Forbearances. Except as set forth in Schedule 5.2, the Shareholders shall cause the Companies, from the date hereof until the earlier of (i) the Closing or (ii) termination under Article IX, without the written consent of Buyer, not to: (i) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration; (ii) cancel or terminate, or amend, modify or waive any material term of, any material contract; (iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis; (iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000; (v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000; (vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment; (vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP; (A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of any class or series of capital stock; (A) incur any indebtedness for borrowed money or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters of credit, guarantees or similar instruments; (x) take any action in anticipation of the execution of this Agreement or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice; (xi) pay, discharge or satisfy any liability, other than any such payment, discharge or satisfaction in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules; (xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents; (A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person; (xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate; (xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease); (xvi) amend, cancel or terminate any license or permit that is material to any of the Companies; (xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; or (xviii) make any material change in the policies or practices relating to selling practices, returns, discounts or other terms of sale or accounting therefor or in policies of employment; or entered into any contract to do any of the foregoing.
Appears in 1 contract
Forbearances. Except as set forth in Schedule 5.2, From the Shareholders shall cause the Companies, from the date hereof Execution Date until the earlier Closing, each of the Parties covenants and agrees to ensure that neither OXMI nor Seller (i) with regard to Hotel Corporation and the Closing Hotel Business), other than as contemplated in this Agreement or (ii) termination under Article IXas otherwise disclosed in writing to the other Party or subject to public disclosure, do any of the following without the prior written consent of Buyerthe other Party, which consent shall not tobe unreasonably withheld:
(ia) selldeclare, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grantset aside, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of its capital stock or otherwise purchase or redeem, directly or indirectly, any class or series shares of its capital stock;
(Ab) issue, sell or deliver or enter into any agreement to issue, sell or deliver any shares of its capital stock or any options, warrants, or other rights, agreements, commitments, arrangements or understandings of any kind, contingent or otherwise, to purchase, sell or deliver any such shares, or any securities convertible into or exchangeable for any such shares, or effect any stock split, or otherwise change, combine or reclassify its authorized capitalization;
(c) incur any indebtedness or issue or sell any debt securities or prepay any debt;
(d) mortgage, pledge or otherwise subject to any material lien or lease, any of its properties or assets, tangible or intangible or permit or suffer any such property or asset to be subjected to any material lien or lease; or license or dispose of any material assets, except in the Ordinary Course of Business consistent with its prior practice;
(e) forgive or cancel any debts or claims, or waive any rights, except for borrowed money fair value;
(f) modify or extend the current term of any material agreement, or waive any material rights thereunder;
(g) pay any bonus to any employee or agent or contractor, or grant to any employee or agent or contractor any increase in compensation except in the Ordinary Course of Business consistent with its prior practice, or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bondsemployment, payment bondsseverance, bid bonds, surety bonds, letters of credit, guarantees termination or similar instrumentsagreement with any employee or agent or contractor;
(xh) take any action in anticipation amend its Certificate of the execution of this Agreement Incorporation or for Bylaws or any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
(xi) pay, discharge or satisfy any liability, other than any such payment, discharge or satisfaction in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; or
(xviiii) make any material change changes in the policies or practices relating to selling practices, returns, discounts business practices or other terms of sale or accounting therefor therefore or in policies of employment; or entered ;
(j) enter into any contract type of business not conducted by it as of the Execution Date or create or organize any subsidiary or enter into or participate in any joint venture or partnership;
(k) except as otherwise expressly contemplated by this Agreement, enter into any agreement or transactions with any Affiliates or make any amendment or modification to any such agreement;
(l) make or change any election in respect of Taxes or settle any claim related to Taxes; or
(m) enter into any contract, commitment or arrangement to do any of the foregoing.
Appears in 1 contract
Forbearances. Except as set forth in Schedule 5.2, During the Shareholders shall cause the Companies, period from the date hereof until of this Agreement to the earlier of (i) the Closing Effective Time, except as expressly contemplated or (ii) termination under Article IXpermitted by this Agreement, email shall not, without the prior written consent of Buyer, not toParent:
(ia) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practiceincur any indebtedness for borrowed money or any indebtedness that constitutes the deferred purchase price of any property or assets, to Buyer assume, guarantee, endorse or persons who are not Affiliates (otherwise as an accommodation become responsible for the obligations of any other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair considerationindividual, corporation or other entity, or make any loan or advance;
(iib) cancel adjust, split, combine or terminate, or amend, modify or waive reclassify any material term of, any material contractcapital stock;
(iiic) make, declare or pay any dividend (A) increase the compensation payable whether in cash or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissionsproperty), service award or make any other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholderdistribution on, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series shares of its capital stock, stock or any securities or obligations convertible (whether currently convertible or convertible only after the passage of time or the occurrence of certain events) into or exchangeable for any shares of its capital stock;
(d) grant any stock appreciation rights or (C) declare or pay grant any dividend individual, corporation or other distribution in respect entity any right to acquire any shares of its capital stock;
(e) issue any class or series additional shares of capital stock;
(Af) incur sell, transfer, mortgage, encumber or otherwise dispose of any of its material properties or assets (including, without limitation, cash) to any individual, corporation or other entity, or cancel, release or assign any indebtedness for borrowed money to any such person or enter into any commitment to borrow money other than borrowings claims held by any such person, except in the ordinary course of business under or pursuant to contracts or agreements in force at the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters date of credit, guarantees or similar instrumentsthis Agreement;
(xg) take except pursuant to contracts or agreements in force at the date of or permitted by this Agreement, make any action investment in, either by purchase of stock or securities, contributions to capital, property transfers, or purchase of any property or assets, any other individual, corporation or other entity;
(h) except for transactions in anticipation the ordinary course of business, terminate, or waive any material provision of, any contract, or make any change in any instrument or agreement governing the execution terms of this Agreement any of its securities, or material lease or contract, other than normal renewals of contracts and leases without material adverse changes of terms;
(i) increase in any manner the compensation or fringe benefits of any of its employees or pay any pension or retirement allowance not required by any existing plan or agreement to any such employees or become a party to, amend or commit itself to any pension, retirement, profit-sharing or welfare benefit plan or agreement or employment agreement with or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations benefit of any kind whatsoever or to accelerate any income, revenue, payment or similar item, employee other than in the ordinary course of business consistent business, or accelerate the vesting of, or the lapsing of restrictions with past practicerespect to, any stock options or other stock-based compensation;
(xij) paysolicit or encourage from any third party or enter into any negotiations, discharge discussions or satisfy agreement in respect of, or authorize any liabilityindividual, corporation or other entity to solicit or encourage from any third party or enter into any negotiations, discussions or agreement in respect of, or provide or cause to be provided any confidential information in connection with, any inquiries or proposals relating to the conveyance, sale, lease, transfer or other disposition of all or a substantial portion of its business, property or assets, or the acquisition of its capital stock or securities convertible into capital stock, or the merger or consolidation, whether in one transaction or a series of transactions, of it with any corporation or other entity, other than as provided by this Agreement (and each party shall promptly notify the other of all of the relevant details relating to all inquiries and proposals which it may receive relating to any such paymentof these matters);
(k) settle any material claim, discharge action or satisfaction proceeding involving money damages, except in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xiil) change make any material capital expenditures, make any material changes in its current method of conducting business, or amend liquidate, dissolve or suffer any of their articles of incorporation liquidation or bylaws or similar organizational documentsdissolution;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (Bm) make any material payment of principal of any debt, with a capital investment (whether through the acquisition maturity of an equity interestmore than one year, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion for the deferred purchase price of property or services except at the stated maturity of the assets of debt or as required by mandatory prepayment provisions relating thereto (subject to any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decreasesubordination provisions applicable thereto);
(xvin) amendenter into any material agreement or become liable under any material agreement for the lease, cancel hire or terminate use of any license real or permit that is personal property, or enter into any material sale/leaseback arrangement with respect to any of the Companiesreal or personal property which now owned or hereafter acquired;
(xviio) cancel, waive incur or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; or
(xviii) make any material change in optional prepayment of, or purchase, redeem or otherwise acquire, or amend any provision pertaining to the policies subordination, or practices relating to selling practices, returns, discounts or other terms of sale or accounting therefor or in policies of employment; or entered into any contract to do any of the foregoing.terms
Appears in 1 contract
Forbearances. Except as set forth in Schedule 5.2, From the Shareholders shall cause the Companies, from the date hereof Effective Date until the earlier Closing, Parent covenants and agrees to ensure that neither Parent nor Merger Sub will (other than as contemplated in this Agreement) do any of (i) the Closing or (ii) termination under Article IX, following without the prior written consent of Buyer, not toCompany acting in good faith:
(ia) selldeclare, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grantset aside, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of its capital stock or otherwise purchase or redeem, directly or indirectly, any class or series shares of its capital stock;
(Ab) issue, sell or deliver or enter into any agreement to issue, sell or deliver any shares of its capital stock or any options, warrants, or other rights, agreements, commitments, arrangements or understandings of any kind, contingent or otherwise, to purchase, sell or deliver any such shares, or any securities convertible into or exchangeable for any such shares, or effect any stock split, or otherwise change, combine or reclassify its authorized capitalization;
(c) incur any indebtedness or issue or sell any debt securities or prepay any debt;
(d) mortgage, pledge or otherwise subject to any material lien or lease, any of its properties or assets, tangible or intangible or permit or suffer any such property or asset to be subjected to any material lien or lease; or license or dispose of any material assets, except in the Ordinary Course of Business consistent with its prior practice;
(e) forgive or cancel any debts or claims, or waive any rights, except for borrowed money fair value;
(f) modify or extend the current term of any material agreement, or waive any material rights thereunder;
(g) pay any bonus to any employee or agent or contractor, or grant to any employee or agent or contractor any increase in compensation except in the Ordinary Course of Business consistent with its prior practice, or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bondsemployment, payment bondsseverance, bid bonds, surety bonds, letters of credit, guarantees termination or similar instrumentsagreement with any employee or agent or contractor;
(xh) take any action in anticipation amend its Certificate of the execution of this Agreement Incorporation (except to change its name to a name to which Company agrees) or for Bylaws or any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
(xi) pay, discharge or satisfy any liability, other than any such payment, discharge or satisfaction in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; or
(xviiii) make any material change changes in the policies or practices relating to selling practices, returns, discounts business practices or other terms of sale or accounting therefor therefore or in policies of employment; or entered ;
(j) enter into any contract type of business not conducted by it as of the Effective Date or create or organize any subsidiary or enter into or participate in any joint venture or partnership;
(k) except as otherwise expressly contemplated by this Agreement, enter into any agreement or transactions with any Affiliates or make any amendment or modification to any such agreement;
(l) make or change any election in respect of Taxes or settle any claim related to Taxes; or
(m) enter into any contract, commitment or arrangement to do any of the foregoing.
Appears in 1 contract
Forbearances. Except as set forth in Schedule 5.2, From the Shareholders shall cause the Companies, from the date hereof Effective Date until the earlier Closing, Parent covenants and agrees to ensure that neither Parent nor Merger Sub will (other than as contemplated in this Agreement) do any of (i) the Closing or (ii) termination under Article IX, following without the prior written consent of Buyer, not toCompany acting in good faith:
(ia) selldeclare, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grantset aside, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of its capital stock or otherwise purchase or redeem, directly or indirectly, any class or series shares of its capital stock;
(Ab) issue, sell or deliver or enter into any agreement to issue, sell or deliver any shares of its capital stock or any options, warrants, or other rights, agreements, commitments, arrangements or understandings of any kind, contingent or otherwise, to purchase, sell or deliver any such shares, or any securities convertible into or exchangeable for any such shares, or effect any stock split, or otherwise change, combine or reclassify its authorized capitalization;
(c) incur any indebtedness or issue or sell any debt securities or prepay any debt;
(d) mortgage, pledge or otherwise subject to any material lien or lease, any of its properties or assets, tangible or intangible or permit or suffer any such property or asset to be subjected to any material lien or lease; or license or dispose of any material assets, except in the Ordinary Course of Business consistent with its prior practice;
(e) forgive or cancel any debts or claims, or waive any rights, except for borrowed money fair value;
(f) modify or extend the current term of any material agreement, or waive any material rights thereunder;
(g) pay any bonus to any employee or agent or contractor, or grant to any employee or agent or contractor any increase in compensation except in the Ordinary Course of Business consistent with its prior practice, or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bondsemployment, payment bondsseverance, bid bonds, surety bonds, letters of credit, guarantees termination or similar instrumentsagreement with any employee or agent or contractor;
(xh) take any action in anticipation amend its Certificate of the execution of this Agreement Incorporation or for Bylaws or any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
(xi) pay, discharge or satisfy any liability, other than any such payment, discharge or satisfaction in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; or
(xviiii) make any material change changes in the policies or practices relating to selling practices, returns, discounts business practices or other terms of sale or accounting therefor therefore or in policies of employment; or entered ;
(j) enter into any contract type of business not conducted by it as of the Effective Date or create or organize any subsidiary or enter into or participate in any joint venture or partnership;
(k) except as otherwise expressly contemplated by this Agreement, enter into any agreement or transactions with any Affiliates or make any amendment or modification to any such agreement;
(l) make or change any election in respect of Taxes or settle any claim related to Taxes; or
(m) enter into any contract, commitment or arrangement to do any of the foregoing.
Appears in 1 contract
Sources: Merger Agreement (Becoming Art Inc)
Forbearances. Except as set forth in Schedule 5.2From and after the Effective Date, Optionor shall ensure that the Shareholders shall cause Company will not do any of the Companies, from the date hereof until the earlier of (i) the Closing or (ii) termination under Article IX, following without the prior written consent of BuyerGRO, not to:
in its sole and absolute discretion, except as otherwise expressly permitted under the Operating Agreement : (ia) declare, set aside, make, or pay any distribution other than a direct obligation of the Company related to the Company Business ; (b) issue, sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, deliver or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeemissue, purchase or otherwise acquiresell, or splitdeliver any Shares, combineeconomic, reclassify or otherwise adjustsimilar interest in the Company, or any class options, warrants, or series other rights, agreements, commitments, arrangements or understandings of capital stockany kind, contingent or otherwise, to purchase, sell or deliver any such interests, or any securities convertible into or exchangeable for capital stock any such interests, or otherwise change, combine, or reclassify its authorized capitalization ; (C) declare or pay any dividend or other distribution in respect of any class or series of capital stock;
(Ac) incur any indebtedness or issue or sell any debt securities or prepay any debt; (d) mortgage, pledge, or otherwise subject to any material lien or lease, any or all of the Property; (e) (f) forgive or cancel any debts or claims, or waive any rights, except for borrowed money fair value ; enter into any type of business other than the Company Business or acquire any asset other than the Property, or create or organize any subsidiary or enter into or participate in any joint venture or partnership ; except as otherwise expressly contemplated by this Agreement, enter into any agreement or transactions with any affiliates or make any amendment or modification to any such agreement; make or change any election in respect of taxes or settle any claim related to taxes; sell or otherwise dispose of the Property; or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bondscontract, payment bonds, bid bonds, surety bonds, letters of credit, guarantees or similar instruments;
(x) take any action in anticipation of the execution of this Agreement or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
(xi) pay, discharge or satisfy any liability, other than any such payment, discharge or satisfaction in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practicecommitment, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; or
(xviii) make any material change in the policies or practices relating to selling practices, returns, discounts or other terms of sale or accounting therefor or in policies of employment; or entered into any contract arrangement to do any of the foregoing. (g) (h) (i) (j) 3. Assignment of Option a) Right to Assign Option to Purchase Shares - The Optionee shall have the right to assign all or part of their rights, title, and interest in and to the option to purchase shares of Optionor any time. b) Acknowledgment of Future Assignment - The Optionor, acknowledges and agrees that the Optionee intends to assign the Option, at a future date, to a new entity that will undertake a Regulation A financing (the “Reg A Entity”). The Optionor further consents to such assignment, provided that it complies with the conditions set forth in this clause and the Option Agreement.
Appears in 1 contract
Forbearances. Except as set forth in Schedule 5.2, From the Shareholders shall cause the Companies, from the date hereof Execution Date until the earlier Closing, Parent covenants and agrees to ensure that neither Parent nor Merger Sub will (other than as contemplated in this Agreement) do any of (i) the Closing or (ii) termination under Article IX, following without the prior written consent of Buyer, not toCompany acting in good faith:
(ia) selldeclare, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grantset aside, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of its capital stock or otherwise purchase or redeem, directly or indirectly, any class or series shares of its capital stock;
(Ab) issue, sell or deliver or enter into any agreement to issue, sell or deliver any shares of its capital stock or any options, warrants, or other rights, agreements, commitments, arrangements or understandings of any kind, contingent or otherwise, to purchase, sell or deliver any such shares, or any securities convertible into or exchangeable for any such shares, or effect any stock split, or otherwise change, combine or reclassify its authorized capitalization;
(c) incur any indebtedness or issue or sell any debt securities or prepay any debt;
(d) mortgage, pledge or otherwise subject to any material lien or lease, any of its properties or assets, tangible or intangible or permit or suffer any such property or asset to be subjected to any material lien or lease; or license or dispose of any material assets, except in the Ordinary Course of Business consistent with its prior practice;
(e) forgive or cancel any debts or claims, or waive any rights, except for borrowed money fair value;
(f) modify or extend the current term of any material agreement, or waive any material rights thereunder;
(g) pay any bonus to any employee or agent or contractor, or grant to any employee or agent or contractor any increase in compensation except in the Ordinary Course of Business consistent with its prior practice, or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bondsemployment, payment bondsseverance, bid bonds, surety bonds, letters of credit, guarantees termination or similar instrumentsagreement with any employee or agent or contractor;
(xh) take any action in anticipation amend its Certificate of the execution of this Agreement Incorporation or for Bylaws or any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
(xi) pay, discharge or satisfy any liability, other than any such payment, discharge or satisfaction in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; or
(xviiii) make any material change changes in the policies or practices relating to selling practices, returns, discounts business practices or other terms of sale or accounting therefor therefore or in policies of employment; or entered ;
(j) enter into any contract type of business not conducted by it as of the Execution Date or create or organize any subsidiary or enter into or participate in any joint venture or partnership;
(k) except as otherwise expressly contemplated by this Agreement, enter into any agreement or transactions with any Affiliates or make any amendment or modification to any such agreement;
(l) make or change any election in respect of Taxes or settle any claim related to Taxes; or
(m) enter into any contract, commitment or arrangement to do any of the foregoing.
Appears in 1 contract
Sources: Merger Agreement (Becoming Art Inc)
Forbearances. Except as set forth in Schedule 5.2, During the Shareholders shall cause the Companies, period from the date hereof until the earlier of (i) the Closing or (ii) termination under Article IX, without the written consent of Buyer, not to:
(i) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this AgreementAgreement to the Effective Time, Union shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of First Charter (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment and Union shall provide First Charter with prompt notice of any such employment or consulting agreement events referred to which it is a party in this SECTION 7.02 occurring after the date hereof):
(except with respect to any employee at will without a written agreement), (Ha) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee consistent with past practice, incur any indebtedness for borrowed money (other than short-term indebtedness incurred to refinance short-term indebtedness, it being understood and agreed that incurrence of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, indebtedness in the ordinary course of business shall include, without limitation, the creation of deposit liabilities, purchases of federal funds, sales of certificates of deposit and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliersentering into repurchase agreements), other than payments underassume, and in accordance with the terms ofguarantee, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase endorse or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable as an accommodation become responsible for capital stock or (C) declare or pay any dividend or other distribution in respect of any class or series of capital stock;
(A) incur any indebtedness for borrowed money or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters of credit, guarantees or similar instruments;
(x) take any action in anticipation of the execution of this Agreement or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever other individual, corporation or to accelerate other entity, or make any income, revenue, payment loan or similar item, advance other than in the ordinary course of business consistent with past practice;
(xib) payadjust, discharge split, combine or satisfy reclassify any liabilitycapital stock or otherwise make any change with respect to its authorized capital stock; make, declare or pay any dividend or make any other than distribution on, or directly or indirectly redeem, purchase or otherwise acquire, any shares of its capital stock or any securities or obligations convertible into or exchangeable for any shares of its capital stock, or grant any stock appreciation rights or grant any individual, corporation or other entity any right to acquire any shares of its capital stock; or issue any additional shares of capital stock, or any securities or obligations convertible into or exchangeable for any shares of its capital stock, except pursuant to the exercise of Union Options outstanding as of the date hereof and pursuant to the Stock Option Agreement;
(c) sell, transfer, mortgage, encumber or otherwise dispose of any of its properties or assets to any individual, corporation or other entity, or cancel, release or assign any indebtedness to any such paymentperson or any claims held by any such person;
(d) make any material investment either by purchase of stock or securities, discharge contributions to capital, property transfers, or satisfaction purchase of any property or assets of any other individual, corporation or other entity;
(e) enter into or terminate any contract or agreement involving annual payments in excess of $1,000 and which cannot be terminated without penalty upon 30 days notice, or make any change in, or extension of, any of its leases or contracts involving annual payments in excess of $1,000 and which cannot be terminated without penalty upon 30 days notice;
(f) increase or modify in any manner the compensation or fringe benefits of any of its Employees or pay any pension or retirement allowance not required by any existing plan or agreement to any such Employees, or become a party to, amend or commit itself to any pension, retirement, profit-sharing or welfare benefit plan or agreement or employment agreement with or for the benefit of any Employee or accelerate the vesting of any stock options or other stock-based compensation; provided the foregoing shall not prevent the continued accrual and payment in the ordinary course of business, consistent with past practice benefits under the existing cash incentive bonus plan for key employees of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and Union in accordance with the terms of such plan; and provided further, that Union may put in effect regularly scheduled salary increases which are either (i) approved in advance by First Charter or (ii) consistent with the budgets for Union which have been approved by First Charter;
(g) take any action, or refrain from taking any action, that would prevent or impede the Merger from qualifying as a reorganization within the meaning of Section 368 of the Code or from qualifying for pooling-of-interests accounting treatment;
(h) settle any claim, any action or proceeding involving the payment of money damages in excess of an amount which, together with all other claims, actions or proceedings previously settled, exceeds $20,000;
(i) amend its Articles of Incorporation or its bylaws;
(j) fail to maintain its Regulatory Agreements, material contracts, licenses and permits or to file in a timely fashion all federal, state, local and other commitments set forth in the Schedulesforeign tax returns;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (Bk) make a any capital investment (whether through the acquisition expenditures of an equity interest, the making of a loan more than $10,000 individually or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material $25,000 in the aggregate;
(xvl) revalue any of their Assets, including any write-off of notes fail to maintain each Union Benefit Plan or accounts receivable timely make all contributions or any increase accruals required thereunder in any reserve (other than in the ordinary course of business accordance with GAAP applied on a consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregatebasis; or
(xviiim) agree to, or make any material change in the policies or practices relating to selling practicescommitment to, returns, discounts or other terms of sale or accounting therefor or in policies of employment; or entered into any contract to do take any of the foregoingactions prohibited by this SECTION 7.02.
Appears in 1 contract
Forbearances. Except During the period from the date of this Agreement to the Effective Time, except as set forth in the Best Disclosure Schedule 5.2or the Hiway Disclosure Schedule, as the Shareholders case may be, and except as expressly contemplated or permitted by this Agreement, neither Best nor Hiway shall, and Hiway shall cause the Companies, from the date hereof until the earlier of (i) the Closing or (ii) termination under Article IXnot permit its Subsidiary to, without the prior written consent of Buyer, not tothe other:
(ia) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity consistent with past practice, incur any indebtedness for borrowed money (other than short-term indebtedness incurred to refinance short-term indebtedness), assume, guarantee, endorse or otherwise as an employee accommodation become responsible for the obligations of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companiesother individual, in the ordinary course of business and on an arms' length basiscorporation or other entity, or make any loan or advance;
(ivb) (i) adjust, split, combine or reclassify any capital stock; (ii) make, declare or pay any dividend or make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or selldistribution on, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series shares of its capital stock, stock or any securities or obligations convertible into or exchangeable for any shares of its capital stock; (iii) grant any stock appreciation rights or grant any individual, corporation or other entity any right to acquire any shares of its capital stock (and no such rights or options shall be granted, except as otherwise agreed in writing by Best and Hiway); or (Civ) declare or pay issue any dividend or other distribution in respect of any class or series additional shares of capital stockstock except pursuant to the exercise of stock options or warrants or the conversion of convertible securities outstanding as of the date of this Agreement or approved hereunder;
(Ac) incur sell, transfer, mortgage, encumber or otherwise dispose of any of its properties or assets to any individual, corporation or other entity other than a Subsidiary, or cancel, release or assign any indebtedness for borrowed money to any such person or enter into any commitment to borrow money other than borrowings claims held by any such person, except in the ordinary course of business under consistent with past practice or pursuant to contracts or agreements in force at the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters date of credit, guarantees or similar instrumentsthis Agreement;
(xd) take any action except for transactions in anticipation the ordinary course of business consistent with past practice or pursuant to contracts or agreements in force at the execution date of this Agreement Agreement, make any material investment either by purchase of stock or for securities, contributions to capital, property transfers, or purchase of any property or assets of any other reason to delay individual, corporation or defer expenses other entity other than a Subsidiary;
(including delay e) except for transactions in the ordinary course of business consistent with past practice, enter into or postponement terminate any material contract or agreement, or make any change in any of capital expenditures its material leases or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar itemcontracts, other than renewals of contracts and leases without material adverse changes of terms;
(f) increase in any manner the compensation or fringe benefits of any of its employees or pay any pension or retirement allowance not required by any existing plan or agreement to any such employees, or become a party to, amend or commit itself to any pension, retirement, profit-sharing or welfare benefit plan or agreement or employment agreement with or for the benefit of any employee other than in the ordinary course of business consistent with past practice or accelerate the vesting of any stock options or other stock-based compensation;
(g) settle any claim, action or proceeding involving money damages, except in the ordinary course of business consistent with past practice;
(xih) pay, discharge take any action that would prevent or satisfy any liability, other than any such payment, discharge or satisfaction in impede the ordinary course Merger from qualifying (i) for "pooling of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, interests" accounting treatment or (Bii) liabilities underas a reorganization within the meaning of Section 368 of the Code;
(i) amend its Articles of Incorporation or its Bylaws, except as contemplated by this Agreement;
(j) take any action that is intended or may reasonably be expected to result in any of its representations and in accordance with the terms of, any material contracts, licenses and permits and other commitments warranties set forth in this Agreement being or becoming untrue in any material respect at any time prior to the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledgeEffective Time, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancelconditions to the Merger set forth in Article VII of this Agreement not being satisfied or in a violation of any provision of this Agreement, waive except, in every case, as may be required by applicable law or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregateexisting contractual obligations; or
(xviiik) agree to, or make any material change in the policies or practices relating to selling practicescommitment to, returns, discounts or other terms of sale or accounting therefor or in policies of employment; or entered into any contract to do take any of the foregoingactions prohibited by this Section 5.2.
Appears in 1 contract
Forbearances. Except as contemplated by this Agreement or as set forth in on Schedule 5.2, the Shareholders shall Company will not, and will cause the Companiesits Subsidiaries not to, from the date hereof until the earlier of (i) the Closing Effective Time or (ii) termination under Article IXVIII, without the written consent of Buyer, not toInvestor:
(i) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit otherwise dispose of any of its Personnelassets, including Intellectual Property, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of any class or series of capital stock;
(A) incur any indebtedness for borrowed money or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters of credit, guarantees or similar instruments;
(x) take any action in anticipation of the execution of this Agreement or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
(xiii) pay, discharge or satisfy incur any liability, other than any such payment, discharge or satisfaction in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion except under credit facilities existing as of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than date hereof in the ordinary course of business consistent with past practice;
(iii) mortgage, pledge or otherwise encumber, or permit to exist any new security interest, lien or encumbrance on, any of its assets except in the ordinary course of business consistent with past practice;
(iv) enter into, amend, modify or cancel any Material Contract or Lease except in the ordinary course of business consistent with past practice;
(v) make any material investment in, purchase any material securities of, or merge with, any Person or, except for purchases of inventory and other assets in the ordinary course of business consistent with past practice, purchase any material assets;
(vi) assume, guarantee, endorse or otherwise become responsible for the obligations of any Person (other than the Company or a Subsidiary), involving in excess of $10,000 individually or $50,000 make loans or advances to any Person except in the aggregate ordinary course of business consistent with past practice;
(such amounts vii) increase in any manner the compensation of any of (a) the employees of the Company or the Subsidiaries or the directors or officers of the Subsidiaries other than ASCI, other than increases in compensation in the ordinary course of business consistent with past practice or (b) the directors and officers of the Company or ASCI;
(viii) pay or agree to pay any pension or retirement allowance not required by an existing plan or agreement to any director, officer or employee, whether past or present, of the Company or its Subsidiaries, or enter into or amend (except to terminate) any employment agreement or any incentive compensation, profit sharing, stock purchase, stock option, stock appreciation rights, savings, consulting, deferred compensation, severance, retirement, pension or other benefit plan or arrangement with or for the benefit of any of its directors, officers, employees or of any other person except as may be calculated without netting required by applicable law or regulation;
(ix) except (A) as set forth in the capital expenditure budget provided to Investor and (B) for purchase orders for inventory arising in the ordinary course of business, enter into any decrease)contract which will require an expenditure after the Effective Time of more than $2,000,000 by the Company or the Subsidiaries;
(x) declare, set aside or pay any dividend in cash or property, repurchase or otherwise make any distribution, with respect to its capital stock other than dividends payable on the Preferred Shares;
(xi) split, combine or otherwise similarly change its capital stock, or redeem any of its capital stock;
(xii) authorize the creation or issuance of, or issue or sell, any shares of its or its Subsidiaries' capital stock or any securities or obligations convertible into or exchangeable for, or giving any person any right to acquire from it, any shares of its or its Subsidiaries' capital stock;
(xiii) enter into any joint venture, partnership or other similar arrangement;
(xiv) enter into any agreement which restricts in any way its ability to compete with any other Person;
(xv) amend its Articles of Incorporation or By-laws, except as contemplated by Section 2.4 and to increase the number of authorized Common Shares to effect the stock split referred to in Section 5.18;
(xvi) amend, cancel or terminate compromise, except compromises of current or former short- term trade receivables or other current assets in the ordinary course of business consistent with past practice, any license or permit that is material indebtedness owed to any of the Companiesit;
(xvii) cancelsettle any material litigation or, except in the ordinary course of business consistent with past practice, waive or release relinquish any material right or claim (benefit, or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; orwrite-off any material asset except as required by generally accepted accounting principles;
(xviii) cancel or allow any of its existing insurance policies to lapse;
(xix) alter in any way the manner in which it has regularly and customarily maintained its books of account and records, or change any of its accounting principles or the methods by which such principles are applied for tax or reporting purposes, except as required by law or by generally accepted accounting principles;
(xx) change or commit to change the business of the Company and its Subsidiaries from the Business or add new businesses, or change or commit to change materially the manner in which the Business is currently conducted;
(xxi) except for items in the categories set forth in Schedule 5.2, make any material change payment or distribution to, or loan or advance funds or extend credit to, sell any asset to or purchase any asset from, or assign or convey any right to, an Affiliated Person, other than payments made under leases at stores or other facilities owned by Affiliated Persons in the policies or practices relating ordinary course of business consistent with past practice, and pursuant to selling practices, returns, discounts or other the terms of sale or accounting therefor or such leases as currently in policies of employmenteffect; or entered into any contract (xxii) agree of commit to do any of the foregoingthings described in clauses (i) through (xxi) above. Except as contemplated by this Agreement, no Shareholder shall sell, transfer, convey, assign, mortgage, pledge, or hypothecate any Common Share or Preferred Share, or enter into any agreement or commitment to do the same.
Appears in 1 contract
Sources: Merger Agreement (Laralev Inc)
Forbearances. Except as set forth in Schedule 5.2, From the Shareholders shall cause the Companies, from the date hereof Effective Date until the earlier Closing, Parent covenants and agrees to ensure that neither Parent nor GACC will (other than as contemplated in this Agreement) do any of (i) the Closing or (ii) termination under Article IX, following without the prior written consent of Buyer, not toGreat American acting in good faith:
(ia) selldeclare, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grantset aside, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of its capital stock or otherwise purchase or redeem, directly or indirectly, any class or series shares of its capital stock;
(Ab) issue, sell or deliver or enter into any agreement to issue, sell or deliver any shares of its capital stock or any options, warrants, or other rights, agreements, commitments, arrangements or understandings of any kind, contingent or otherwise, to purchase, sell or deliver any such shares, or any securities convertible into or exchangeable for any such shares, or effect any stock split, or otherwise change, combine or reclassify its authorized capitalization;
(c) incur any indebtedness or issue or sell any debt securities or prepay any debt;
(d) mortgage, pledge or otherwise subject to any material lien or lease, any of its properties or assets, tangible or intangible or permit or suffer any such property or asset to be subjected to any material lien or lease; or license or dispose of any material assets, except in the Ordinary Course of Business consistent with its prior practice;
(e) forgive or cancel any debts or claims, or waive any rights, except for borrowed money fair value;
(f) modify or extend the current term of any material agreement, or waive any material rights thereunder;
(g) pay any bonus to any employee or agent or contractor, or grant to any employee or agent or contractor any increase in compensation except in the Ordinary Course of Business consistent with its prior practice, or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bondsemployment, payment bondsseverance, bid bonds, surety bonds, letters of credit, guarantees termination or similar instrumentsagreement with any employee or agent or contractor;
(xh) take any action in anticipation amend its Certificate of the execution of this Agreement Incorporation or for Bylaws or any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
(xi) pay, discharge or satisfy any liability, other than any such payment, discharge or satisfaction in the ordinary course of business, consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of business, consistent with past practice, or (B) liabilities under, and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregate; or
(xviiii) make any material change changes in the policies or practices relating to selling practices, returns, discounts business practices or other terms of sale or accounting therefor therefore or in policies of employment; or entered ;
(j) enter into any contract type of business not conducted by it as of the Effective Date or create or organize any subsidiary or enter into or participate in any joint venture or partnership;
(k) except as otherwise expressly contemplated by this Agreement, enter into any agreement or transactions with any Affiliates or make any amendment or modification to any such agreement;
(l) make or change any election in respect of Taxes or settle any claim related to Taxes; or
(m) enter into any contract, commitment or arrangement to do any of the foregoing.
Appears in 1 contract
Sources: Merger Agreement (Dse Fishman Inc)
Forbearances. Except as set forth in Schedule 5.2, During the Shareholders shall cause the Companies, period from the date hereof until of this Agreement to the earlier of (i) the Closing Effective Time, except as expressly contemplated or (ii) termination under Article IXpermitted by this Agreement, email shall not, without the prior written consent of Buyer, not toParent:
(ia) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practiceincur any indebtedness for borrowed money or any indebtedness that constitutes the deferred purchase price of any property or assets, to Buyer assume, guarantee, endorse or persons who are not Affiliates (otherwise as an accommodation become responsible for the obligations of any other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair considerationindividual, corporation or other entity, or make any loan or advance;
(iib) cancel adjust, split, combine or terminate, or amend, modify or waive reclassify any material term of, any material contractcapital stock;
(iiic) make, declare or pay any dividend (A) increase the compensation payable whether in cash or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissionsproperty), service award or make any other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholderdistribution on, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;
(iv) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series shares of its capital stock, stock or any securities or obligations convertible (whether currently convertible or convertible only after the passage of time or the occurrence of certain events) into or exchangeable for any shares of its capital stock;
(d) grant any stock appreciation rights or (C) declare or pay grant any dividend individual, corporation or other distribution in respect entity any right to acquire any shares of its capital stock;
(e) issue any class or series additional shares of capital stock;
(Af) incur sell, transfer, mortgage, encumber or otherwise dispose of any of its material properties or assets (including, without limitation, cash) to any individual, corporation or other entity, or cancel, release or assign any indebtedness for borrowed money to any such person or enter into any commitment to borrow money other than borrowings claims held by any such person, except in the ordinary course of business under or pursuant to contracts or agreements in force at the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters date of credit, guarantees or similar instrumentsthis Agreement;
(xg) take except pursuant to contracts or agreements in force at the date of or permitted by this Agreement, make any action investment in, either by purchase of stock or securities, contributions to capital, property transfers, or purchase of any property or assets, any other individual, corporation or other entity;
(h) except for transactions in anticipation the ordinary course of business, terminate, or waive any material provision of, any contract, or make any change in any instrument or agreement governing the execution terms of this Agreement any of its securities, or material lease or contract, other than normal renewals of contracts and leases without material adverse changes of terms;
(i) increase in any manner the compensation or fringe benefits of any of its employees or pay any pension or retirement allowance not required by any existing plan or agreement to any such employees or become a party to, amend or commit itself to any pension, retirement, profit-sharing or welfare benefit plan or agreement or employment agreement with or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations benefit of any kind whatsoever or to accelerate any income, revenue, payment or similar item, employee other than in the ordinary course of business consistent business, or accelerate the vesting of, or the lapsing of restrictions with past practicerespect to, any stock options or other stock-based compensation;
(xij) paysolicit or encourage from any third party or enter into any negotiations, discharge discussions or satisfy agreement in respect of, or authorize any liabilityindividual, corporation or other entity to solicit or encourage from any third party or enter into any negotiations, discussions or agreement in respect of, or provide or cause to be provided any confidential information in connection with, any inquiries or proposals relating to the conveyance, sale, lease, transfer or other disposition of all or a substantial portion of its business, property or assets, or the acquisition of its capital stock or securities convertible into capital stock, or the merger or consolidation, whether in one transaction or a series of transactions, of it with any corporation or other entity, other than as provided by this Agreement (and each party shall promptly notify the other of all of the relevant details relating to all inquiries and proposals which it may receive relating to any such paymentof these matters);
(k) settle any material claim, discharge action or satisfaction proceeding involving money damages, except in the ordinary course of business;
(l) make any material capital expenditures, consistent with past practice make any material changes in its current method of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of conducting business, consistent or liquidate, dissolve or suffer any liquidation or dissolution;
(m) make any material payment of principal of any debt, with past practicea maturity of more than one year, for borrowed money or for the deferred purchase price of property or services except at the stated maturity of the debt or as required by mandatory prepayment provisions relating thereto (subject to any subordination provisions applicable thereto);
(n) enter into any material agreement or become liable under any material agreement for the lease, hire or use of any real or personal property, or enter into any material sale/leaseback arrangement with respect to any real or personal property which now owned or hereafter acquired;
(Bo) liabilities underincur or make any optional prepayment of, and in accordance with or purchase, redeem or otherwise acquire, or amend any provision pertaining to the subordination, or the terms of payment of, any material contracts, licenses and permits and other commitments set forth in the Schedulessubordinated debt;
(xiip) change create, incur, assume or amend suffer to exist any lien or encumbrance of any kind upon any of their its properties, assets, income or profits, whether borrowed or hereafter acquired;
(q) knowingly take any action that would prevent or impede the Merger from qualifying as a reorganization within the meaning of Section 368 of the Code;
(r) amend its articles of incorporation or bylaws or similar organizational documentsits by-laws;
(As) acquire (by mergertake any action that is intended or expected to result in any of its representations and warranties set forth in this Agreement being or becoming untrue in any material respect at any time prior to the Effective Time, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets conditions to the Merger not being satisfied or in a violation of any Person that constitutes a division or operating unit provision of such Personthis Agreement, except, in every case, as may be required by applicable law;
(xivt) mortgage implement or pledgeadopt any change in its accounting principles, practices or otherwise make or suffer any Encumbrance (methods, other than any Permitted Encumbrance) on, any of their material Assets as may be required by general accepted accounting principles or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive or release any right or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 in the aggregateregulatory guidelines; or
(xviiiu) agree to take, make any material change commitment to take, or adopt any resolutions of its board of directors in the policies or practices relating to selling practicessupport of, returns, discounts or other terms of sale or accounting therefor or in policies of employment; or entered into any contract to do any of the foregoingactions prohibited by this Section 7.2.
Appears in 1 contract
Sources: Merger Agreement (Realm Productions & Entertainment Inc)
Forbearances. Except During the period from the date of this Agreement to the earlier of the Effective Time or the termination of this Agreement, and except as set forth in Schedule 5.2Section 7.2 of the Bank Disclosure Schedule, the Shareholders Bank shall cause the Companiesnot, from the date hereof until the earlier and shall not permit any of (i) the Closing or (ii) termination under Article IXits Subsidiaries to, without the prior written consent of Buyer, not to:
Sterling (i) sell, assign, lease or transfer any of and the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent Bank shall provide Sterling with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit prompt notice of any of its Personnel, except pursuant events referred to the employee plans in effect as of this Section 7.2 occurring after the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;):
(iva) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of any class or series of capital stock;
(A) incur any indebtedness for borrowed money or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters of credit, guarantees or similar instruments;
(x) take any action in anticipation of the execution of this Agreement or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
, incur any indebtedness for borrowed money (xi) pay, discharge or satisfy any liability, other than short-term indebtedness incurred to refinance short-term indebtedness and indebtedness of the Bank or any such payment, discharge of its Subsidiaries to the Bank or satisfaction any of its Subsidiaries; it being understood and agreed that incurrence of indebtedness in the ordinary course of businessbusiness shall include, consistent with past practice without limitation, the creation of (A) liabilities reflected deposit liabilities, purchases of federal funds, and sales of certificates of deposit), assume, guarantee, endorse or reserved against on otherwise as an accommodation become responsible for the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course obligations of business, consistent with past practiceany other Person, or (B) liabilities under, and in accordance with the terms of, make any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practicepractice and prudent banking practices;
(b) adjust, split, combine or reclassify any capital stock; make, declare or pay any dividend or make any other distribution on, or directly or indirectly redeem, purchase or otherwise acquire, any shares of its capital stock or any securities or obligations convertible into or exchangeable for any shares of its capital stock; grant any stock options or stock awards, or grant any Person any right to acquire any shares of its capital stock; or issue any additional shares of capital stock (except upon exercise and conversion of Bank Options, as provided in Section 3.3 and Section 8.6), or any securities or obligations convertible into or exchangeable for any shares of its capital stock;
(c) sell, transfer, mortgage, encumber or otherwise dispose of any of its properties or assets to any Person, or cancel, release or assign any indebtedness to such Person or any claims held by any such Person, except in the ordinary course of business consistent with past practice and prudent banking practices or pursuant to contracts or agreements in force at the date of this Agreement;
(d) make any material investment (other than trades in investment securities in the ordinary course) either by purchase of stock or securities, contributions to capital, property transfers, or purchase of any property or assets of any other Person;
(e) enter into, terminate or fail to exercise any material right under, any contract or agreement involving annual payments in excess of $10,000 individually and which cannot be terminated without penalty upon 30 days’ notice, or make any change in, or extension of (other than automatic extensions) any of its leases or contracts involving annual payments in excess of $50,000 in the aggregate (such amounts to 10,000 and which cannot be calculated terminated without netting any decrease)penalty upon 30 days’ notice;
(xvif) amendmake, cancel renegotiate, renew, increase, extend or terminate purchase any license (i) loan, lease (credit equivalent), advance, credit enhancement or permit other extension of credit, except (A) in conformity with existing lending practices of the Bank in amounts not to exceed $1,000,000 to any individual borrower, (B) loans or advances as to which the Bank or any Subsidiary has a legally binding obligation to make such loan or advances as of the date hereof and (C) loans fully secured by a certificate of deposit at the Bank; provided, however, that the Bank and its Subsidiaries may not make, renegotiate, renew, increase, extend or purchase any loan that is material underwritten based on no verification of income or loans commonly known or referred to as “no documentation loans,” or (ii) loans, advances or commitments to directors, officers or other affiliated parties of the Bank or any of the Companiesits subsidiaries;
(xviig) cancelmodify the terms of any Bank Benefit Plan (including any severance pay plan) or increase or modify in any manner the compensation or fringe benefits of any of its Employees (including, waive without limitation, entering into any commitment to pay any “stay bonuses” or release similar benefits) or pay any right pension or claim retirement allowance not required by any existing plan or agreement to any such Employees, or become a party to, amend or commit itself to any pension, retirement, profit-sharing or welfare benefit plan or agreement or employment agreement with or for the benefit of any Employee other than routine adjustments in compensation and fringe benefits in the ordinary course of business consistent with past practice or accelerate the vesting of any stock options or other stock-based compensation; provided, that the Bank may pay accrued bonuses in an amount not to exceed $20,000 prior to the Closing;
(h) settle any claim, action or series proceeding involving the payment of related rights or claims) involving money damages in excess of $10,000;
(i) amend its articles of association or its bylaws;
(j) fail to maintain its Regulatory Agreements, material Authorizations or to file in a timely fashion all federal, state, local and foreign Tax Returns;
(k) make any capital expenditures of more than $10,000 individually or $50,000 in the aggregate;
(l) fail to maintain or administer each Bank Benefit Plan in accordance with applicable Law or timely make all contributions or accruals required thereunder in accordance with GAAP;
(m) take any action that is intended or may reasonably be expected to result in any of its representations and warranties set forth in this Agreement being or becoming untrue at any time prior to the Effective Time, or in any of the conditions to the Merger set forth in Article X not being satisfied or in a violation of any provision of this Agreement, except, in every case, as may be required by applicable law;
(n) change any methods or policies of accounting from those used in the Bank Financial Statements;
(o) take or cause or permit to be taken any action, whether before or after the Effective Time, which would disqualify the Merger as a tax-free reorganization within the meaning of Section 368 of the Code (subject to required recognition of gain or loss with respect to cash paid for shares pursuant hereto);
(p) make or change any election, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement, settle any Tax claim or assessment relating to the Bank or any of its Subsidiaries, surrender any right to claim a refund of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Bank or any of its Subsidiaries, or take any other similar action relating to the filing of any Tax Return or the payment of any Tax, if such election, adoption, change, amendment, agreement, settlement, surrender, consent or other action would have the effect of increasing the Tax liability of the Bank or any of its Subsidiaries for any period ending after the Closing Date or decreasing any Tax attribute of the Bank or any of its Subsidiaries existing on the Closing Date;
(q) make any material changes to its allowance for loan losses or to its securities portfolio; or
(xviiir) agree, or make any material change commitment, to take, in the policies writing or practices relating to selling practicesotherwise, returns, discounts or other terms of sale or accounting therefor or in policies of employment; or entered into any contract to do any of the foregoingactions described in clauses (a) through (q) of this Section 7.2.
Appears in 1 contract
Forbearances. Except as set forth in Schedule 5.2, the Shareholders shall cause the Companies, from the date hereof until the earlier of (i) the Closing expressly contemplated by this Agreement or (ii) termination under Article IXrequired by Legal Requirement, without the prior written consent of BuyerInvestar (and any such consent shall not be unreasonably conditioned or delayed), CFG will not (and will cause each of its Subsidiaries not to:):
(i) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement, (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment material line of business or consulting agreement change its lending, investment, underwriting, risk and asset liability management and other material banking and operating policies in any material respect;
(B) open, close or cause relocate any written branch office, or oral terminationacquire or sell or agree to acquire or sell any branch office or deposit liabilities;
(C) issue, cancellation sell or amendment otherwise permit to become outstanding, or dispose of or encumber or pledge, or authorize or propose the creation of, any additional shares of its capital stock or permit new shares of its stock to become subject to new grants;
(D) issue, grant or accelerate the vesting of any such employment option, restricted stock award, warrant, call, commitment, subscription, right to repurchase or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement character related to which it is a party the authorized or (I) with respect to any Shareholderissued capital stock of CFG or Cheaha Bank, or any Affiliate securities convertible its shares of such stock;
(E) directly or indirectly adjust, split, combine, redeem, reclassify, purchase of otherwise acquire, any Shareholdershares of its stock;
(F) sell, granttransfer, make mortgage, encumber or accrue otherwise dispose of or discontinue any payment of its assets, deposits, business or distribution properties, except for sales, transfers, mortgages, encumbrances or other like benefit, contingently dispositions or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person discontinuances in the ordinary course of business consistent with past practice and in his a transaction that, together with other such transactions, is not material to CFG or Cheaha Bank, taken as a whole;
(G) acquire (other than by way of foreclosures or acquisitions of control in a fiduciary or similar capacity as an employee or in satisfaction of debts previously contracted in good faith, in each case in the ordinary and usual course of business consistent with past practice) all or any portion of the ▇▇▇▇▇▇▇'▇ Companies and (2) assets, business, deposits or properties of any transactions between the ▇▇▇▇▇▇▇'▇ Companiesother Entity or enter into any other transaction, except in the ordinary course of business consistent with past practice and on an arms' length basisin a transaction that, together with other such transactions, is not material to it and its Subsidiaries, taken as a whole;
(ivH) make enter into, amend, renew or terminate any capital expenditure agreement of the type that is or commitment would be required to make any capital expenditure be disclosed in excess Section 3.13(A) of $50,000the Schedules other than as contemplated by this Agreement, unless the agreement is to be performed in full prior to the Closing;
(vI) execute (A) any lease for real property amend its Constituent Documents or (B) any lease for personal property involving annual payments in excess those of $50,000its Subsidiaries;
(viJ) make implement or adopt any payments change in its accounting principles or given any other consideration to customers or supplierspolicies, other than payments under, and in accordance with the terms of, contracts in effect at the time of such paymentas may be required by GAAP or regulatory accounting principles;
(viiK) change its accounting methods, principles knowingly take or practices, including omit to take any change action that is reasonably likely to result in any of the application conditions to the consummation of the Contemplated Transactions set forth in Sections 7.01 or interpretation of GAAP7.02 not being satisfied;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of any class or series of capital stock;
(AL) incur or guarantee any indebtedness for borrowed money or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters of credit, guarantees or similar instruments;
(x) take any action in anticipation of the execution of this Agreement or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
(xiM) except as set forth in Section 5.01(M) of the Schedules, make any change in the rate of compensation, commission, bonus or other direct or indirect remuneration payable, or pay or agree or orally promise to pay, discharge conditionally or satisfy otherwise, any liabilitybonus, extra compensation, pension or severance or vacation pay, to or for the benefit of any of its directors, officers, employees or agents, or enter into any employment or consulting contract (other than in the ordinary course consistent with past practices or as contemplated by this Agreement) or other agreement with any director, officer or employee or adopt, amend in any material respect or terminate any pension, employee welfare, retirement, stock purchase, stock option, stock appreciation rights, termination, severance, income protection, golden parachute, savings or profit‑sharing plan (including trust agreements and insurance contracts embodying such paymentplans), discharge any deferred compensation, or satisfaction collective bargaining agreement, any group insurance contract or any other incentive, welfare or Employee Benefit Plan or agreement maintained by it for the benefit of its directors, employees or former employees, in each case except in the ordinary course of business, business and consistent with past practice of (A) liabilities reflected or reserved against on the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course of businesspractices, consistent with past practice, or (B) liabilities under, as contemplated by this Agreement and in accordance with the terms of, any material contracts, licenses and permits and other commitments set forth in the Schedulesas may be required by Legal Requirements;
(xiiN) change settle any Proceeding involving the payment by it of monetary damages or amend imposing a material restriction on the operations of CFG, Investar or any of their articles of incorporation or bylaws or similar organizational documentsrespective Subsidiaries;
(AO) acquire mortgage, pledge or subject to Lien any of its property, business or assets, corporeal or incorporeal, except (by merger, consolidation, acquisition of stock, other securities or assets or otherwise)i) statutory liens not yet delinquent, (Bii) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money oflandlord liens, (1iii) any Person or minor defects and irregularities in title and encumbrances that do not materially impair the use thereof for the purpose for which they are held, and (2iv) any portion pledges of the assets of any Person that constitutes a division or operating unit of such Personto secure public funds deposits;
(xivP) mortgage or pledgesell, transfer, lease to others or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, dispose of any of their its material Assets assets (except any sales or group leases of their Assets that is material property acquired by Cheaha Bank by foreclosure or otherwise, in the aggregate;
(xv) revalue any of their Assetseach instance, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually practices) or $50,000 in the aggregate (such amounts to be calculated without netting any decrease);
(xvi) amend, cancel or terminate compromise any license debt or permit that is material to any of the Companies;
(xvii) cancelclaim, or waive or release any right or claim (or series of related rights or claims) involving a value in excess of $10,000 individually 25,000;
(Q) make any capital expenditures or capital additions or betterments in excess of an aggregate of $50,000 25,000;
(R) hire or employ any new employee with an annual salary exceeding $50,000, or hire or employ any Person for any newly created position;
(S) sell or dispose of, or otherwise divest itself of the ownership, possession, custody or control, of any corporate books or records of any nature that, in accordance with sound business practice, normally are retained for a period of time after their use, creation or receipt, except at the end of the normal retention period;
(T) materially change any method, practice or principle of accounting, except as may be required from time to time by GAAP (without regard to any early adoption date) or any Governmental Authority; (U) sell (other than for payment at maturity) or purchase any securities other than in the aggregateordinary course of business with past practices;
(V) make, commit to make, renew, extend the maturity of, or alter any of the material terms of any Loan in excess of $1,000,000 without Investar’s consent, which consent Investar will be deemed to have given unless it objects to the Loan within three (3) Business Days of receiving a notice from CFG identifying the proposed borrower, the loan amount, and the material Loan terms;
(W) renew, extend the maturity of, or alter any of the material terms of any Loan which has been classified as, or, in the exercise of reasonable diligence by Cheaha Bank or any Governmental Authority with supervisory jurisdiction over Cheaha Bank, should have been classified as “substandard,” “doubtful,” “loss,” “other loans especially mentioned,” “other assets especially mentioned,” “watch,” “pass/watch” or any comparable classifications by such Persons, in excess of $250,000;
(X) make or commit to make a loan to any borrower with an outstanding loan agreement, note or borrowing arrangement with Cheaha Bank which has been classified as or, in the exercise of reasonable diligence by Cheaha or any Governmental Authority with supervisory jurisdiction over Cheaha Bank, should have been classified as “substandard,” “doubtful,” “loss,” “other loans especially mentioned,” “other assets especially mentioned,” “watch,” “pass/watch” or any comparable classifications by such Persons;
(Y) enter into any acquisitions or leases of real property, including new leases and lease extensions, excluding the acquisition of property acquired by Cheaha Bank by foreclosure or otherwise; or
(xviiiZ) make foreclose upon or otherwise acquire any commercial real property prior to receipt and approval by Investar of a Phase I environmental review thereof;
(AA) excluding deposits and certificates of deposit, incur or modify any indebtedness for borrowed money, including Federal Home Loan Bank advances;
(BB) prepay any indebtedness or other similar arrangements resulting in any prepayment penalty thereunder;
(CC) issue a replacement of any certificate representing its securities except upon (i) written notice to Investar, (ii) presentation of a properly executed lost certificate affidavit in form reasonably satisfactory to Investar and (iii) if required by Investar, the delivery of an indemnity or surety bond in the amount of the consideration payable with respect to shares of CFG Common Stock represented therein;
(DD) take or fail to take any action which would adversely affect or delay in any material change in respects the policies ability of Cheaha Bank or practices relating Investar to selling practices, returns, discounts obtain any approvals from any regulatory agencies or other terms approvals required for consummation of sale the Contemplated Transactions or accounting therefor or in policies of employmentto perform its obligations and agreements under this Agreement; or entered or
(EE) enter into any contract contract, with respect to, or otherwise agree or commit to do do, any of the foregoing.
Appears in 1 contract
Sources: Agreement and Plan of Reorganization (Investar Holding Corp)
Forbearances. Except as set forth in Schedule 5.2, During the Shareholders shall cause the Companies, period from the date hereof until the earlier of (i) the Closing or (ii) termination under Article IX, without the written consent of Buyer, not to:
(i) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this Agreement to the earlier of the Effective Time or the termination of this Agreement, the Company shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of Sterling (F) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment and the Company shall provide Sterling with prompt notice of any such employment or consulting agreement events referred to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in this Section 7.02 occurring after the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;date hereof):
(iva) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of any class or series of capital stock;
(A) incur any indebtedness for borrowed money or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters of credit, guarantees or similar instruments;
(x) take any action in anticipation of the execution of this Agreement or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
, incur any indebtedness for borrowed money (xi) pay, discharge or satisfy any liability, other than short-term indebtedness incurred to refinance short-term indebtedness and indebtedness of the Company or any such payment, discharge of its Subsidiaries to the Company or satisfaction any of its Subsidiaries; it being understood and agreed that incurrence of indebtedness in the ordinary course of businessbusiness shall include, consistent with past practice without limitation, the creation of (A) liabilities reflected deposit liabilities, purchases of federal funds, and sales of certificates of deposit), assume, guarantee, endorse or reserved against on otherwise as an accommodation become responsible for the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course obligations of business, consistent with past practiceany other Person, or (B) liabilities under, and in accordance with the terms of, make any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practice), involving in excess of $10,000 individually or $50,000 in the aggregate (such amounts to be calculated without netting any decrease)practice and prudent banking practices;
(xvib) amendadjust, cancel split, combine or terminate reclassify any license capital stock; make, declare or permit that is material pay any dividend or make any other distribution on, or directly or indirectly redeem, purchase or otherwise acquire, any shares of its capital stock or any securities or obligations convertible into or exchangeable for any shares of its capital stock, grant any stock options or stock awards, or grant any Person any right to acquire any shares of the Companiesits capital stock; or issue any additional shares of capital stock (except upon exercise and conversion of Company Options, as provided in Section 3.03 and Section 8.06), or any securities or obligations convertible into or exchangeable for any shares of its capital stock;
(xviic) sell, transfer, mortgage, encumber or otherwise dispose of any of its properties or assets to any Person, or cancel, waive release or release assign any right indebtedness to such Person or claim (or series of related rights or claims) involving in excess of $10,000 individually or $50,000 any claims held by any such Person, except in the aggregate; or
(xviii) make any material change ordinary course of business consistent with past practice and prudent banking practices or pursuant to contracts or agreements in force at the policies or practices relating to selling practices, returns, discounts or other terms date of sale or accounting therefor or in policies of employment; or entered into any contract to do any of the foregoing.this Agreement;
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Forbearances. Except as set forth in Schedule 5.2, During the Shareholders shall cause the Companies, period from the date hereof until the earlier of (i) the Closing or (ii) termination under Article IX, without the written consent of Buyer, not to:
(i) sell, assign, lease or transfer any of the Assets that exceed $10,000 individually or $25,000 in the aggregate in book value or fair market value, other than inventory sold or disposed of in the ordinary course of business, consistent with past practice, to Buyer or persons who are not Affiliates (other than the ▇▇▇▇▇▇▇'▇ Companies and their Subsidiaries) of the ▇▇▇▇▇▇▇'▇ Companies for fair consideration;
(ii) cancel or terminate, or amend, modify or waive any material term of, any material contract;
(iii) (A) increase the compensation payable or to become payable to any of its directors or officers, (B) increase the base compensation payable or to become payable to any of its Personnel who are not directors or officers, except for normal periodic increases in such base compensation (not exceeding, in each case, 5%) in the ordinary course of business, consistent with past practice, (C) increase the sales commission rate payable or to become payable to any of its Personnel who are not directors or officers, (D) grant, make or accrue any loan, bonus, severance, termination or continuation fee, incentive compensation (excluding sales commissions), service award or other like benefit, contingently or otherwise, to or for the benefit of any of its Personnel, except pursuant to the employee plans in effect as of the date hereof, (E) adopt, amend or cause any addition to or modification of any employee plan, other than (1) contributions made in the ordinary course of business, consistent with past practice or (2) the extension of coverage to any of its Personnel who became eligible after the date of this AgreementAgreement to the Effective Time, the Company shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of Sterling (Fand the Company shall provide Sterling with prompt notice of any events referred to in this Section 7.02 occurring after the date hereof and Sterling shall respond to any such notice within three (3) grant any additional stock options or performance unit grants or other interest under any employee plan, (G) enter into any new employment or consulting agreement or cause any written or oral termination, cancellation or amendment Business Days of its receipt of any such employment or consulting agreement to which it is a party (except with respect to any employee at will without a written agreement), (H) enter into any collective bargaining agreement or cause any termination or amendment of any collective bargaining agreement to which it is a party or (I) with respect to any Shareholder, or any Affiliate of any Shareholder, grant, make or accrue any payment or distribution or other like benefit, contingently or otherwise, or otherwise transfer Assets, including any payment of principal of or interest on any debt owed to any such Shareholder or Affiliate, other than (1) any payments to such person in the ordinary course of business in his capacity as an employee of the ▇▇▇▇▇▇▇'▇ Companies and (2) any transactions between the ▇▇▇▇▇▇▇'▇ Companies, in the ordinary course of business and on an arms' length basis;notice):
(iva) make any capital expenditure or commitment to make any capital expenditure in excess of $50,000;
(v) execute (A) any lease for real property or (B) any lease for personal property involving annual payments in excess of $50,000;
(vi) make any payments or given any other consideration to customers or suppliers, other than payments under, and in accordance with the terms of, contracts in effect at the time of such payment;
(vii) change its accounting methods, principles or practices, including any change in the application or interpretation of GAAP;
(A) issue or sell, or enter into any agreement obligating it to issue or sell (B) directly or indirectly redeem, purchase or otherwise acquire, or split, combine, reclassify or otherwise adjust, any class or series of capital stock, or any securities convertible into or exchangeable for capital stock or (C) declare or pay any dividend or other distribution in respect of any class or series of capital stock;
(A) incur any indebtedness for borrowed money or enter into any commitment to borrow money other than borrowings in the ordinary course of business under the Companies' working capital lines or (B) incur any obligations for any performance bonds, payment bonds, bid bonds, surety bonds, letters of credit, guarantees or similar instruments;
(x) take any action in anticipation of the execution of this Agreement or for any other reason to delay or defer expenses (including delay or postponement of capital expenditures or the payment of accounts payable), liabilities or obligations of any kind whatsoever or to accelerate any income, revenue, payment or similar item, other than in the ordinary course of business consistent with past practice;
, incur any indebtedness for borrowed money (xi) pay, discharge or satisfy any liability, other than short-term indebtedness incurred to refinance short-term indebtedness and indebtedness of the Company or any such payment, discharge of its Subsidiaries to the Company or satisfaction any of its Subsidiaries; it being understood and agreed that incurrence of indebtedness in the ordinary course of businessbusiness shall include, consistent with past practice without limitation, the creation of (A) liabilities reflected deposit liabilities, purchases of federal funds, and sales of certificates of deposit), assume, guarantee, endorse or reserved against on otherwise as an accommodation become responsible for the balance sheets in the Financial Statements or incur subsequent thereto in the ordinary course obligations of business, consistent with past practiceany other Person, or (B) liabilities under, and in accordance with the terms of, make any material contracts, licenses and permits and other commitments set forth in the Schedules;
(xii) change or amend any of their articles of incorporation or bylaws or similar organizational documents;
(A) acquire (by merger, consolidation, acquisition of stock, other securities or assets or otherwise), (B) make a capital investment (whether through the acquisition of an equity interest, the making of a loan or advance or otherwise) in or (C) guarantee indebtedness for borrowed money of, (1) any Person or (2) any portion of the assets of any Person that constitutes a division or operating unit of such Person;
(xiv) mortgage or pledge, or otherwise make or suffer any Encumbrance (other than any Permitted Encumbrance) on, any of their material Assets or group of their Assets that is material in the aggregate;
(xv) revalue any of their Assets, including any write-off of notes or accounts receivable or any increase in any reserve (other than in the ordinary course of business consistent with past practicepractice and prudent banking practices;
(b) adjust, split, combine or reclassify any capital stock; make, declare or pay any dividend or make any other distribution on (other than the payment of dividends with respect to the Company Preferred Stock and interest with respect to the Company Debenture in accordance with their respective terms and provisions), or directly or indirectly redeem, purchase or otherwise acquire, any shares of its capital stock or any securities or obligations convertible into or exchangeable for any shares of its capital stock, grant any stock options or stock awards, or grant any Person any right to acquire any shares of its capital stock; or issue any additional shares of capital stock (except upon exercise and conversion of Company Options, Company Preferred Stock and Company Debenture as provided in Sections 3.02 and 8.04), or any securities or obligations convertible into or exchangeable for any shares of its capital stock;
(c) sell, transfer, mortgage, encumber or otherwise dispose of any of its properties or assets to any Person, or cancel, release or assign any indebtedness to such Person or any claims held by any such Person, except in the ordinary course of business consistent with past practice and prudent banking practices or pursuant to contracts or agreements in force at the date of this Agreement;
(d) make any material investment (other than trades in investment securities in the ordinary course) either by purchase of stock or securities, contributions to capital, property transfers, or purchase of any property or assets of any other Person;
(e) enter into, terminate or fail to exercise any material right under, any contract or agreement involving annual payments in excess of $10,000 individually 25,000 and which cannot be terminated without penalty upon 30 days' notice, or $50,000 in the aggregate make any change in, or extension of (such amounts to be calculated without netting any decrease);
(xviother than automatic extensions) amend, cancel or terminate any license or permit that is material to any of the Companies;
(xvii) cancel, waive its leases or release any right or claim (or series of related rights or claims) contracts involving annual payments in excess of $10,000 25,000 and which cannot be terminated without penalty upon 30 days' notice;
(f) modify the terms of any Company Benefit Plan (including any severance pay plan) or increase or modify in any manner the compensation or fringe benefits of any of its Employees or pay any pension or retirement allowance not required by any existing plan or agreement to any such Employees, or become a party to, amend or commit itself to any pension, retirement, profit-sharing or welfare benefit plan or agreement or employment agreement with or for the benefit of any Employee other than (i) routine adjustments in compensation and fringe benefits in the ordinary course of business consistent with past practice, (ii) accelerating the vesting of any stock options or other stock- based compensation, and (iii) the payment of incentive compensation and bonuses accruing during the 2000 fiscal year to the extent (A) any such incentive compensation and/or bonus is fully accrued and reflected in the Company Financial Statements or otherwise fully accrued and reflected in the Company's books and records and disclosed in Section 7.02(f) of the Company Disclosure Schedule, and (B) paid in accordance with the terms and conditions of the Company's incentive compensation and/or bonus policies or in the absence of such policies, in accordance with past practices;
(g) settle any claim, action or proceeding involving the payment of money damages in excess of $25,000;
(h) amend its Articles of Incorporation or its bylaws;
(i) fail to maintain its Regulatory Agreements, material Authorizations or to file in a timely fashion all federal, state, local and foreign Tax Returns;
(j) make any capital expenditures of more than $25,000 individually or $50,000 100,000 in the aggregate; or;
(xviiik) fail to maintain or administer each Company Benefit Plan in accordance with applicable Law or timely make all contributions or accruals required thereunder in accordance with GAAP;
(l) take any material change action that is intended or may reasonably be expected to result in any of its representations and warranties set forth in this Agreement being or becoming untrue at any time prior to the policies or practices relating to selling practicesEffective Time, returns, discounts or other terms of sale or accounting therefor or in policies of employment; or entered into any contract to do any of the foregoingconditions to the Merger set forth in Article IX not being satisfied or in a violation of any provision of this Agreement, except, in every case, as may be required by applicable law;
(m) change any methods or policies of accounting from those used in the Company Financial Statements;
(n) agree, or make any commitment, to take, in writing or otherwise, any of the actions described in clauses (a) through (m) of this Section 7.02.
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