Restrictions on Company Activities. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective Time, except as expressly contemplated by this Agreement or required by Applicable Law due to a change in such Applicable Law after the Agreement Date and except as expressly set forth in Section 5.2 of the Disclosure Schedule, the Company shall not (and shall ensure that no Subsidiary shall), without the prior written consent of Buyer: (a) cause or permit any modifications, amendments or changes to the Governing Documents or the organizational documents of any Subsidiary; (b) declare, set aside, or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Shares or the capital stock of any Subsidiary, or split, combine or reclassify any Company Shares or the capital stock of any Subsidiary or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Shares or the capital stock of any Subsidiary, or directly or indirectly repurchase, redeem or otherwise acquire any shares of Company Shares or the capital stock of any Subsidiary (or options, warrants or other rights convertible into, exercisable or exchangeable for Company Shares or the shares or equity interests of any Subsidiary) except in accordance with the agreements evidencing Company Options outstanding as of the date of this Agreement; (c) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any Company Shares or equity-based awards (whether payable in cash, share or otherwise) or the capital stock of any Subsidiary or any securities convertible into, exercisable or exchangeable for, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating any of them to issue or purchase any such shares or other convertible securities or amend, accelerate the vesting of or adjust or modify any Company Shares, except for the issuance of Company Shares pursuant to the exercise of Company Options or the conversion into Company Ordinary Shares of Company Preferred Shares, in each case to the extent outstanding as of the date of this Agreement; (d) form, or enter into any binding commitment to form, a subsidiary, or acquire, or enter into any binding commitment to acquire, an interest in any corporation, association, joint venture, partnership or other business entity or division thereof; (e) make or agree to make any capital expenditure or commitment exceeding $100,000 individually or $300,000 in the aggregate; (f) acquire or agree to acquire or dispose or agree to dispose of any material assets of the Company or any Subsidiary or any business enterprise or division thereof outside the ordinary course of the business of the Company or its Subsidiary, as the case may be, and consistent with past practice; (g) (i) sell, exclusively license or assign to any Person or enter into any agreement to sell, exclusively license or assign to any Person any rights to any Company IP; (ii) buy or license any Intellectual Property or Intellectual Property Right of any third party (other than pursuant to agreements with Employees or other contributors in the form of the applicable Standard Form IP Contract or pursuant to a Permitted Agreement); (iii) license any Company Products or Company IP to third parties, other than in the form of the applicable Standard Form IP Contract (and other than pursuant to a Permitted Agreement); (iv) enter into any distributor, reseller, sales representative, marketing, or similar agreement (other than pursuant to a Permitted Agreement); (v) amend, modify, or extend any agreement for the license, sale, or other distribution of Company Products or Company IP (other than with respect to agreements that constitute Permitted Agreements prior to such amendment, modification or extension and thereafter); (vi) enter into any agreement with respect to the development of any Intellectual Property or Intellectual Property Right on behalf of the Company or any Subsidiary with a third party (other than agreements with employees, contractors or other contributors in the form of the applicable Standard Form IP Contract); (vii) change practices related to pricing or royalties charged by the Company or any Subsidiary to, or the compensation or other amounts payable to, the Company’s or any of its Subsidiaries’ distributors, resellers, sales representatives, customers or licensees, or the pricing or royalties set or charged by Persons who have licensed Intellectual Property or Intellectual Property Rights to the Company or any of its Subsidiaries (other than with respect to a Permitted Agreement); or (viii) make available any Company IP such that the Company IP becomes subject to an Open Source License (other than new versions of any Company IP in its products previously distributed under an Open Source License consistent with past practices and under the same license terms); (h) incur any Indebtedness (other than the obligation to reimburse employees for travel and business expenses in the ordinary course of the Company’s business consistent with past practices), issue or sell any debt securities, create a Lien (other than a Permitted Lien) over any asset of the Company or any Subsidiary or amend the terms of any outstanding loan agreement; (i) make any loan to any Person (except for advances to employees for reasonable business travel and expenses in the ordinary course of business consistent with past practice), purchase debt securities of any Person or guarantee any Indebtedness of any Person; (j) commence or settle any Action or threat of any Action by or against the Company or any Subsidiary or relating to any of their businesses, properties or assets (other than routine collections proceedings); (k) pay, discharge, release, waive or satisfy any claims, rights or Liabilities, other than the payment, discharge or satisfaction in the ordinary course of business of Liabilities reflected on the Current Balance Sheet or incurred in the ordinary course of business after the Balance Sheet Date and the payment, discharge or satisfaction of Third Party Expenses; (l) adopt or change accounting methods or practices (including any change in depreciation or amortization policies or rates or any change to practices that would impact the methodology for recognizing revenue) other than as required by GAAP; (m) make or change any material Tax election, adopt or change any Tax accounting method, enter into any agreement in respect of Taxes, settle any Tax claim or assessment, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment, make or request any Tax ruling, enter into any Tax sharing or similar agreement or arrangement (other than Ordinary Course Contracts), enter into any transactions giving rise to deferred gain or loss, amend any Tax Return or file any income or other material Tax Return including any estimated Tax Return, except in accordance with Section 7.6; (n) enter into, adopt, amend or terminate any Company Employee Plan, including any indemnification agreement or enter into or amend any Employee Agreement other than entry into standard form offer letters with new hires who are terminable at-will, with annual remuneration (including base remuneration and bonus opportunities) of not more than $200,000 each, in the ordinary course of the Company’s business consistent with past practice; (o) increase or make any other change that would result in increased cost to the Company to the salary, wage rate, employment status, title or other compensation (including equity based compensation whether payable in cash, Company Shares or other property) payable or to become payable by the Company or any Subsidiary to any Employee or terminate any current Employee (other than for cause); (p) make any declaration, payment, commitment or obligation of any kind for the payment (whether in cash, equity or otherwise) of any severance payment or other change in control payment, termination payment, bonus, special remuneration or other additional salary or compensation (including equity based compensation) to any Employee, except payments made pursuant to written agreements existing on the date of this Agreement and disclosed in Section 5.2(p) of the Disclosure Schedule; (q) take any action to accelerate or otherwise modify the terms of any of the outstanding Company Options; (r) make any representations or issue any communications to Employees that are inconsistent with this Agreement or the transactions contemplated thereby, including any representations regarding offers of employment from Buyer; (s) enter into, participate in, establish or join any new standards-setting organization, collaborative effort with a university or industry body or consortium or other multi-party special interest group or activity; (t) cancel, amend (other than in connection with the addition of customers and suppliers to such insurance policies from time to time in the ordinary course of business consistent with past practices) or fail to renew (on substantially similar terms) any insurance policy of the Company or any Subsidiary; (u) (i) amend, or waive or modify, or violate the terms of any Material Contract (provided that the Company may amend, waive or modify a Permitted Agreement in a manner such that it remains a Permitted Agreement), (ii) terminate any Material Contract (other than expiration at the end of a scheduled term), or (ii) enter into any Contract which would have constituted a Material Contract had such Contract been entered into prior to the date of this Agreement (provided that the Company may enter in to Permitted Agreements); or (v) take, commit, or agree in writing or otherwise to take, any of the actions described clause (a) – (u) of this Section 5.2, or any other action that would (i) prevent the Company from performing, or cause the Company not to perform, its covenants or agreements hereunder, or (ii) that the Person taking such action actually knows, or, with respect to the Company’s officers and members of the Company’s board of directors, should reasonably be expected to know, will cause or result in a breach of or inaccuracy in any representation or warranty of the Company herein as of the Closing. Buyer acknowledges and agrees that: (i) nothing contained in this Agreement shall give Buyer, directly or indirectly, the right to control or direct the Company’s operations prior to the Closing, and (ii) prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ operations.
Appears in 1 contract
Samples: Merger Agreement (F5 Networks Inc)
Restrictions on Company Activities. During the period from the date of this Agreement Date and continuing until the earlier of the termination of this Agreement or the Effective Time, except as expressly contemplated by this Agreement or expressly required by Applicable applicable Law due to a change in such Applicable applicable Law after the Agreement Date Date, and except as expressly set forth in Section 5.2 of the Disclosure Schedule, the Company shall not (and shall ensure that no Subsidiary shall), without the prior written consent of Buyer:Buyer (which consent, with respect to Sections 5.2(n)-(p) and Section 5.2(v), shall not be unreasonably withheld, conditioned or delayed):
(a) cause or permit any modifications, amendments or changes to the Governing Documents or the organizational documents of any Subsidiary;
(b) declare, set aside, or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Shares or the capital stock of any Subsidiary, or split, combine or reclassify any Company Shares or the capital stock of any Subsidiary or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Shares or the capital stock of any Subsidiary, or directly or indirectly repurchase, redeem or otherwise acquire any shares of Company Shares or the capital stock of any Subsidiary (or options, warrants or other rights convertible into, exercisable or exchangeable for Company Shares or the shares or equity interests of any Subsidiary) except in accordance with the agreements evidencing Company Options or Company Restricted Stock outstanding as of the date of this AgreementAgreement Date;
(c) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any Company Shares or equity-based awards (whether payable in cash, share or otherwise) or the capital stock of any Subsidiary or any securities convertible into, exercisable or exchangeable for, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating any of them to issue or purchase any such shares or other convertible securities or amend, accelerate the vesting of or adjust or modify any Company Shares, except for the issuance of Company Shares pursuant to the exercise of Company Options Options, the repurchase of Company Restricted Stock or the conversion into Company Ordinary Common Shares of Company Preferred Shares, in each case to the extent outstanding as of the date of this AgreementAgreement Date;
(d) form, or enter into any binding commitment to form, a subsidiary, or acquire, or enter into any binding commitment to acquire, an interest in any corporation, association, joint venture, partnership or other business entity or division thereof;
(e) make or agree to make any capital expenditure or commitment exceeding $100,000 250,000 individually or $300,000 1,000,000 in the aggregate;
(f) acquire or agree to acquire or dispose or agree to dispose of any material assets of the Company or any Subsidiary or any business enterprise or division thereof outside the ordinary course of the business businesses of the Company or its any Subsidiary, as the case may be, and consistent with past practice;
(g) (i) sell, exclusively license License or assign to any Person (or enter into any agreement Contract to sell, exclusively license License or assign to any Person Person) any rights to any Company IP; (ii) buy or license License any Intellectual Property or Intellectual Property Right of any third party (other than pursuant to agreements Contracts with Employees Employees, contractors or other contributors Contributors substantially in the form of the applicable Standard Form IP Contract or pursuant to a Permitted Agreement); (iii) license License any Company Products or Company IP to third parties, other than substantially in the form of the applicable Standard Form IP Contract (and other than pursuant to a Permitted Agreement); (iv) enter into any distributor, reseller, sales representative, marketing, or similar agreement Contract (and other than pursuant to a Permitted Agreement); (v) amend, modify, or extend any agreement for the licenseLicense, sale, or other distribution of Company Products or Company IP (other than with respect to agreements Contracts that constitute Permitted Agreements prior to and after such amendment, modification or extension and thereafterextension); (vi) enter into any agreement Contract with respect to the development of any Intellectual Property or Intellectual Property Right on behalf of the Company or any Subsidiary with a third party (other than agreements Contracts with employeesEmployees, contractors or other contributors Contributors substantially in the form of the applicable Standard Form IP Contract); (vii) change practices related to pricing or royalties charged by the Company or any Subsidiary to, or the compensation or other amounts payable to, the Company’s or any of its the Subsidiaries’ distributors, resellers, sales representatives, customers or licensees, or the pricing or royalties set or charged by Persons who have licensed Licensed Intellectual Property or Intellectual Property Rights to the Company or any of its the Subsidiaries (other than with respect pursuant to a Permitted Agreement); (viii) abandon, withdraw or dispose of any Company Registered IP; or (viiiix) make available any Company IP such that the Company IP becomes subject to under an Open Source License (other than new versions of any Company IP in its products previously distributed under an Open Source License to which such Company IP is already subject consistent with past practices and under the same license terms);
(h) incur any Indebtedness for borrowed money (other than the obligation to reimburse employees Employees for travel and business expenses in the ordinary course of the Company’s business businesses consistent with past practices), issue or sell any debt securities, or create a Lien (other than a Permitted Lien) over any asset of the Company or any Subsidiary or amend the terms of any outstanding loan agreementagreement in a manner that would prevent the repayment thereof upon the Closing;
(i) make any loan to any Person (except for advances to employees Employees for reasonable business travel and expenses in the ordinary course of business consistent with past practice), or purchase debt securities of any Person or guarantee any Indebtedness of any Person;
(j) commence or settle any Action or threat of any Action by or against the Company or any Subsidiary or relating to any of their businesses, properties or assets (other than routine collections collection proceedings);
(k) pay, discharge, release, waive or satisfy any claims, rights or Liabilities, other than the payment, discharge or satisfaction in the ordinary course of business of Liabilities reflected on the Current Balance Sheet or incurred in the ordinary course of business after the Balance Sheet Date and the payment, discharge or satisfaction of Third Third-Party Expenses;
(l) adopt or change accounting methods or practices (including any change in depreciation or amortization policies or rates or any change to practices that would impact the methodology for recognizing revenue) other than as required by GAAP;
(m) make or change any material Tax election, adopt or change any Tax accounting method, change a Tax year, enter into any agreement in respect of Taxes, settle any Tax claim or assessment, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment, make or request any Tax ruling, enter into any Tax sharing or similar agreement or arrangement (other than Ordinary Course Contracts), enter into any transactions outside of the ordinary course of business giving rise to deferred gain or loss, amend any Tax Return or file any income or other material Tax Return including any estimated Tax Return, except in accordance with Section 7.6;
(n) except as required by Law, enter into, adopt, amend or terminate any Company Employee PlanPlan (or any plan, including any indemnification program, agreement or arrangement that would be a Company Employee Plan if it had been in existence on the Agreement Date) or enter into or amend any Employee Agreement other than entry into standard offer letters on terms substantially similar to the Company’s (or any Subsidiary’s) form offer letters letter with new hires who are terminable at-will, with annual remuneration (including base remuneration and bonus opportunities) of not more than $200,000 each, in the ordinary course of the Company’s business consistent with past practice;
(o) increase or make any change to employment status or title or increase or make any other change that would result in increased cost to the Company to the salary, wage rate, employment statusfee, title or other compensation (including equity based compensation whether payable in cash, Company Shares or other property) payable or to become payable by the Company or any Subsidiary to any Employee or terminate any current Employee (other than for cause);
(p) make any declaration, payment, commitment or obligation of any kind for the payment (whether in cash, equity or otherwise) of any severance payment or other change in control payment, termination payment, bonus, special remuneration or other additional salary or compensation (including equity based compensation) to any Employee, except payments made pursuant to written agreements or promises existing on the date of this Agreement and disclosed in Section 5.2(p) of the Disclosure ScheduleDate;
(q) take any action to accelerate or otherwise modify the terms of any of the outstanding Company OptionsOptions or shares of Company Restricted Stock or otherwise accelerate the payment of any compensation or benefit to any employee;
(r) make any representations or issue any written communications to Employees that are inconsistent with this Agreement or the transactions contemplated thereby, including any representations regarding offers of employment from BuyerBuyer that are inconsistent with this Agreement;
(s) except as required by Law, (i) modify, extend, or enter into any labor agreement, collective bargaining agreement or any other labor-related Contract with any labor or trade union, labor organization or works council, or (ii) recognize or certify any labor or trade union, labor organization, works council, or group of Employees as the bargaining representative for any Employees;
(t) (i) enter into, participate in, establish or join any new standards-setting organization, collaborative effort with a university or industry body or consortium or other multi-party special interest group or activityactivity or (ii) subject any Patent in the Company IP to any obligation to grant a License thereunder on a royalty-free basis or on reasonable and non-discriminatory (RAND) or fair reasonable and non-discriminatory (FRAND) terms;
(tu) cancel, amend (other than in connection with the addition of customers and suppliers to such insurance policies from time to time in the ordinary course of business consistent with past practices) or fail to renew (on substantially similar terms) any insurance policy of the Company or any SubsidiarySubsidiary (other than an insurance policy relating to any Company Employee Plan);
(uv) (i) amend, or waive or modify, or violate the terms of modify any Material Contract (provided that the Company may amend, waive or modify a Permitted Agreement in a manner such that it remains a Permitted Agreement), (ii) terminate any Material Contract (other than expiration at the end of a scheduled term), or (iiiii) enter into any Contract which would have constituted a Material Contract had such Contract been entered into prior to the date of this Agreement Date (provided that the Company may enter in to into Permitted AgreementsAgreements and that the Company may enter into Contracts with new customers with expected annual recurring revenues of no more than $1,500,000 individually); or
(vw) take, commit, or agree in writing or otherwise to take, any of the actions described clause (a) – (uv) of this Section 5.2, or any other action that would (i) prevent the Company from performing, or cause the Company not to perform, its covenants or agreements hereunder, or (ii) that the Person taking such action actually knows, or, with respect to the Company’s officers and members of the Company’s board of directors, should reasonably be expected to know, will cause or result in a breach of or inaccuracy in any representation or warranty of the Company herein as of the Closing. The Buyer acknowledges and agrees that: (i) nothing contained in this Agreement shall give the Buyer, directly or indirectly, the right to control or direct the Company’s operations prior to the Closing, and (ii) prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ operations.
Appears in 1 contract
Samples: Merger Agreement (F5 Networks, Inc.)
Restrictions on Company Activities. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective TimePre-Closing Period, except as (i) to the extent expressly contemplated or provided by this Agreement Agreement, (ii) as required to comply with any COVID-19 Measures, (iii) as consented to in writing by Acquiror, or required by Applicable Law due to a change in such Applicable Law after the Agreement Date and except (iv) as expressly set forth in Section 5.2 of the Disclosure Schedule, the Company shall not (and shall ensure that no Subsidiary shall)not, without the prior written consent of Buyer:Acquiror (which consent shall not be unreasonably withheld, conditioned or delayed):
(a) cause or permit any modifications, amendments or changes to the Governing Documents or the organizational documents of any SubsidiaryCharter Documents;
(b) propose in writing or adopt a plan of complete or partial liquidation, dissolution, consolidation, restructuring, recapitalization or other reorganization of the Company;
(c) declare, set aside, or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Shares Capital Stock or the other capital stock of any Subsidiarythe Company, or split, combine or reclassify any Company Shares Common Stock or the other capital stock of any Subsidiary the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Shares or the capital stock of any SubsidiaryCapital Stock, or directly or indirectly repurchase, redeem or otherwise acquire any shares of Company Shares or the capital stock of any Subsidiary Common Stock (or options, warrants or other rights convertible into, exercisable or exchangeable for Company Shares Common Stock) or other capital stock of the shares or equity interests Company, except (i) for the issuance of any Subsidiary) except Company Common Stock upon exercise of Company Options in accordance with the agreements Contracts evidencing Company Options outstanding as of the date Agreement Date or (ii) from former employees, non-employee directors and consultants in accordance with agreements providing for the repurchase of this Agreementshares in connection with any termination of service;
(cd) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any Company Shares Capital Stock or equity-based awards (whether payable in cash, share Company Securities or otherwise) or the capital stock of any Subsidiary or any securities convertible into, exercisable or exchangeable for, or subscriptions, rights, warrants or options to acquire, or other agreements Contracts or commitments of any character obligating any of them to issue or purchase any such shares or other convertible securities securities, or amend, accelerate the vesting of or of, adjust or modify any Company SharesSecurities, except for (i) the issuance of Company Shares Capital Stock pursuant to the exercise of Company Options or the conversion into Company Ordinary Shares of Company Preferred Shares, in each case to the extent outstanding as of the date Agreement Date and listed on Section 3.5(c) of this Agreementthe Disclosure Schedule, (ii) the issuance of Company Common Stock upon conversion of Company Preferred Stock outstanding on the Agreement Date or (iii) the repurchase of any shares of Company Capital Stock from former employees, non-employee directors and consultants in accordance with Contracts providing for the repurchase of shares in connection with any termination of service;
(de) form, or enter into any binding commitment to form, a subsidiary, or acquire, or enter into any binding commitment to acquire, an interest in any corporation, association, joint venture, partnership or other business entity or division thereofthereof or any portion of the assets of the foregoing;
(ef) make or agree to make any capital expenditure or commitment exceeding $100,000 1,000,000 individually or $300,000 5,000,000 in the aggregateaggregate (over a 12 month period);
(fg) acquire or agree to acquire or dispose or agree to dispose of (i) any assets of any Person (including the Company), other than acquisitions of supplies or similar assets in the ordinary course of the business consistent with past practice or the disposal of non-material assets of the Company in the ordinary course of business consistent with past practice, or (ii) any Subsidiary Equity Interest in any Person or any business enterprise or division thereof outside the ordinary course of the business of the Company or its Subsidiary, as the case may be, and consistent with past practicethereof;
(g) (i) sell, exclusively divest, license or assign to any Person or enter into any agreement Contract to sell, exclusively divest, license or assign to any Person any rights to any Company IPIP (other than non-exclusive licenses with vendors and contractors entered into in the ordinary course of business); (ii) buy or license any Intellectual Property Technology or Intellectual Property Right of any third party (other than pursuant to agreements with Employees Open Source Software or other contributors Shrink-Wrap Software that is licensed in the form ordinary course of the applicable Standard Form IP Contract or pursuant to a Permitted AgreementCompany’s business); (iii) license any Company Products or Company IP to third parties, parties (other than non-exclusive licenses pursuant to a Contract substantially in the form of the applicable a Standard Form IP Contract (and other than pursuant to a Permitted Agreement); (iv) enter entered into any distributor, reseller, sales representative, marketing, or similar agreement (other than pursuant to a Permitted Agreement); (v) amend, modify, or extend any agreement for the license, sale, or other distribution of Company Products or Company IP (other than with respect to agreements that constitute Permitted Agreements prior to such amendment, modification or extension and thereafter); (vi) enter into any agreement with respect to the development of any Intellectual Property or Intellectual Property Right on behalf of the Company or any Subsidiary with a third party (other than agreements with employees, contractors or other contributors in the form of the applicable Standard Form IP Contract); (vii) change practices related to pricing or royalties charged by the Company or any Subsidiary to, or the compensation or other amounts payable to, the Company’s or any of its Subsidiaries’ distributors, resellers, sales representatives, customers or licensees, or the pricing or royalties set or charged by Persons who have licensed Intellectual Property or Intellectual Property Rights to the Company or any of its Subsidiaries (other than with respect to a Permitted Agreement); or (viii) make available any Company IP such that the Company IP becomes subject to an Open Source License (other than new versions of any Company IP in its products previously distributed under an Open Source License consistent with past practices and under the same license terms);
(h) incur any Indebtedness (other than the obligation to reimburse employees for travel and business expenses in the ordinary course of the Company’s business consistent with past practicespractice); or (iv) disclose any Company Source Code to, issue or sell deposit in escrow any Company Source Code with, any third party other than its Employees who have entered into Contracts in the form of a Proprietary Information Agreement or contractors who have entered into work for hire agreements with the Company in the ordinary course of business who have entered into Contracts in the form of a Proprietary Information Agreement;
(i) allow any Company IPR to lapse or expire, or fail to renew or make any filing or payment necessary in connection with the prosecution or maintenance of any Company Registered IP except as consistent with the normal course of management of Company IPR;
(j) (i) incur any Indebtedness in excess of $500,000 in the aggregate, including by the issuance or sale of any debt securities, (ii) create a any Lien (other than a Permitted LienLiens) over any material asset (including intangible asset) of the Company Company, or (iii) amend any Subsidiary or amend the material terms of any outstanding loan agreementagreement or other Contract evidencing Indebtedness;
(ik) make any loan to any Person (except for reasonable business expense advances to employees for reasonable business travel and expenses employees, officers or directors in the ordinary course of business consistent with past practice), purchase debt securities of any Person or guarantee any Indebtedness of any Person;
(jl) commence or settle any Action or threat of any Action by or against the Company or any Subsidiary or relating to any of their businesses, properties or assets (other than routine collections proceedings)(i) for a breach of this Agreement; or (ii) commence or settle any pending or threatened lawsuit or other dispute for an amount less than $100,000;
(km) pay, discharge, release, waive or satisfy any claims, rights or Liabilitiesliabilities, other than the payment, discharge discharge, release, waiver or satisfaction in the ordinary course of business consistent with past practice of Liabilities liabilities reflected on or reserved against in the Current Balance Sheet Company Financials or incurred in the ordinary course of business consistent with past practice after the Company Balance Sheet Date and the payment, discharge or satisfaction of Third Party ExpensesDate;
(ln) adopt or change accounting methods or practices (including any change in depreciation or amortization policies or rates or any change to practices that would impact the methodology for recognizing revenue) other than as required by GAAP;
(mo) make or change any material Tax electionelection in respect of Taxes, adopt or change any Tax material accounting method, enter into any agreement method in respect of Taxes, settle any Tax material claim or assessmentassessment in respect of Taxes, or Tax Refunds or credits, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessmentassessment in respect of Taxes, make or request any Tax ruling, enter into any Tax sharing or similar agreement Contract or arrangement (other than Ordinary Course Contractscustomary commercial contracts entered into in the ordinary course of business and the primary purpose of which is unrelated to Tax), enter into any transactions giving rise to deferred gain or loss, amend any Tax Return or file any income or other material Tax Return including or file any estimated Tax Return, Return except in accordance with Section 7.67.6(a);
(np) enter intoexcept as required by Law, adoptas required by a Company Employee Plan in effect on the Agreement Date, amend or in the ordinary course of business, amend, modify, suspend, or terminate any Company Employee Plan, including any indemnification agreement or enter into or amend any Employee Agreement other than entry into standard form offer letters with new hires who are terminable at-will, with annual remuneration (including base remuneration and bonus opportunities) of not more than $200,000 each, in the ordinary course of the Company’s business consistent with past practice;
(oq) amend, modify, or remove any Company Privacy Policy, or publish any new Company Privacy Policy; (r) (i) except as required by Law or as required by a Company Employee Plan in effect on the Agreement Date, increase or make any other change that would result in increased cost to the Company to the salary, wage rate, employment status, title or other compensation (including equity based compensation or benefits whether payable in cash, Company Shares Securities or other property) property payable or to become payable by the Company or any Subsidiary to any Employee or terminate any current Employee with an annual base salary greater than $150,000, except for any such increase of any current Employee’s base salary in the ordinary course of business consistent with past practice that does not exceed five percent (5%) of such Employee’s annual base salary or compensation, (ii) hire or engage any employee with an annual base salary or annual compensation or fee rate greater than $150,000, or (iii) terminate (other than for cause)cause or due to death or permanent disability) the employment of any current employee with an annual base salary greater than $150,000;
(ps) make any declaration, payment, commitment or obligation of any kind for the payment (whether in cash, equity Company Securities or otherwise) of any severance payment or other change in control payment, termination payment, bonus, special remuneration or other additional salary or compensation (including equity based compensation) separation payment to any Employee, except payments made pursuant to written agreements existing on the date of this Agreement and disclosed in Section 5.2(p) of the Disclosure Schedule;
(q) take any action to accelerate or otherwise modify the terms of any of the outstanding Company Options;
(r) make any representations or issue any communications to Employees that are inconsistent with this Agreement or the transactions contemplated thereby, including any representations regarding offers of employment from Buyer;
(s) enter into, participate in, establish or join any new standards-setting organization, collaborative effort with a university or industry body or consortium or other multi-party special interest group or activityDate;
(t) cancel, cancel or materially amend (other than in connection with the addition of customers and suppliers customers, distributors, resellers, licensees, suppliers, or vendors to such insurance policies from time to time in the ordinary course of business consistent with past practices) or fail to renew (on substantially similar termspractice) any insurance policy of the Company or any SubsidiaryCompany;
(u) (i) terminate, amend, or waive or modifyextend, or waive, violate the terms of any Material Contract (provided that the Company may amend, waive or modify a Permitted Agreement in a manner such that it remains a Permitted Agreement), (ii) terminate any Material Contract (other than expiration at amendments, extensions, waivers, or modifications in the end ordinary course of business consistent with past practice) in a scheduled term)manner that would be material relative to the Company’s business or operations, or (ii) enter into any Contract which would have constituted a Material Contract had such Contract been entered into prior to the date Agreement Date;
(v) enter into any new line of business (it being understood that nothing in this Agreement (provided that section shall prohibit the Company may from continuing to compete in the ordinary course of business consistent with past practice) or change the Company’s material operating policies in any material respect, except as required by applicable Law or by policies imposed by any Governmental Entity;
(w) enter into any Contract to purchase or sell any interest in real property, grant any security interest in any real property, enter into any lease, sublease, license or other occupancy Contract with respect to Permitted any real property, or materially alter, amend or modify, or knowingly or willfully violate or terminate any material terms of any Lease Agreements); or
(vx) take, commit, or agree in writing or otherwise to take, take any of the actions described clause (a) – through (uw) of this Section 5.2, or any other action that would (i) prevent the Company from performing, or cause the Company not to perform, its covenants or agreements hereunder, or (ii) that the Person taking such action actually knows, or, with respect . Notwithstanding anything to the Company’s officers and members of the Company’s board of directorscontrary herein, should reasonably be expected to know, will cause or result in a breach of or inaccuracy in any representation or warranty of the Company herein as of the Closing. Buyer acknowledges and agrees that: (i) nothing contained in this Agreement shall give BuyerAcquiror, directly or indirectly, the right to control or direct the Company’s operations of the Company prior to Closing in violation of the Closing, and (ii) prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ operationsHSR Act or other Antitrust Laws.
Appears in 1 contract
Samples: Merger Agreement (Pacific Biosciences of California, Inc.)
Restrictions on Company Activities. During the period from the date of this Agreement Date and continuing until the earlier of the termination of this Agreement or the Effective Time, except as expressly contemplated by this Agreement or expressly required by Applicable applicable Law due to a change in such Applicable applicable Law after the Agreement Date Date, and except as expressly set forth in Section 5.2 of the Disclosure Schedule, the Company shall not (and shall ensure that no Subsidiary shall), without the prior written consent of Buyer:Buyer (which consent, with respect to Sections 5.2(j), (n)-(q) and (w), shall not be unreasonably withheld, conditioned or delayed):
(a) cause or permit any modifications, amendments or changes to the Governing Documents or the organizational documents of any Subsidiary;
(b) declare, set aside, or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Shares or the capital stock of any Subsidiary, or split, combine or reclassify any Company Shares or the capital stock of any Subsidiary or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Shares or the capital stock of any Subsidiary, or directly or indirectly repurchase, redeem or otherwise acquire any shares of Company Shares or the capital stock of any Subsidiary (or options, warrants or other rights convertible into, exercisable or exchangeable for Company Shares or the shares or equity interests of any Subsidiary) except in accordance with the agreements evidencing Company Options Options, Company Restricted Stock and Company RSUs outstanding as of the date of this AgreementAgreement Date;
(c) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any Company Shares or equity-based awards (whether payable in cash, share or otherwise) or the capital stock of any Subsidiary or any securities convertible into, exercisable or exchangeable for, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating any of them to issue or purchase any such shares or other convertible securities or amend, accelerate the vesting of or adjust or modify any Company Shares, except for pursuant to Section 7.5(h) of the Disclosure Schedule, the issuance of Company Shares pursuant to the exercise of Company Options or the settlement of Company RSUs, the repurchase of Company Restricted Stock or the conversion into Company Ordinary Common Shares of Company Preferred Shares, in each case to the extent outstanding as of the date of this AgreementAgreement Date;
(d) form, or enter into any binding commitment to form, a subsidiary, or acquire, or enter into any binding commitment to acquire, an interest in any corporation, association, joint venture, partnership or other business entity or division thereof;
(e) make or agree to make any capital expenditure or commitment exceeding $100,000 250,000 individually or $300,000 1,000,000 in the aggregate;
(f) acquire or agree to acquire or dispose or agree to dispose of any material assets of the Company or any Subsidiary or any business enterprise or division thereof outside the ordinary course of the business businesses of the Company or its any Subsidiary, as the case may be, and consistent with past practice;
(g) (i) sell, exclusively license License or assign to any Person (or enter into any agreement Contract to sell, exclusively license License or assign to any Person Person) any rights to any Company IP; (ii) buy or license License any Intellectual Property or Intellectual Property Right of any third party (other than pursuant to agreements Contracts with Employees Employees, contractors or other contributors Contributors substantially in the form of the applicable Standard Form IP Contract or pursuant to a Permitted Agreement); (iii) license License any Company Products or Company IP to third parties, other than substantially in the form of the applicable Standard Form IP Contract (and other than pursuant to a Permitted Agreement); (iv) enter into any distributor, reseller, sales representative, marketing, or similar agreement Contract (other than pursuant to a Permitted Agreement); (v) amend, modify, or extend any agreement for the licenseLicense, sale, or other distribution of Company Products or Company IP (other than with respect to agreements Contracts that constitute Permitted Agreements prior to and after such amendment, modification or extension and thereafterextension); (vi) enter into any agreement with respect to the development of any Intellectual Property or Intellectual Property Right on behalf of the Company or any Subsidiary with a third party (other than agreements with employees, contractors or other contributors in the form of the applicable Standard Form IP Contract); (vii) change practices related to pricing or royalties charged by the Company or any Subsidiary to, or the compensation or other amounts payable to, the Company’s or any of its Subsidiaries’ distributors, resellers, sales representatives, customers or licensees, or the pricing or royalties set or charged by Persons who have licensed Intellectual Property or Intellectual Property Rights to the Company or any of its Subsidiaries (other than with respect to a Permitted Agreement); or (viii) make available any Company IP such that the Company IP becomes subject to an Open Source License (other than new versions of any Company IP in its products previously distributed under an Open Source License consistent with past practices and under the same license terms);
(h) incur any Indebtedness (other than the obligation to reimburse employees for travel and business expenses in the ordinary course of the Company’s business consistent with past practices), issue or sell any debt securities, create a Lien (other than a Permitted Lien) over any asset of the Company or any Subsidiary or amend the terms of any outstanding loan agreement;
(i) make any loan to any Person (except for advances to employees for reasonable business travel and expenses in the ordinary course of business consistent with past practice), purchase debt securities of any Person or guarantee any Indebtedness of any Person;
(j) commence or settle any Action or threat of any Action by or against the Company or any Subsidiary or relating to any of their businesses, properties or assets (other than routine collections proceedings);
(k) pay, discharge, release, waive or satisfy any claims, rights or Liabilities, other than the payment, discharge or satisfaction in the ordinary course of business of Liabilities reflected on the Current Balance Sheet or incurred in the ordinary course of business after the Balance Sheet Date and the payment, discharge or satisfaction of Third Party Expenses;
(l) adopt or change accounting methods or practices (including any change in depreciation or amortization policies or rates or any change to practices that would impact the methodology for recognizing revenue) other than as required by GAAP;
(m) make or change any material Tax election, adopt or change any Tax accounting method, enter into any agreement in respect of Taxes, settle any Tax claim or assessment, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment, make or request any Tax ruling, enter into any Tax sharing or similar agreement or arrangement (other than Ordinary Course Contracts), enter into any transactions giving rise to deferred gain or loss, amend any Tax Return or file any income or other material Tax Return including any estimated Tax Return, except in accordance with Section 7.6;
(n) enter into, adopt, amend or terminate any Company Employee Plan, including any indemnification agreement or enter into or amend any Employee Agreement other than entry into standard form offer letters with new hires who are terminable at-will, with annual remuneration (including base remuneration and bonus opportunities) of not more than $200,000 each, in the ordinary course of the Company’s business consistent with past practice;
(o) increase or make any other change that would result in increased cost to the Company to the salary, wage rate, employment status, title or other compensation (including equity based compensation whether payable in cash, Company Shares or other property) payable or to become payable by the Company or any Subsidiary to any Employee or terminate any current Employee (other than for cause);
(p) make any declaration, payment, commitment or obligation of any kind for the payment (whether in cash, equity or otherwise) of any severance payment or other change in control payment, termination payment, bonus, special remuneration or other additional salary or compensation (including equity based compensation) to any Employee, except payments made pursuant to written agreements existing on the date of this Agreement and disclosed in Section 5.2(p) of the Disclosure Schedule;
(q) take any action to accelerate or otherwise modify the terms of any of the outstanding Company Options;
(r) make any representations or issue any communications to Employees that are inconsistent with this Agreement or the transactions contemplated thereby, including any representations regarding offers of employment from Buyer;
(s) enter into, participate in, establish or join any new standards-setting organization, collaborative effort with a university or industry body or consortium or other multi-party special interest group or activity;
(t) cancel, amend (other than in connection with the addition of customers and suppliers to such insurance policies from time to time in the ordinary course of business consistent with past practices) or fail to renew (on substantially similar terms) any insurance policy of the Company or any Subsidiary;
(u) (i) amend, or waive or modify, or violate the terms of any Material Contract (provided that the Company may amend, waive or modify a Permitted Agreement in a manner such that it remains a Permitted Agreement), (ii) terminate any Material Contract (other than expiration at the end of a scheduled term), or (ii) enter into any Contract which would have constituted a Material Contract had such Contract been entered into prior to the date of this Agreement (provided that the Company may enter in to Permitted Agreements); or
(v) take, commit, or agree in writing or otherwise to take, any of the actions described clause (a) – (u) of this Section 5.2, or any other action that would (i) prevent the Company from performing, or cause the Company not to perform, its covenants or agreements hereunder, or (ii) that the Person taking such action actually knows, or, with respect to the Company’s officers and members of the Company’s board of directors, should reasonably be expected to know, will cause or result in a breach of or inaccuracy in any representation or warranty of the Company herein as of the Closing. Buyer acknowledges and agrees that: (i) nothing contained in this Agreement shall give Buyer, directly or indirectly, the right to control or direct the Company’s operations prior to the Closing, and (ii) prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ operations.any
Appears in 1 contract
Samples: Merger Agreement (F5 Networks, Inc.)
Restrictions on Company Activities. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective TimePre-Closing Period, except (i) as may be required by applicable Law, (ii) as expressly contemplated by this Agreement or required by Applicable Law due to a change in such Applicable Law after the Agreement Date and except (iii) as expressly set forth in Section 5.2 of the Disclosure Schedule, neither the Company shall not (and shall ensure that no Subsidiary nor any Company Entity shall), without the prior written consent of Buyer:Acquiror (not to be unreasonably withheld, conditioned or delayed):
(a) cause or permit any modifications, amendments or changes to the Governing Documents or the organizational documents of any SubsidiaryCompany Entity;
(b) propose or adopt a plan of complete or partial liquidation, dissolution, consolidation, restructuring, recapitalization or other reorganization of the Company or any Company Entity;
(c) declare, set aside, or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Shares or the other capital stock of the Company or any SubsidiaryCompany Entity, or split, combine or reclassify any Company Shares or the other capital stock of the Company or any Subsidiary Company Entity or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Shares or the capital stock Equity Interests of any SubsidiaryCompany Entity, or directly or indirectly repurchase, redeem or otherwise acquire any shares of Company Shares or the capital stock Equity Interests of any Subsidiary Company Entity (or options, warrants or other rights convertible into, exercisable or exchangeable for Company Shares or the shares or equity interests Equity Interests of any SubsidiaryCompany Entity) or other Equity Interests of the Company or any Company Entity, except for the issuance, repurchase or reacquisition thereof in accordance with the agreements Contracts evidencing Company Options outstanding as of the date Agreement Date and listed on Section 3.5(c) of this Agreementthe Disclosure Schedule;
(cd) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any Company Shares or other Equity Interests of the Company or any Company Entity or equity-based awards (whether payable in cash, share Company Securities, Equity Interests in any Company Entity or otherwise) or the capital stock of any Subsidiary or any securities convertible into, exercisable or exchangeable for, or subscriptions, rights, warrants or options to acquire, or other agreements Contracts or commitments of any character obligating any of them to issue or purchase any such shares or other convertible securities securities, or amend, accelerate the vesting of or of, adjust or modify any Company SharesSecurities or any Equity Interests in any Company Entity, except for the issuance of Company Shares pursuant to the exercise of Company Options or the conversion into Company Ordinary Shares of Company Preferred Shares, in each case to the extent outstanding as of the date Agreement Date and listed on Section 3.5(c) of this Agreementthe Disclosure Schedule;
(de) form, or enter into any binding commitment to form, a subsidiary, or acquire, or enter into any binding commitment to acquire, an interest in any corporation, association, joint venture, partnership or other business entity or division thereofthereof or any portion of the assets of the foregoing;
(ef) make except as contemplated by the Capex Budget, enter into any new purchase orders in respect of capital expenditures or agree commitments with respect to make capital expenditures in any capital expenditure or commitment given month exceeding $100,000 500,000 individually or $300,000 2,000,000 in the aggregate;
(fg) acquire or agree to acquire or dispose or agree to dispose of (i) any material assets of any Person (including the Company or any Company Entity), other than acquisitions of supplies or similar assets in the ordinary course of the business consistent with past practice or the disposal of non-material assets of the Company or any Subsidiary Company Entity or the distribution or sale of any Company Products, in each case, in the ordinary course of business consistent with past practice, or (ii) any Equity Interest in any Person (including the Company or any Company Entity) or any business enterprise or division thereof outside the ordinary course of the business of the Company or its Subsidiary, as the case may be, and consistent with past practicethereof;
(g) (i) sell, exclusively license divest, license, grant or assign to any Person or enter into any agreement Contract to sell, exclusively license divest, license, grant or assign to any Person any rights to any Company IPIP (other than non-exclusive licenses entered into in the ordinary course of business consistent with past practice); (ii) buy or license any Intellectual Property or Intellectual Property Right of any third party (other than pursuant to agreements with Employees Open Source Software or other contributors Shrink-Wrap Software that is licensed in the form ordinary course of the applicable Standard Form IP Contract or pursuant to a Permitted AgreementCompany’s business consistent with past practice); (iii) license any Company Products or Company IP to third parties, parties (other than non-exclusive licenses pursuant to a Contract substantially in the form of the applicable a Standard Form IP Contract (and other than pursuant to a Permitted Agreement); (iv) enter entered into any distributor, reseller, sales representative, marketing, or similar agreement (other than pursuant to a Permitted Agreement); (v) amend, modify, or extend any agreement for the license, sale, or other distribution of Company Products or Company IP (other than with respect to agreements that constitute Permitted Agreements prior to such amendment, modification or extension and thereafter); (vi) enter into any agreement with respect to the development of any Intellectual Property or Intellectual Property Right on behalf of the Company or any Subsidiary with a third party (other than agreements with employees, contractors or other contributors in the form of the applicable Standard Form IP Contract); (vii) change practices related to pricing or royalties charged by the Company or any Subsidiary to, or the compensation or other amounts payable to, the Company’s or any of its Subsidiaries’ distributors, resellers, sales representatives, customers or licensees, or the pricing or royalties set or charged by Persons who have licensed Intellectual Property or Intellectual Property Rights to the Company or any of its Subsidiaries (other than with respect to a Permitted Agreement); or (viii) make available any Company IP such that the Company IP becomes subject to an Open Source License (other than new versions of any Company IP in its products previously distributed under an Open Source License consistent with past practices and under the same license terms);
(h) incur any Indebtedness (other than the obligation to reimburse employees for travel and business expenses in the ordinary course of the Company’s business consistent with past practicespractice); or (iv) disclose any Company Source Code to, issue or sell deposit in escrow any Company Source Code with, any third party other than its Employees who have entered into Contracts in the form of a Proprietary Information Agreement;
(i) allow any Company IPR to lapse or expire, or fail to renew or make any filing or payment necessary in connection with the prosecution or maintenance of any Company Registered IP;
(j) (i) incur any Indebtedness in excess of $1,000,000 in the aggregate, including by the issuance or sale of any debt securities, (ii) create a or permit any Lien (other than a Permitted LienLiens) over any intangible or material asset of the Company or any Subsidiary Company Entity, or (iii) amend the terms of any outstanding loan agreementagreement or other Contract evidencing Indebtedness in any material respect;
(i) make any loan to any Person (except for advances to employees for reasonable business travel and expenses in the ordinary course of business consistent with past practice), (ii) purchase debt securities of any Person or (iii) guarantee any Indebtedness of any PersonPerson (other than intercompany arrangements among the Company or any Company Entity entered into in the ordinary course of business consistent with past practice);
(jl) commence or settle any Action or threat of any Action by or against the Company or any Subsidiary Company Entity or relating to any of their businesses, properties or assets (assets, other than routine collections proceedings)Actions not in excess of $100,000 individually or $500,000 in the aggregate, provided that each such settlement (i) provides only for monetary payment and ancillary terms customary for such a settlement, such as confidentiality obligations and a release of claims (it being understood that any such settlement must include full release of claims against the Company and the Company Entities) and (ii) does not include any admission of fault or liability of any kind whatsoever by the Company or any Company Entity;
(k) pay, discharge, release, waive or satisfy any claims, rights or Liabilities, other than the payment, discharge or satisfaction in the ordinary course of business of Liabilities reflected on the Current Balance Sheet or incurred in the ordinary course of business after the Balance Sheet Date and the payment, discharge or satisfaction of Third Party Expenses;
(lm) adopt or change accounting methods or practices (including any change in depreciation or amortization policies or rates or any change to practices that would impact the methodology for recognizing revenue) other than as required by HK GAAP or Taiwan GAAP;
(mn) make or change any material Tax electionelection in respect of Taxes, adopt or change any Tax accounting method, enter into any agreement method in respect of Taxes, waive any right to a Tax refund or credit in lieu thereof, settle any Tax claim or assessmentassessment in respect of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessmentassessment in respect of Taxes (other than pursuant to automatic extensions of the due date for filing a Tax Return obtained in the ordinary course of business), make or request any Tax ruling, enter into any Tax sharing or similar agreement Contract or arrangement (other than Ordinary Course Contracts)arrangement, enter into any transactions giving rise to deferred gain or loss, amend any Tax Return or file any income or other material Tax Return including without providing a copy to Acquiror for review and comment no later than five (5) Business Days prior to filing (and considering any estimated Tax Return, except such reasonable comments thereto in accordance with Section 7.6;
(n) enter into, adopt, amend or terminate any Company Employee Plan, including any indemnification agreement or enter into or amend any Employee Agreement other than entry into standard form offer letters with new hires who are terminable at-will, with annual remuneration (including base remuneration and bonus opportunities) of not more than $200,000 each, in the ordinary course of the Company’s business consistent with past practicegood faith);
(o) amend modify in any material respect, or publish or remove, any Data Processing Policy, or announce any such amendment, modification, publication, or removal;
(p) make any material change to the Processing of any Company Data;
(q) (i) increase or make any other change that would result in increased cost to the Company with respect to the salary, wage rate, employment status, title or other compensation (including equity based compensation whether payable in cash, Company Shares Securities or other property) payable or to become payable by the Company or any Subsidiary Company Entity to any Employee Employee, (ii) hire or engage any Person for service, demote, terminate any current Employee (other than for cause)) or otherwise materially modify the terms and conditions of the service or employment of any current Employee;
(pi) make any declaration, payment, commitment or obligation of any kind for the payment (whether in cash, equity Company Securities, Equity Interests in any Company Entity or otherwise) of any severance payment or other payment, change in control payment, termination payment, bonus, incentive, special remuneration or other additional salary or compensation (including equity based compensation) or benefits to any Employee, except payments made pursuant to Company Employee Plans (or any other written agreements existing on the date of this Agreement Date and disclosed Made Available to Acquiror) or (ii) enter into, adopt, suspend, terminate, or materially modify or amend any Company Employee Plan, including any indemnification Contract (other than such actions as permitted in Section 5.2(paccordance with clause (ii) of the Disclosure ScheduleSection 5.2(q));
(qs) take any action to accelerate or otherwise modify the terms of any of the outstanding Company Options;
(r) make any representations or issue send any communications (including electronic communications) to Employees that are inconsistent with or do not accurately describe this Agreement or the other Related Agreements or the transactions contemplated hereby or thereby, including any representations regarding offers of employment from Buyer;
(s) enter into, participate in, establish or join any new standards-setting organization, collaborative effort with a university or industry body or consortium or other multi-party special interest group or activity;
(t) cancel, amend (other than in connection with the addition of customers and suppliers customers, distributors, resellers, licensees, suppliers, or vendors to such insurance policies from time to time in the ordinary course of business consistent with past practices) practice), or fail to renew (on substantially similar terms) any insurance policy of the Company or any SubsidiaryCompany Entity;
(u) (i) terminate, amend, or waive or modify, or violate the terms of any Material Contract (provided that the Company may amendextend, waive or modify a Permitted Agreement in a manner such that it remains a Permitted Agreement), (ii) terminate any Material Contract (other than expiration at immaterial amendments, waivers, or modifications in the end ordinary course of a scheduled termbusiness consistent with past practice), or (ii) enter into any Contract which would have constituted a Material Contract had such Contract been entered into prior to the date Agreement Date (other than Contracts that are substantially in the form of this Agreement the applicable Standard Form IP Contract and are entered into in the ordinary course of business consistent with past practice);
(provided that v) enter into any new line of business or change the Company’s or any Company may Entity’s material operating policies in any material respect, except as required by applicable Law or by policies imposed by any Governmental Entity;
(w) enter into any Contract to purchase or sell any interest in real property, grant any security interest in any real property or enter into any lease, sublease, license or other occupancy Contract with respect to Permitted Agreements)any real property or alter, amend, modify, knowingly or willfully violate or terminate any of the terms of any Company Leases; or
(vx) take, commit, or agree in writing or otherwise to taketake or make, any of the actions described clause (a) – through (uw) of this Section 5.2, or any other action that would (i) prevent the Company from performing, or cause the Company not to perform, its covenants or agreements hereunder, or (ii) that the Person taking such action actually knows, or, with respect to the Company’s officers and members of the Company’s board of directors, should reasonably be expected to know, will cause or result in a breach of or inaccuracy in any representation or warranty of the Company herein as of the Closing. Buyer acknowledges and agrees that: (i) nothing contained in this Agreement shall give Buyer, directly or indirectly, the right to control or direct the Company’s operations prior to the Closing, and (ii) prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ operations.
Appears in 1 contract
Restrictions on Company Activities. During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement or the Effective TimePre-Closing Period, except as expressly contemplated by this Agreement or required by Applicable Law due to a change in such Applicable Law after the Agreement Date and except as expressly set forth in Section 5.2 of the Disclosure Schedule, none of the Company shall not (and shall ensure that no Subsidiary or any of its Subsidiaries shall), without the prior written consent of Buyer:Acquiror (such consent not to be unreasonably withheld, conditioned or delayed):
(a) cause or permit any modifications, amendments or changes to the Governing Charter Documents or the organizational documents of any Subsidiary;
(b) (i) declare, set aside, or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any Company Shares Capital Stock or the capital stock or other Equity Interest of any Subsidiary, or (ii) split, combine or reclassify any Company Shares Capital Stock or the capital stock or other Equity Interest of any Subsidiary or Subsidiary, (iii) issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Shares Capital Stock or the capital stock or other Equity Interest of any SubsidiarySubsidiary (other than with respect to the exercise of Company Options outstanding as of the Agreement Date), or (iv) directly or indirectly repurchase, redeem or otherwise acquire any shares of Company Shares Security or the capital stock or other Equity Interest of any Subsidiary (or options, warrants or other rights convertible into, exercisable or exchangeable for Company Shares or the shares or equity interests of any Subsidiary) except in accordance with the agreements Contracts evidencing Company Options outstanding as of the date of this AgreementAgreement Date that have been Made Available);
(c) issue, grant, deliver or sell or authorize or propose the issuance, grant, delivery or sale of, or purchase or propose the purchase of, any Company Shares Capital Stock or equity-based awards other Company Security (whether payable in cash, share Company Securities or otherwise) or the capital stock or other Equity Interest of any Subsidiary or any securities convertible into, exercisable or exchangeable for, or subscriptions, rights, warrants or options to acquire, or other agreements or commitments of any character obligating any of them to issue or purchase any such shares or other convertible securities securities, or amend, accelerate the vesting of or of, adjust or modify any Company SharesSecurities, except for the issuance of Company Shares Capital Stock pursuant to the exercise of Company Options or the conversion into Company Ordinary Shares of Company Preferred Shares, in each case to the extent outstanding as of the date of this AgreementAgreement Date;
(d) form, or enter into any binding commitment to form, a subsidiary, or acquire, or enter into any binding commitment to acquire, an interest in any corporation, association, joint venture, partnership or other business entity or division thereofthereof or any portion of the assets of the foregoing;
(e) make or agree to make any capital expenditure or commitment exceeding $100,000 50,000 individually or $300,000 150,000 in the aggregate;
(f) acquire or agree to acquire or dispose or agree to dispose of (i) any material assets of the Company or any Subsidiary or any business enterprise or division thereof outside the ordinary course of the business of the Company or its Subsidiary, as the case may be, and consistent with past practice, or (ii) any Subsidiary or any business enterprise or division thereof;
(g) (i) sell, divest, exclusively license or assign to any Person or enter into any agreement to sell, divest, exclusively license or assign to any Person any rights to any Company IP; (ii) buy or license any Intellectual Property Technology or Intellectual Property Right of any third party (party, other than pursuant to agreements with Employees or other contributors in the form ordinary course of the applicable Standard Form IP Contract or pursuant to a Permitted Agreement)business consistent with past practices; (iii) license any Company Products or Company IP to third parties, parties other than pursuant to customer agreements in the form of the applicable Standard Form IP Contract (and other than pursuant to a Permitted Agreement)that are entered into in the ordinary course of business consistent with past practice; (iv) enter into any distributor, reseller, sales representative, referral, marketing, or similar agreement (other than pursuant to a Permitted Agreement)agreement; (v) amend, modify, or extend any agreement for the license, sale, or other distribution of Company Products or Company IP (other than amendments, extensions, or modifications are entered into in the -43- ordinary course of business consistent with respect to agreements that constitute Permitted Agreements prior to past practice and which do not change pricing under such amendment, modification or extension and thereafteragreements); (vi) enter into any agreement with respect to the development of any Intellectual Property Technology or Intellectual Property Right on behalf of the Company or any Subsidiary with a third party (other than agreements with employees, contractors or other contributors Employees in the form of the applicable Standard Form IP ContractProprietary Information Agreement); (vii) change practices related to pricing or royalties charged by the Company or any Subsidiary to, or the compensation or other amounts payable to, the Company’s or any of its Subsidiaries’ to their respective distributors, resellers, sales representatives, customers or licensees, or the pricing or royalties set or charged by Persons who have licensed Intellectual Property Technology or Intellectual Property Rights to the Company or any of its Subsidiaries (Subsidiaries, other than with respect to a Permitted as already agreed upon as of the date of this Agreement); or (viii) make available disclose any Company IP such that the Source Code to, or deposit in escrow any Company IP becomes subject to an Open Source License (Code with, any third party other than new versions its Employees who have entered into agreements in the form of any Company IP in its products previously distributed under an Open Source License consistent with past practices and under the same license terms)a Proprietary Information Agreement;
(h) incur any Indebtedness (other than the obligation to reimburse employees for travel and business expenses in the ordinary course of the Company’s business consistent with past practices), issue or sell any debt securities, create a Lien (other than a Permitted Lien) over any asset of the Company or any Subsidiary or amend the terms of any outstanding loan agreementagreement or other Contract evidencing Indebtedness;
(i) make any loan to any Person (except for advances to employees for reasonable business travel and expenses in the ordinary course of business consistent with past practice), purchase debt securities of any Person or guarantee any Indebtedness of any Person;
(j) commence or settle any Action or threat of any Action by or against the Company or any Subsidiary or relating to any of their businesses, properties or assets (assets, other than routine collections proceedings)in connection with the enforcement of the rights of the Company under this Agreement;
(k) pay, discharge, release, release or waive or satisfy any claims, rights or Liabilitiesliabilities, other than the payment, discharge or satisfaction in the ordinary course of business consistent with past practice of Liabilities liabilities reflected on the Current Balance Sheet or incurred in the ordinary course of business consistent with past practice after the Balance Sheet Date and the payment, discharge or satisfaction of Third Party ExpensesDate;
(l) adopt or change accounting methods or practices (including any change in depreciation or amortization policies or rates or any change to practices that would impact the methodology for recognizing revenue) other than as required by GAAP;
(m) make or change any material Tax electionelection in respect of Taxes, adopt or change any Tax accounting methodmethod in respect of Taxes, enter into any agreement with a Taxing authority in respect of Taxes, waive any right to a tax refund or credit, settle any Tax claim or assessmentassessment in respect of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessmentassessment in respect of Taxes, make or request any Tax ruling, enter into any Tax sharing or similar agreement or arrangement (other than Ordinary Course Contractscustomary provisions of commercial contracts entered into in the ordinary course of business the primary purpose of which is unrelated to Tax), enter into any transactions giving rise to deferred gain or loss, amend any Tax Return or file any income or other material Tax Return including any estimated Tax Return, except in accordance with Section 7.67.6(a);
(n) enter intoexcept as required by Law, adopt, amend or terminate any Company Employee Plan, including any indemnification agreement or enter into or amend any Employee Agreement other than entry into standard form offer letters with new hires who are terminable at-will, with annual remuneration (including base remuneration and bonus opportunities) of not more than $200,000 each, in the ordinary course of the Company’s business consistent with past practiceemployee agreement;
(o) modify or remove any Company Privacy Policy, publish any new Company Privacy Policy, or announce any modification, removal, or publication of any Company Privacy Policy;
(p) (i) increase or make any other change that would result in increased cost to the Company with respect to the salary, wage rate, employment status, title or other compensation (including equity Company Security-based compensation compensation, whether payable in cash, Company Shares Securities or other property) payable or to become payable by the Company or any Subsidiary to any Employee or (ii) hire or engage any Person for service, demote, terminate (other than for cause) or otherwise modify the terms and conditions of the service or employment of any current Employee, or (iii) cause any Employee to resign from the Company or otherwise terminate the services of any Employee to the Company or any Subsidiary (other than for cause);
(pi) make any declaration, payment, commitment or obligation of any kind for the payment (whether in cash, equity Company Securities or otherwise) of any severance payment or other change in control payment, termination payment, bonus, special remuneration or other additional salary or compensation (including equity Company Security-based compensation) to any Employee, except payments made pursuant to written agreements existing on the date of this Agreement Date and disclosed Made Available and set forth in Section 5.2(p) of the Disclosure Schedule, or (ii) enter into, adopt or amend any Company Employee Plan;
(qr) take any action to accelerate or otherwise modify the terms of any of the outstanding Company Options;
(rs) make any representations or issue send any communications (including electronic communications) to Employees regarding this Agreement or the transactions contemplated hereby that are inconsistent with this Agreement or the transactions contemplated therebyhereby, including any representations regarding with respect to offers of employment from Buyer;
(s) enter into, participate in, establish with Acquiror or join any new standards-setting organization, collaborative effort with a university or industry body or consortium or other multi-party special interest group or activityof its Affiliates;
(t) unilaterally take action to cancel, amend (other than in connection with the addition of customers and suppliers customers, distributors, resellers, licensees, suppliers, or vendors to such insurance policies from time to time in the ordinary course of business consistent with past practices) or willfully fail to renew (on substantially similar terms) any insurance policy of the Company or any Subsidiary;
(u) other than in the ordinary course of business consistent with past practice, (i) terminate, amend, or waive or modifyextend, waive, or violate the terms of modify any Material Contract (provided that the Company may amend, waive or modify a Permitted Agreement in a manner that would (A) be material relative to such that it remains a Permitted Agreement)Material Contract, or (iiB) terminate be material relative to the Company’s or any Material Contract (other than expiration at the end of a scheduled term)Subsidiary’s businesses or operations, or (ii) enter into any Contract which would have constituted a Material Contract had such Contract been entered into prior to the date Agreement Date (other than customer contracts that provide for non-exclusive licenses of this Agreement Company Products, are in the form of the applicable Standard Form IP Contract, and are entered into in the ordinary course of business consistent with past practice);
(provided that v) enter into any agreement to purchase or sell any interest in real property, grant any security interest in any real property, enter into any lease, sublease, license or other occupancy agreement with respect to any real property or alter, amend, modify, violate or terminate any of the terms of any Lease Agreements;
(i) other than in the ordinary course of business consistent with past practice, defer payment of any accounts payable, commissions, or other liabilities of the Company may enter or any of its Subsidiaries, (ii) provide for a reduction in fees or other amounts due to Permitted Agreements)the Company or any of its Subsidiaries after the Closing, (iii) give any discount, credits, accommodation or other concession, or otherwise take action that would reasonably be expected to accelerate or induce the collection of any receivable or otherwise increase the cash or cash equivalents or other current assets of the Company or any of its Subsidiaries, including any sales of a Company Product (A) with payment terms longer than terms customarily offered for such Company Product in the ordinary course of business consistent with past practice, (B) at a greater discount from listed prices or with more credits or other monetary incentives than customarily offered for such Company Product, other than pursuant to a promotion of a nature previously used in the ordinary course of business consistent with past practice for such Company Product, (C) at a price that does not give effect to any general increase in the list price for such Company Product publicly announced prior to the Closing Date, (D) in a quantity or volume greater than the reasonable resale requirement of the particular customer, distributor or reseller, (E) in conjunction with other material benefits to the customer, distributor or reseller not previously offered in the ordinary course of business consistent with past practice to such customer, or (F) accelerating the timing of any new releases for Company Products, or (iv) take any other action or omit to take any action with the primary intention of increasing the Total Closing Consideration; or
(vx) take, commit, or agree in writing or otherwise to take, (i) any of the actions described clause (a) – through (uw) of this Section 5.2, or (ii) any other action that would (i) prevent the Company or any of its Subsidiaries from performing, or cause the Company or any of its Subsidiaries not to perform, its covenants or agreements hereunder, or (ii) that the Person taking such action actually knows, or, with respect to the Company’s officers and members of the Company’s board of directors, should reasonably be expected to know, will cause or result in a breach of or inaccuracy in any representation or warranty of the Company herein as of the Closing. Buyer acknowledges and agrees that: (i) nothing contained in this Agreement shall give Buyer, directly or indirectly, the right to control or direct the Company’s operations prior to the Closing, and (ii) prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ operations.
Appears in 1 contract
Samples: Merger Agreement (Pluralsight, Inc.)
