Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not permit any of the Company Group Members to engage in any of the following actions without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed: (i) amend the Organizational Documents of any Company Group Member or of Pennant Midstream; (ii) (A) issue, sell or deliver any shares of capital stock or any other equity securities or equity equivalents of any Company Group Member or (B) amend in any material respect any of the terms of any securities of any Company Group Member outstanding as of the Effective Date; (iii) (A) split, combine, or reclassify its outstanding equity interests, (B) declare, set aside or pay any non-cash distribution in respect of the outstanding equity of any Company Group Member, (C) repurchase, redeem or otherwise acquire any securities of any Company Group Member or (D) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of any Company Group Member; (iv) declare, set, pay, make or distribute any in-kind distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests; (v) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Member, (A) create, incur, guarantee or assume any Indebtedness for Borrowed Money or otherwise become liable or responsible for the obligations of any other Person (other than a Company Group Member) that remains outstanding as of the Closing, or (B) mortgage or pledge any of its material assets, tangible or intangible, or create any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrances; (vi) acquire assets or sell, lease, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in the ordinary course of business consistent with past practice; (vii) merge or consolidate with any Person, acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereof, make an investment in, or purchase any securities from, any Person, or enter into any joint venture, partnership or similar venture with any other Person; (viii) change in any material respect any of the financial accounting principles or practices used by any Company Group Member, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year; (ix) settle any Proceeding against a Company Group Member unless such settlement (A) requires the payment of less than $2,000,000 by such Company Group Member, (B) involves the unconditional release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closing; (x) make any capital expenditure other than (A) as set forth in the budget attached hereto as Schedule 6.2(a)(x), (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s); (xi) enter into any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x); (xii) amend in any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract; (xiii) fail to maintain, or cause to be maintained, insurance coverage for the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate; (xiv) make or change any Tax election, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, in each case, if such action would reasonably be expected to have a material adverse effect on Buyer; (xv) fail to use Reasonable Efforts to maintain all material Governmental Approvals in effect on the Effective Date and necessary or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Date; or (xvi) enter into any agreement or commitment to do any of the foregoing. (b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan in effect on the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 2019, in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller. (c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period.
Appears in 1 contract
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated required by this Agreement (including Section 7.10) or the Arrangement Agreement, prior to the Closing, Seller shall not, and shall not permit the Company, its Subsidiaries or any of Seller Affiliate with respect to the Company Group Members Business, to engage in any of the following actions without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed:
(i) amend the Organizational Documents of the Company or any Company Group Member or of Pennant Midstreamits Subsidiaries;
(ii) (A) issue, sell or deliver any shares of capital stock or any other equity securities or equity equivalents of any the Company Group Member or its Subsidiaries or (B) amend in any material respect any of the terms of any securities of any the Company Group Member or its Subsidiaries outstanding as of the Effective Datedate hereof;
(iii) (A) split, combine, or reclassify its the outstanding equity interestsinterests of the Company or any of its Subsidiaries, (B) declare, set aside or pay any non-cash distribution in respect of the outstanding equity of the Company or any Company Group Memberof its Subsidiaries, (C) repurchase, redeem or otherwise acquire any securities of the Company or any Company Group Member of its Subsidiaries or (D) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any Company Group Memberof its Subsidiaries;
(iv) declare, set, pay, make or distribute any in-kind distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests;
(v) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Memberpractice, (A) create, incur, guarantee or assume any Indebtedness for Borrowed Money of the Company or any of its Subsidiaries or otherwise become liable or responsible for the obligations of any other Person (other than a Company Group Memberthe Company) that remains outstanding as of the Closing, or (B) mortgage or pledge any material assets of the Company or any of its material assetsSubsidiaries, tangible or intangible, or create any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrances;
(viv) acquire assets in the Company or any of its Subsidiaries with a value in the aggregate exceeding $10,000,000, except as expressly contemplated in the capital expenditure budget made available to Buyer;
(vi) sell, lease, sublease, assign, distribute, pledge, transfer, abandon, permit to lapse or expire (including by means of allowing to lapse or failing to maintain, renew or enforce, or failing to pay applicable maintenance, renewal, registration fees or other dues) or otherwise dispose of, directly or indirectly, any material assets of the Company or any Company Group Member, except for sales and dispositions of hydrocarbons its Subsidiaries with a value in the ordinary course of business consistent with past practiceaggregate exceeding $10,000,000;
(vii) merge (A) acquire in the Company or consolidate with any Person, acquire of its Subsidiaries (by merger, consolidation, or acquisition of stock or assets or otherwise) all or substantially all of the assets of, or any equity interest of, any corporation, partnership, limited liability company, or other business organization or division thereof, make an investment in, thereof or purchase any securities from, any Person, or (B) enter into any joint venture, partnership or similar venture with between the Company and any other of its Subsidiaries and any Person;
(viii) change in any material respect any of the financial accounting principles or practices used by the Company or any Company Group Memberof its Subsidiaries, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ix) settle any Proceeding against a the Company Group Member or any of its Subsidiaries unless such settlement (A) requires solely the payment of less than $2,000,000 5,000,000 by the Company or such Company Group MemberSubsidiary, (B) involves the unconditional release of such the Company Group Member and its Subsidiaries with respect to the subject matter of the Proceeding and (C) does not impose any material obligations or injunctive or equitable relief on the Company or any Company Group Member of its Subsidiaries after the Closing;
(x) cause the Company or any of its Subsidiaries to (i) make any capital expenditure other than (A) as set forth in the capital expenditure budget attached hereto as Schedule 6.2(a)(x)made available to Buyer, (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a emergency affecting the Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such the capital expenditure budget made available to Buyer and do not exceed $5,000,000 in the aggregate; provided, that, or (ii) fail to make any material capital expenditure substantially in accordance with the capital expenditure budget made available to Buyer other than variations thereto (including acceleration or delay of timing for making expenditures) in the case ordinary course of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s)business reasonably consistent with past practices;
(xi) enter into any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x);
(xii) amend in any material respect, terminate, accelerate, modify, extend cause or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiii) fail to maintain, or cause to be maintained, insurance coverage for allow the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate;
of its Subsidiaries to (xivA) make or change any material Tax election, (B) settle or compromise any claim, notice, audit report or assessment in respect of material Taxes, (C) change any annual Tax accounting period, adopt or change any method of Tax accounting, (D) file any amended Tax Return, (E) enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, material Tax (F) surrender any right to claim a Tax refund, refund or (D) consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, in each case, if such action would reasonably be expected other than in the ordinary course of business and consistent with past practices;
(xii) amend in any material respect, fail to have a renew or terminate any Material Contract;
(xiii) amend in any material adverse effect on Buyerrespect, fail to renew or terminate any Material Permit;
(xiv) cause the Company or any of its Subsidiaries engage in any new line of business;
(xv) fail to use Reasonable Efforts manage the Company’s and its Subsidiaries’ working capital in the ordinary course of business consistent with past practices;
(xvi) cause the Company or any of its Subsidiaries make a voluntary assignment for the benefit of creditors or file a voluntary petition for bankruptcy relief or insolvency or otherwise institute insolvency proceedings of any type, or liquidate, dissolve, reorganize or otherwise wind up the Business or its operations;
(xvii) except (A) to maintain all material Governmental Approvals the extent required by applicable Law or (B) to the extent required by any Benefit Plan as in effect on the Effective Date date of this Agreement, (i) grant any loan to, or except in the ordinary course of business consistent with past practice and necessary during the same time of year of past practice, increase the compensation or benefits or pay any bonus to any Available Employee, (ii) grant any severance, change of control, retention, termination or similar compensation or benefits to any Available Employee, (iii) amend (in a manner that increases the financial value of benefits provided to an Available Employee), adopt, establish, agree to establish, enter into or terminate any Benefit Plan or collective bargaining agreement or other labor union contract with respect to any Available Employee, (iv) pay to any Available Employee any benefit or amount not required for the ownership and operation of the Company Group Members under any Benefit Plan as owned and operated in effect on the Effective Datedate of this Agreement, (v) take any action to accelerate the vesting of, or payment of, any compensation or benefit payable to Available Employees under any Benefit Plan, (vi) transfer the employment of any employee from a status in which such employee would have been an Available Employee to a status in which such employee will not be an Available Employee, (vii) transfer the employment of any employee from a status in which such employee would not have been an Available Employee to a status in which such employee will be an Available Employee, or (viii) hire or transfer any new employee who would be an Available Employee except, the hire or transfer of employees in the ordinary course of business consistent with past practice (including to fill vacancies); or
(xvixviii) enter into any agreement or commitment to do any of the foregoing.
(b) Without limiting Notwithstanding the generality foregoing provisions of this Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan in effect on the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 20196.2, in the ordinary course event of business an emergency, to preserve life, property or the environment, Seller may take such action as reasonably necessary in response to such emergency and do not exceed 5% of the value shall notify Buyer of such bonus, salary or other compensation or benefits action and the emergency circumstances in reasonable detail as in effect on the date hereof, soon as practicable (B) entering into new retention agreements, for or with respect using Reasonable Efforts to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms do so prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments action taken pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Sellerb)).
(c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Pembina Pipeline Corp)
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this AgreementSection 7.7 or as otherwise expressly provided in Schedule 6.2, prior to the Closing, the Shareholder and Seller shall not permit any of the Company Group Members to engage in any of the following actions not, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned withheld or delayed, to:
(ia) permit the Company to amend the Organizational Documents its certificate of any Company Group Member formation or of Pennant Midstreamlimited liability company agreement;
(iib) permit the Company to (Ai) issue, sell sell, or deliver any shares of capital stock membership interests or any other equity securities or equity equivalents of any Company Group Member equivalents; or (Bii) amend in any material respect any of the terms of any securities of any Company Group Member such interests outstanding as of the Effective Datedate hereof;
(iiic) permit the Company to (Ai) split, combine, or reclassify any of its outstanding equity interests, equity; (Bii) declare, set aside or pay any non-cash dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of its outstanding equity, except to pay and distribute to Seller the outstanding equity of any Company Group Member, Excluded Assets; (Ciii) repurchase, redeem or otherwise acquire any of its Interests or other securities of any Company Group Member or equity equivalents; or (Div) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization recapitalization, or other reorganization of any Company Group Memberreorganization;
(ivd) declare, set, pay, make or distribute any in-kind distributions on any permit the Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests;
to (v) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Member, (Ai) create, incur, guarantee guarantee, or assume any Indebtedness indebtedness for Borrowed Money borrowed money or otherwise become liable or responsible for the obligations of any other Person Person; (other than a Company Group Memberii) that remains outstanding as of the Closingmake any loans, advances, or capital contributions to, or investments in, any other Person; or (Biii) mortgage or pledge any of its material assets, tangible or intangible, or create any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrances;
(vie) acquire assets or permit the Company to acquire, sell, lease, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in outside the ordinary course of business consistent with past practice;
(viif) merge or consolidate with any Person, permit the Company to acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereof;
(g) permit the Company to terminate, make an investment inamend, or purchase grant any securities fromwaiver of any material term under, or give any material consent with respect to, any Person, Material Contract or enter into any joint venture, partnership contract or similar venture with any other Personagreement that would be a Material Contract;
(viiih) permit the Company to change in any material respect any of the financial accounting principles or practices used by any Company Group MemberXxxxx-Xxxxx, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ixi) settle permit the Company to establish or amend any Proceeding against Benefit Plan other than as required by the terms of any such Benefit Plan or to comply with applicable Law, or establish any plan, agreement, program, policy, trust, fund or other arrangement that would be a Company Group Member unless such settlement (A) requires the payment of less than $2,000,000 by such Company Group Member, (B) involves the unconditional release of such Company Group Member with respect to the subject matter Benefit Plan if it were in existence as of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closingdate of this Agreement;
(xj) make permit the Company to settle any capital expenditure claim or Proceeding (other than (A) as set forth those legal Proceedings constituting Excluded Assets), other than settlements in the budget attached hereto as Schedule 6.2(a)(x)ordinary course of business consistent with past practice, in each case (Bi) as may be required to comply with Law, for no more than $250,000 (C) as may be reasonably required in response to any damage to individually or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, aggregate with other settlements since the date of this Agreement) and (ii) in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts a manner that does not involve non-monetary relief that would otherwise reasonably be prohibited by this clause (x) in order expected to prevent adversely effect the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice ability of Xxxxx-Xxxxx to Buyer upon the occurrence of such emergency and upon taking of such action(s)operate its business as currently conducted consistent with past practice;
(xik) enter into any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x);
(xii) amend in any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiii) fail to maintain, or cause to be maintained, insurance coverage for permit the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate;
(xiv) make or change any material election in respect of Taxes, adopt or change any accounting method in respect of Taxes, file any amendment to a federal, state or foreign income Tax electionReturn or any other material Tax Return, enter into any Tax sharing or similar agreement or closing agreement, settle or compromise any claim, notice, audit report claim or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations limitation period applicable to any Tax claim or assessmentassessment in respect of Taxes, in each case, if such action would reasonably be expected or enter into intercompany transactions giving rise to have a material adverse effect on Buyerdeferred gain or loss of any kind;
(xvl) fail permit the Company to use Reasonable Efforts purchase any equity interests or other securities of any Person, except for short-term investments made in the ordinary course of business consistent with past practice;
(m) grant, or permit the Company to maintain all grant, to any Employee or Worker (or agree with XxxXxxxx to xxxxx) an increase in compensation or take any action with respect to the amendment or grant of any severance or termination or compensation pay policies or arrangements for any Employee other than in the ordinary course of business consistent with past practices or as required by or to comply with the terms of a Benefit Plan or applicable Law, provided, however, that the Company, in its discretion, may (i) grant Employees and Workers base pay increases in the manner and to the extent described on Schedule 6.2, and (ii) pay bonuses and other amounts to Key Personnel, other Employees, Workers, former employees and others in connection with the Closing in an aggregate amount that is not in excess of the limit set forth on Schedule 6.2 (provided that (x) the amount of such bonuses, including any withholdings and associated payroll tax liability, will be deducted from the Company’s cash balances prior to the Company’s distribution as part of the Excluded Assets to Seller as described in Section 7.7 and the Purchase Price shall be reduced dollar-for-dollar to the extent the amount of such bonuses exceeds the Company’s cash balances prior to such distribution of such cash balances as part of the Excluded Assets as described in Section 7.7, and (y) the Seller will advise Buyer of the identities of the recipients of such bonuses and the amount for each recipient at least two Business Days prior to Closing);
(n) permit the Company to cancel or terminate any of the insurance coverage or allow any insurance coverage to lapse, unless simultaneously with such termination, cancellation or lapse, replacement policies underwritten by insurance or re-insurance companies of nationally recognized standing provide coverage equal to or greater than the coverage under the cancelled, terminated or lapsed policies for substantially similar premiums are in full force and effect;
(o) directly or indirectly (i) discuss or continue to discuss, negotiate or continue to negotiate, initiate, authorize, propose or enter into any transaction involving a business combination, the sale of a material Governmental Approvals in effect on amount of the Effective Date and necessary or required for the ownership and operation assets of the Company Group Members as owned and operated on or the Effective DateSeller, the sale of the Interests or that would otherwise be inconsistent with the transactions contemplated by this Agreement or (ii) furnish information to or otherwise cooperate with any Person to engage in or seek to engage in any such transaction; or
or (xvip) enter into any agreement agree or commitment commit to do any of the foregoing.
(b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan in effect on the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 2019, in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller.
(c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Forum Energy Technologies, Inc.)
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not permit any of the Company Group Members to engage in any of the following actions without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed:
(i) amend the Organizational Documents of any Company Group Member or of Pennant MidstreamMember;
(ii) (A) issue, sell or deliver any shares of capital stock or any other equity securities or equity equivalents of any Company Group Member or (B) amend in any material respect any of the terms of any securities of any Company Group Member outstanding as of the Effective Date;
(iii) (A) split, combine, or reclassify its outstanding equity interests, (B) declare, set aside or pay any non-cash distribution in respect of the outstanding equity of any Company Group Member, (C) repurchase, redeem or otherwise acquire any securities of any Company Group Member or (D) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of any Company Group Member;
(iv) declare, set, pay, make or distribute any distributions, or otherwise make any return of capital, on the Purchased Interests, in each case, whether in cash, cash equivalents, in-kind or otherwise; provided, however, that this Section 6.2(a)(iv) shall not prohibit or limit distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interestscontemplated by Section 7.13;
(v) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Member, (A) create, incur, guarantee or assume any Indebtedness for Borrowed Money or otherwise become liable or responsible for the obligations of any other Person (other than a Company Group Member) that remains outstanding as of the Closing, or (B) mortgage or pledge any of its material assets, tangible or intangible, or create any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrances;
(vi) acquire assets or sell, lease, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in the ordinary course of business consistent with past practice;
(vii) merge or consolidate with any Person, acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereof, make an investment in, or purchase any securities from, any Person, or enter into any joint venture, partnership or similar venture with any other Person;
(viii) change in any material respect any of the financial accounting principles or practices used by any Company Group Member, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ix) settle any Proceeding against a Company Group Member unless such settlement (A) requires the payment of less than $2,000,000 by such Company Group Member, (B) involves the unconditional release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closing;
(x) make any capital expenditure other than (A) as set forth in the budget attached hereto as Schedule 6.2(a)(x)Pennant Budget, (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s);
(xi) enter into any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x);
(xii) amend in any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiii) fail to maintain, or cause to be maintained, insurance coverage for the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller Seller. Pennant Midstream or any Seller AffiliateAffiliate (as applicable);
(xiv) make or change any Tax election, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, in each case, solely with respect to the Company, and not Pennant Midstream or the Pennant Subsidiaries, and only if such action would reasonably be expected to have a material adverse effect on Buyer;
(xv) fail to use Reasonable Efforts to maintain all material Governmental Approvals in effect on the Effective Date and necessary or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Date; or
(xvi) enter into any agreement or commitment to do any of the foregoing.
(b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan in effect on the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 2019, in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller.
(c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period.
Appears in 1 contract
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except as set forth on otherwise expressly provided in Schedule 6.2 or otherwise contemplated by this Agreement6.2, prior to the Closing, Seller shall not permit any of the Company Group Members to engage in any of the following actions Tejas Company, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned withheld or delayed, to:
(ia) amend the Organizational Documents of any Company Group Member its charter or of Pennant Midstreambylaws or other governing instruments;
(iib) (Ai) issue, sell sell, or deliver any shares of its capital stock of any class or any other equity securities or securities, equity equivalents of any Company Group Member or other ownership interests; or (Bii) amend in any material respect any of the terms of any securities of any Company Group Member such securities, equity equivalents or other ownership interests outstanding as of the Effective Datedate hereof;
(iii) (Ai) split, combine, or reclassify any shares of its capital stock or outstanding equity or other ownership interests, ; (Bii) declare, set aside or pay any non-cash dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of the its capital stock or outstanding equity of any Company Group Member, or other ownership interests; (Ciii) repurchase, redeem or otherwise acquire any securities of any Company Group Member its securities; or (Div) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization recapitalization, or other reorganization of any Company Group MemberTejas Company;
(iv) declare, set, pay, make or distribute any in-kind distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests;
(vd) except in the ordinary course of business consistent with past practice create or for borrowings made under any existing credit facility of a Company Group Member, (A) create, incur, guarantee or assume incur any Indebtedness for Borrowed Money Money, assume, guarantee, endorse or otherwise become liable or responsible for the obligations of any other Person, except for obligations of another Tejas Company;
(e) make any loans, advances, or capital contributions to, or investments in, any other Person (other than a Company Group Memberany Tejas Company;
(f) cancel any debts owed to or claims held (including the settlement of any claims or litigation) other than in the ordinary course of business consistent with past practice;
(i) except as may be required by applicable Law, enter into, adopt or make (and Seller shall not make) any amendments to any Benefit Plan that remains outstanding as of would materially increase the ClosingTejas Companies' liability under any Benefit Plan, or (Bii) mortgage pay to any director or pledge officer of the Tejas Companies any of its material assets, tangible or intangiblebenefit not permitted by any Benefit Plan, or create (iii) increase the compensation of any material Encumbrance thereupon that is not released at officer or prior to Closing, key employee or consultant other than Permitted Encumbrancesin the ordinary course of business consistent with past practice;
(vih) acquire assets or acquire, sell, lease, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in outside the ordinary course of business consistent with past practice;
(viii) merge or consolidate with any Person, acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereof, make an investment in, or purchase any securities from, any Person, or enter into any joint venture, partnership or similar venture with any other Person;
(viiij) enter into, amend, modify, or change any Material Contract except in the ordinary course of business provided however, Seller shall give Buyer prompt notice of any material change to, or the entering into of, any new Material Contract;
(k) change in any material respect any of the financial accounting principles or practices used by any Company Group Memberit, except for any change required by reason of applicable Law or a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ix) settle any Proceeding against a Company Group Member unless such settlement (A) requires the payment of less than $2,000,000 by such Company Group Member, (B) involves the unconditional release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closing;
(x) make any capital expenditure other than (A) as set forth in the budget attached hereto as Schedule 6.2(a)(x), (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s);
(xil) enter into any new Contract that would have been required to be disclosed renewal of, extension of or replacement for any of the Material Contracts listed on Schedule 4.15(a4.14(a) had it been in effect as of under the Effective Date, except as permitted under Section 6.2(a)(x)heading "Sales Contracts;" or
(xii) amend in any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiiim) fail to maintainmaintain in full force and effect, or cause to be maintained, insurance coverage for the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate;
(xiv) make or change any Tax electionreasonably available, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, in each case, if such action would reasonably be expected to have a material adverse effect on Buyer;
(xv) fail to use Reasonable Efforts to maintain all material Governmental Approvals insurance now in effect on covering the Effective Date and necessary Tejas Companies or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Date; or
(xvi) enter into any agreement or commitment to do any of the foregoingcomparable insurance.
(b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan in effect on the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 2019, in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller.
(c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period.
Appears in 1 contract
Samples: Purchase and Sale Agreement (Kinder Morgan Energy Partners L P)
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except Except as set forth on Schedule 6.2 or otherwise contemplated by expressly provided in this Agreement, in Schedule 6.1, in the Company’s 2007 and 2008 Annual Budgets in the form attached hereto as Annex I (the “Current Budget”) or as expressly agreed to in writing by Buyer, prior to the Closing, Seller shall cause each of the MidCon Entities to conduct its operations in all material respects according to its ordinary and usual course of business and consistent with its past practice and use its Reasonable Efforts to preserve intact its current business organization and to preserve its relationships with customers, suppliers, licensors, licensees, advertisers, distributors and others having business dealings with it. Without limiting the generality of the foregoing, except as expressly provided in this Agreement, in Schedule 6.1, or in the Current Budget, Seller shall not permit any of MidCon Entity other than the Company Group Members Joint Venture Entities (and with regard to engage in the Joint Venture Entities, Seller shall not consent to any of the following actions unless the withholding of such consent would cause Seller to breach a duty owed to any of the Joint Venture Entities or any partner thereof), without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned withheld or delayed, to:
(ia) amend the Organizational Documents of any Company Group Member its charter or of Pennant Midstreambylaws or other governing instruments;
(iib) (Ai) issue, sell sell, or deliver any shares of its capital stock of any class or any other equity securities or equity equivalents of any Company Group Member equivalents; or (Bii) amend in any material respect any of the terms of any such securities of any Company Group Member outstanding as of the Effective Datedate hereof;
(iiic) (Ai) split, combine, or reclassify any shares of its capital stock or outstanding equity interests, equity; (B) declare, set aside or pay any non-cash distribution in respect of the outstanding equity of any Company Group Member, (Cii) repurchase, redeem or otherwise acquire any securities of any Company Group Member its securities; or (Diii) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization recapitalization, or other reorganization of any Company Group MemberMidCon Entity;
(ivd) declareacquire, set, pay, make or distribute any in-kind distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests;
(v) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Member, (A) create, incur, guarantee or assume any Indebtedness for Borrowed Money or otherwise become liable or responsible for the obligations of any other Person (other than a Company Group Member) that remains outstanding as of the Closing, or (B) mortgage or pledge any of its material assets, tangible or intangible, or create any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrances;
(vi) acquire assets or sell, lease, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in outside the ordinary course of business consistent with past practice;
(viie) merge or consolidate with any Person, acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereof, make an investment in, or purchase any securities from, any Person, or enter into any joint venture, partnership or similar venture with any other Person;
(viiif) change in any material respect any of the financial accounting principles or practices used by any Company Group Member, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ix) settle any Proceeding against a Company Group Member unless such settlement (A) requires the payment of less make or rescind any express or deemed election relating to Taxes other than $2,000,000 as mandated by such Company Group Member, Law; (B) involves the unconditional release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closing;
(x) make any capital expenditure other than (A) as set forth in the budget attached hereto as Schedule 6.2(a)(x), (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency request for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s);
(xi) enter into any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x);
(xii) amend in any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiii) fail to maintain, or cause to be maintained, insurance coverage for the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate;
(xiv) make or change any a Tax election, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Returnruling, enter into any agreement with a Taxing Authority with respect to Tax allocation agreement, matters or provide a power of attorney regarding Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessmentmatters, in each case, if such action would reasonably be expected to have a material adverse effect on Buyer;
(xv) fail to use Reasonable Efforts to maintain all material Governmental Approvals in effect on which could affect any MidCon Entity after the Effective Date and necessary or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Closing Date; or
(xviC) enter into settle or compromise any agreement Tax claim or commitment other controversy relating to do any of the foregoing.
(b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this AgreementTaxes, prior to the Closingextent the amount of such settlement is equal to or greater than $50,000, Seller shall not, except to the extent a liability has been specifically accrued for with respect to Available Employeessuch Tax claim or controversy on the Balance Sheet in a manner consistent with GAAP; (D) file any amendments to any previously filed Tax Returns that could affect the Taxes of a MidCon Entity; (E) except as mandated by Law, without change any of its methods of reporting income or deductions for Tax purposes from those employed in the prior written consent preparation of Buyerthe most recently filed Tax Return that has been previously delivered or made available to Buyer on which such item of income or deduction was previously reported; or (F) file any Tax Return in a manner that is inconsistent with past custom and practice, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to by a change in Law;
(g) amend the Current Budget or approve any Seller Benefit Plan in effect on the date hereof other budget for it or as may be required under applicable Law, its subsidiaries;
(ih) increase the amount of incur or prepay any bonus, salary indebtedness (or other compensation or benefits to any Available Employeeguaranty another person’s indebtedness), other than (A) increases that occur after December 31, 2019, the MidCon Debt or in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater amount less than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, $5 million in the aggregate, exceed $1,000,000, (ii) except as would not result or create any liens on or security interest in material liability to any of the assets of the Company Group Members or Buyerits subsidiaries in connection therewith;
(i) grant any stock bonuses, enter intostock options or stock-based arrangements from the Company or its subsidiaries for their officers, establishdirectors or employees, or amend or provide for employee pension, benefit or welfare plans or arrangements by the Company or its subsidiaries other than ordinary course grants consistent with past practice;
(j) approve projects for capital expenditures outside the Current Budget other than capital expenditures reasonably necessary in the event of an emergency, to safeguard life or property, or to ensure compliance with Laws;
(k) make any filing with the Federal Energy Regulatory Commission otherwise than in the ordinary course, or materially amend any government permit, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employeesfiling with any governmental body, or seek any material governmental action;
(iiil) settle a dispute or litigation involving the Company or its subsidiaries that would materially adversely effect the Company or its subsidiaries or require payment by the Company or its subsidiaries of more than $10 million, individually or in the aggregate;
(Am) hire defer any individual who expenditure that otherwise would be an Available Employee, made consistent with its past practice and practices of a reasonable and prudent natural gas pipeline operator;
(n) amend or modify the cash management policies of the MidCon Entities or manage working capital other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or consistent with past practices;
(Bo) terminate accelerate the employment collection of any Available Employeeaccounts receivable or delay the payment of any accounts payable, other than due to failure in the ordinary course of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller.business consistent with past practice; or
(cp) Buyer’s approval cause the Company or its subsidiaries to enter into any contract to do any of the foregoing or to take any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days action, appeal or proceeding in connection with any of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that periodforegoing.
Appears in 1 contract
Samples: Purchase Agreement (Knight Inc.)
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement9.1, prior to the Closing, Seller shall not permit any of the Company Group Members to engage in any of the following actions without the prior written consent of BuyerCopano, which consent shall not be unreasonably withheld, conditioned the Contributors shall not and shall not cause the Partnership or delayedany of its Subsidiaries to take any action to:
(ia) amend the Partnership Agreement or the Certificate of Limited Partnership of the Partnership or the Organizational Documents of any Company Group Member or Subsidiary of Pennant Midstreamthe Partnership;
(iib) (Ai) transfer, issue, sell sell, pledge, encumber, dispose or deliver any shares of capital stock the Partnership Interests held by the respective Contributors or any other equity securities interest in the Partnership or equity equivalents any of its Subsidiaries; (ii) grant options, warrants, calls or other rights to purchase or otherwise acquire any Company Group Member interest in the Partnership or any of its Subsidiaries; (Biii) amend grant any Lien with respect to the Partnership Interests held by the respective Contributors or any interest held by the Partnership in any material respect Subsidiary of the Partnership, other than Permitted Liens; (iv) redeem, purchase or acquire any of the terms of Partnership Interests or any securities of interest in any Company Group Member outstanding as Subsidiary of the Effective Date;
Partnership, (iiiv) effect any reorganization or recapitalization of the Partnership or any of its Subsidiaries, (Avi) split, combinecombine or reclassify any of the Partnership Interests or any interest in any Subsidiary of the Partnership, or reclassify its outstanding equity interests, (Bvii) declare, set aside or pay any non-cash dividend or distribution in respect of the outstanding equity Partnership Interests or any interest in any Subsidiary of any Company Group Member, the Partnership (C) repurchase, redeem other than dividends or otherwise acquire any securities of any Company Group Member or (D) adopt distributions from a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of any Company Group MemberSubsidiary to the Partnership);
(ivc) declarecause the Partnership or any of its Subsidiaries to (i) except in the ordinary course of business consistent with past practice, set(A) as to the Partnership or any of its Subsidiaries, paycreate, incur, endorse, guarantee, or assume any Indebtedness or (B) modify the terms of any Indebtedness of the Partnership or any of its Subsidiaries; (ii) cause the Partnership or any of its Subsidiaries to make any loans, advances, or distribute capital contributions to, or investments in, any in-kind distributions on other Person; or (iii) mortgage or pledge any Company Group Member’s outstanding membership interests assets of the Partnership or limited liability company interestsany of its Subsidiaries, as applicabletangible or intangible, including the Purchased Interestsor create any Lien thereupon other than Permitted Liens;
(vd) cause the Partnership or any of its Subsidiaries to hire any new employees of the Partnership or any of its Subsidiaries, other than to fill vacancies in existing positions in the reasonable discretion of the Partnership,
(e) other than pursuant to the terms of any Material Contract, take any action prior to Closing to increase, or accelerate the vesting of, any benefits payable to the employees employed by the Partnership or any of its Subsidiaries;
(f) cause the Partnership or any of its Subsidiaries to grant to any employee any increase in compensation, except in the ordinary course of business consistent with past practice or for borrowings made under amend, modify or terminate any existing credit facility of a Company Group MemberBenefit Plan or any Benefit Program or Agreement, (A) create, incur, guarantee or assume any Indebtedness for Borrowed Money or except as otherwise become liable or responsible for the obligations of any other Person (other than a Company Group Member) that remains outstanding as of the Closing, or (B) mortgage or pledge any of its material assets, tangible or intangible, or create any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrancesexpressly contemplated by this Agreement;
(vig) acquire assets or acquire, sell, lease, license, assign, convey, transfer, or otherwise dispose of, directly or indirectly, any material assets of the Partnership or any Company Group Member, of its Subsidiaries except for sales and dispositions of hydrocarbons (i) in the ordinary course of business consistent with past practicepractices; (ii) sales of Hydrocarbons or entering into oil and gases Leases in the ordinary course of business; and (iii) sales of inventory and excess or obsolete assets in the ordinary course of business or personal property in the ordinary course of business that is either replaced by equivalent property or normally consumed in the operation of the Business;
(viih) merge cause the Partnership or consolidate with any Personof its Subsidiaries to, as to the Partnership or any of its Subsidiaries, acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereof, make an investment in, thereof or purchase any securities from, any Person, material assets or enter into any joint venture, partnership or similar venture with any other Personproperties;
(viiii) amend, modify, or change in any material respect any Material Contract other than amendments, modifications or changes to such Contracts made in the ordinary course of business consistent with past practices, or as required under Section 11.5;
(i) make any change to any of the financial accounting principles principles, methods, policies or practices used by any Company Group Memberthe Partnership or its Subsidiaries, except for any change required by reason of a concurrent change in GAAP; (ii) make or revoke any Tax election or change or make a request to change any Tax accounting methods, policies or immaterial, known accruals that may not normally be recorded intra-fiscal yearprocedures; or (iii) settle or compromise any proceeding relating to Taxes;
(ixk) settle cause the Partnership or any Proceeding against a Company Group Member unless such settlement of its Subsidiaries to engage in any new business or acquire the securities of any other Person;
(Al) requires cause the payment Partnership or any of less than $2,000,000 by such Company Group Member, (B) involves the unconditional its Subsidiaries to compromise any debt or claim or waive or release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on right except in the ordinary course of business consistent with past practice;
(m) cause the Partnership or any Company Group Member after of its Subsidiaries to other than in response to an emergency situation as is reasonably necessary to protect human health or safety, or the environment, cause the Partnership or any of its Subsidiaries to enter into any commitment for capital expenditures in excess of $500,000 for any individual commitment and $2 million for all commitments in the aggregate that will not be satisfied prior to Closing;
(xn) make amend or modify the terms and conditions of that certain Gas Purchase Agreement dated October 1, 2003 by and between Dynegy Midstream Services Limited Partnership and Central Crude, Inc., as amended by an Amendment to Gas Purchase Agreement dated effective as of October 5, 2005;
(o) amend, modify or cancel any capital expenditure of the insurance policies listed in Schedule 7.17 other than (A) renewals in the ordinary course of business on terms no less favorable than as set forth in the budget attached hereto as Schedule 6.2(a)(x), (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in on such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s);
(xi) enter into any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x);
(xii) amend in any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiii) fail to maintain, or cause to be maintained, insurance coverage for the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate;
(xiv) make or change any Tax election, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, in each case, if such action would reasonably be expected to have a material adverse effect on Buyer;
(xv) fail to use Reasonable Efforts to maintain all material Governmental Approvals in effect on the Effective Date and necessary or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Dateschedule; or
(xvip) enter into any agreement commit or commitment agree to do any of the foregoing.
(b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan in effect on the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 2019, in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller.
(c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period.
Appears in 1 contract
Pre-Closing Restrictions. During the period between February 17, 2011 and the Closing Date, Seller has not permitted the Acquired Company to:
(a) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 amend its charter or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not permit any of the Company Group Members to engage in any of the following actions without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned operating agreement or delayed:other governing instruments;
(b) (i) amend the Organizational Documents of any Company Group Member or of Pennant Midstream;
(ii) (A) issue, sell sell, or deliver or allow the transfer any shares of capital stock Membership Interests or any other equity securities equivalents or equity equivalents any subscriptions, options, warrants or other rights in respect of any Company Group Member the foregoing; or (Bii) amend in any material respect any of the terms of any securities of any Company Group Member the Membership Interests outstanding as of the Effective Datedate hereof;
(iiic) (Ai) split, combine, or reclassify its outstanding equity interests, any Membership Interests; (Bii) declare, set aside or pay any non-cash dividend or other distribution (whether in stock or property or any combination thereof) in respect of the outstanding equity of any Company Group Member, equity; (Ciii) repurchase, redeem redeem, or otherwise acquire any securities of any Company Group Member its Membership Interests; or (Div) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization recapitalization, or any other reorganization of any Company Group Memberthe Acquired Company;
(ivd) declare, set, pay, make or distribute any in-kind distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests;
(v) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Member, (Ai) create, incur, guarantee guarantee, or assume any Indebtedness indebtedness for Borrowed Money borrowed money for itself or any other Person or otherwise become liable or responsible for the obligations of any other Person Person; (other than a Company Group Memberii) that remains outstanding as of the Closingmake any loans, advances, or capital contributions to, or investments in, any other Person; or (Biii) mortgage or pledge any of its material assets, tangible or intangible, or create any material Encumbrance Lien thereupon that is not released at or prior to Closing, other than Permitted Encumbrances;
(vie) acquire assets or acquire, sell, lease, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in Assets outside the ordinary course of business consistent with past practice;
(viif) merge or consolidate with any Person, acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereofthereof or form any subsidiary;
(g) terminate (other than in accordance with its terms), make an investment inamend, modify, or purchase change in any securities frommaterial respect, or settle any material dispute in respect of, any PersonAcquired Company Agreements, or enter into any joint venture, partnership or similar venture with any other Person;
(viii) change in any material respect any of the financial accounting principles or practices used by any Company Group Member, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ix) settle any Proceeding against a Company Group Member unless such settlement (A) requires the payment of less than $2,000,000 by such Company Group Member, (B) involves the unconditional release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closing;
(x) make any capital expenditure other than (A) as set forth in the budget attached hereto as Schedule 6.2(a)(x), (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts contract that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s);
(xi) enter into any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x);
(xii) amend in any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiii) fail to maintain, or cause to be maintained, insurance coverage for the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate;
(xiv) make or change any Tax election, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, in each case, if such action would reasonably be expected to have a material adverse effect on Buyer;
(xv) fail to use Reasonable Efforts to maintain all material Governmental Approvals in effect on the Effective Date and necessary or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Date; or
(xvi) enter into any agreement or commitment to do any of the foregoing.
(b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan contract if in effect on the date hereof or as may be required under applicable Law, (i) increase the amount to take any action or omit to take any action that would constitute a material breach of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 2019, in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Acquired Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller.
(c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period.Agreement;
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Rentech Inc /Co/)
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 7.1(a) and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreementthe Contribution, prior to the Closing, Seller shall not permit any of the Company Group Members to engage in any of the following actions without the prior written consent of Buyer, which consent Seller (with respect to the Gathering Assets or the Business) shall not, and shall not be unreasonably withheldpermit any Seller Affiliate (with respect to the Gathering Assets or the Business) or the Company to, conditioned take or delayedconsent to any action to:
(i) amend the Organizational Documents charter or bylaws or other equivalent organizational or governing instruments of any Company Group Member or of Pennant Midstreamthe Company;
(ii) (A) transfer, issue, sell sell, pledge, encumber, dispose or deliver any shares of capital stock of any class or any other equity securities or equity equivalents of the Company; (B) grant options, warrants, calls or other rights to purchase or otherwise acquire shares of capital stock of any class or any other securities or equity equivalents of the Company Group Member or (BC) amend in any material respect any of the terms of any such securities of any Company Group Member or equity equivalents outstanding as of the Effective Datedate hereof;
(iii) (A) split, combine, or reclassify its any shares of capital stock or outstanding equity interests, of the Company; (B) declare, set aside or pay any non-cash dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of the capital stock or outstanding equity of any Company Group Member, the Company; (C) repurchase, redeem or otherwise acquire any securities of any Company Group Member the Company; or (D) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization recapitalization, or other reorganization of any Company Group Memberthe Company;
(iv) declare, set, pay, make or distribute any in-kind distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests;
(v) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Member, (A) create, incur, guarantee endorse, guarantee, or assume any Indebtedness for Borrowed Money indebtedness of the Company; (B) cause the Company to make any loans, advances, or otherwise become liable capital contributions to, or responsible for the obligations of investments in, any other Person (other than a Company Group Member) that remains outstanding as of the Closing, Person; or (BC) mortgage or pledge any of its material assetsthe Gathering Assets, or assets of the Company, tangible or intangible, or create any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrances;
(v) hire at, or transfer to, the Company, any employees,
(vi) acquire assets or acquire, sell, lease, license, assign, convey, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in the ordinary course of business consistent with past practiceassets;
(vii) merge or consolidate with any Person, cause the Company to acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereof, make an investment in, or purchase any securities from, any Person, or enter into any joint venture, partnership or similar venture with any other Person;
(viii) (A) amend, modify, or change in any material respect any Contract or (B) enter into any Contract;
(ix) make any change in any material respect to any of the financial accounting principles principles, methods, policies or practices used by any Company Group Memberthe Business or the Company, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ix) settle any Proceeding against a Company Group Member unless such settlement (A) requires the payment of less than $2,000,000 by such Company Group Member, (B) involves the unconditional release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closing;
(x) make cause the Company to engage in any capital expenditure new business or acquire the securities of any other than (A) as set forth in the budget attached hereto as Schedule 6.2(a)(x), (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s)Person;
(xi) enter into cause the Company to compromise any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x)debt or claim or waive or release any material right;
(xii) amend other than in response to an emergency situation as is reasonably necessary to protect human health or safety, or the environment, or to provide for continuation of services of the Business, enter into any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contractcommitment for capital expenditures other than with respect to pipeline construction project described on Schedule 4.8(c);
(xiii) fail to maintainenter into any Contract that restrains, restricts, limits or impedes the ability of the Company, the Business, or cause the Gathering Assets to be maintained, insurance coverage for the Company Group Members compete with or conduct any business or line of business in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliategeographic area;
(xiv) make or change any Tax election, settle or compromise any claim, notice, audit report pending or assessment in respect of Taxes, change threatened Proceeding or any annual Tax accounting period, adopt claim or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refundclaims for, or consent to any extension that would result in a Loss by the Company or waiver of the statute of limitations period applicable to any Tax claim or assessment, in each case, if such action would reasonably be expected to have a material adverse effect on BuyerBusiness;
(xv) fail to use Reasonable Efforts to maintain all (A) make, change or revoke any material Governmental Approvals Tax election or settle or compromise any material Tax claim or liability or (B) prepare or file any Tax Return (or any amendment thereof) unless such Tax Return shall have been prepared in effect on the Effective Date and necessary or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Datea manner consistent with past practice; or
(xvi) enter into any agreement commit or commitment agree to do any of the foregoing.
(b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan in effect on the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 2019, in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller.
(c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period.
Appears in 1 contract
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement3.4, prior to the Closing, Seller shall not permit any of the Acquired Company Group Members to engage in any of or the following actions Project Entities, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, to:
(ia) amend the Organizational Documents Amend its articles of any Company Group Member organization, operating agreement or of Pennant Midstreamother governing instruments;
(iib) (Ai) issue, sell sell, or deliver or allow the transfer of any shares of capital stock Membership Interest or any other equity securities or equity equivalents or any subscriptions, options, warrants or other rights in respect of any Company Group Member the foregoing; or (Bii) amend in any material respect any of the terms of any such securities of any Company Group Member outstanding as of the Effective Datedate hereof;
(iiic) (Ai) split, combine, or reclassify its outstanding equity interests, any Membership Interest; (Bii) declare, set aside or pay any non-cash dividend or other distribution (whether in stock or property or any combination thereof) in respect of the outstanding equity of any Company Group Member, equity; (Ciii) repurchase, redeem redeem, or otherwise acquire any securities of any Company Group Member its Membership Interest; or (Div) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization recapitalization, or any other reorganization of Acquired Company or any Company Group Member;of the Project Entities.
(ivd) declare, set, pay, make or distribute any in-kind distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests;
(v) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Member, (Ai) create, incur, guarantee guarantee, or assume any Indebtedness indebtedness for Borrowed Money borrowed money for itself or any other person or otherwise become liable or responsible for the obligations of any other Person person; (other than a Company Group Memberii) that remains outstanding as of the Closingmake any loans, advances, or capital contributions to, or investments in, any other person; or (Biii) mortgage or pledge any of its material assetsAssets, tangible or intangible, or create any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrances;Lien thereupon.
(vie) acquire assets or acquire, sell, lease, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in Assets outside the ordinary course of business consistent with past practice;
(viif) merge or consolidate with any Person, acquire (by merger, consolidation, or acquisition of stock or assets Assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereofthereof or form any subsidiary;
(g) terminate (other than in accordance with its terms), make an investment inamend, modify, or purchase change in any securities frommaterial respect, or to settle any material dispute in respect of, any PersonAcquired Company Agreements, or to enter into any joint venture, partnership contract that would be a material contract if in effect on the date hereof or similar venture with to take any other Personaction or omit to take any action that would constitute a material breach of any Acquired Company Agreement;
(viiih) (i) make or change or revoke any material tax election or tax accounting method or settle or compromise any tax liability, file any amended tax return or extend or waive the application of any statute of limitations regarding the assessment or collection of any tax, (ii) change its fiscal year, or (iii) fail to pay any taxes as such taxes become due and payable;
(i) change in any material respect any of the financial accounting principles or practices used by any Company Group Memberit, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ixj) settle make any Proceeding against a Company Group Member unless such settlement (A) requires Capital Expenditures that are for items other than for operations or maintenance in the payment of less than $2,000,000 by such Company Group Member, (B) involves the unconditional release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closingordinary course;
(xk) make any capital expenditure other than (A) as set forth in materially alter the budget attached hereto as Schedule 6.2(a)(x), (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to amount or destruction type of a coverage insuring the Acquired Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s);
(xi) enter into any new Contract that would have been required to be disclosed on Schedule 4.15(a) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x);
(xii) amend in any material respect, terminate, accelerate, modify, extend or change any Material Contract or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiii) fail to maintain, or cause to be maintained, insurance coverage for the Company Group Members in the amounts and of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate;
(xiv) make or change any Tax election, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, in each case, if such action would reasonably be expected to have a material adverse effect on Buyer;
(xv) fail to use Reasonable Efforts to maintain all material Governmental Approvals in effect on the Effective Date and necessary or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Datetheir Assets; or
(xvil) enter into any agreement or commitment arrangement to do any of the foregoing.
(b) Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreement, prior anything restricted pursuant to the Closing, Seller shall not, with respect to Available Employees, without the prior written consent foregoing provisions of Buyer, which consent shall not be unreasonably withheld, conditioned or delayed, and except as may be required pursuant to any Seller Benefit Plan in effect on the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than (A) increases that occur after December 31, 2019, in the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, (B) entering into new retention agreements, for or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on the date hereof, but only if such retention agreement as in effect on the date hereof becomes payable pursuant to its terms prior to the Closing Date and only if any such new retention agreement does not provide for a payment greater than the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and (C) transition payments, for or with respect to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, in the aggregate, exceed $1,000,000, (ii) except as would not result in material liability to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in the ordinary course of business or (B) terminate the employment of any Available Employee, other than due to failure of such individual to meet performance expectations or otherwise for cause, in each case, as reasonably determined by Seller.
(c) Buyer’s approval of any action restricted by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that period3.5.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (Solar Power, Inc.)
Pre-Closing Restrictions. (a) Without limiting the generality of Section 6.1 and except as set forth on otherwise expressly provided in Schedule 6.2 or otherwise contemplated by in this Agreement, Agreement prior to the Closing, Seller shall not permit any of the Company Group Members to engage in any of the following actions Acquired Company, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayedto:
(ia) amend the Organizational Documents of any Company Group Member its charter or of Pennant Midstreambylaws or other governing instruments;
(iib) (Ai) issue, sell sell, or deliver any shares of its capital stock of any class or any other equity securities or equity equivalents of any Company Group Member equivalents; or (Bii) amend in any material respect any of the terms of any such securities of any Company Group Member outstanding as of the Effective Datedate hereof;
(iiic) (Ai) split, combine, or reclassify any shares of its outstanding equity interests, capital stock; (Bii) declare, set aside or pay any non-cash dividend or other distribution (whether in cash, stock or property or any combination thereof) in respect of the outstanding equity of any Company Group Member, its capital stock; (Ciii) repurchase, redeem or otherwise acquire any securities of any Company Group Member its securities; or (Div) adopt a plan of complete or partial liquidation or resolutions providing for or authorizing a liquidation, dissolution, merger, consolidation, restructuring, recapitalization recapitalization, or other reorganization of any Company Group MemberAcquired Company;
(iv) declare, set, pay, make or distribute any in-kind distributions on any Company Group Member’s outstanding membership interests or limited liability company interests, as applicable, including the Purchased Interests;
(vi) except in the ordinary course of business consistent with past practice or for borrowings made under any existing credit facility of a Company Group Memberpractice, (A) create, incur, guarantee guarantee, or assume any Indebtedness indebtedness for Borrowed Money borrowed money or otherwise become liable or responsible for the obligations of any other Person, except for obligations of wholly owned Subsidiaries or of another Acquired Company; (ii) make any loans, advances, or capital contributions to, or investments in, any other Person (other than a Company Group Member) that remains outstanding as of the Closing, intercompany transactions with another Acquired Company; or (Biii) mortgage except in the ordinary course of business consistent with past practice, mortgage, or pledge any of its material assets, tangible or intangible, or create or suffer to exist any material Encumbrance thereupon that is not released at or prior to Closing, other than Permitted Encumbrances;
(vii) acquire assets except as may be required by applicable Law, enter into, adopt or make (and Seller shall not make) any amendments to any Company Benefit Plan that would materially increase the Acquired Companies’ liability under any Company Benefit Plan, or (ii) pay to any director or officer of the Acquired Companies any benefit not permitted by any Company Benefit Plan;
(f) acquire, sell, lease, transfer, or otherwise dispose of, directly or indirectly, any material assets of any Company Group Member, except for sales and dispositions of hydrocarbons in outside the ordinary course of business consistent with past practice;
(viig) merge or consolidate with any Person, acquire (by merger, consolidation, or acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, or other business organization or division thereof, make an investment in, or purchase any securities from, any Person, or enter into any joint venture, partnership or similar venture with any other Person;
(viiih) make any capital expenditure or expenditures, which, individually, is in excess of $500,000 or, in the aggregate, are in excess of $2,000,000, except, (i) for any capital expenditure made for the items described in the capital expenditures schedule referenced in Schedule 4.13, and (ii) reasonable expenditures made by any Acquired Company in connection with any emergency or other force majeure events affecting such Acquired Company;
(i) except as may be required by applicable Law, amend, modify, or change in any material adverse respect any Scheduled Contract if such amendment, modification or change (i) is outside of the ordinary course of business and not consistent with past practice, (ii) results in accelerating payments in excess of $500,000 (individually or in the aggregate) under the Scheduled Contracts so that such payments are payable to the Acquired Companies prior to as opposed to following Closing or (iii) results in eliminating or reducing a benefit in favor of the Acquired Companies or increasing the liability of the Acquired Companies under the Scheduled Contracts by an amount in excess of $500,000 (individually or in the aggregate); provided the Parties acknowledge and agree that modifying volumes of natural gas to be sold or purchased in the ordinary course of business under a master agreement and related daily confirmations of natural gas pursuant to which spot sales transactions are made shall not require the prior approval of Buyer if such amendment, modification or change does not affect periods after the Closing;
(j) change in any material respect any of the financial accounting principles or practices (including tax accounting principles and/or practices) used by any Company Group Memberit, except for any change required by reason of a concurrent change in GAAP, or immaterial, known accruals that may not normally be recorded intra-fiscal year;
(ixk) settle enter into or modify any Proceeding against agreement and/or settlement with any Taxing Authority that would adversely affect a Company post-Closing period or any amount payable by Acquired Companies or Buyer in respect thereof or in respect of any Asset Group Member unless such settlement (A) requires the payment of less than $2,000,000 by such Company Group Member, (B) involves the unconditional release of such Company Group Member with respect to the subject matter of the Proceeding and (C) does not impose any material obligations on any Company Group Member after the Closing;
(x) make any capital expenditure other than (A) as set forth in the budget attached hereto as Schedule 6.2(a)(x), (B) as may be required to comply with Law, (C) as may be reasonably required in response to any damage to or destruction of a Company Group Member’s principal properties or (D) additional capital expenditures that are not reflected in such budget and do not exceed $5,000,000 in the aggregate; provided, that, in the case of an emergency for the safety of individuals, or protection of property or the environment, Seller may take Reasonable Efforts that would otherwise be prohibited by this clause (x) in order to prevent the occurrence of, or mitigate the existence of, the emergency situation; provided further, Seller shall provide prompt notice to Buyer upon the occurrence of such emergency and upon taking of such action(s);
(xil) enter into any new Contract that would have been required employment or severance agreement or make or approve any increase in the compensation payable by any Acquired Company to be disclosed on Schedule 4.15(aany director, consultant, or employees (including, without limitation, salary, bonuses and benefits) had it been in effect as of the Effective Date, except as permitted under Section 6.2(a)(x)for increases consistent with past practices;
(xiim) amend other than in any material respectthe ordinary course of business, terminateincur, acceleratepurchase, modifycancel, extend prepay or change any Material Contract otherwise provide for a complete or waive, release, grant, close out or transfer any material rights under any Material Contract;
(xiii) fail to maintainpartial discharge in advance of a scheduled payment date with respect to, or cause to be maintainedwaive any right under, insurance coverage for the Company Group Members in the amounts and any liability or obligation of the types currently in force or, upon renewal thereof, in similar amounts and types to the extent then available on commercially reasonable terms and prices to Seller or any Seller Affiliate;
(xiv) make or change any Tax election, settle or compromise any claim, notice, audit report or assessment in respect of Taxes, change any annual Tax accounting period, adopt or change any method of Tax accounting, file any amended Tax Return, enter into any Tax allocation agreement, Tax sharing agreement, Tax indemnity agreement or closing agreement relating owing to any Tax, surrender any right to claim a Tax refund, or consent to any extension or waiver of the statute of limitations period applicable to any Tax claim or assessment, Acquired Company in each case, if such action would reasonably be expected to have a material adverse effect on Buyer;
(xv) fail to use Reasonable Efforts to maintain all material Governmental Approvals in effect on the Effective Date and necessary or required for the ownership and operation of the Company Group Members as owned and operated on the Effective Datean aggregate amount exceeding $500,000; or
(xvin) enter into any agreement change the Inventory or commitment to do any Working Capital of the foregoing.
(b) Acquired Companies by a substantial amount except in the ordinary course of business consistent with past practice; Without limiting the generality of Section 6.1 and except as set forth on Schedule 6.2 or otherwise contemplated by this Agreementthe foregoing, prior to the ClosingClosing Date, Seller shall not, except with respect to Available Employees, without the prior written consent of Buyer, which consent shall not be unreasonably withheld, conditioned or delayedSeller will, and except as may be required pursuant to any Seller Benefit Plan in effect on will cause the date hereof or as may be required under applicable Law, (i) increase the amount of any bonus, salary or other compensation or benefits to any Available Employee, other than Acquired Companies to:
(A) increases that occur after December 31, 2019, in consult with the Buyer as to the making of any material decisions or the taking of any material actions outside the ordinary course of business and do not exceed 5% of the value of such bonus, salary or other compensation or benefits as in effect on the date hereof, business;
(B) consult with Buyer as to the making of any decisions or the taking of any actions involving Material Environmental Decisions which for purposes of this Agreement will involve (i) entering into new retention agreementscommitments to remediate properties owned, for leased or with respect to which Buyer will have no obligation or liability, with Available Employees who are parties to retention agreements with Seller or an applicable Seller Affiliate on used by the date hereof, but only if such retention agreement as Acquired Companies involving remediation costs in effect on the date hereof becomes payable pursuant to its terms prior to excess of $250,000 following the Closing Date and only if any such new retention agreement does not provide for a payment greater than (ii) entering into consent orders or otherwise paying environmental fines or penalties involving payments in excess of $250,000 following the amount payable under the retention agreement in effect on the date hereof with respect to the applicable Available Employee, and Closing Date;
(C) transition paymentsuse reasonable efforts to maintain their respective assets in customary repair, for or working order and condition (reasonable wear and tear excepted) in accordance with respect prior operating practice;
(D) use reasonable efforts to which Buyer will have no obligation or liability, for Transferred Employees as determined by Seller, which payments pursuant to this clause (C) shall not, keep in the aggregate, exceed $1,000,000, (ii) except as would force at not result in material liability less than their present limits all policies of insurance relating to the Company Group Members or Buyer, enter into, establish, materially amend or terminate any Seller Benefit Plan if such establishment, amendment or termination is targeted at Available Employees, or (iii) (A) hire any individual who would be an Available Employee, other than individuals to replace any Available Employee whose employment has terminated or otherwise in Acquired Companies and promptly notify Buyer of the ordinary course of business or (B) terminate the employment cancellation of any Available Employee, other than due to failure of such individual to meet performance expectations policy or otherwise for cause, in each case, as reasonably determined by Seller.any material modification thereto;
(cE) Buyer’s approval of use reasonable efforts to maintain their customary business relationship with any action restricted Third Party and to maintain good relations with employees; and
(F) use reasonable efforts to maintain in full force and effect, and comply with, all Permits held by this Section 6.2 shall be considered granted within five (5) Business Days of Seller’s notice to Buyer requesting such consent unless Buyer notifies Seller to the contrary during that periodentities.
Appears in 1 contract
Samples: Purchase and Sale Agreement
