Operation of the Business of the Company. Except as described in Section 5.2 of the Disclosure Schedule, as required by applicable Law or as expressly provided for by this Agreement, or with the prior written consent of Parent (which consent shall not be unreasonably conditioned, withheld or delayed), during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, the Company will conduct and will cause each of its Subsidiaries to conduct its operations in all material respects according to its ordinary course of business consistent with past practice, and the Company will use and will cause each of its Subsidiaries to use reasonable best efforts to preserve intact its business organization and to preserve the present relationships with those Persons having significant business relationships with the Company or any such Subsidiaries. Without limiting the generality of the foregoing, except as set forth in Section 5.2 of the Disclosure Schedule, as required by applicable Law or as expressly provided for by this Agreement, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, without the prior written consent of Parent (which consent shall not be unreasonably conditioned, withheld or delayed), the Company will not and will not permit any of its Subsidiaries to: (a) (i) adopt any amendments to its certificate of incorporation or bylaws (or other similar governing documents) or (ii) hold any annual or special meeting of the stockholders of the Company or file, mail or otherwise distribute any proxy solicitations or statement in respect thereof (other than, with respect to clause (ii), in connection with the Company’s annual meeting of stockholders for 2016, provided that (A) only matters that would not require the filing of a preliminary proxy statement under SEC regulations are presented for approval at such meeting and (B) the proxy statement in respect of such meeting is not filed, mailed or otherwise distributed prior to November 5, 2016); (b) issue, sell, grant options or rights to purchase, pledge, or authorize or propose the issuance, sale, grant of options or rights to purchase or pledge, any Company Securities or securities of any Subsidiary of the Company, other than Company Shares issuable (i) in accordance with the Company ESPP terms as in effect on the date of this Agreement, (ii) upon exercise of Company Options outstanding on the date of this Agreement or the vesting of Company RSU Awards outstanding on the date of this Agreement in accordance with their terms and (iii) the conversion of the Company Convertible Notes into Company Shares in accordance with their terms; (c) acquire or redeem, directly or indirectly, or amend any Company Securities, other than (i) as provided by any Company Stock Plan, (ii) the redemption of the Company Convertible Notes in accordance with their terms, (iii) the acquisition by the Company of Company Shares in connection with the surrender of Company Shares by holders of Company Options in order to pay the exercise price of such Company Options, (iv) the withholding of Company Shares to satisfy Tax obligations with respect to Company Options or Company RSU Awards or (v) the acquisition by the Company of Company Options or Company RSU Awards in connection with the forfeiture of such awards; (d) split, combine or reclassify its capital stock or declare, set aside, make or pay any dividend or distribution (whether in cash, stock or property) on any shares of its capital stock (other than dividends paid to the Company or one of its wholly owned Subsidiaries by a wholly owned Subsidiary of the Company); (e) (i) acquire, by means of a merger, consolidation, recapitalization or otherwise, any material business, assets or securities (other than any acquisition of assets, including active pharmaceutical ingredients and other supplies, in the ordinary course of business consistent with past practice), (ii) sell, lease, or otherwise dispose of any material assets of the Company or any of its Subsidiaries, except (A) pursuant to Contracts or commitments existing as of the date of this Agreement, (B) the sale of the Company Products in the ordinary course of business consistent with past practices, (C) non-exclusive outbound licenses to service providers, clinical trial agreements and material transfer agreements, in each case in the ordinary course of business consistent with past practices, and (D) de minimis dispositions or abandonments, in each case in the ordinary course of business and consistent with past practice, or (iii) adopt a plan of complete or partial liquidation, dissolution, recapitalization or restructuring; (f) make any loans, advances or capital contributions to, or investments in, any other Person (other than wholly owned Subsidiaries of the Company), except for advances to employees for travel and other business expenses in the ordinary course of business consistent with past practice; (g) enter into, renew or terminate (or allow to terminate or expire) any Material Contract or amend any Material Contract in any material respect or grant any release or relinquishment of any material rights under any Material Contract; (h) incur, assume or otherwise become liable or responsible for any indebtedness for borrowed money, except for indebtedness permitted under Sections 9.05(c), (g) and (h) of the Company Loan Agreement that are incurred in the ordinary course of business consistent with past practice; (i) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person except wholly owned Subsidiaries of the Company; (j) change, in any material respect, any financial accounting methods, principles or practices used by it, except in order to comply with GAAP or applicable Law; (k) make any material change to any accounting method or change any annual Tax accounting period, make or change any material Tax election, file any material Tax Return other than on a basis consistent with past practice, amend any material Tax Return, settle, compromise or consent to any material Tax claim or assessment, surrender a right to a material Tax refund, waive or extend the statute of limitations with respect to any material Tax other than pursuant to extensions of time to file a Tax Return obtained in the ordinary course of business, or incur any Taxes as a result of distributing, lending, transferring or otherwise repatriating any property in-kind or any cash amounts into the United States; (l) except as contemplated by Section 6.9, (A) establish, adopt, terminate or amend any Plan (or any plan, program, arrangement, practice or agreement that would be an Plan if it were in existence on the date hereof except that the Company may amend any Plans to the extent required by applicable Law), (B) amend or waive any of its rights under, or accelerate the vesting under, any provision of any of the Plans (or any plan, program, arrangement, practice or agreement that would be an Plan if it were in existence on the date hereof), (C) grant any Company Employee any increase in compensation, bonuses or other benefits or (D) pay any severance, retention or retirement benefits to any current or former Company Employee, other than vested benefits (including benefits that become vested as a result of a termination of employment permitted under this Section 5.2 or the transactions) required by the terms of a Plan listed on Section 3.16(a) of the Disclosure Schedule or (E) grant any equity or equity-based compensation to any Company Employee; (m) make any Company contributions (excluding contributions which are employee deferrals of eligible earnings under the Company’s 401(k) Plan) to the Company’s 401(k) Plan other than as required under the terms of such plan as in effect on the date of this Agreement, or make any contribution to the Company’s 401(k) Plan in Company Shares; (n) (i) enter into any Plans, other than with any Company Employee, who is not an executive officer, with an annual base salary of less than $200,000 in the ordinary course of business consistent with past practice, or (ii) hire, promote or terminate any Company Employee other than a Company Employee, who is not an executive officer, with an annual base salary of less of $200,000 in the ordinary course of business consistent with past practice; (o) enter into any Labor Agreement; (p) make or authorize any capital expenditure or incur any obligations, Liabilities or indebtedness in respect thereof, except for (i) those contemplated by the capital expenditure budget for the relevant fiscal year, which capital expenditure budget has been provided or made available to Parent prior to the date of this Agreement, and (ii) any unbudgeted capital expenditures in an amount not to exceed $150,000 in the aggregate; (q) settle any Legal Proceeding other than a settlement solely for monetary damages (net of insurance proceeds received) not in excess of $50,000 individually or $200,000 in the aggregate or commence any Legal Proceeding except in connection with a breach of this Agreement or any other agreements contemplated by this Agreement; or (r) offer, agree or commit, in writing or otherwise, to take any of the foregoing actions. Notwithstanding the foregoing, nothing in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the right to control or direct the business or operations of the Company or its Subsidiaries at any time prior to the Effective Time. Prior to the Effective Time, the Company and its Subsidiaries shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over their own business and operations.
Appears in 2 contracts
Samples: Merger Agreement (Horizon Pharma PLC), Merger Agreement (Raptor Pharmaceutical Corp)
Operation of the Business of the Company. Except as described in Section 5.2 of the Disclosure Schedule, as required by applicable Law or as expressly provided for by this Agreement, or with the prior written consent of Parent (which consent shall not be unreasonably conditioned, withheld or delayed), during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, the Company will conduct and will cause each of its Subsidiaries to conduct its operations in all material respects according to its ordinary course of business consistent with past practice, and the Company will use and will cause each of its Subsidiaries to use reasonable best efforts to maintain and preserve intact its business organization and to organization, preserve the its present relationships and goodwill with those Persons having significant business relationships with the Company or any such Subsidiaries, keep available the services of its current officers and key employees and maintain in effect all material Governmental Authorizations pursuant to which the Company and any of its Subsidiaries currently operates. Without limiting the generality of the foregoingforegoing and, except as set forth in Section 5.2 of the Disclosure Schedule, as required by applicable Law or as expressly provided for by this Agreement, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, without the prior written consent of Parent (which consent shall not be unreasonably conditioned, withheld or delayed), the Company will not and will not permit any of its Subsidiaries to:
(a) (i) adopt any amendments to its certificate of incorporation or bylaws (or other similar governing documents) or (ii) hold any annual or special meeting of the stockholders of the Company or file, mail or otherwise distribute any proxy solicitations or statement in respect thereof (other than, with respect to clause (ii), in connection with the Company’s annual meeting of stockholders for 2016, provided that (A) only matters that would not require the filing of a preliminary proxy statement under SEC regulations are presented for approval at such meeting and (B) the proxy statement in respect of such meeting is not filed, mailed or otherwise distributed prior to November 5, 2016);
(b) issue, sell, deliver, transfer, convey, dispose of, grant options or rights to purchase, pledge, or authorize or propose the issuance, sale, delivery, transfer, conveyance, disposition, grant of options or rights to purchase or pledge, any Company Securities or securities of any Subsidiary of the Company, other than Company Shares issuable (i) in accordance with the Company ESPP terms as in effect on the date of this Agreement, (ii) or upon exercise of Company Options outstanding on the date of this Agreement or Company Warrants or the vesting of Company RSU Awards outstanding on the date of this Agreement hereof in accordance with their terms and (iii) the conversion of the Company Convertible Notes into Company Shares in accordance with their existing terms;
(c) repurchase, acquire or redeem, directly or indirectly, or amend any Company Securities, other than (i) as provided by any Company Stock Plan, (ii) the redemption of the Company Convertible Notes in accordance with their terms, (iii) the acquisition by the Company of Company Shares in connection with the surrender of Company Shares by holders of Company Options or Company Warrants in order to pay the exercise price of such Company Options, (iviii) the withholding of Company Shares to satisfy Tax obligations with respect to Company Options or Company RSU Awards or Awards, (viv) the acquisition by the Company of Company Options or Company RSU Awards in connection with the forfeiture of such awardsawards or (v) the acquisition by the Company of Company Restricted Shares pursuant to the terms thereof;
(d) split, combine combine, reclassify, subdivide, exchange, recapitalize or reclassify enter into any similar transaction in respect of its capital stock or declare, set aside, make or pay any dividend or distribution (whether in cash, stock or property) on any shares of its capital stock (other than dividends paid to the Company or one of its wholly owned Subsidiaries by a wholly owned Subsidiary of the Company);
(e) without limiting any capital expenditures permitted under clause (n) below, (i) acquire, acquire by means of a merger, consolidation, recapitalization or otherwise, any material business, assets or securities (other than any acquisition of assets, including active pharmaceutical ingredients and other supplies, in the ordinary course of business consistent with past practice), (ii) or sell, lease, license, encumber (other than Permitted Liens) or otherwise dispose of any material business, assets or securities of the Company or any of its Subsidiaries, in each case involving the payment of consideration (including consideration in the form of assumption of Liabilities) of $1,000,000 or more or the disposition of assets or securities with a fair market value in excess of $1,000,000, except (A) pursuant to Contracts or commitments existing as of the date of this Agreement, (B) the sale for purchases or sales of the Company Products in the ordinary course of business consistent with past practicesProduct, (C) non-exclusive outbound licenses to service providersraw materials, clinical trial agreements and material transfer agreementsincluding active pharmaceutical ingredients, in each case in the ordinary course of business consistent with past practices, and (D) de minimis dispositions inventory or abandonments, in each case other supplies in the ordinary course of business and consistent with past practice, (C) non-exclusive licenses entered into in the ordinary course of business and consistent with past practice or (iiiD) the acquisition or disposition of securities (other than Company Securities) pursuant to the Company’s Corporate Investment Policy, (ii) adopt a plan of complete or partial liquidation, dissolution, recapitalization recapitalization, restructuring or restructuringother reorganization of the Company or its Subsidiaries, or (iii) enter into any Contract that contains a change of control or similar provision that would require a material payment to the other party or parties thereto in connection with the Offer, the Merger or the other transactions contemplated by this Agreement;
(f) make any loans, advances or capital contributions to, or investments in, or forgive any loans of, any other Person (other than wholly owned Subsidiaries of the Company), except for advances to employees for travel and other business expenses in the ordinary course of business consistent with past practice;
(g) other than in the ordinary course of business consistent with past practice, enter into, renew or terminate (or allow to terminate or expire) any into a Contract that would have been a Material Contract or if it were in effect as of the date hereof, amend any Material Contract in any material respect (except as set forth in Section 5.2(g) of the Disclosure Schedule), terminate any Material Contract or grant any release or relinquishment of any material rights under any Material Contract, except for renewals, expirations or terminations in accordance with the terms of any Material Contract;
(h) (i) incur, assume or otherwise become liable or responsible for any indebtedness for borrowed money, except for indebtedness permitted under Sections 9.05(c), (g) and (h) of the Company Loan Agreement that are incurred in the ordinary course of business consistent with past practice for borrowings to fund working capital requirements under the Company’s existing credit facilities in an amount not to exceed $1,000,000 at any time, (ii) repay (other than in the ordinary course of business consistent with past practice), redeem or repurchase any indebtedness, or (iii) cancel any material indebtedness owed to the Company or any of its Subsidiaries;
(i) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person except wholly owned Subsidiaries of the Company;
(j) change, in any material respect, any financial accounting methods, principles or practices used by it, except in order to comply with GAAP or applicable Law;
(k) make any material change except to any accounting method or the extent required by applicable Law, change any annual Tax accounting period, make or change any material Tax election, file settle any material Tax Return other than on a basis consistent with past practice, claim or assessment or amend any material Tax Return, settle, compromise ;
(l) except pursuant to a Plan in effect on the date hereof or consent to as required by applicable Law: (i) grant any material Tax claim severance or assessmenttermination pay which will become due and payable on or after the Effective Time, surrender a right to a material Tax refund(ii) adopt, waive enter into, amend or extend the statute of limitations with respect to terminate any material Tax Plan (other than pursuant to extensions of time to file a Tax Return obtained reflect changes in Plan administration or in the ordinary course of business, or incur any Taxes as a result of distributing, lending, transferring or otherwise repatriating any property in-kind or any cash amounts into the United States;
(l) except as contemplated by Section 6.9, (A) establish, adopt, terminate or amend any Plan (or any plan, program, arrangement, practice or agreement that would be an Plan if it were in existence on the date hereof except that the Company may amend any Plans to the extent required by applicable Law), (B) amend or waive any of its rights under, or accelerate the vesting under, any provision of any of the Plans (or any plan, program, arrangement, practice or agreement that would be an Plan if it were in existence on the date hereof), (Ciii) grant any Company Employee any increase increases in compensation, bonuses the compensation or other benefits or (D) pay any severance, retention or retirement benefits payable to any current or former Company Employeemembers of the Board of Directors or any employees at the level of director or above, other than vested benefits (including benefits that become vested as a result of a termination of employment permitted under this Section 5.2 or increases for employees who are below the transactions) required by the terms of a Plan listed on Section 3.16(a) of the Disclosure Schedule or (E) grant any equity or equity-based compensation to any Company Employee;
(m) make any Company contributions (excluding contributions which are employee deferrals of eligible earnings under the Company’s 401(k) Plan) to the Company’s 401(k) Plan other than as required under the terms of such plan as in effect on the date of this Agreement, or make any contribution to the Company’s 401(k) Plan in Company Shares;
(n) (i) enter into any Plans, other than with any Company Employee, who is not an executive officer, with an annual base salary of less than $200,000 director level in the ordinary course of business consistent with past practice, or (iiiv) hire, promote hire or terminate any Company Employee (other than a Company Employeefor cause) any employee who is, or would be, if hired, at the level of director or above, or hire or terminate (other than for cause) any employee who is not an executive officerbelow the director level (other than in the ordinary course of business), with an annual base salary (v) promote any employee who is at the level of less director or above to a position more senior than such employee’s position as of $200,000 the date of this Agreement, (vi) promote any employee who is below the director level (other than in the ordinary course of business consistent with past practice), or (vii) accelerate any rights or benefits under, or make any material determinations or interpretations with respect to, any Plan (except as contemplated by this Agreement);
(om) enter into any Labor Agreementcollective bargaining or similar labor agreement;
(pn) make or authorize any capital expenditure or incur any obligations, Liabilities or indebtedness in respect thereof, except for (i) those contemplated by the capital expenditure budget for the relevant fiscal year, which capital expenditure budget has been provided or made available to Parent prior to the date of this Agreement, and (ii) any unbudgeted capital expenditures in an amount not to exceed exceed, in any fiscal quarter, $150,000 1,000,000 in the aggregate;
(qo) discharge, settle or compromise any Legal Proceeding suit, action, claim, proceeding or investigation other than a settlement solely for monetary damages (net of insurance proceeds received) not in excess of $50,000 250,000 individually or $200,000 500,000 in the aggregate aggregate;
(p) form or commence the operations of any Legal Proceeding except in connection with a breach of this Agreement business or any corporation, partnership, limited liability company, joint venture, business association or other agreements contemplated by this Agreementbusiness organization or enter into any new line of business;
(q) waive, release or assign any material rights or material claims or make any material payment, directly or indirectly, of any Liability of the Company or any of its Subsidiaries before the same comes due in accordance with its terms, other than in the ordinary course of business consistent with past practice;
(r) sell, license, assign, transfer, abandon, permit to lapse, or otherwise dispose of, any material Company Intellectual Property other than non-exclusive licenses and de minimis dispositions or abandonments in the ordinary course of business consistent with past practice; or
(rs) offer, agree or commit, in writing or otherwise, to take any of the foregoing actions. Notwithstanding the foregoing, nothing in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the right to control or direct the business or operations of the Company or its Subsidiaries at any time prior to the Effective Time. Prior to the Effective Time, the Company and its Subsidiaries shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over their own business and operations.
Appears in 1 contract
Samples: Merger Agreement (Relypsa Inc)
Operation of the Business of the Company. Except as described in Section 5.2 4.2 of the Disclosure Schedule, as required by applicable Law or as expressly provided for contemplated or required by this Agreement, or with the prior written consent of Parent (which consent shall not be unreasonably conditioned, withheld or delayed), during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective TimeInterim Period, the Company will conduct use reasonable best efforts to conduct, and will to cause each of its Subsidiaries to conduct conduct, its operations in all material respects according to its ordinary course of business consistent with past practice, and the Company will use and will cause each of its Subsidiaries to use reasonable best efforts to preserve intact its business organization and to preserve the present relationships with those Persons having significant business relationships with the Company or any such Subsidiaries; provided, that no action by the Company or its Subsidiaries with respect to matters specifically addressed by Section 4.2(a) through Section 4.2(t) below shall be deemed a breach of the foregoing unless such action would constitute a breach of such specific clause. Without limiting the generality of the foregoing, except as set forth in Section 5.2 4.2 of the Disclosure Schedule, as required by applicable Law or as expressly provided for contemplated, required or permitted by this Agreement, during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective TimeInterim Period, without the prior written consent of Parent (which consent shall not be unreasonably conditioned, withheld or delayed), the Company will not and will not permit any of its Subsidiaries to:
(a) (i) adopt any amendments to its certificate of incorporation or bylaws (or other similar governing documents) or (ii) hold any annual or special meeting ); Table of the stockholders of the Company or file, mail or otherwise distribute any proxy solicitations or statement in respect thereof (other than, with respect to clause (ii), in connection with the Company’s annual meeting of stockholders for 2016, provided that (A) only matters that would not require the filing of a preliminary proxy statement under SEC regulations are presented for approval at such meeting and (B) the proxy statement in respect of such meeting is not filed, mailed or otherwise distributed prior to November 5, 2016);Contents
(b) issue, sell, grant options or rights to purchase, pledge, or authorize or propose the issuance, sale, grant of options or rights to purchase or pledge, any Company Securities or securities of any Subsidiary of the Company, other than Company Shares issuable (i) in accordance with upon the Company ESPP terms as in effect on the date of this Agreementvesting, (ii) upon settlement or exercise of Company Options outstanding on the date of this Agreement or the vesting of Company RSU Awards outstanding on the date of this Agreement in accordance with their terms and (iii) the conversion of the Company Convertible Notes into Company Shares in accordance with their terms;
(c) acquire or redeem, directly or indirectly, or amend any Company Securities, other than (i) as provided by any Company Stock Plan, (ii) the redemption of the Company Convertible Notes in accordance with their terms, (iii) the acquisition by the Company of Company Shares in connection with the surrender of Company Shares by holders of Company Options in order to pay the exercise price of such Company Options, (iviii) the withholding of Company Shares to satisfy Tax withholding obligations with respect to Company Options or Company RSU Awards or Awards, (viv) the acquisition by the Company of Company Options or Company RSU Awards in connection with the forfeiture of such awardsawards or (v) the acquisition by the Company of Company Restricted Shares pursuant to the terms thereof or in satisfaction of any Tax withholding obligations in respect thereof;
(d) split, combine or reclassify its capital stock or declare, set aside, make or pay any dividend or distribution (whether in cash, stock or property) on any shares of its capital stock (other than dividends paid to the Company or one of its wholly owned Subsidiaries by a wholly owned Subsidiary of the Company);
(e) (i) acquire, by means of a merger, consolidation, recapitalization or otherwise, any material business, assets or securities (other than any acquisition of assets, including active pharmaceutical ingredients and other supplies, assets in the ordinary course of business consistent with past practicebusiness), (ii) sell, lease, lease or otherwise dispose of any material assets of the Company or any of its Subsidiaries, except (A) pursuant to Contracts or commitments existing as of the date of this Agreement, or (B) the sale of the Company Products in the ordinary course of business consistent with past practices, (C) non-exclusive outbound licenses to service providers, clinical trial agreements and material transfer agreements, in each case in the ordinary course of business consistent with past practices, and (D) de minimis dispositions or abandonments, in each case in the ordinary course of business and consistent with past practicebusiness, or (iii) adopt a plan of complete or partial liquidation, dissolution, recapitalization or restructuring;
(f) make any loans, advances or capital contributions to, or investments in, any other Person (other than wholly owned Subsidiaries of the Company), except for advances to employees for travel and other business expenses in the ordinary course of business consistent with past practice;
(g) enter into, renew or (i) terminate (or allow to terminate or expire) any Material Contract or Contract, (ii) amend any Material Contract in any material respect or respect, (iii) grant any release or relinquishment of any material rights under any Material Contract, (iv) enter into any Contract that would be a Material Contract if entered into prior to the date of this Agreement or (v) enter into any Contract with any 5% shareholder or Affiliate of the Company or any of its Subsidiaries, in each case, except in the ordinary course of business and except for renewals, expirations or terminations in accordance with the terms of any Material Contract;
(h) incur, assume or otherwise become liable or responsible for any indebtedness for borrowed money, except for indebtedness permitted under Sections 9.05(c), (g) and (h) of the Company Loan Agreement that are incurred borrowings in an amount not to exceed $500,000 in the ordinary course of business consistent with past practiceaggregate;
(i) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person except wholly owned Subsidiaries of the Company;
(j) change, in any material respect, any financial accounting methods, principles or practices used by it, except in order to comply with GAAP or applicable Law;
(k) make any material change to any accounting method or change any annual Tax accounting period, make or change any material Tax election, file any material Tax Return other than on a basis consistent with past practice, or amend any material Tax Return, settlein each ease, compromise or consent to any material Tax claim or assessment, surrender a right to a material Tax refund, waive or extend the statute of limitations with respect to any material Tax other than pursuant to extensions of time to file a Tax Return obtained as required by applicable Law or in the ordinary course of business, or incur any Taxes as a result of distributing, lending, transferring or otherwise repatriating any property in-kind or any cash amounts into the United States;
(l) except as contemplated by Section 6.9, (A) establish, adopt, terminate or amend any Plan (or any plan, program, arrangement, practice or agreement that would be an Plan if it were in existence on the date hereof except that the Company may amend any Plans pursuant to the extent required by applicable Law), (B) amend or waive any of its rights under, or accelerate the vesting under, any provision of any of the Plans (or any plan, program, arrangement, practice or agreement that would be an Plan if it were in existence on the date hereof), (C) grant any Company Employee any increase in compensation, bonuses or other benefits or (D) pay any severance, retention or retirement benefits to any current or former Company Employee, other than vested benefits (including benefits that become vested as a result of a termination of employment permitted under this Section 5.2 or the transactions) required by the terms of a Plan listed on Section 3.16(a) of the Disclosure Schedule or (E) grant any equity or equity-based compensation to any Company Employee;
(m) make any Company contributions (excluding contributions which are employee deferrals of eligible earnings under the Company’s 401(k) Plan) to the Company’s 401(k) Plan other than as required under the terms of such plan as in effect on the date of this Agreement, hereof or make any contribution to the Company’s 401(k) Plan in Company Shares;
(n) as required by applicable Law: (i) grant any severance or termination pay which will become due and payable on or after the Effective Time, (ii) adopt, enter into into, materially amend or terminate any Plans, Plan (other than with any Company Employee, who is not an executive officer, with an annual base salary of less than $200,000 to reflect changes in Plan administration or in the ordinary course of business consistent with past practice, business) or (iiiii) hire, promote or terminate grant any Company Employee other than a Company Employee, who is not an executive officer, with an annual base salary of less of $200,000 increases in the ordinary course of business consistent with past practicecompensation or benefits payable to its executive officers or directors;
(o) enter into any Labor Agreement;
(p) make or authorize any capital expenditure or incur any obligations, Liabilities or indebtedness in respect thereof, except for (i) those contemplated by the capital expenditure budget for the relevant fiscal year, which capital expenditure budget has been provided or made available to Parent prior to the date of this Agreement, and (ii) any unbudgeted capital expenditures in an amount not to exceed $150,000 in the aggregate;
(q) settle any Legal Proceeding other than a settlement solely for monetary damages (net of insurance proceeds received) not in excess of $50,000 individually or $200,000 in the aggregate or commence any Legal Proceeding except in connection with a breach of this Agreement or any other agreements contemplated by this Agreement; or
(r) offer, agree or commit, in writing or otherwise, to take any of the foregoing actions. Notwithstanding the foregoing, nothing in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the right to control or direct the business or operations of the Company or its Subsidiaries at any time prior to the Effective Time. Prior to the Effective Time, the Company and its Subsidiaries shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over their own business and operations.
Appears in 1 contract
Operation of the Business of the Company. Except (a) During the Pre-Closing Period, except (w) as described set forth in Section 5.2 4.2(a) of the Company Disclosure Schedule, (x) as otherwise expressly contemplated by this Agreement (for the avoidance of doubt, excluding Section 5.8(a)), (y) as required by applicable Law or (z) as expressly provided for by this Agreement, or with the prior written Parent shall otherwise consent of Parent in writing: (which consent shall not be unreasonably conditioned, withheld or delayed), during the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, i) the Company will conduct and will cause each of its Subsidiaries to conduct its operations in all material respects according to its ordinary course of business consistent with past practice, and the Company will use and will cause each of its Subsidiaries to shall use reasonable best efforts to preserve intact ensure that each Acquired Company conducts its business organization and to preserve the present relationships with those Persons having significant business relationships operations in accordance with the Company Budget; and (ii) the Company shall use commercially reasonable efforts to ensure that the Acquired Companies terminate and conduct an orderly wind-down of the Acquired Companies’ programs set forth in Section 4.2(a)(ii) of the Company Disclosure Schedule; provided, that the Acquired Companies shall not be required to take any action or any inaction that would constitute a breach of the Company’s obligations under this Agreement (including Section 4.2(a)(i) or Section 4.2(b)), so long as, in each such Subsidiaries. Without instance, the Company has provided written notice to Parent of such conflict and a reasonable opportunity for Parent to consult with the Company and, if practicable, resolve such conflict.
(b) In addition, without limiting the generality of the foregoing, during the Pre-Closing Period, except (w) as set forth in Section 5.2 4.2(b) of the Company Disclosure Schedule, (x) as otherwise expressly contemplated by this Agreement, (y) as required by applicable Law or (z) as expressly provided for by this AgreementParent shall otherwise consent in writing (with respect to clauses (vii), during the period from the date of this Agreement (viii), (ix), (x), (xv) and continuing until the earlier of the termination of this Agreement or the Effective Time(xvii), without the prior written such consent of Parent (which consent shall not to be unreasonably conditionedwithheld, withheld conditioned or delayed), the Company will shall not, and the Company shall ensure each of its Subsidiaries does not and will shall not permit any of its Subsidiaries to:
(ai) (iA) adopt declare, accrue, set aside or pay any amendments to its certificate dividend or make any other distribution in respect of incorporation or bylaws (any shares of capital stock or other similar governing documents) or (ii) hold any annual or special meeting securities of the stockholders Acquired Companies (other than dividends or distributions by a wholly owned Subsidiary of the Company to the Company or fileanother wholly owned Subsidiary of the Company), mail or (B) repurchase, redeem or otherwise distribute reacquire any proxy solicitations shares of capital stock or statement in respect thereof other securities of the Acquired Companies, other than (other thanx) repurchases from terminated employees, with respect to clause directors or consultants of the Acquired Companies, or (ii), y) in connection with the Company’s annual meeting payment of stockholders for 2016the exercise price and/or withholding Taxes incurred upon the exercise, provided that (A) only matters that would not require settlement or vesting of any award granted under a Company Stock Incentive Plan in accordance with the filing of a preliminary proxy statement under SEC regulations are presented for approval at such meeting and (B) the proxy statement in respect terms of such meeting is not filed, mailed or otherwise distributed prior to November 5, 2016)award in effect on the date of this Agreement;
(bii) sell, issue, sellgrant, grant options pledge or rights to purchase, pledgeotherwise dispose of or encumber, or authorize or propose agree to the sale, issuance, salegrant, grant pledge or other disposition or encumbrance of: (A) any capital stock or other security (other than the issuance of options Company Common Stock upon the valid exercise of Company Options or rights Company Warrants or the vesting of Company RSUs, in each case, to purchase or pledge, any Company Securities or securities of any Subsidiary the extent outstanding as of the Companydate of this Agreement); (B) any option, call, warrant or right to acquire any capital stock or other security; or (C) any instrument convertible into or exchangeable for any capital stock or other security;
(iii) other than as required pursuant to the terms of a Company Shares issuable (i) in accordance with the Company ESPP terms Employee Plan as in effect on the date of this AgreementAgreement or, (ii) upon exercise of Company Options outstanding on the date of this Agreement or the vesting of Company RSU Awards outstanding on the date of this Agreement in accordance with their terms and (iii) the conversion of the Company Convertible Notes into Company Shares in accordance with their terms;
(c) acquire or redeem, directly or indirectly, or amend any Company Securities, other than (i) as provided by any Company Stock Plan, (ii) the redemption of the Company Convertible Notes in accordance with their terms, (iii) the acquisition by the Company of Company Shares in connection with the surrender of Company Shares by holders of Company Options in order to pay the exercise price of such Company Options, (iv) the withholding of Company Shares to satisfy Tax obligations solely with respect to Company Options or Company RSU Awards or (v) the acquisition by the Company of Company Options or Company RSU Awards in connection with the forfeiture of such awards;
(d) splitEarn-Out, combine or reclassify its capital stock or declare, set aside, make or pay any dividend or distribution (whether in cash, stock or property) on any shares of its capital stock (other than dividends paid to the Company or one of its wholly owned Subsidiaries as expressly permitted by a wholly owned Subsidiary of the Company);
(e) (i) acquire, by means of a merger, consolidation, recapitalization or otherwise, any material business, assets or securities (other than any acquisition of assets, including active pharmaceutical ingredients and other supplies, in the ordinary course of business consistent with past practiceSection 5.17(a), (ii) sell, lease, or otherwise dispose of any material assets of the Company or any of its Subsidiaries, except (A) pursuant to Contracts or commitments existing as of the date of this Agreement, (B) the sale of the Company Products in the ordinary course of business consistent with past practices, (C) non-exclusive outbound licenses to service providers, clinical trial agreements and material transfer agreements, in each case in the ordinary course of business consistent with past practices, and (D) de minimis dispositions or abandonments, in each case in the ordinary course of business and consistent with past practice, or (iii) adopt a plan of complete or partial liquidation, dissolution, recapitalization or restructuring;
(f) make any loans, advances or capital contributions to, or investments in, any other Person (other than wholly owned Subsidiaries of the Company), except for advances to employees for travel and other business expenses in the ordinary course of business consistent with past practice;
(g) enter into, renew or terminate (or allow to terminate or expire) any Material Contract or amend any Material Contract in any material respect or grant any release or relinquishment of any material rights under any Material Contract;
(h) incur, assume or otherwise become liable or responsible for any indebtedness for borrowed money, except for indebtedness permitted under Sections 9.05(c), (g) and (h) of the Company Loan Agreement that are incurred in the ordinary course of business consistent with past practice;
(i) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person except wholly owned Subsidiaries of the Company;
(j) change, in any material respect, any financial accounting methods, principles or practices used by it, except in order to comply with GAAP or applicable Law;
(k) make any material change to any accounting method or change any annual Tax accounting period, make or change any material Tax election, file any material Tax Return other than on a basis consistent with past practice, amend any material Tax Return, settle, compromise or consent to any material Tax claim or assessment, surrender a right to a material Tax refund, waive or extend the statute of limitations with respect to any material Tax other than pursuant to extensions of time to file a Tax Return obtained in the ordinary course of business, or incur any Taxes as a result of distributing, lending, transferring or otherwise repatriating any property in-kind or any cash amounts into the United States;
(l) except as contemplated by Section 6.9, (A) establish, adopt, terminate or amend any Plan (or any plan, program, arrangement, practice or agreement that would be an Plan if it were in existence on the date hereof except that the Company may amend any Plans to the extent required by applicable Law), (B) amend or waive any of its rights under, or accelerate the vesting of Company Equity Awards granted under, any provision of any of the Plans (Company Stock Incentive Plans, any Company Warrants, any provision of any Contract evidencing any outstanding Company Equity Award or Company Warrant, the Company DeSPAC Merger Agreement or any planContract ancillary thereto in respect of the Company Earn-Out, programor otherwise modify any of the terms of any Company Equity Award, arrangementany Company Warrant, practice the Company Earn-Out or agreement any other option, call, warrant or right to acquire any capital stock or other security, any instrument convertible or exchangeable for any capital stock or other security, or any related Contract;
(iv) amend or permit the adoption of any amendment to the certificate of incorporation or bylaws or other charter or organizational documents of any Acquired Company;
(v) form any Subsidiary, acquire any equity interest or other interest in any other Person (other than marketable securities purchased in the ordinary course in accordance with the Investment Policy Guidelines set forth on Section 2.1(d) of the Company Disclosure Schedule), or enter into a joint venture or similar arrangement with any other Person;
(vi) effect or be a party to any acquisition, merger, consolidation, share exchange, business combination, amalgamation, recapitalization, reclassification of shares, stock split, reverse stock split, division or subdivision of shares, consolidation of shares or similar transaction (other than the Contemplated Transactions);
(vii) except for any action (x) taken in accordance with the Company Budget (including the 10% “cushion” described therein) or (y) expressly required by and taken in accordance with the terms of this Agreement, (A) make any expenditures (including capital expenditures), (B) permit, agree to or consent to the incurrence of any liability that would be an Plan if it were in existence on material to the date hereof)Acquired Companies, taken as a whole, or (C) grant discharge or satisfy any Company Employee any increase in compensation, bonuses or other benefits or (D) pay any severance, retention or retirement benefits to any current or former Company Employee, other than vested benefits (including benefits that become vested as a result of a termination of employment permitted under this Section 5.2 or the transactions) required by the terms of a Plan listed on Section 3.16(a) of the Disclosure Schedule or (E) grant any equity or equity-based compensation to any Company Employeemonetary liabilities;
(mviii) make (A) enter into or become bound by any Contract that would have been a Company contributions (excluding contributions which are employee deferrals of eligible earnings under the Company’s 401(k) Plan) Material Contract if entered into on or prior to the Company’s 401(k) Plan other than as required under the terms of such plan as in effect on the date of this Agreement, other than as expressly permitted by Section 5.17(a), or make (B) amend, voluntarily terminate or waive any contribution material right or remedy under any Company Material Contract, other than (1) a termination upon the expiration of any such Company Material Contract in accordance with its terms or (2) a termination of any such Company Material Contract pursuant to which the Company’s 401(kAcquired Companies (x) Plan incur monetary liabilities in accordance with the Company SharesBudget and (y) incur no material non-monetary obligations;
(nix) except as provided for in the Company Budget, acquire, lease or license any right or asset (or group of related rights or assets) from any other Person;
(A) except as provided for in the Company Budget, sell, transfer, lease, convey or dispose of any assets, properties or business (or group of related assets, properties or businesses) of the Acquired Companies (including Company Intellectual Property and Company Software); and (B) except (x) as provided for in the Company Budget or (y) otherwise consistent with the winding down of the Acquired Companies’ programs described in Section 4.2(a)(ii) of the Company Disclosure Schedule, abandon, cancel, fail to maintain, let lapse or surrender any assets, properties or business (or group of related assets, properties or businesses) of the Acquired Companies (including Company Intellectual Property and Company Software);
(xi) except as provided for in the Company Budget, make any pledge of any of its rights or assets (or group of related rights or assets), or permit any of its rights or assets (or group of related rights or assets) to become subject to any Encumbrances (other than Permitted Encumbrances);
(xii) (iA) enter into lend money to any Plans, Person (other than with any Company Employee, who is not an executive officer, with an annual base salary the advancement of less than $200,000 expenses to employees and directors for routine travel and business expense made in the ordinary course of business consistent with past practice), or (iiB) hireincur or guarantee any indebtedness for borrowed money, promote including any such indebtedness of others;
(xiii) other than as required pursuant to the terms of a Company Employee Plan as in effect on the date of this Agreement: (A) adopt, terminate, establish or terminate enter into any Company Employee other than Plan or any plan, program, policy, agreement or arrangement that would be a Company Employee, who is not an executive officer, with an annual base salary of less of $200,000 Employee Plan if it was in the ordinary course of business consistent with past practice;
(o) enter into any Labor Agreement;
(p) make or authorize any capital expenditure or incur any obligations, Liabilities or indebtedness in respect thereof, except for (i) those contemplated by the capital expenditure budget for the relevant fiscal year, which capital expenditure budget has been provided or made available to Parent prior to effect on the date of this Agreement, (B) cause or permit any Company Employee Plan to be amended or modified in a manner that would, individually or in the aggregate, materially increase costs, obligations or liabilities for the Company or Parent, or accelerate the vesting of any compensation for the benefit of any current or former director, officer, employee or consultant, (C) increase the amount of the wages, salary, commissions, bonus compensation or other compensation or benefit payable to any of its current or former directors, officers, employees or consultants, (D) pay any bonus or make any profit-sharing or similar payment to, or enter into or amend any employment severance, retention or change-of-control or termination agreement with any current or former director, officer, employee or consultant (or make any related or similar payments), or (E) hire, terminate (other than for cause or as otherwise contemplated by the Company Budget) or change the employment status or title of, or promote, any officer or employee (other than any hire, change of employment title or promotion of an employee to fill a vacancy resulting from the resignation, without good reason, of an officer or key employee of the Acquired Companies);
(xiv) recognize any labor union or labor organization;
(xv) materially change any of its methods of accounting or accounting practices in any respect, except insofar as may be required by GAAP or regulatory guidelines;
(xvi) make, change or revoke any income or other material Tax election, fail to pay any income or other material Tax as such Tax becomes due and payable, file any amendment making any material change to any Tax Return, settle or compromise any income or other material Tax liability or submit any voluntary disclosure application, request or consent to any extension or waiver of any limitation period with respect to any claim or assessment for any income or other material Taxes, or adopt or change any material accounting method in respect of Taxes;
(xvii) subject to Section 5.15 with respect to securityholder litigation, commence, initiate, settle or compromise any Legal Proceeding or other material claim against the Acquired Companies; or
(xviii) agree, resolve or commit to do any of the foregoing.
(c) During the Pre-Closing Period, the Company shall promptly notify Parent in writing of any event, condition, fact or circumstance that would reasonably be expected to make the timely satisfaction of any of the conditions set forth in Section 6.1 or Section 6.2 impossible or unlikely, or that has had or would reasonably be expected to have or result in a Company Material Adverse Effect. Without limiting the generality of the foregoing, the Company shall notify Parent in writing of: (i) any claim asserted or Legal Proceeding commenced, or, to the Knowledge of the Company, threatened, against, relating to, involving or otherwise affecting any of the Contemplated Transactions; (ii) any unbudgeted capital expenditures in an amount not to exceed $150,000 in Knowledge of any notice from any Person alleging that the aggregate;
(q) settle any Legal Proceeding other than a settlement solely for monetary damages (net consent of insurance proceeds received) not in excess of $50,000 individually such Person is or $200,000 in the aggregate or commence any Legal Proceeding except may be required in connection with a breach of this Agreement the Mergers or any other agreements contemplated by this Agreement; or
(r) offer, agree or commit, in writing or otherwise, to take any of the foregoing actionsother Contemplated Transactions; and (iii) any other material Legal Proceeding or material claim threatened, commenced or asserted against or with respect to the Acquired Companies. Notwithstanding No notification given to Parent pursuant to this Section 4.2(c) shall limit or otherwise affect any of the foregoingrepresentations, nothing in this Agreement is intended to give Parent warranties, covenants or Merger Sub, directly or indirectly, the right to control or direct the business or operations obligations of the Company or its Subsidiaries at any time prior to the Effective Time. Prior to the Effective Time, the Company and its Subsidiaries shall exercise, consistent with the terms and conditions of contained in this Agreement, complete control and supervision over their own business and operations.
Appears in 1 contract
