and effect the insurance coverage other than advances under the Insurance Policies applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination of any such policies);
(viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time;
(ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues;
(x) sell, assign, transfer, lease, abandon or dispose of any (A) Company Group member’s assets (including Intellectual Property) that are material to the Business, taken as a whole, or (B) material Real Property (or any interests therein);
(xi) mortgage, pledge or subject to a Lien (other than a Permitted Lien) any Company Group member’s assets (including Intellectual Property);
(xii) issue, transfer, sell, pledge, deliver, purchase, dispose, redeem or grant any Equity Interests of any Company Group member;
(xiii) initiate, compromise or settle any claim or Action in which such Company Group member is a named party, and the amount at issue in such claim or Action is in excess of $100,000, or waive or release any material rights or claims held by the Company Group;
(xiv) enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023), or terminate (subject to Sections 6.14 and 6.15), waive the performance of any obligation under or amend, modify or supplement any Material Contract, Lease or Easement, except renewals of Easements Company's existing warehouse line in the ordinary course of business;
(xvvii) except as required by the Credit Agreement make, or this Agreementagree to make, unwind or otherwise modify existing xxxxxx any distribution (other than distributions permitted under Section 5.5) or other Derivative Transactions disposition of assets to any of its Affiliates, or enter into any new xxxxxx issue, reissue, sell, otherwise dispose of, transfer, repurchase, redeem, otherwise acquire, or other Derivative Transactions;
(xvi) declareadjust, set asidesplit, make combine, subdivide or reclassify, pay any dividend on or make any other distribution with respect to any of the Company Group Interestsits LLC Interests or evidence of indebtedness or other securities, or grant any options, warrants, calls, convertible securities, rights or commitments or any other than cash distributions that are either Permitted Leakage agreements of any character obligating it to issue, sell, adjust, split, combine, subdivide or are included in the Leakage Amountreclassify any of its LLC Interests or any evidence of indebtedness or other securities;
(xviiviii) cancel institute any Indebtedness owed to the Company Group or waive any claims or rights of value;
(xviii) enter into any agreement that restricts material increase in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of business;
(xix) (A) create, incur, guarantee or assume any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts benefit provided under any Company Benefit Plan (as in effect on the Signing Date or as amended as permitted by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advancesapplicable, or capital contributions toadopt any profit‑sharing, bonus, incentive, deferred compensation, insurance, pension, retirement, medical, hospital, disability, welfare or investments in, any Person other than a member of the Company Group;
employee benefit plan in which Employees participate (xx) other than as required by any such plan or Requirements of Law);
(ix) other than in the terms ordinary course of business, enter into, amend or terminate any contract of a Company Benefit Plantype that, (A) increase the compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees or to any current or former officers, directors, or independent contractors of any member of the Company Group, other than with respect to amounts that constitute Transaction Expenses, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement that would be a Company Benefit Plan if in effect on at the Signing Datedate of this Agreement, would be required to be disclosed pursuant to Schedule 3.18(a), excluding such establishment or amendments made in connection with open enrollment periods; (C) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period not in excess of thirty (30) days or without penalty;
(xxix) enter into merge or consolidate with any Contract described other Person, or participate in any business combination, or restructure, recapitalize, reorganize or adopt any other corporate or legal entity reorganization, otherwise alter its legal structure or form or completely or partially liquidate;
(xi) fail to operate its business in all material respects in accordance with the Applicable Requirements, the Requirements of Law and all material Governmental Permits, or fail to maintain all material Governmental Permits;
(xii) subject to Section 6.01(b)(xxi) 6.1, make or change any Tax election of the Disclosure ScheduleCompany, change the Tax status of the Company, change any Tax accounting period of the Company, or adopt or change any method of Tax accounting for the Company;
(xiii) make any material change in the accounting policies applied in the preparation of the Financial Statements unless such change is required by GAAP;
(xiv) make any change in the Company's certificate of formation or operating agreement or issue any LLC Interest (or securities exchangeable, convertible or exercisable for LLC Interests); or
(xxiixv) authorizetake, resolve, or agree or otherwise commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(b).
(c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c)foregoing actions.
(d) Nothing in this Agreement shall be construed to (i) limit the Seller’s or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.
Appears in 1 contract
Samples: Limited Liability Company Interest Purchase Agreement (Republic First Bancorp Inc)
Interim Period Operations. (a) During the Interim Period, except as set forth in Section 6.01(a) of the Disclosure Schedule, for Emergency Operations, as expressly permitted or required under the terms of this Agreement, as required by Law or any COVID-19 Measures or COVID-19 Response or to comply with (or as permitted by) the terms of any Contract in effect as of the Signing Date or as consented to in advance in writing by the PurchaserPurchaser (which consent shall not be unreasonably delayed, withheld or conditioned), the Seller shall cause each member of the Company Group to (i) conduct operate the Business in the ordinary course of business, consistent with past practice, (B) and (ii) use its commercially reasonable efforts to (A) preserve intact in all material respects the present business organizations and goodwill of the Business and the present relationships of the Business with material customers, suppliers, vendors and other Persons having business relationships with the Business, (C) comply in all material respects with all applicable Laws and maintain in full force and effect all Permits of the Business and (D) make capital and maintenance expenditures in the ordinary course of business consistent with the capital expenditure budget set forth on Section 1.01(h) of the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFE.
(b) Other than (w) as set forth on Section 6.01(b) of the Disclosure Schedule, (x) as required by applicable Law, (y) as expressly permitted or required by this Agreement, or (z) with the prior written consent of the Purchaser (such consent not to be unreasonably withheld, conditioned or delayed with respect to the matters described in Section 6.01(b)(iv), (xiv), and (xx)), the Seller shall not cause or permit any member of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo tonot:
(i) amend or propose to adopt any amendment to the Company Group member’s Organizational Documents of any member of the Company GroupDocuments;
(ii) (A) effect any recapitalization, reclassification, equity interest split, combination combination, merger, consolidation, conversion or similar change in the capitalization or organization of any Company Group member, or (B) encumber, purchase, redeem or otherwise acquire or retire for value any Equity Interest of any Company Group member;
(iii) acquire declare, set aside or agree pay any dividend or other distribution to acquire in any manner Person (whether by merger or consolidation, the purchase of an Equity Interest in or a material portion other than another member of the assets (including any material portion of the real property assets) of or otherwise) any business or any corporation, partnership, association or other business organization or division thereof or any other Person, other than in connection with the acquisition of assets in the ordinary course of businessCompany Group);
(iv) make any capital expenditures other than as set forth payment to the Seller or any of its Affiliates member except (A) in respect of amounts owed to 3 Bear Energy under the Capital Expenditure BudgetCost Sharing Agreement or the Control Center Agreement, (B) pursuant to any covenants, obligations or closing conditions under this Agreement or (C) payments made between members of the Target AFE or in connection with Emergency OperationsCompany Group;
(v) (A) acquire all or substantially all of the assets of any other Person or form any non-wholly owned SubsidiariesSubsidiaries or (B) purchase any Equity Interests of, or make any investment in, any Person other than a wholly-owned Subsidiary;
(vi) (A) acquire any asset or enter into any Contracts or (B) amend, terminate or allow the expiration of any Contracts that, in each case of (A) and (B), would reasonably be anticipated to result in the generation of gross income in the aggregate amount of $2,000,000 or more per year that is not “qualifying income” under Section 7704(d) of the Code;
(vii) other than actions taken in the ordinary course of business that will not have the effect of materially increasing the Tax Liability of the Company Group for any period after the Closing, (A) make any settlement of or compromise any Tax Liability, (B) change any Tax election or Tax method of accounting or make any new Tax election or adopt any new Tax method of accounting, (C) surrender any right to claim a refund of Taxes, or (F) consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment;
(viii) other than in the ordinary course of business or as required on an emergency basis or as necessary for the temporary safety of individuals or the environment, make any capital expenditures (excluding capital expenditures related to Approved Projects) in excess of $1,000,000 individually or $5,000,000 in the aggregate with respect to any Company Group member;
(ix) except as required by applicable Laws, pursuant to any Benefit Plan, or in the ordinary course of business, (A) increase the annual base salary or base wages of any Business Employee employed by any Company Group member, (B) grant any bonus or incentive compensation to any Business Employee employed by any Company Group member, (C) materially increase the coverage or benefits available under any (or create any new) Benefit Plan or any severance pay, vacation pay, deferred compensation, bonus or other incentive compensation plan or arrangement made to, for, or with any Business Employee or otherwise amend any such plan or arrangement, or (D) hire any new employees that would be Business Employees, other than: (1) employees that replace Business Employees whose employment is terminated after the Signing Date, and (2) the hiring of up to three new employees as Business Employees, so long as no such individual is hired with base wages in excess of $45 per hour;
(x) other than in the ordinary course of business or as may be required by Law, enter into, adopt, materially amend or terminate any Benefit Plan;
(xi) make any material change to any of the Company Group member’s accounting practices, except as may be required by GAAP or other accounting principles or regulatory policy, or the interpretation or enforcement thereofLaw;
(viixii) (A) failliquidate, directly dissolve or indirectly, to continue in full force and effect otherwise wind up the insurance coverage under the Insurance Policies applicable to the Business or the affairs of any Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination of any such policies)member;
(viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time;
(ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues;
(xxiii) sell, assign, transfer, leaselease or otherwise dispose of, abandon directly or dispose of indirectly, any (A) Company Group member’s assets (including Intellectual Property) that are material to the Business, taken as a whole, or (B) material Real Property (or any interests therein)Property, in each case, except in the ordinary course of business;
(xixiv) mortgage, pledge or subject to a Lien (other than a Permitted Lien) any Company Group member’s assets (including Intellectual Property)assets;
(xiixv) issue, transfer, sell, pledge, deliver, purchase, dispose, redeem sell or grant any Equity Interests of any Company Group member, accelerate the vesting of or cause the lapsing of any restrictions with respect to, any option or other equity-based award, or issue any Preferential Right to purchase or subscribe for any of such securities or issue any securities convertible into Equity Interests in any member of the Company Group;
(xiiixvi) initiate, compromise or settle any material claim or Action in which such Company Group member is a named partydefendant, and except in the amount at issue in such claim or Action is in excess ordinary course of $100,000, or waive or release any material rights or claims held by the Company Groupbusiness;
(xivxvii) enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023)Contract, or terminate (subject to Sections 6.14 and 6.15)Breach, terminate, waive the performance of any material obligation under or amend, modify or supplement materially amend any Material Contract, Lease or Easementin each case, except renewals of Easements in the ordinary course of business;
(xvxviii) except as required by the Credit Agreement or this Agreement, unwind or otherwise modify existing xxxxxx or other Derivative Transactions or enter into any new xxxxxx or other Derivative Transactions;
(xvi) declare, set aside, make or pay any distribution with respect to any of the Company Group Interests, other than cash distributions that are either Permitted Leakage or are included in the Leakage Amount;
(xvii) cancel incur any Indebtedness owed that will not be paid off at or prior to the Company Group or waive any claims or rights of value;
(xviii) enter into any agreement that restricts in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of businessClosing;
(xix) (A) create, incur, guarantee or assume destroy any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering material Books and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts under any Company Benefit Plan (as in effect on the Signing Date or as amended as permitted by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advances, or capital contributions to, or investments in, any Person other than a member of the Company Group;
(xx) other than as required by the terms of a Company Benefit Plan, (A) increase the compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees or to any current or former officers, directors, or independent contractors of any member of the Company Group, other than with respect to amounts that constitute Transaction Expenses, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement that would be a Company Benefit Plan if in effect on the Signing Date), excluding such establishment or amendments made in connection with open enrollment periods; (C) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors Records of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period not in excess of thirty (30) days or without penalty;
(xxi) enter into any Contract described in Section 6.01(b)(xxi) of the Disclosure Schedule; or
(xxiixx) authorize, resolve, agree or commit to take, or cause to be taken, take or delegate to any other Person, Person any action described in this Section 6.01(b6.01(a).
(c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c).
(db) Nothing in this Agreement shall be construed to (i) limit the Seller’s Seller or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.
(c) Section 6.01(c) of the Disclosure Schedule sets forth a list of certain expansion capital projects which have been approved by members of the Company Group which have either commenced prior to the Signing Date or will be commenced by the Company Group during the Interim Period (each individually an “Approved Project” and collectively, the “Approved Projects”). Section 6.01(c) of the Disclosure Schedule sets forth certain information concerning each Approved Project, including the name of the project, the amount of any applicable authorizations for expenditure, budget and forecast at completion. During the Interim Period, the Seller shall, and shall cause the members of the Company Group to, use commercially reasonable efforts to pursue and implement the Approved Projects in accordance with the ordinary course of operations of the Company Group and in accordance with the Material Contracts related to the Approved Projects (or enter into Material Contracts, to the extent not entered into as of the Signing Date) for the construction, completion, and commissioning of the Approved Projects, subject to events or conditions arising during such activities. During the Interim Period, the Seller shall, and shall cause the members of the Company Group to, provide to the Purchaser regular updates (no less frequently than on a monthly basis) concerning the status of the Approved Projects and such other information as reasonably requested by the Purchaser concerning the Approved Projects. For the avoidance of doubt, nothing in the foregoing shall, or shall be deemed to, restrict the Company Group from engaging in activities in response to connection notices from producers under existing connection and dedication agreements, and the Seller shall cause the members of the Company Group to undertake and perform their obligations pursuant to such agreements consistent with past practices.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Delek Logistics Partners, LP)
Interim Period Operations. (a) During the Interim Period, except as set forth in Section 6.01(a7.01(a) of the Disclosure Schedule, for Emergency Operationsas expressly permitted or required under the terms of this Agreement, as required by Law or to comply with the terms of any Contract in effect as of the Signing Date or as consented to in advance in writing by the PurchaserPurchaser (which consent shall not be unreasonably delayed, withheld or conditioned, and which consent shall be deemed given if the Purchaser does not respond to any request in writing within seven Business Days of any request for consent), the Seller Sellers shall cause each member of the Company Partnership Group and the MMP Group to (x) use its commercially reasonable efforts to (i) conduct operate the Business in the ordinary course of business, consistent with past practice, (B) and (ii) use preserve substantially intact its commercially reasonable efforts to (A) preserve intact in all material respects the present business organizations organization, goodwill and goodwill of the Business and the present relationships of the Business with material customers, suppliers, vendors and other Persons having business relationships with the Businessassets, (Ciii) comply in all material respects with all applicable Laws and the Material Contracts, (iv) maintain in full force and effect all Permits existing Target Permits, (v) keep available the services of the Business its current officers and employees and (Dvi) make capital preserve its existing relationships with Governmental Authorities and maintenance expenditures its material customers, suppliers, licensors, licensees, distributors, lessors and others having material business dealings with it (provided that this Section 7.01(a) shall not prohibit any Target Company from undertaking Emergency Operations and in such event, the ordinary course Target Companies shall, as promptly as reasonably practicable, inform the Purchaser of business consistent with the capital expenditure budget set forth on Section 1.01(h) of the Disclosure Schedule (the “Capital Expenditure Budget”such Emergency Operations) and the Target AFE.
(b) Other than (w) as set forth on Section 6.01(b) of the Disclosure Schedule, (x) as required by applicable Law, (y) as expressly permitted not, directly or required by this Agreement, or (z) with the prior written consent of the Purchaser (such consent not to be unreasonably withheld, conditioned or delayed with respect to the matters described in Section 6.01(b)(iv), (xiv), and (xx)), the Seller shall not cause or permit any member of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo toindirectly:
(i) amend or propose to adopt any amendment to the Organizational Documents of any Partnership Group member of the Company Groupor MMP Group member;
(ii) effect any recapitalization, reclassification, equity interest split, combination combination, exchange or similar other change in the capitalization of any Company Partnership Group member or MMP Group member;
(iii) acquire permit any member of the Partnership Group or agree the MMP Group to acquire in any manner (whether by merger all or consolidation, the purchase of an Equity Interest in or a material portion substantially all of the equity or assets (including any material portion of the real property assets) of or otherwise) any business or any corporation, partnership, association or other business organization or division thereof or any other Person, other than in connection with the acquisition of assets in the ordinary course of business;
(iv) make any capital expenditures other than as set forth in the Capital Expenditure Budget, the Target AFE or in connection with Emergency Operations;
(v) form any non-wholly owned Subsidiaries;
(viiv) make any loans, advances or capital contributions to, or investments in, any other Person with a value in excess of $10,000,000 in the aggregate; provided, however, that no Partnership Group member or MMP Group member shall make any loans, advances or capital contributions to, or investments in, any other Person that would reasonably be expected to prevent, impede or delay the consummation of the Transactions;
(v) make any material change to the accounting practices of any of the Company Partnership Group member or MMP Group member’s accounting practices, except as may be required by GAAP or other accounting principles or regulatory policy, or the interpretation or enforcement thereof;
(viivi) (A) failliquidate, directly dissolve or indirectly, to continue in full force and effect otherwise wind up the insurance coverage under the Insurance Policies applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination affairs of any such policies)Partnership Group member or MMP Group member;
(viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time;
(ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues;
(xvii) sell, assign, transfer, lease, abandon lease or dispose of any (A) Company Group member’s assets (including Intellectual PropertyEquity Interests) that are material to the Businessof any Partnership Group member or MMP Group member with a value in excess of $5,000,000, taken as a whole, except for dispositions of hydrocarbon inventory or pipeline loss allowances in the ordinary course of business or dispositions of obsolete or worthless assets or (B) material Real Property (or any interests therein)with a value in excess of $5,000,000, taken as a whole;
(xiviii) mortgage, pledge or subject to a Lien (other than a Permitted Lien) any Company assets of any Partnership Group member or MMP Group member’s assets (including Intellectual Property);
(xiiix) issue, transfer, sell, pledge, deliver, purchase, dispose, redeem grant or grant exchange any Equity Interests of any Company Partnership Group member or MMP Group member;
(xiiix) initiate, compromise or settle any material claim or Action in which such Company a Partnership Group member or MMP Group member is a named partydefendant, and except where the amount at issue in such claim or Action is in excess of $100,000, or waive or release any material rights or claims held aggregate payments by the Company GroupPartnership Group or MMP Group do not exceed $1,000,000; provided, however, that no compromise or settlement shall (A) impose any restrictions or limitations upon the assets, operations, business or conduct of any Partnership Group member or the MMP Group member or any equity or injunctive remedies on any Partnership Group member or MMP Group member or (B) involve the admission of any criminal wrongdoing by any Partnership Group member or MMP Group member;
(xivxi) Except in connection with actions permitted by clause (xii) below, enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023)Contract, or terminate (subject to Sections 6.14 and 6.15)terminate, waive the performance of any material obligation under or amend, modify or supplement materially amend any Material Contract, Lease or Easement, except renewals of Easements Contract (unless due to expiration in the ordinary course of businessaccordance with its terms);
(xvxii) make or incur any capital expenditures (individually or in the aggregate) in excess of $10,000,000, except for capital expenditures (A) in connection with Emergency Operations (and in such event, the Target Companies shall, as promptly as reasonably practicable, inform the Purchaser of such Emergency Operations) or (B) set forth in Section 3.19 of the Disclosure Schedule;
(xiii) terminate, let lapse or materially modify any material insurance policy maintained by any member of the Partnership Group or the MMP Group, except for any insurance policy replaced by a new or successor policy of substantially similar coverage on substantially similar terms;
(xiv) except as may be required by the Credit Agreement applicable Law or this Agreement, unwind or otherwise modify existing xxxxxx or other Derivative Transactions or enter into any new xxxxxx or other Derivative Transactions;
(xvi) declare, set aside, make or pay any distribution with respect to any of the Company Group Interests, other than cash distributions that are either Permitted Leakage or are included in the Leakage Amount;
(xvii) cancel any Indebtedness owed pursuant to the Company Group or waive any claims or rights existing terms of value;
(xviii) enter into any agreement that restricts in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of business;
(xix) (A) create, incur, guarantee or assume any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts under any Company an existing Business Benefit Plan (as in effect on the Signing Date and set forth on Section 3.13(b) of the Disclosure Schedule, or as amended as permitted expressly contemplated by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advances, or capital contributions to, or investments in, any Person other than a member of the Company Group;
(xx) other than as required by the terms of a Company Benefit PlanAgreement, (A) grant any new, or increase the or decrease any existing, compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees Business Employee or other individual service provider of the Partnership Group or the MMP Group, other than increases to base salary in the ordinary course of business consistent with past practice for non-officer level employees, which increases shall not exceed 5% in the aggregate, (B) hire, promote or terminate (other than for cause) any current or former employees, officers, directorsdirectors or other individual service providers of the Partnership Group or the MMP Group whose target annual cash compensation is equal to or in excess of $200,000, (C) except in connection with Emergency Operations (and in such event, the Target Companies shall, as promptly as reasonably practicable, inform the Purchaser of such Emergency Operations), enter into any new, or independent contractors of materially amend any member existing, employment, consulting, severance or termination agreement with any Business Employee or other individual service provider of the Company GroupPartnership Group or MMP Group or any other Business Benefit Plan, other than with respect to amounts that constitute Transaction Expenses, by more than 10% (x) annual renewals of group benefit plans in the aggregate ordinary course of business consistent with respect to any such Person; past practice that would not result in material additional or increased cost and (y) offer letters, employment, consulting, severance or termination agreements for individuals hired or terminated as permitted by the immediately preceding clause (B) adopt, amend, provided in the ordinary course of business consistent with past practice that follow in all material respects the applicable form of offer letter or take other applicable agreement made available to the Purchaser and do not provide for any actions severance entitlements beyond those provided in the ordinary course of business consistent with past practice to accelerate the funding under any Company Benefit Plan (similarly situated employees or any plan change-in-control or arrangement that would be a Company Benefit Plan if in effect on the Signing Date), excluding such establishment or amendments made other entitlements payable in connection with open enrollment periods; the Transactions, or (CD) take any action to accelerate the time of payment, vesting or payment funding of any compensation or benefits under any Company Business Benefit Plan or otherwise;
(or any award thereunderxv) with respect to an Available Employee or to any current or former officers(A) negotiate, directorsmodify, or independent contractors of any member of the Company Group; (D) extend, terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union Labor Agreement or recognize or certify any Union as the bargaining representativerepresentative for any employees of the Partnership Group or the MMP Group, (B) implement or announce any reduction in force, plant closing, or early retirement program, or other actions, in each case, with respect case that requires notices to any Available Employees; be sent pursuant to the WARN Act or (GC) with respect to waive or release any member noncompetition, nonsolicitation, or other restrictive covenant obligation of the Company Group only, enter into any contract with an individual current or former employee or independent contractor;
(xvi) incur, assume, guarantee or otherwise become liable for any Indebtedness for borrowed money or any guarantee of such Indebtedness, except for any Indebtedness incurred after the Effective Time in the ordinary course of business and not exceeding $25,000,000 in the aggregate; provided, however, that such contracts Indebtedness does not impose or result in any additional restrictions or limitations that can would be terminated by a member of material to the Company Group with a notice period not in excess of thirty (30) days or without penaltyTarget Companies, or, following the Closing, the Purchaser and its Subsidiaries, other than any obligation to make payments on such Indebtedness;
(xxiA) change its fiscal year or any material method of Tax accounting, (B) make (other than in the ordinary course of business consistent with past practice), change or revoke any material Tax election, (C) enter into any Contract described closing (or similar) agreement with respect to, or otherwise settle or compromise, any material liability for Taxes, (D) file any material amended Tax Return, (E) file any material Tax Return in Section 6.01(b)(xxia manner materially inconsistent with past practices, (F) surrender any claim for a material refund of Taxes, (G) take actions to incur any material Tax liability outside of the Disclosure Scheduleordinary course of business, or (H) fail to pay any income or other material Tax (including estimated Tax payments or installments) that becomes due and payable; or
(xxiixviii) authorize, resolve, agree or commit to take, or cause to be taken, take or delegate to any other Person, Person any action described in this Section 6.01(b7.01(a)(y).
(c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c).
(d) Nothing in this Agreement shall be construed to (i) limit the Seller’s or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.;
Appears in 1 contract
Interim Period Operations. (a) During Except (i) as required or permitted hereby, (ii) required by applicable Law or the terms of any Permit or Material Contract, (iii) as consented to by Buyer, or (iv) as otherwise set forth in Schedule 6.4, during the Interim Period, except as set forth in Section 6.01(a) Seller shall cause each member of the Disclosure Schedule, for Emergency Operations, as required by Law or as consented to in advance in writing by the PurchaserCompany Group, the Business and the Panther Creek Plant to be owned and operated in the ordinary course of business, in compliance in all material respects with appliable Laws, Permits and Contracts.
(b) Without limiting the foregoing or the provisions of Section 6.3, during the Interim Period, Seller shall cause each member of the Company Group not to undertake any of the following without the consent of Buyer (which consent shall not be unreasonably withheld, delayed or conditioned in the case of the following clauses (i), (ii) or (xii) and otherwise may be withheld or granted in Buyer’s sole discretion):
(i) conduct create any Lien (other than a Permitted Lien) against any of the Business in material assets of the ordinary course of business, consistent with past practice, (B) and Company Group which Lien will not be released prior to Closing;
(ii) use its commercially reasonable efforts to grant any waiver or consent of any material term under any Material Contract or Real Property Agreement;
(Aiii) preserve intact in all material respects the present business organizations and goodwill sell, transfer, convey or otherwise dispose of any assets of any member of the Business and the present relationships Company Group other than any assets that have become obsolete;
(iv) hire any employees, engage any independent contractor or establish, or become obligated to contribute to, any benefit plan as defined in Section 3(3) of the Business with material customersERISA or other employee benefit or compensation plan, suppliersprogram, vendors and policy, agreement or arrangement;
(v) other Persons having business relationships with the Business, (C) comply in all material respects with all applicable Laws and maintain in full force and effect all Permits of the Business and (D) make capital and maintenance expenditures than accounts payable incurred in the ordinary course of business consistent with or indebtedness otherwise incurred pursuant to the capital expenditure budget set forth on Section 1.01(hMaterial Contracts, incur, create, assume or otherwise become liable for indebtedness for borrowed money or issue any debt securities or assume or guarantee the obligations of any other Person (excluding indebtedness (and guaranties of such indebtedness) of the Disclosure Schedule (the “Capital Expenditure Budget”) and the Target AFE.that is repaid at or prior to Closing);
(bvi) Other than (w) as set forth on Section 6.01(b) of the Disclosure Schedule, (x) as required by applicable Law, (y) as expressly permitted or required by this Agreement, or (z) with the prior written consent of the Purchaser (such consent not to be unreasonably withheld, conditioned or delayed enter into any Contract with respect to hedging, marketing or trading;
(vii) except as may be required to meet the matters described requirements of any applicable Law or GAAP, change any accounting method or practice in Section 6.01(b)(iv)a manner that is inconsistent with past practice;
(viii) fail to maintain its limited liability company or partnership status, (xiv)as applicable, and (xx)), the Seller shall not cause or permit consolidate with any member other Person or acquire all or substantially all of the Company Group or, with respect to Section 6.01(b)(xx)(A), (C), (D) or (F) only, Durango EmployeeCo to:assets of any other Person;
(iix) amend issue or propose to adopt sell any amendment to the Organizational Documents of Equity Interests in any member of the Company Group;
(iix) effect any recapitalizationliquidate, reclassificationdissolve, equity interest splitrecapitalize, combination reorganize or similar change in the capitalization of any Company Group member;
(iii) acquire or agree to acquire in any manner (whether by merger or consolidation, the purchase of an Equity Interest in or a material portion of the assets (including any material portion of the real property assets) of or otherwise) any otherwise wind up their business or any corporation, partnership, association or other business organization or division thereof or any other Person, other than in connection with the acquisition of assets in the ordinary course of business;
(iv) make any capital expenditures other than as set forth in the Capital Expenditure Budget, the Target AFE or in connection with Emergency Operations;
(v) form any non-wholly owned Subsidiaries;
(vi) make any material change to any of the Company Group member’s accounting practices, except as may be required by GAAP or other accounting principles or regulatory policy, or the interpretation or enforcement thereof;
(vii) (A) fail, directly or indirectly, to continue in full force and effect the insurance coverage under the Insurance Policies applicable to the Business or the Company Group or any member thereof (or fail to renew such policies or obtain substantially equivalent new policies upon any expiration or termination of any such policies);
(viii) (A) settle or compromise any Tax liability, (B) change, or revoke any material Tax election or make any new material Tax election outside the ordinary course of business and inconsistent with past practice, (C) amend any Tax Return, (D) file any Tax Return which has not been prepared in accordance with applicable Law and past practices, (E) enter into any closing agreement or consent to any extension or waiver of any statute of limitations period with respect to Taxes, (F) surrender any right to claim a material refund of Taxes, (G) incur any Tax liability outside the ordinary course of business or (H) take any other action outside the ordinary course of business that has (or could have) the effect of increasing the Tax liability of the Company Group for any Tax period (or portion thereof) beginning on or after the Effective Time;
(ix) adopt a plan of complete or partial liquidation or resolutions to take any action providing for or authorizing a liquidation, dissolution, merger, consolidation, conversion, restructuring, recapitalization or other reorganization of the Company or the appointment of a receiver, administrator or administrative receiver, trustee or similar officer of its assets or revenues;
(x) sell, assign, transfer, lease, abandon or dispose of any (A) Company Group member’s assets (including Intellectual Property) that are material to the Business, taken as a whole, or (B) material Real Property (or any interests therein)operations;
(xi) mortgage, pledge or subject to a Lien (other than a Permitted Lien) purchase any Company Group member’s assets (including Intellectual Property)securities of any Person;
(xii) issueenter into, transferterminate or amend any Material Contract, sellReal Property Agreement or any Contract that, pledgeif existing as of the date of this Agreement, deliver, purchase, dispose, redeem or grant any Equity Interests of any Company Group memberwould have been required to be listed on Schedule 4.10(a);
(xiii) initiate, compromise change any Tax election or settle Tax method of accounting or make any claim or Action in which such Company Group member is a named party, and the amount at issue in such claim or Action is in excess of $100,000, or waive or release any material rights or claims held by the Company Groupnew Tax election;
(xiv) enter into any Contract that, if in effect as of the Signing Date, would be a Material Contract (including any Contract that would reasonably be expected to make the applicable counterparty a Material Producer had the Contract been in effect for the twelve (12) months ended December 31, 2023), amend or terminate (subject to Sections 6.14 and 6.15), waive the performance of any obligation under or amend, modify or supplement any Material Contract, Lease or Easement, except renewals of Easements in the ordinary course of businessits Organizational Documents;
(xv) except as required by the Credit Agreement or this Agreement, unwind or otherwise modify existing xxxxxx or other Derivative Transactions or enter into make any new xxxxxx or other Derivative Transactions;Seller Distribution Amount; or
(xvi) declare, set aside, make or pay any distribution with respect to any of the Company Group Interests, other than cash distributions that are either Permitted Leakage or are included in the Leakage Amount;
(xvii) cancel any Indebtedness owed to the Company Group or waive any claims or rights of value;
(xviii) enter into any agreement that restricts in any material respect the ability of the Company Group to engage or compete in any line of business or to enter a new line of business;
(xix) (A) create, incur, guarantee or assume any Indebtedness other than amounts drawn under the Credit Agreement to the extent the proceeds are used to fund (1) expenditures in connection with the Kings Landing Gas Gathering and Processing Development or other expenditures in accordance with the Capital Expenditure Budget, (2) other ordinary course expenses of the Company Group consistent with past practice or (3) or amounts under any Company Benefit Plan (as in effect on the Signing Date or as amended as permitted by this Section 6.01(b)) or (B) with respect to the Company Group, make any loans, advances, or capital contributions to, or investments in, any Person other than a member of the Company Group;
(xx) other than as required by the terms of a Company Benefit Plan, (A) increase the compensation, incentives or benefits (including severance or termination payments) payable or provided, or to become payable or to be provided, to any Available Employees or to any current or former officers, directors, or independent contractors of any member of the Company Group, other than with respect to amounts that constitute Transaction Expenses, by more than 10% in the aggregate with respect to any such Person; (B) adopt, amend, or take any actions to accelerate the funding under any Company Benefit Plan (or any plan or arrangement that would be a Company Benefit Plan if in effect on the Signing Date), excluding such establishment or amendments made in connection with open enrollment periods; (C) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan (or any award thereunder) with respect to an Available Employee or to any current or former officers, directors, or independent contractors of any member of the Company Group; (D) terminate or transfer the employment of any Available Employee, except terminations for cause or poor performance; (E) with respect to any member of the Company Group only, hire any employee; (F) establish, adopt or enter into any collective bargaining agreement or other Contract with a Union or recognize any Union as the bargaining representative, in each case, with respect to any Available Employees; or (G) with respect to any member of the Company Group only, enter into any contract with an individual independent contractor, except for such contracts that can be terminated by a member of the Company Group with a notice period not in excess of thirty (30) days or without penalty;
(xxi) enter into any Contract described in Section 6.01(b)(xxi) of the Disclosure Schedule; or
(xxii) authorize, resolve, agree or commit to take, or cause to be taken, or delegate to do any other Person, any action described in this Section 6.01(b).
(c) Other than (x) as required by applicable Law, (y) expressly permitted or required by this Agreement, or (z) with the prior written consent of the Seller, neither Purchaser Parent nor Parent shall amend or proposed to adopt any amendments to the Organizational Documents of Purchaser (in a manner that would require the consent of Seller under the terms of the Organizational Documents of Purchaser if such amendment were effected following the Closing and the issuance of the Closing Date Equity Consideration) or authorize, resolve, agree or commit to take, or cause to be taken, or delegate to any other Person, any action described in this Section 6.01(c)foregoing.
(d) Nothing in this Agreement shall be construed to (i) limit the Seller’s or the Company Group’s discretion to operate the Business in the ordinary course, consistent with pre-Signing Date business practices, operations and activities, during the Interim Period or (ii) give the Purchaser any ownership rights with respect to the Purchased Interests, the Business or the Company Group’s assets before the Closing.
Appears in 1 contract
Samples: Equity Capital Contribution Agreement (Stronghold Digital Mining, Inc.)
