Interim Operations. (a) Prior to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14 (b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).
Appears in 4 contracts
Sources: Information Statement (Allmerica Financial Corp), Information Statement (Allmerica Financial Corp), Information Statement (Allmerica Financial Corp)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing (such approval not to be unreasonably withheld, delayed or conditioned)), and except as otherwise expressly permitted by this Agreement or as required by a Governmental Entity or applicable Laws, the business of it and its Subsidiaries shall be conducted in all material respects in the ordinary course and, to the extent consistent with the foregoing, the Company and its Subsidiaries shall use their respective commercially reasonable efforts to preserve their business organizations substantially intact, maintain satisfactory relationships with Governmental Entities, NERC, PJM, customers and suppliers having significant business dealings with them and keep available the services of their key employees; provided, however, that no action taken by the Company or its Subsidiaries with respect to matters specifically addressed by clauses (i)-(xx) of this Section 6.1(a) shall be deemed a breach of this sentence unless such action would constitute a breach of such other provision. In furtherance of the foregoing, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly permitted by this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, delayed or conditioned), (C) as is required by applicable Law or any Governmental Entity or (D) as set forth in Section 6.1(a) of the Company Disclosure Letter, the Company will not and will not permit its Subsidiaries to:
(i) adopt any change in its certificate of incorporation or bylaws or other applicable governing instruments;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person or restructure, reorganize or completely or partially liquidate the Company or any of its Subsidiaries, except for any such transactions among wholly-owned Subsidiaries of the Company;
(iii) acquire (including by merger, consolidation or acquisition of equity interests or assets or any other business combination) (A) any other Person or any organization or division of any other Person or (B) any assets outside of the ordinary course of business, other than acquisitions (1) pursuant to Contracts in effect as of the date of this Agreement (copies of which have been made available to Parent), (2) made in connection with any transaction solely between the Company and a wholly-owned Subsidiary of the Company or between wholly-owned Subsidiaries of the Company or (3) that would be permissible under clause (ix) below;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock or other equity interests of the Company or any of its Subsidiaries (other than (A) the issuance of Shares upon the vesting, exercise or settlement of Company RSUs, Company PSUs, and Company Awards (and dividend equivalents thereon, if applicable) or (B) the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary), or securities convertible or exchangeable into or exercisable for any shares of such capital stock or other equity interests, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) make any loans, advances or capital contributions to or investments in any Person (other than among the Company and any direct or indirect wholly-owned Subsidiary of the Company or among the Company’s wholly-owned subsidiaries) in excess of $10,000,000 in the aggregate other than loans, advances, capital contributions or investments made in the ordinary course of business;
(vi) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for (A) regular quarterly dividends paid to holders of Shares in an amount and on a schedule consistent with the Company’s past practices and not in excess of $0.27 per Share per quarter, (B) a “stub period” dividend to stockholders of record as of immediately prior to the Effective Time equal to the product of (x) the number of days from the record date for payment of the last quarterly dividend paid by the Company prior to the Effective Time through and including immediately prior to the Effective Time and (y) a daily dividend rate determined by dividing the amount of the last quarterly dividend prior to the Effective Time by ninety-one (91), and (C) dividends paid by any direct or indirect wholly-owned Subsidiary to the Company or to any other direct or indirect wholly-owned Subsidiary) or enter into any agreement with respect to the voting of its capital stock;
(vii) except for transactions among the Company and its wholly-owned Subsidiaries or among the Company’s wholly-owned Subsidiaries, reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock (other than the retention or acquisition of any Shares tendered by current or former employees or directors in order to pay Taxes in connection with the vesting, exercise or settlement of Company RSUs, Company PSUs, and Company Awards (and dividend equivalents thereon, if applicable));
(viii) incur, assume or otherwise become liable for any indebtedness for borrowed money or guarantee such indebtedness of another Person (other than of a wholly-owned Subsidiary of the Company), or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, other than (A) in the ordinary course of business (including to fund expenditures permissible under clauses (iii), (v) and (ix) of this Section 6.1(a)) or (B) other indebtedness in an aggregate principal amount not to exceed $50,000,000 outstanding at any time;
(ix) except for expenditures related to operational emergencies, equipment failures or outages make or authorize any capital expenditure in excess of $100,000,000 in the aggregate during any calendar year;
(x) make any material changes with respect to financial accounting policies or procedures, except as required by GAAP;
(xi) other than with respect to Rate Cases and the regulatory approval process, which are addressed in Section 6.5 and Transaction Litigation, which is addressed in Section 6.14, settle, release, waive or compromise any litigation claim, or other pending or threatened proceedings by or before a Governmental Entity if such settlement, release, waiver or compromise (A) with respect to the payment of monetary damages, involves the payment by the Company or any of its Subsidiaries of monetary damages that together with all other settlements, releases, waivers or compromises by the Company or any of its Subsidiaries exceed $50,000,000 individually or in the aggregate during any calendar year, net of any amount covered by insurance or third-party indemnification or (B) with respect to any non-monetary terms and conditions therein, imposes or requires actions that would or would be reasonably likely to have a material effect on the continuing operations of the Company or any of its Subsidiaries or Parent or any of its Subsidiaries after the Closing;
(xii) other than with respect to the Rate Cases, initiate, file or pursue any rate cases, or make any public announcement regarding an intent to file any rate cases;
(xiii) fail to make any regulatory filings required by Law, other than those regulatory filings that are otherwise addressed by this Agreement, except to the extent such failure would not have a material adverse effect on the continuing operations of the Company or any of its Subsidiaries or Parent or any of its Subsidiaries after the Closing;
(xiv) make, revoke or amend any material Tax election, enter into any closing agreement, settlement or compromise of any claim or assessment with respect to any material Tax liability (unless such closing agreement, settlement or compromise is not materially greater than the reserves established in accordance with GAAP in respect of the claim or assessment that is the subject of such closing agreement, settlement or compromise), amend any material Tax Return, surrender a claim for a material refund of Taxes or consent to any extension or waiver of the statute of limitations period applicable to any material Tax claim or assessment;
(xv) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any material amount of assets, product lines or businesses of the Company or its Subsidiaries, including capital stock of any of its Subsidiaries, other than sales and dispositions of inventory, supplies and other assets (A) in the ordinary course of business or (B) pursuant to Contracts in effect prior to the date of this Agreement (copies of which have been made available to Parent);
(xvi) except as required pursuant to Contracts or Benefit Plans in effect prior to the date of this Agreement (including the Company Change in Control Severance Plan), (A) grant any equity awards, or grant or provide any material severance or material termination payments or benefits to any executive employee of the Company or its Subsidiaries who have individual employment agreements with severance or termination provisions or who participate in the Change of Control Severance Plan (“Executive Employees”), (B) accelerate or materially increase the compensation or employee benefits of any Executive Employee, except for annual merit-based or promotion-based pay increases in the ordinary course of business, (C) establish, adopt, terminate or materially amend any Benefit Plan (other than routine changes to welfare plans or any changes to Benefit Plans that would not result in more than a de minimis increase to the Company’s costs under such Benefit Plans), including any severance benefit plan or (D) accelerate or materially increase the compensation of other employees of the Company or its Subsidiaries, except for (1) merit-based or promotion-based pay increases in the ordinary course of business, (2) acceleration or increases required by any CBA, or (3) any acceleration or increase done after consultation with Parent;
(xvii) enter into any Company Material Contract that contains a change of control or similar provision that would require a payment to any Person counterparty thereto in connection with the consummation of the Merger that would not otherwise be due;
(xviii) grant or incur any new Lien material to the Company and its Subsidiaries, other than (A) pledges or deposits by the Company or any of its Subsidiaries in the ordinary course of business under workmen’s compensation Laws, unemployment insurance Laws or similar Laws; (B) good faith deposits in connection with Contracts (other than for the payment of indebtedness) to which the Company or one of its Subsidiaries is a party, or (C) in connection with securing indebtedness permitted to be incurred under the terms of this Agreement by granting or incurring Liens on the assets of the utility Subsidiaries of the Company, in each case, in the ordinary course of business; or
(xix) agree, authorize or commit to do any of the foregoing.
(b) Nothing contained in this Agreement is intended to give Parent, directly or indirectly, the right to control or direct the Company’s or its Subsidiaries’ operations prior to the Effective Time, and nothing contained in this Agreement is intended to give the Company, directly or indirectly, the right to control or direct Parent’s or its Subsidiaries’ operations. Prior to the Effective Time, except as set forth in each of Parent and the Company Disclosure Letter or as contemplated by any other provision shall exercise, consistent with the terms and conditions of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, complete control and shall cause each of supervision over its Significant Subsidiaries to, conduct and its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Subsidiaries’ respective operations.
Appears in 4 contracts
Sources: Agreement and Plan of Merger (Exelon Corp), Agreement and Plan of Merger (Potomac Electric Power Co), Merger Agreement (Potomac Electric Power Co)
Interim Operations. (a) Prior to From the Effective date of this Agreement until the Tender Offer Purchase Time, except as set forth in Section 5.1 of the Company Disclosure Letter Schedule or as expressly contemplated by any other provision of this Agreement, unless the Purchaser Parent has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries subsidiaries to, :
(a) conduct its business and operations according to their usual, regular and only in the ordinary course of business consistent with past practice;
(b) use reasonable efforts to preserve intact the business, organization, goodwill, rights, licenses, permits and franchises of the Company and its subsidiaries and maintain their existing relationships with customers, suppliers and other Persons having business dealings with them;
(c) use reasonable efforts to keep in substantially the same manner as heretofore conducted; full force and effect adequate insurance coverage and maintain and keep its material Company Assets in good repair, working order and condition, normal wear and tear excepted;
(iid) shall not amend or modify its respective Certificate of Incorporation Incorporation, Bylaws, partnership agreement or Bylaws other charter or comparable governing instruments organizational documents;
(e) other than pursuant to the stock purchase right identified as Item 1 in Section 3.2(a) of the Disclosure Schedule and other than up to 20,000 Company Stock Options that may be issued under the 2000 Stock Option Plan in connection with the Company's fair share plan, not authorize for issuance, issue, sell, grant, deliver, pledge or encumber or agree or commit to issue, sell, grant, deliver, pledge or encumber any shares of any class or series of capital stock of the Company or any of its subsidiaries or any other equity or voting security or equity or voting interest in the Company or any of its subsidiaries, any securities convertible into or exercisable or exchangeable for any such shares, securities or interests, or any options, warrants, calls, commitments, subscriptions or rights to purchase or acquire any such shares, securities or interests (other than to permit the consummation issuances of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser Shares upon exercise of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent Stock Options granted prior to the date of this Agreement; Agreement to directors, officers, employees and consultants of the Company in accordance with the Company Stock Plan as currently in effect);
(vf) shall not (xi) except pursuant to the exercise of optionssplit, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, combine or pursuant to the Recapitalization issue reclassify any shares of its capital stockstock or issue or authorize or propose the issuance of any other securities in respect of, effect any stock split in lieu of, or otherwise change its capitalization as it existed on the date hereofin substitution for, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, stock or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify in solely the Company case of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any reportCompany, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend dividends on, or make other distributions in respect of, any other distribution of the Company's stock, repurchase, redeem or payment with respect otherwise acquire, or agree or commit to repurchase, redeem or otherwise acquire, any shares of its capital stock or other ownership equity or debt securities or equity interests of the Company or any of its subsidiaries;
(g) except as contemplated by Section 2.10, not amend or otherwise modify the terms of any Company Stock Options or the Company Option Plans, the effect of which shall be to make such terms more favorable to the holders thereof or Persons eligible for participation therein;
(h) other than normal salary increases in the ordinary course of business consistent with past practice, not (i) materially increase the compensation payable or to become payable to any directors, officers or employees of the Company or any of its subsidiaries except arrangements in connection with employee transfers and agreements with new employees having a salary of greater than $75,000, (ii) grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer or employee (other than regular quarterly cash dividends in the ordinary course of business) of the Company or any of its subsidiaries, or (iii) establish, adopt, enter into or amend in any material respect or take action to accelerate any material rights or material benefits under any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any director or officer or employee (other than in the ordinary course of business) of the Company or any of its subsidiaries;
(i) not acquire or agree to acquire (including, without limitation, by merger, consolidation, or acquisition of stock, equity securities or interests, or assets) any corporation, partnership, joint venture, association or other business organization or division thereof or otherwise acquire or agree to acquire any assets of any other Person outside the ordinary course of business consistent with past practice or any interest in any real properties (other than in the ordinary course of business);
(j) not incur, assume or guarantee any indebtedness for borrowed money (including draw-downs on letters or lines of credit) or issue any notes, bonds, debentures, debt instruments, evidences of indebtedness or other debt securities of the Company or any of its subsidiaries or any options, warrants or rights to purchase or acquire any of the same, except for (i) renewals of existing bonds and letters of credit in the ordinary course of business not to exceed $0.05 per share1,000,000 in the aggregate; (ii) incurring indebtedness for borrowed money in the ordinary course of business consistent with past practice in an aggregate amount not to exceed $100,000 or (iii) advances in the ordinary course pursuant to (A) working capital lines of credit in an amount not to exceed $15,000,000 in the aggregate and (B) warehouse lines of credit set forth in Section 3.16(a)(v) of the Company Disclosure Schedule, or any renewal or replacement thereof;
(k) not sell, lease, license, encumber or otherwise dispose of, or agree to sell, lease, license, encumber or otherwise dispose of, any material properties or assets of the Company or any of its subsidiaries, other than in the ordinary course of business;
(l) not authorize or make any capital expenditures (including by lease) in excess of $500,000 in the aggregate other than the ordinary course of business for the Company and all of its subsidiaries;
(m) not make any material change in any of its accounting or financial reporting (including tax accounting and reporting) methods, principles or practices, including with respect to the method of accounting for loans held for sale or premiums for risk management instruments, or recognizing loan origination income, net premium income, or gains or losses on risk management instruments, except as may be required by a change in law or in GAAP;
(n) not make any material tax election or settle or compromise any material United States or foreign tax liability;
(o) except in the ordinary course of business consistent with past practice, not amend, modify or terminate any material Contract or waive, release or assign any material rights or claims thereunder;
(p) other than in the ordinary course of business, not enter into contracts that reasonably would involve financial obligations by the Company exceeding $100,000;
(q) not adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its subsidiaries;
(r) fail to report any facts, circumstance or events that has resulted in any insurance claims that, individually or in the aggregate, would have a Material Adverse Effect; and
(s) except as to subsections (a), (b) and (c) of Section 5.1, not agree or commit in writing or otherwise to do any of the foregoing.
Appears in 4 contracts
Sources: Merger Agreement (Royal Bank of Canada), Merger Agreement (Prism Financial Corp), Merger Agreement (Prism Financial Corp)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, from and after the execution of this Agreement and prior to the Effective Time (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld, conditioned or delayed, and except as (1) required by applicable Law, (2) expressly required by this Agreement or (3) otherwise expressly disclosed in Section 6.1(a) of the Company Disclosure Letter), the Company shall use its reasonable best efforts to conduct its business and the business of its Subsidiaries in the ordinary course of business consistent with past practice and each of the Company and its Subsidiaries shall, subject to compliance with the specific matters set forth below, use reasonable best efforts to preserve its business organization intact and maintain the existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, licensors, creditors, lessors, employees and business associates and others having material business dealings with it and keep available the services of the Company and its Subsidiaries’ present employees and agents. Without limiting the generality of, and in furtherance of, the foregoing, the Company covenants and agrees as to itself and its Subsidiaries that, from and after the date of this Agreement and prior to the Effective Time, except (A) as set forth required by applicable Law, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (C) as expressly disclosed in Section 6.1(a) of the Company Disclosure Letter or (D) as contemplated by any other provision of expressly provided for in this Agreement, unless the Purchaser has consented in writing thereto, the Company: Company shall not and will not permit any of its Subsidiaries to:
(i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (iiA) shall not amend its Certificate articles of Incorporation incorporation or Bylaws code of regulations (or comparable governing instruments documents) (other than immaterial amendments to permit the consummation governing documents of any wholly owned Subsidiary of the Company that would not prevent, materially delay or materially impair the Merger or the other transactions contemplated by this Agreement); , (iiiB) shall promptly notify the Purchaser of any breach of any representation split, combine, subdivide or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any reclassify its outstanding shares of its capital stock, effect stock (except for any stock split or otherwise change its capitalization as it existed on such transaction by a wholly owned Subsidiary of the date hereofCompany which remains a wholly owned Subsidiary after consummation of such transaction), (yC) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make distribution payable in cash, stock or property (or any combination thereof) in respect of any shares of its capital stock (except for (1) any dividends or distributions paid by a direct or indirect wholly owned Subsidiary of the Company to another direct or indirect wholly owned Subsidiary of the Company or to the Company or (2) other distribution or payment than normal quarterly cash dividends on the Company’s Shares as described in Section 6.1(a)(i)(C) of the Company Disclosure Letter), (D) enter into any agreement with respect to the voting of its capital stock or (E) purchase, repurchase, redeem or otherwise acquire any shares of its capital stock or other ownership interests any securities convertible or exchangeable into or exercisable for any shares of its capital stock (other than regular quarterly (1) pursuant to the cashless exercise of Company Options or the forfeiture of, or withholding of Taxes with respect to, Company Options, Company Restricted Stock Units or Company Performance Stock Units in connection with any Taxable event related to such awards, in each case in accordance with past practice and with the terms of the applicable Company Stock Plan as in effect on the date of this Agreement (or as modified after the date of this Agreement in accordance with the terms of this Agreement) or (2) purchases, repurchases, redemptions or other acquisitions of securities of any wholly owned Subsidiary of the Company by the Company or any other wholly owned Subsidiary of the Company);
(ii) merge or consolidate with any other Person, or restructure, reorganize or completely or partially liquidate (other than mergers among, or the restructuring, reorganization or liquidation of any wholly owned Subsidiaries of the Company that would not (x) prevent, materially delay or materially impair the Merger or the other transactions contemplated by this Agreement or (y) reasonably be expected to result in any significant Tax liability);
(iii) except as expressly contemplated by the terms of this Agreement, as expressly disclosed in Section 6.1(a)(iii) of the Company Disclosure Letter or as required by applicable Law or by the terms of any Company Plan listed on Section 5.1(h)(i) of the Company Disclosure Letter or any CBA, in either case as in effect on the date hereof (or as modified after the date of this Agreement in accordance with the terms of this Agreement):
(A) increase the compensation or benefits payable to any director or named executive officers as identified in the Company’s proxy statement for the 2017 annual meeting of stockholders (collectively, the “Senior Executives”) of the Company, increase the compensation or benefits payable to any employee or individual consultant of the Company or any of its Subsidiaries, or make any loans to, any director, officer, employee or individual consultant of the Company or any of its Subsidiaries;
(B) grant any new equity-based awards, or amend or modify the terms or accelerate the vesting of any such outstanding awards (except for any acceleration of any Company Option, Company Performance Stock Unit and Company Restricted Stock Unit in connection with the cessation of any Person’s employment with the Company or any of its Subsidiaries (other than any Senior Executive) to the extent that such acceleration is consistent with past practice), under any Company Plan;
(C) amend any severance plan or agreement as in effect on the date hereof or waive or release any restrictive covenants thereunder;
(D) make any change to any Company Pension Plan or any Company Plan that is an “employee welfare benefit plan” (within the meaning of Section 3(1) of ERISA) that would materially increase the costs to the Company or any of its Subsidiaries in respect of such Company Plan;
(E) establish, adopt, or enter into any new arrangement that would be a Company Plan if in effect on the date hereof, other than individual separation and release agreements entered into in connection with ordinary-course terminations on terms consistent with the severance arrangements listed on Section 5.1(h)(i) of the Company Disclosure Schedule;
(F) accelerate the payment of non-equity related compensation or benefits to any director, officer, employee, consultant or individual service provider, except as required (without discretion) pursuant to the terms of the Company Plans;
(G) hire any new officer, employee, consultant or individual service provider (provided that the Company shall be permitted to (x) hire employees, consultants or other individual service providers with an aggregate annual base compensation and target incentive opportunity below $350,000 in the ordinary course of business consistent with past practice, or (y) engage individual or entity service providers with an aggregate annual base compensation and target incentive opportunity below $350,000 in the ordinary course of business consistent with past practice to fill positions that are open as of the date hereof or that become open following the date hereof to the extent reasonably necessary as determined by the Company in its sole discretion to maintain the Company’s core business); or
(H) terminate any employee or officer of the Company or any of its Subsidiaries at level B7 or higher other than for cause (as determined in the ordinary course of business consistent with past practice);
(iv) incur or guarantee any Indebtedness or issue any warrants or other rights to acquire any Indebtedness, except (A) in the ordinary course of business consistent with past practice, borrowings under the Company’s revolving credit facility as in effect as of the date hereof, (B) inter-company Indebtedness among the Company and its wholly owned Subsidiaries, (C) commercial paper issued in the ordinary course of business and (D) (i) to the extent not drawn upon and payments are not triggered thereby, letters of credit, bank guarantees, security or performance bonds or similar credit support instruments and (ii) overdraft facilities or cash dividends management programs, in the case of each of clauses (i) and (ii), issued, made or entered into in the ordinary course of business;
(v) make or commit to any capital expenditures other than (A) in connection with the repair or replacement of facilities, properties or assets destroyed or damaged due to casualty or accident or (B) in the ordinary course of business consistent with past practice and which do not exceed during either the 2017 fiscal year or the 2018 fiscal year one hundred and five percent (105%) of the amounts reflected in the Company’s capital expenditure budget for 2017, a copy of which was previously provided to exceed Parent;
(vi) transfer, lease, license, sell, assign, let lapse, abandon, cancel, mortgage, pledge, place a Lien (other than a Permitted Lien) upon or otherwise dispose of any Intellectual Property; provided that this clause (vi) shall not restrict (A) any of the foregoing that occur in the ordinary course of business or, to the extent applicable, among the Company and its Subsidiaries, (B) the granting of any licenses of Intellectual Property in the ordinary course consistent with past practice or (C) transfers, leases, sales, assignments, lapses, abandonments, cancellations, mortgages, pledges, Liens, or other dispositions of Intellectual Property (other than licenses) with a fair market value less than $0.05 per share10,000,000 in the aggregate for all such actions;
(vii) other than in the ordinary course of business consistent with past practice, transfer, lease, license, sell, assign, let lapse, abandon, cancel, mortgage, pledge, place a Lien upon or otherwise dispose of any properties or assets (including capital stock of any of its Subsidiaries but not including any Intellectual Property, which is governed by Section 6.1(a)(vi) with a fair market value in excess of $5,000,000 individually or $12,500,000 in the aggregate (other than transactions among the Company and its wholly owned Subsidiaries).;
(viii) issue, deliver, sell, grant, transfer, or encumber, or authorize the issuance, delivery, sale, grant, transfer or encumbrance of, any shares of its capital stock or any securities convertible or exchangeable into or exercisable for, or any options, warrants or other rights to acquire, any such shares, except (A) for any Shares issued pursuant to Company Options, Company Restricted Stock Units and Company Performance Stock Units outstanding on the date of this Agreement in accordance with the existing terms of such awards and the Company Stock Plans, or (B) by wholly owned Subsidiaries to the Company or to any other wholly owned Subsidiary of the Company;
(ix) spend or commit to spend in excess of $5,000,000 individually or $12,500,000 in the aggregate to acquire any business or businesses or to acquire assets or other property, whether by merger, consolidation, purchase of property or assets or otherwise (valuing any non-cash consideration at its fair market value as of the date of the agreement for such acquisition); provided that neither the Company nor any of its Subsidiaries shall make any acquisition that would, or would reasonably be likely to, prevent, delay or impair the Company’s ability to consummate the transactions contemplated by this Agreement; provided, further that nothing in this Section 6.1(a)(ix) shall restrict the ability of the Company to invest additional funds in any existing asset of the Company to offset any dilution in the Company’s existing interest in such asset;
(x) make any material change with respect to its financial accounting policies or procedures, except as required by changes in GAAP (or any interpretation thereof) or by applicable Law;
(xi) except as required by applicable Law, (A) make, change or revoke any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement, in each case that is inconsistent with elections made or positions taken in preparing or filing similar Tax Returns in prior periods, except in each case as a result of, or in response to, any change in U.S. federal Tax Laws or regulations or administrative guidance promulgated or issued thereunder, (B) change any Tax accounting period or any material method of Tax accounting, (C) amend any material Tax Return, (D) settle or resolve any material Tax liability or any Tax audit or controversy with respect to a material amount of Taxes, (E) surrender any right to claim a material refund of Taxes, (F) consent to any extension or waiver of the limitation period applicable to any material Tax claim or assessment relating to the Company or any of its Subsidiaries, other than any extension pursuant to an extension of time to file any Tax Return or (G) enter into any closing agreement or similar agreement with any Tax authority in respect of Taxes;
(xii) (A) enter into any new line of business other than any line of business that is reasonably ancillary to and a reasonably foreseeable extension of any line of business as of the date of this Agreement or (B) conduct a line of business of the Company or any of its Subsidiaries in any geographic area where it has never previously conducted business prior to the date of this Agreement;
(xiii) make any loans, advances or capital contributions to, or investments in, any Person (other than loans, advances or capital contributions to the Company or any direct or indirect wholly owned Subsidiary of the Company);
(xiv) (A) amend or modify in any material respect or terminate (excluding terminations upon expiration of the term thereof in accordance with the terms thereof) any Material Contract or waive, release or assign any material rights, claims or benefits under any Material Contract, other than any amendment, modification, termination, waiver, release or assignment (x) as required by Law, (y) pursuant to “most favored nation” offers made prior to the date of this Agreement or (z) in the ordinary course of business; provided that in no event shall the Company or its Subsidiaries amend or modify a Contract in which the packaging or rate terms would materially impact meeting the Company’s business plan, (B) enter into any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement unless it is on terms substantially consistent with, or on terms more favorable to the Company and/or its Subsidiaries (and to Parent and its Subsidiaries following the Closing) than a contract it is replacing; provided that in no event shall the Company or its Subsidiaries enter into a Contract in which the packaging or rate terms would materially impact meeting the Company’s business plan or (C) without restricting any action that is permissible in accordance with clauses (A) or (B) hereof, make any concession, or offer to make any concession, under any Material Contract except for (x) annual “most favored nation” offers made in the ordinary course of business consistent with past practice in connection with new issues arising after March 2017 or (y) mutual “clean slate” releases with distributors; provided that the foregoing shall not prohibit or restrict the ability of the Company or its Subsidiaries to take any action described in this Section 6.1(a)(xiv) in the ordinary course of business with respect to Material Contracts between the Company and/or one or more of its wholly owned Subsidiaries; provided, further that for the avoidance of doubt, this Section 6.1(a)(xiv) shall not prohibit or restrict any Company Plans;
(xv) settle any action, suit, case, litigation, claim, hearing, arbitration, investigation or other proceedings before or threatened to be brought before a Governmental Entity, or pay, discharge, settle or waive any material liability, other than settlements (A) if the amount of any such settlement is not in excess of $500,000 individually or $2,000,000 in the aggregate; provided that such settlements are solely for money damages (and confidentiality and other similar customary provisions that would not reasonably be expected to place any material restrictions on the
Appears in 4 contracts
Sources: Voting Agreement (Newhouse Broadcasting Corp), Merger Agreement (Scripps Networks Interactive, Inc.), Voting Agreement (Discovery Communications, Inc.)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly authorized by this Agreement or as set forth in Section 6.1 of the Company Disclosure Letter) and except as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, creditors, lessors, employees and business associates and keep available the services of its and its Subsidiaries’ current employees and agents.
(b) Without limiting the generality of Section 6.1(a) and in furtherance thereof, from and after the date hereof until the Acceptance Time and, if the 90% Requirement is satisfied at any time from and after the Acceptance Time, from and after such time that the 90% Requirement is satisfied until the Effective Time, except (A) as otherwise expressly required by this Agreement, (B) as Parent may approve in writing, or (C) as set forth in Section 6.1 of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing theretoLetter, the Company: Company will not and will not permit its Subsidiaries to:
(i) shall, and shall cause each adopt any change in the certificate of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially incorporation or by-laws or other applicable governing instruments of any Subsidiary of the same manner as heretofore conducted; Company;
(ii) shall not amend its Certificate of Incorporation merge or Bylaws or comparable governing instruments (other than to permit the consummation consolidate any Subsidiary of the transactions contemplated by this Agreement); Company with any other Person, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on the Company’s or any of its Subsidiaries’ assets, operations or businesses;
(iii) shall promptly notify issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the Purchaser issuance, sale, pledge, disposition, grant, transfer, or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries, or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any breach kind to acquire any shares of such capital stock or such convertible or exchangeable securities, except in accordance with the terms of the grant of any representation or warranty contained herein or any outstanding and exercisable Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent Option that was issued prior to the date of this Agreement; ;
(iv) except for the Company’s declaration and payment of regular quarterly cash dividends consistent with past practice and in any event not in excess of $0.52 per share with usual record and payment dates for such dividends in accordance with past dividend practice of the Company, declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock;
(v) shall not (x) except pursuant to the exercise reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, its capital stock or pursuant to the Recapitalization issue securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(vi) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP;
(vii) settle any material litigation or other material proceedings before a Governmental Entity;
(viii) (A) make or rescind any material election relating to Taxes; (B) file any amended income Tax Return or material claim for refund; (C) make any material change in any method of accounting, keeping of books of account or accounting practices or in any method of Tax accounting of the Company or any of its Subsidiary unless required by GAAP or applicable Law; (D) enter into or agree to any private letter ruling, closing agreement or similar ruling or agreement with the IRS or any other taxing authority or settle any audit or proceeding with respect to any material amount of Taxes owed; or (E) file its federal income Tax Return for any fiscal year ending on or after December 31, 2007 without providing Parent reasonable opportunity to review and comment on such Tax Return;
(ix) except as required pursuant to existing written, binding agreements in effect prior to the date of this Agreement, or as otherwise required by applicable Law, (i) grant or provide any stock split severance or termination payments or benefits to any director, officer or employee of the Company or any of its Subsidiaries, (ii) increase the compensation, bonus or pension, welfare, severance or other benefits of, pay any bonus to, or make any new equity awards to any director, officer or employee of the Company or any of its Subsidiaries, (iii) establish, adopt, amend or terminate any Compensation Agreements and Benefit Plans or amend the terms of any outstanding equity-based awards, (iv) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any Compensation Agreements and Benefit Plans, to the extent not already provided in any such Compensation Agreements and Benefit Plans, (v) change any actuarial or other assumptions used to calculate funding obligations with respect to any Compensation Agreements and Benefit Plans or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP; or (vi) forgive, grant a waiver or extension under, or amend in any manner adverse to the Company or one of its Subsidiaries, any extension of credit to directors or executive officers of the Company or any of its Subsidiaries;
(x) take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Offer set forth in Exhibit 1 or the conditions to the Merger set forth in Article VII not being satisfied; or
(xi) agree, authorize or commit to do any of the foregoing.
(c) Without limiting the generality of Section 6.1(a) and in furtherance thereof, during any period from and after the Acceptance Time and prior to the Effective Time during which the 90% Requirement is not satisfied, except (A) as otherwise expressly required by this Agreement, (B) as Parent may approve in writing, or (C) as set forth in Section 6.1 of the Company Disclosure Letter, the Company will not and will not permit its Subsidiaries to:
(i) adopt any change in the certificate of incorporation or by-laws or other applicable governing instruments of any Subsidiary of the Company;
(ii) merge or consolidate any Subsidiary of the Company with any other Person, or restructure, reorganize or completely or partially liquidate or otherwise change its capitalization as it existed enter into any agreements or arrangements imposing material changes or restrictions on the date hereofCompany’s or any of its Subsidiaries’ assets, operations or businesses;
(yiii) issue, sell, pledge, dispose of, grant, confer transfer, encumber, or award authorize the issuance, sale, pledge, disposition, grant, transfer, or encumbrance of, any optionshares of capital stock of the Company or any of its Subsidiaries (other than the issuance of shares by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary), warrantor securities convertible or exchangeable into or exercisable for any shares of such capital stock, conversion right or any options, warrants or other right not existing on rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities, except in accordance with the terms of the grant of any outstanding and exercisable Company Option that was issued prior to the date hereof of this Agreement;
(iv) except for the Company’s declaration and payment of regular quarterly cash dividends consistent with past practice and in any event not in excess of $0.52 per share with usual record and payment dates for such dividends in accordance with past dividend practice of the Company, declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to acquire any of its capital stock;
(v) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock, or (z) adopt any A1-14;
(bvi) Prior make any changes with respect to the Effective Timeaccounting policies or procedures, except as set forth required by changes in GAAP;
(vii) settle any material litigation or other material proceedings, in each case relating to any of the Purchaser Disclosure Letter or Transactions before a Governmental Entity;
(viii) except as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than required pursuant to any Purchaser Stock Plans) or existing written, binding agreements in effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent prior to the date of this Agreement; , or as otherwise required by applicable Law, (i) grant or provide any severance or termination payments or benefits to any director, officer or employee of the Company or any of its Subsidiaries, (ii) increase the compensation, bonus or pension, welfare, severance or other benefits of, pay any bonus to, or make any new equity awards to any director, officer or employee of the Company or any of its Subsidiaries, (iii) establish, adopt, amend or terminate any Compensation Agreements and Benefit Plans or amend the terms of any outstanding equity-based awards, (iv) shall not declaretake any action to accelerate the vesting or payment, set aside or pay any dividend fund or make in any other distribution way secure the payment, of compensation or payment benefits under any Compensation Agreements and Benefit Plans, to the extent not already provided in any such Compensation Agreements and Benefit Plans, (v) change any actuarial or other assumptions used to calculate funding obligations with respect to any shares Compensation Agreements and Benefit Plans or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP; or (vi) forgive, grant a waiver of extension under, or amend in any manner adverse to the Company or one of its capital stock Subsidiaries, any extension of credit to directors or other ownership interests executive officers of the Company or any of its Subsidiaries;
(other than regular quarterly cash dividends ix) take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Merger set forth in Article VII not being satisfied; or
(x) agree, authorize or commit to exceed $0.05 per share)do any of the foregoing.
(d) Prior to making any written or oral communications to the directors, officers or employees of the Company or any of its Subsidiaries pertaining to compensation or benefit matters that are affected by the Transactions, the Company shall provide Parent with a copy of the intended communication, Parent shall have a reasonable period of time to review and comment on the communication, and Parent and the Company shall cooperate in providing any such mutually agreeable communication.
(e) Parent shall not knowingly take or permit any of its Subsidiaries to take any action that is reasonably likely to prevent or materially delay the consummation of the Transactions.
Appears in 3 contracts
Sources: Agreement and Plan of Merger (Bank of Tokyo - Mitsubishi Ufj, LTD), Merger Agreement (Unionbancal Corp), Merger Agreement (Mitsubishi Ufj Financial Group Inc)
Interim Operations. (a) Prior From and after the date of this Agreement to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries to, (i) conduct its operations according to their its usual, regular and ordinary course in substantially the same manner as heretofore conductedof business consistent with past practice; (ii) shall not amend use its Certificate reasonable best efforts to preserve intact their business organizations, maintain in effect all existing material qualifications, licenses, permits, approvals and other authorizations referred to in Sections 6.1 and 6.12, keep ------------ ---- available the services of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)their officers and key employees and maintain satisfactory relationships with those persons having business relationships with them; (iii) shall promptly upon the discovery thereof notify Purchaser of the Purchaser existence of any breach of any representation or warranty contained herein (or, in the case of any representation or any Company warranty that makes no reference to Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of such representation or warranty in any material respect) or the occurrence of any event that would cause any representation or warranty contained herein no longer to be true and correct (or, in the case of any representation or any Purchaser warranty that makes no reference to Material Adverse Effect, to no longer be true and correct in any material respect); (iiiiv) shall promptly deliver to the Company Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (ivv) maintain its books of account and records in its usual, regular and ordinary manner, consistent with its past practices.
(b) From and after the date of this Agreement to the Effective Time, unless Purchaser has consented in writing thereto, the Company shall not, and shall not declarepermit any of its Subsidiaries to, set aside (i) amend its certificate of incorporation or pay any dividend bylaws or make any other distribution comparable governing instruments; (ii) issue, sell, pledge or payment with respect to register for issuance or sale any shares of its capital stock or other ownership interests interest in the Company (other than regular quarterly cash dividends not issuances of Common Stock in respect of any exercise of Options outstanding on the date hereof) or any of the Subsidiaries, or any securities convertible into or exchangeable for any such shares or ownership interest, or any rights, warrants or options to exceed $0.05 per shareacquire or with respect to any such shares of capital stock, or ownership interest, or convertible or exchangeable securities or accelerate any right to convert or exchange or acquire any securities of the Company (other than Options pursuant to Section ------- 5.2(d).) or any of its Subsidiaries for any such shares or ownership interest; ------ (iii) effect
Appears in 3 contracts
Sources: Merger Agreement (Avery Dennison Corporation), Merger Agreement (Quad-C Inc), Merger Agreement (Stimsonite Corp)
Interim Operations. Except (a) Prior to the Effective Timeas otherwise expressly required or permitted by this Agreement or as required by Law, except (b) as Parent may approve in writing or (c) as set forth in Section 6.01 of the Company Disclosure Letter or as contemplated by any other provision Schedule, during the period from the date of this AgreementAgreement until the earlier of the Effective Time or termination of this Agreement in accordance with Article 8, unless the Purchaser has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries to, (i) conduct its operations according to their usual, regular and business in the ordinary course consistent with past practice in substantially the same manner as heretofore conducted; all material respects, (ii) shall not amend use its Certificate commercially reasonable efforts to maintain and preserve intact, in all material respects, its business organization and advantageous business relationships, and goodwill with Governmental Authorities, customers, suppliers, distributors, creditors, lessors, officers and employees and business associates and keep available the services of Incorporation Company and its Subsidiaries’ present employees and agents, (iii) maintain in full force and effect insurance comparable in amount and scope of coverage to that now maintained by it, (iv) take no action that is intended to or Bylaws would reasonably be expected to adversely affect or comparable governing instruments (other than materially delay the ability of either Company or Parent to permit the consummation obtain any necessary approvals of any Governmental Authority required for the transactions contemplated by hereby or to perform its covenants and agreements under this Agreement); Agreement or to consummate the transactions contemplated hereby (iiiv) shall promptly notify the Purchaser of take any breach of action or omit to take any representation action that is intended to or warranty contained herein or any would reasonably be expected to result in (a) a Company Material Adverse Effect; Effect or (ivb) shall promptly deliver any of the conditions to the Purchaser true Merger set forth in Article 7 not being satisfied or being materially delayed. Without limiting the generality of and correct copies in furtherance of any reportthe foregoing, statement or schedule filed with the SEC subsequent to from the date of this Agreement; Agreement until the earlier of the Effective Time or termination of this Agreement in accordance with Article 8, except (vA) as otherwise expressly required or permitted by this Agreement or as required by Law, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed) or (C) as set forth in Section 6.01 of the Company Disclosure Schedule, Company shall not and shall not permit any of its Subsidiaries to:
(xa) except Other than pursuant to the exercise of options, warrants, conversion rights Company Options and other contractual rights existing Company Stock Awards outstanding on the date hereof and disclosed of this Agreement or Interim Period Company RSU Awards granted pursuant to this AgreementSection 6.01(g)(iv) of the Company Disclosure Schedule, or pursuant to dispositions or deemed dispositions of shares of Company Common Stock for Tax withholding or payment of the Recapitalization issue exercise price on the vesting, settlement or exercise of any Company Option or Company Stock Award, (i) issue, sell or 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, effect any stock split or otherwise change its capitalization as it existed on the date hereofsecurities convertible or exchangeable into, (y) grantor exercisable for, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities or receive a cash payment based on the value of any shares of such capital stock, (zii) adopt permit any A1-14additional shares of its capital stock, or securities convertible or exchangeable into, or exercisable for, any shares of its capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities or receive a cash payment based on the value of any shares of such capital stock, to become be subject to new grant, or (iii) directly or indirectly adjust, split, combine, redeem, reclassify, purchase or otherwise acquire, any shares of its stock or other securities.
(b) Prior to the Effective TimeMake, except as declare, pay or set forth aside for payment any dividend on or in the Purchaser Disclosure Letter respect of, or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue declare or make any distribution on any shares of its capital stock (other than (A) authorized dividends from its wholly-owned Subsidiaries to it or another of its wholly-owned Subsidiaries and (B) regular quarterly dividends on shares of Company Common Stock not to exceed $0.13 per share).
(c) Except with respect to transactions made in the ordinary course of business (including normal renewals of contracts without material adverse changes of terms), amend or modify the material terms of, waive, release or assign any material rights under, or terminate or enter into (i) any Material Contract, Lease, Regulatory Agreement, CRA Agreement, or any Contract that would be a Material Contract if it were in existence on the date hereof; (ii) any material restriction on the ability of the Company or its Subsidiaries to conduct its business as it is presently being conducted; or (iii) any Contract governing the terms of Company Common Stock or rights associated therewith or any other outstanding capital stock or any outstanding instrument of indebtedness, in each case which is not terminable at will or within sixty (60) calendar days or less notice without payment of any amount other than for products delivered or services performed through the date of termination.
(d) Sell, transfer, mortgage, lease, guarantee, encumber, license, let lapse, cancel, abandon or otherwise create any Lien on or otherwise dispose of or discontinue any of its assets, deposits, business or properties (other than sales pursuant to Section 6.01(p), which Section 6.01(p) will exclusively govern such sales), except for sales, transfers, mortgages, leases, guarantees, encumbrances, licenses, lapse, cancellation, abandonments or other dispositions or discontinuances in the ordinary course of business consistent with past practice and in a transaction that, together with other such transactions, does not exceed $500,000.
(e) Acquire (other than by way of foreclosures or acquisitions of control in a fiduciary or similar capacity or in satisfaction of debts previously contracted in good faith, in each case in the ordinary course of business) all or any portion of the assets, business, deposits or properties of any other entity, except in the ordinary course of business and in a transaction that, together with other such transactions, is not material to it and its Subsidiaries, taken as a whole, and would not reasonably be expected to present a material risk that the Closing Date will be materially delayed or that any Requisite Regulatory Approvals will not be obtained.
(f) Amend the Company Articles or the Company Bylaws, or similar governing documents of any of its Subsidiaries.
(g) Except as and solely when required under applicable Law or the terms of any Employee Benefit Plan in effect as of the date hereof (taking into account actions required by Section 6.13):
(i) increase in any manner the compensation, bonus or pension, welfare, severance or other benefits of any of the current or former directors, officers, employees or other service providers of Company or its Subsidiaries, except for ordinary course merit-based increases in the base salary (and corresponding increases in any base salary factor in incentive compensation) of employees (other than directors) (not exceeding 105% in the aggregate) consistent with past practice or as set forth in Section 6.01(g)(ii) below.
(ii) accrue, grant, pay or agree to pay any annual, quarterly, monthly or other bonus or other incentive compensation (excluding any severance, retention, retirement or termination pay, which shall be subject to clause (v) of this Section 6.01(g) below), other than:
(A) any bonuses and other incentive compensation that are payable by Company on an annual basis in the ordinary course of business consistent in all material respects with past practice for the year ending December 31, 2025; provided, however, that such bonuses shall not exceed the aggregate amount accrued as of the Closing Date on the Company financial statements, or (B) any incentive compensation that is payable by the Company on less than fair market value annual basis in the ordinary course of business consistent in all material respects with an Employee Benefit Plan and past practice.
(iii) become a party to, establish, amend, alter a prior interpretation of in a manner that enhances rights or materially increases costs, commence participation in, terminate or commit itself to the adoption of any Employee Benefit Plan or plan that would be an Employee Benefit Plan if in effect as of the date hereof, other than de minimis amendments in the ordinary course of business consistent with past practice or as required pursuant to the terms of such Employee Benefit Plan.
(iv) grant (or commit to grant) any new equity award, except as set forth on Section 6.01(g)(iv) of the Company Disclosure Schedule with respect to any Interim Period Company RSU Award.
(v) grant, pay or increase (or commit to grant, pay or increase) any severance, retention, retirement or termination pay, other than pursuant to any Purchaser Stock Plans(i) or the Employee Benefit Plans in effect any stock split as of its capital stockthe date hereof as listed on Section 4.11(a) of the Company Disclosure Schedule; and (ii) such retention payments consistent with the terms and conditions set forth on Section 6.01(g)(v)(i) of the Company Disclosure Schedule.
(vi) other than as expressly stated in Section 3.03 or contemplated under Section 6.13, accelerate the payment or vesting of, or lapsing of restrictions with respect to, any stock-based compensation (including the Company Options and Company Stock Awards), long-term incentive compensation, deferred compensation or any bonus or other incentive or deferred compensation.
(vii) cause the funding of any rabbi trust or similar arrangement or take any action to fund or in any other way secure the payment of compensation or benefits under any Employee Benefit Plan.
(viii) terminate the employment or services of any executive officer of the Company other than for cause.
(ix) enter into any collective bargaining or other agreement with a labor organization.
(x) forgive or issue any loans to any current or former officer, employee or director of Company or its Subsidiaries.
(xi) make any Company contributions to the Company 401(k) Plan outside of the ordinary course of business and consistent with past practice.
(xii) hire any officer, employee or other service provider except in the ordinary course of business consistent with past practices, including as a result of vacancies arising on or after the date hereof.
(h) Knowingly take, or omit to take, any action that would prevent or impede, or could reasonably be expected to prevent or impede, the Merger or the Bank Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code.
(i) (i) other than intercompany indebtedness among the Company and any wholly-owned Subsidiaries, incur or guarantee any indebtedness for borrowed money, other than in amounts and at maturities in the ordinary course of business consistent with past practice, and provided further that the maturity period for any such indebtedness shall promptly notify not exceed a period of ninety (90) days from the date of incurrence of such indebtedness or (ii) assume, guarantee, endorse or otherwise as an accommodation become responsible for the obligations of any other Person (other than the endorsement of checks, commercial paper, bankers acceptances and bank drafts, and guarantees by the Company of any breach indebtedness of any representation or warranty contained herein wholly-owned Subsidiary of the Company and guarantees by any wholly-owned Subsidiary of the Company of indebtedness of the Company or any Purchaser Material Adverse Effect; other wholly-owned Subsidiary of the Company, in each case, in the ordinary course of business consistent with past practice and which does not exceed a period of ninety (iii90) shall promptly deliver days from the date of such assumption, guarantee, endorsement or otherwise).
(j) Enter into any new line of business or make any material change in any basic policies and practices with respect to pricing or risk profile of loans, deposits and services, liquidity management and cash flow planning, marketing, deposit origination, lending, budgeting, profit and tax planning, personnel practices or any other material aspect of Company’s or its Subsidiaries’ business or operations, except as required by Law or requested by any Governmental Authority;
(k) Other than in accordance with the investment policies of Company or any of its Subsidiaries in effect on the date hereof or in securities transactions as provided in (ii) below, (i) make any investment either by contributions to capital, property transfers or purchase of any property or assets of any Person, or (ii) other than purchases of direct obligations of the United States of America or obligations of United States government agencies which are entitled to the Company true full faith and correct copies credit of the United States of America, in any case with a remaining maturity at the time of purchase of one year or less, purchase or acquire securities of any reporttype other than securities purchased in the ordinary course of business consistent with past practice and the Company’s interest rate risk and investment policies following reasonable prior consultation with and review by Parent; provided, statement however, that in the case of Investment Securities, Company may purchase Investment Securities if, within two (2) Business Days after Company requests in writing (which request shall describe in detail the investment securities to be purchased and the price thereof) that Parent consent to making of any such purchase, Parent has approved such request in writing (which consent will not be unreasonably withheld) or schedule filed has not responded in writing to such request.
(l) Except as set forth in Section 6.01(l) of the Company Disclosure Schedule, enter into any settlement, compromise or similar agreement with the SEC subsequent respect to, any action, suit, claim, proceeding, order or investigation to which Company or any of its Subsidiaries is or become a party after the date of this Agreement; , other than any settlement, compromise, agreement or action, suit, claim, proceeding, order or investigation that is settled in an amount and for consideration not in excess of $250,000 individually or $500,000 in the aggregate and that would not (ivi) shall not declareimpose any material restriction on the business of the Surviving Corporation or the Surviving Bank or (ii) create adverse precedent for claims that are reasonably likely to be material to the Company or its Subsidiaries taken as a whole.
(m) Other than as required by applicable Law or by a Governmental Authority or as determined to be necessary or advisable by Company in the good faith exercise of its discretion based on changes in market condition and subject in any event to clause (u) below of this Section 6.01, set aside alter materially its interest rate or pay any dividend pricing fee or make any other distribution or payment fee pricing policies with respect to depository accounts of any shares of its capital stock or other ownership interests (Subsidiaries or, other than regular quarterly cash dividends not in the ordinary course of business, waive any material fees with respect thereto.
(n) Except as required by applicable Law or by a Governmental Authority, (i) implement or adopt any material change in its interest rate and other risk management policies, procedures or practices or (ii) fail to comply in all material respects, with Company’s or its applicable Subsidiary’s applicable policies, procedures or practices with respect to managing its exposure to interest rate and other risk.
(o) Grant or commit to grant any new extension of credit or any renewal or modification of an existing extension of credit to any obligor (whether a new or existing relationship) (if such extension of credit would be provided either on an unsecured basis or on a secured basis and equal or exceed $0.05 per share5,000,000; in each case, consent shall be deemed granted if within one (1) Business Days of written notice delivered to Citizens’ Chief Credit Officer or his designee, notice of objection is not received by Company;
(p) Sell any real estate owned, charge-off any assets, make any compromises on debt, release any collateral on loans or commit to do any of the foregoing, if such sale, charge-off, compromise or release would exceed $500,000 in the aggregate (consent shall be deemed granted if within three (3) Business Days of written notice delivered to Citizens’ Chief Credit Officer or his designee, notice of objection is not received by Company).
(q) Renew or commit to renew any extension of credit that would equal or exceed: $1,000,000 if rated either Su
Appears in 3 contracts
Sources: Agreement and Plan of Reorganization and Merger (Heritage Commerce Corp), Agreement and Plan of Reorganization and Merger (Heritage Commerce Corp), Merger Agreement (CVB Financial Corp)
Interim Operations. (a) Prior Except as set forth in the corresponding section of the Company Disclosure Schedule or otherwise as expressly contemplated hereby, subject to applicable Law, the Company covenants and agrees as to itself and its Subsidiaries that, from the date of this Agreement until the Effective Time, the business of it and its Subsidiaries shall be conducted only in the ordinary course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective commercially reasonable efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of the present key employees and agents of the Company and its Subsidiaries. Without limiting the generality of the foregoing and in furtherance thereof, except as set forth in the corresponding section of the Company Disclosure Letter Schedule or as otherwise expressly contemplated by any other provision hereby, from the date of this Agreement, unless Agreement until the Purchaser has consented in writing theretoEffective Time, the Company: Company will not and will not permit its Subsidiaries to (unless Novartis shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed and shall be subject to the procedures set forth on Schedule 7.1(a) of the Company Disclosure Schedule):
(i) shall, and shall cause each adopt or propose any change in its certificate of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; incorporation or by-laws (or similar governing documents);
(ii) shall not amend merge or consolidate the Company or any of its Certificate of Incorporation or Bylaws or comparable governing instruments (Subsidiaries with any other than to permit the consummation Person, except for any such transactions among wholly-owned Subsidiaries of the transactions contemplated by this Agreement); Company;
(iii) shall promptly notify acquire assets outside of the Purchaser ordinary course of business from any breach Person with a purchase price in the aggregate in excess of $2,000,000 individually, other than acquisitions pursuant to any representation Contract in effect as of the date of this Agreement and described in or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver filed as an exhibit to the Purchaser true and correct copies of any report, statement or schedule Company Reports filed with the SEC subsequent prior to the date of this Agreement; ;
(viv) shall not other than in the ordinary course of business consistent with past practice (xexcluding for this purpose the activities of the Company and its Subsidiaries in 2005) except or pursuant to Contracts in effect as of the date of this Agreement as set forth on Section 7.1(a)(iv) of the Company Disclosure Schedule, and other than the issuance of shares of Common Stock upon the exercise of optionsoutstanding Company Options, warrants, conversion rights and pursuant to other contractual rights existing on equity-based awards granted under other Company equity-based compensation plans prior to the date hereof and disclosed pursuant to of this Agreement, Agreement consistent with the terms thereof or pursuant to the Recapitalization issue terms of the Debentures (to the extent required by such terms), in each case, in accordance with their terms, issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries (other than the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary), or securities convertible or exchangeable or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) other than pursuant to Contracts in effect as of the date of this Agreement and described in or filed as an exhibit to the Company Reports filed prior to the date of this Agreement, make any loan, advance or capital contribution to or investment in any Person (other than a wholly-owned Subsidiary of the Company) outside the ordinary course of business (other than loans to employees not to exceed, in the aggregate, $2,500,000 in principal amount);
(vi) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends or other distributions by any direct or indirect wholly-owned Subsidiary of the Company to the Company or to any other direct or indirect wholly-owned Subsidiary of the Company and periodic dividends and other periodic distributions by non-wholly-owned Subsidiaries in the ordinary course of business);
(vii) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14;
(bviii) Prior to incur any third-party indebtedness for borrowed money or guarantee such indebtedness of another Person, except for unsecured indebtedness for borrowed money incurred in the Effective Time, ordinary course of business repayable within 180 days without penalty;
(ix) except as set forth in Section 7.1(a)(ix) of the Purchaser Company Disclosure Letter Schedule, make or as contemplated by authorize any capital expenditure;
(x) enter into any Contract that would have been a Material Contract had it been entered into prior to the execution of this Agreement, unless other than any Contract (A) for the sale of products in the ordinary course of business or (B) providing for any capital expenditure to the extent permitted by Section 7.1(a)(ix);
(xi) other than in the ordinary course of business, amend or modify in any material respect, or terminate or waive any material right or benefit under, any Material Contract;
(xii) make any significant changes with respect to accounting policies or practices, except as required by changes in GAAP or by Law;
(xiii) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity or arbitral proceeding for an amount payable by or on behalf of the Company and or any Subsidiary in excess of $2,500,000 (exclusive of any amounts to be received by the Special Committee Company in reimbursement of such settlement amount, whether under any insurance policy or indemnity, other than such amounts that are contested) or which would be reasonably likely to have consented any adverse impact on the operations of the Company or any of its Subsidiaries or on any current or future litigation or other proceeding of the Company or any of its Subsidiaries;
(xiv) except as required by Law, make any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any material method therefor that is inconsistent with elections made, positions taken or methods used in writing theretopreparing or filing similar Tax Returns in prior periods;
(xv) sell, lease, license or otherwise dispose of any assets of the Purchaser: Company or its Subsidiaries except for (i) shall sales of (A) products or services provided in the ordinary course of business or (B) other assets in aggregate amount not issue to exceed $5,000,000, or (ii) licenses of Intellectual Property of the Company or its Subsidiaries in the ordinary course of business (but excluding (x) any shares licenses of its capital stock at less than fair market value programs, projects or products or (y) any licenses with up-fronts or milestones in excess of $5,000,000 in the aggregate), and other than pursuant to any Purchaser Stock Plans) or Contracts in effect any stock split as of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; Agreement as set forth on Section 7.1(xv) of the Company Disclosure Schedule;
(xvi) other than pursuant to Contracts in effect as of the date of this Agreement as set forth on Section 7.1(xvi) of the Company Disclosure Schedule, or as otherwise required by Law, (i) enter into any new employment or compensatory agreements with, or increase the compensation and employee benefits of, any employee, consultant, or director of the Company or any of its Subsidiaries (including entering into any bonus, severance, change of control, termination, reduction-in-force or consulting agreement or other employee benefits arrangement or agreement pursuant to which such person has the right to any form of compensation from the Company or any of its Subsidiaries), (ii) hire any employee to fill a position at the level of (A) executive committee member or other executive officer or (B) vice president or above who reports directly to an executive committee member, or (iii) adopt or amend in any respect, or accelerate vesting or payment under, any Benefit Plan in the case of clauses (i) and (iviii) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (above other than regular quarterly cash dividends not in the ordinary course of business consistent with past practice;
(xvii) engage in the conduct of any new line of business, other than as expressly permitted by Section 7.1(a)(iii) of the Company Disclosure Schedule; or
(xviii) agree, resolve or commit to exceed $0.05 per share)do any of the foregoing.
Appears in 3 contracts
Sources: Agreement and Plan of Merger (Novartis Ag), Merger Agreement (Chiron Corp), Agreement and Plan of Merger (Novartis Corp)
Interim Operations. (a) Prior Pursuant to the Effective TimeMerger Agreement, the Company has agreed that, except as set forth expressly contemplated by the Merger Agreement or agreed to in writing by Parent, prior to the time the directors of the Parent constitute a majority of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing theretoBoard, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries 22 to, (a) conduct its operations in all material respects according to their usual, regular ordinary and ordinary usual course of business in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent conducted prior to the date of this the Merger Agreement; (vb) shall use reasonable best efforts to preserve intact its business organization in all material respects, keep available the services of its executive officers and key employees as a group, subject to changes in the ordinary course, and maintain satisfactory relationships with suppliers, distributors, customers and others having business relationships with them; (c) confer at such times as Parent may reasonably request with one or more representatives of Parent to report material operational matters and the general status of ongoing operations (in each case to the extent Parent reasonably requires such information) and consult with Parent regarding material operational decisions; (d) promptly notify Parent of any emergency or other change in the normal course of its businesses or in the operation of its properties and of any complaints, investigations or hearings (or communications indicating that the same may be contemplated) of any governmental body or authority; (e) not authorize or pay any dividends on or make any distribution with respect to its outstanding shares of stock; (xf) not, except as otherwise contemplated by the Merger Agreement or as may be required by applicable law, enter into or amend any employment, severance or similar agreements or arrangements with any of their directors or executive officers; (g) not, subject to the provisions described below under the heading "No Solicitation," authorize, announce an intention to authorize, or enter into an agreement with respect to, any merger, consolidation or business combination other than the Merger, any acquisition of a material amount of assets or securities, any disposition of a material amount of assets or securities or any release or relinquishment of any material contract rights, in each case, not in the ordinary course of business; (h) not propose or adopt any amendments to its corporate charter or by-laws, except pursuant to the Merger as provided in the Merger Agreement; (i) not issue any shares of capital stock, except upon exercise of options previously issued pursuant to existing employee plans, programs or arrangements and non-employee director plans; (j) not grant, confer or award any options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right rights not existing on the date hereof of the Merger Agreement, to acquire any shares of its capital stock; (k) not purchase, redeem, or (z) adopt any A1-14
(b) Prior offer to the Effective Time, except as set forth in the Purchaser Disclosure Letter purchase or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue redeem any shares of its capital stock at less than fair market value or any securities convertible into or exchangeable for shares of stock, except for the deemed repurchase of options in accordance with the terms of the Merger Agreement, or purchases, redemptions and offers to purchase in the ordinary course of business in connection with employee incentive and benefit plans, programs or arrangements in existence on the date of the Merger Agreement; (other than pursuant l) not, except as contemplated by the Merger Agreement or as may be required by applicable law, amend in any material respect the terms of its employee benefit plans, programs or arrangements or any severance or similar agreements or arrangements in existence on the date of the Merger Agreement, enter into or amend any employment or consulting agreement, adopt or enter into any new employee benefit plans, programs or arrangements or any severance or similar agreements or arrangements or increase the base salary of any person who is a party to a Change of Control Employment Agreement or make any payments under any benefit plan to any Purchaser Stock Plansdirector, employee, independent contractor or consultant (except in the ordinary course of business and in amounts and in a manner consistent with past practice or as otherwise required by law or the provisions of such benefit plan); (m) not (i) enter into any material loan agreement or effect incur any stock split indebtedness in excess of an aggregate of $100,000 or amend any Company credit facility to increase the amount that may be borrowed thereunder, (ii) make or enter into any agreement or contract for capital expenditures in excess of $50,000, (iii) enter into any lease for real property in excess of $50,000 or any lease for personal property in excess of $20,000, or (iv) enter into any agreement or contract outside of the ordinary course of business of the Company or any of the Company's subsidiaries that involves performance of services or delivery of goods or materials by or to the Company or any of the Company's subsidiaries of an amount or value in excess of $50,000; (n) not make or change any material Tax election, file any amendment to any federal income Tax Return unless required by law, enter into any closing agreement, or settle or compromise any material Tax liability; (o) not adjust, split, combine or reclassify its capital stock; (p) not enter into any agreement, understanding or arrangement with respect to the sale or voting of its capital stock; (iiq) shall promptly notify not create any new subsidiaries; (r) except as required by the Company Merger Agreement, not take any action which could reasonably be expected to adversely affect or delay the ability of any breach of the parties to obtain any approval of any representation governmental or warranty contained herein or any Purchaser Material Adverse Effectregulatory body required to consummate the transactions contemplated thereby; (iiis) shall promptly deliver to the Company true and correct copies not directly or indirectly sell, transfer, lease, pledge, mortgage, encumber or otherwise dispose of any report, statement material property or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (assets other than regular quarterly cash dividends in the ordinary course of business; (t) not to exceed $0.05 per share).enter into any financial derivative contracts; (u) not change in any material respect its accounting policies, methods or procedures except as required by GAAP; (v) except as may 23
Appears in 3 contracts
Sources: Offer to Purchase (Falcon Products Inc /De/), Offer to Purchase (Falcon Products Inc /De/), Offer to Purchase (Shelby Williams Industries Inc)
Interim Operations. (a) Prior During the period from the date of this Agreement to the Effective Time, except as set forth specifically contemplated by this Agreement or otherwise as consented to or approved in writing by BarCo:
(a) The business of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular shall be conducted only in the ordinary and ordinary usual course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true business and correct copies of any report, statement or schedule filed consistent with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14past practice;
(b) Prior The Company shall use reasonable efforts to preserve intact the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless business organization of the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares each of its capital Subsidiaries, to keep available the services of its and their present officers and key employees in good standing, and to preserve the goodwill of those having business relationships with it and its Subsidiaries;
(c) Neither the Company nor any Subsidiary shall amend its charter documents or similar governing documents;
(d) Except for Shares issuable upon exercise of currently outstanding stock at less than fair market value (other than options under the Company's Directors' Stock Option Plan and Employees' Incentive Stock Option Plan or issuable pursuant to the Company's Directors' Deferred Compensation Plan, neither the Company nor any Purchaser Stock PlansSubsidiary shall authorize for issuance, issue or deliver any additional debt or equity securities or any class or series thereof or any securities convertible into the same or issue or grant any right, option or other commitment for the issuance of any of the foregoing securities;
(e) Neither the Company nor any Subsidiary shall split, combine, reclassify or effect otherwise modify the terms and provisions of any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation debt or warranty contained herein equity securities or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend (whether in cash, stock or property) in respect of its debt or equity securities or redeem or otherwise acquire any of its debt or equity securities except as contemplated hereby;
(f) Neither the Company nor any Subsidiary shall dispose of or acquire any material properties or assets except in the ordinary course of business;
(g) Neither the Company nor any Subsidiary shall enter into or amend any consulting agreements or other agreements with employees, increase the compensation payable or to become payable by it to any of its officers, employees or agents over the amount payable as of the date of this Agreement, adopt or amend any employee benefit plan or arrangement, or make any advances to employees (other distribution or payment than advances for reimbursable expenses) except with respect to any shares of the above, such as are generally consistent with the Company's existing guidelines and are made in the ordinary course of business; provided, however, the Company shall be authorized to negotiate and execute the renewal of the union contract or contracts at its Harvey, Illinois facility with such terms as the Company, using its commercially reasonable judgment, may determine;
(h) Neither the Company nor any Subsidiary shall borrow or enter into any agreements to borrow money or guarantee or agree to guarantee the obligations of others, excluding (i) any amounts borrowed, net of any repayments, in the ordinary course of business pursuant to and in accordance with the terms and conditions of its capital stock existing lines of credit as the same may be reasonably amended, modified or extended hereafter by the Company using its commercially reasonable judgment and (ii) guarantees, net of the extinguishment of any existing guarantees, of the debt of the Subsidiaries of the Company;
(i) Except as contemplated hereby, neither the Company nor any Subsidiary shall directly or indirectly redeem, purchase or otherwise acquire, commit to acquire or change the terms of any of its debt or equity securities or any class or series thereof or any securities convertible into the same or directly or indirectly terminate or reduce or commit to terminate or reduce any bank line of credit or the availability of any funds under any other ownership interests loan or financing agreement; provided, however, that the Company or any Subsidiary may exercise any option or right to repurchase securities issued pursuant to a Company or Subsidiary benefit plan at a price at or below the Merger Consideration for Shares; and provided, further, that the Company may borrow under existing credit facilities under the terms existing as of the date hereof as the same may be reasonably amended, modified or extended hereafter by the Company using its commercially reasonable judgment;
(other than regular quarterly cash dividends j) Neither the Company nor any Subsidiary shall fail to pay or otherwise satisfy its monetary obligations as they become due, except where the consequences of failure to pay are not material to exceed $0.05 per share)the Company and its Subsidiaries considered as a whole;
(k) Neither the Company nor any Subsidiary shall cancel, materially amend or fail to renew any insurance policy; and
(l) Neither the Company nor any Subsidiary shall agree in writing or otherwise to take any of the foregoing actions set forth in clauses (b) through (k) above or take any actions which would make any representation or warranty in this Agreement untrue or incorrect in any material respect.
Appears in 3 contracts
Sources: Agreement and Plan of Merger (Bliss & Laughlin Industries Inc /De), Agreement and Plan of Merger (BRW Steel Corp), Merger Agreement (BRW Steel Corp)
Interim Operations. Except (ai) Prior to the Effective Timeas expressly contemplated by this Agreement, except (ii) as set forth in Section 7.01 of the Company Disclosure Letter Schedule, (iii) as required by applicable Law, (iv) as consented to in writing by Parent, which consent shall not be unreasonably conditioned, withheld or as contemplated by any other provision delayed, the Company agrees that, from the date of this Agreement, unless Agreement until the Purchaser has consented earlier of the termination of this Agreement in writing thereto, accordance with its terms and the Company: Effective Time:
(a) the Company and each of its Subsidiaries shall (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and business only in the ordinary course in substantially the same manner as heretofore conducted; of business consistent with past practice and (ii) use commercially reasonable efforts to (A) preserve intact its current business organization and (B) keep available the services of its current officers, employees and consultants who are important to the operation of the business; provided that no action or failure to take action by the Company or any of its Subsidiaries with respect to matters specifically addressed by any provision of Section 7.01(b) through (n) shall constitute a breach under this Section 7.01(a) unless such action or failure to take action would constitute a breach of such provision of Section 7.01(b) through (n), as applicable;
(b) the Company shall not amend its Certificate articles of Incorporation incorporation or Bylaws bylaws;
(c) the Company shall not, and shall not permit any of its Subsidiaries that is not wholly owned to, authorize or comparable governing instruments pay any dividends on or make any distribution with respect to its outstanding shares of capital stock or other equity securities (whether in cash, assets, stock or other than to permit the consummation securities of the transactions contemplated Company or its Subsidiaries), except (i) dividends and distributions paid or made on a pro rata basis by this Agreement); Subsidiaries and (iiiii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed quarterly dividends in accordance with the SEC subsequent to Company’s publicly announced dividend policy as in effect on the date of this Agreement; ;
(v) shall not (xd) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless for transactions exclusively among the Company and its wholly owned Subsidiaries or among the Special Committee have consented in writing theretoCompany’s wholly owned Subsidiaries, the Purchaser: (i) Company shall not, and shall not issue permit any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) Subsidiaries to, issue, sell, pledge, dispose of or effect any stock split of its capital stock; (ii) shall promptly notify encumber, or authorize the Company of any breach of any representation issuance, sale, pledge, disposition or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any reportencumbrance of, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests interest in the Company or any Subsidiaries of the Company or any securities convertible into or exchangeable for any such shares or ownership interest, or any rights, warrants or options to acquire or with respect to any such shares of capital stock, ownership interest or convertible or exchangeable securities, take any action to cause to be exercisable any otherwise unexercisable Company Stock Option (except as otherwise provided by the terms of this Agreement or the express terms of any unexercisable options or awards outstanding on the date hereof) or otherwise make any changes (by combination, merger, consolidation, reorganization, liquidation, split, combination, reclassification, adjustment or otherwise) in the capital structure of the Company or any of its Subsidiaries or amend the terms of any securities of the Company or any of its Subsidiaries, other than issuances of shares of Common Stock in respect of any exercise of Company Stock Options outstanding on the date hereof;
(e) except to the extent required by Law (including Section 409A of the Code) or by Contracts in existence as of the date hereof or by Company Benefit Plans, the Company shall not and shall not permit any of its Subsidiaries to (i) increase in any material manner the aggregate compensation and benefits of its directors or executive officers except (A) in the ordinary course of business consistent with past practice (the ordinary course including, for this purpose, the employee salary, bonus and equity compensation review process and related adjustments substantially as conducted each year), or (B) in accordance with existing Contracts or Company Benefit Plans, (ii) pay any pension, severance or retirement benefits not required by any existing plan or agreement to any such directors or executive officers, (iii) enter into, amend (other than regular quarterly cash dividends amendments that do not materially increase the cost to the Company or any of its Subsidiaries of maintaining the applicable compensation or benefit program, policy, arrangement or agreement), adopt, implement or otherwise commit itself to any compensation or benefit plan, program, policy, arrangement or agreement including any pension, retirement, profit-sharing, bonus, collective bargaining or other employee benefit or welfare benefit plan, policy, arrangement or agreement or employment or consulting agreement with or for the benefit of any employee, director, consultant, independent contractor or service provider, other than with respect to any employment, severance or retention agreement (or amendment with respect thereto) entered into in the ordinary course of business consistent with past practice between the Company or one of its Subsidiaries, on the one hand, and any consultant, independent contractor, service provider or employee of the Company or its Subsidiaries who is not an executive officer of the Company or its Subsidiaries, or (iv) other than pursuant to the express terms of the respective Company Benefit Plan or Contract, accelerate the vesting of, or the lapsing of restrictions with respect to, any stock options or other stock-based compensation of or for the benefit of any director or executive officer or otherwise accelerate any rights or benefits, or make any determinations that would result in a material increase in liabilities under any Company Benefit Plan;
(f) the Company shall not, and shall not permit any its Subsidiaries to, make any loans or advances to any of its directors and executive officers (other than in the ordinary course of business consistent with past practice in amount) or make any change in its existing borrowing or lending arrangements for or on behalf of any such Persons;
(g) the Company shall not, and shall not permit any of its Subsidiaries to, incur, assume, guarantee, prepay or otherwise become liable for any indebtedness for borrowed money (directly, contingently or otherwise), except for (A) any indebtedness for borrowed money among the Company and its wholly owned Subsidiaries or among the Company’s wholly owned Subsidiaries, (B) indebtedness for borrowed money in an amount not to exceed $0.05 per share)5,000,000 in aggregate principal amount outstanding at any time, incurred under and pursuant to existing credit arrangements, (C) letters of credit issued in the ordinary course of business consistent with past practices, and (D) indebtedness for borrowed money as required to consummate the Merger and the transactions contemplated hereby;
(h) neither the Company nor any of its Subsidiaries shall settle or compromise any claim, suit action, arbitration or other proceeding, whether administrative, civil or criminal, in law or equity, except for settlements or compromises that consist solely of the payment of monetary damages in an amount not to exceed $1,000,000 individually or $5,000,000 in the aggregate;
(i) neither the Company nor any of its Subsidiaries shall change any of the material accounting methods, principles or practices used by it unless required by or advisable under a change in GAAP, SEC rule or policy or applicable Law;
(j) other than in the ordinary course of business, neither the Company nor any of its Subsidiaries shall (A) make, change or revoke any material income Tax election, (B) file any material amended income Tax Return, or (C) settle or compromise any material liability for income Taxes or surrender any claim for a refund of a material amount of income Taxes, other than in the case of clauses (B) and (C) hereof in respect of any income Taxes that have been identified in the reserves for income Taxes in the Company’s GAAP financial statements and for settlements or compromises permitted under clause (g) of this Section;
(k) neither the Company nor any of its subsidiaries shall acquire, except in respect of any mergers, consolidations, business combinations among the Company and its wholly owned Subsidiaries or among the Company’s wholly owned Subsidiaries, including by merger, consolidation or acquisition of stock or assets, any corporation, partnership, limited liability company, other business organization or any division thereof, or any material amount of assets in connection with acquisitions or investments;
(l) neither the Company nor any of its Subsidiaries shall amend in any material respect or waive any of its material rights under any Company Material Contract or enter into any Contract that would constitute a Company Material Contract, except in the ordinary course of business consistent with past practice or as would not reasonably be expected to result in a Company Material Adverse Effect;
(m) neither the Company nor any of its Subsidiaries shall sell, transfer, mortgage, encumber or otherwise dispose of any of its assets, business or properties, except for sales, transfers, mortgages, encumbrances or other dispositions in the ordinary course of business, or Liens, mortgages or encumbrances granted in connection with refinancing, replacement or extension of existing indebtedness consistent with past practice or pursuant to a transaction that, together with any other such transactions, is not material to it and its Subsidiaries, taken as a whole; and
(n) neither the Company nor any of its Subsidiaries shall enter into a Contract to do any of the foregoing. The Company, on the one hand, and Parent and Merger Sub, on the other hand, acknowledge and agree that: (i) nothing contained in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the right to control or direct the operations of the Company or any of its Subsidiaries prior to the Effective Time, (ii) prior to the Effective Time, the Company shall exercise, consistent with the terms and conditions of this Agreement, control and supervision over its and its Subsidiaries’ operations and (iii) notwithstanding anything to the contrary in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.01 or elsewhere in this Agreement to the extent the requirement of such consent would reasonably be expected to be a violation of applicable Law.
Appears in 3 contracts
Sources: Merger Agreement (Campbell Thomas J), Merger Agreement (Michael Baker Corp), Merger Agreement (Michael Baker Corp)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, such approval not to be unreasonably withheld or delayed, and except as otherwise expressly contemplated by this Agreement, and except as required by applicable Laws) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of its and its Subsidiaries’ present employees and agents. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly contemplated by this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld or delayed) or (C) for transactions set forth in Section 6.1 of the Company Disclosure Letter, the Company will not and will not permit any of its Subsidiaries to:
(i) adopt or propose any change in its articles of incorporation or by-laws or other applicable governing instruments;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) acquire assets outside of the ordinary course of business consistent with past practice from any other Person, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any Shares or any shares of capital stock of the Company or any of its Subsidiaries (other than the issuance of shares by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any Shares or any shares of such capital stock or such convertible or exchangeable securities;
(v) create or incur any Lien in excess of $5 million on any assets of the Company or any of its Subsidiaries;
(vi) make any loans, advances or capital contributions to or investments in any Person, other than non-material advances to vendors and employees in the ordinary course of business consistent with past practice;
(vii) enter into any agreement with respect to the voting of its capital stock or declare, set aside, make or pay any dividend or other distribution, or purchase, redeem or otherwise acquire any of its capital stock payable in cash, stock, property or otherwise, with respect to any of its capital stock except for (x) dividends paid by any direct or indirect wholly owned Subsidiary of the Company to the Company or to any other direct or indirect wholly owned Subsidiary of the Company or (y) a regular quarterly dividend paid in the fourth quarter of 2006 consistent with past practice, which shall not exceed $200,000 in the aggregate as set forth in Section 5.1(f) of the Company Disclosure Letter Letter;
(viii) reclassify, split, combine, subdivide or as contemplated by redeem, purchase or otherwise acquire, directly or indirectly, any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct capital stock or securities convertible or exchangeable into or exercisable for any shares of its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; capital stock;
(iiix) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments incur any indebtedness for borrowed money (other than borrowings under the Company’s existing working capital debt facilities in the ordinary course of business consistent with past practice to permit the consummation fund working capital of the transactions contemplated by Company) or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries;
(x) make or authorize any capital expenditures in excess of $5 million in the aggregate;
(xi) enter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement); ;
(iiixii) shall promptly notify make any changes with respect to accounting policies or procedures, except as required by changes in GAAP;
(xiii) other than in the Purchaser ordinary course of business consistent with past practice, amend, modify or terminate any breach Material Contract, or cancel, modify or waive any debts or claims held by it or waive any rights;
(xiv) make any material Tax election, take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any representation tax accounting method that is inconsistent with positions taken or warranty contained herein methods used in preparing or filing similar Tax Returns in prior periods, or settle or resolve any Company Material Adverse Effect; material Tax controversy;
(ivxv) shall promptly deliver other than pursuant to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent Contracts in effect prior to the date of this Agreement; (v) shall not , transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets, product lines or businesses of the Company or its Subsidiaries, including capital stock of any of its Subsidiaries, except (x) except pursuant to in the exercise ordinary course of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereofbusiness consistent with past practice, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares for sales of its capital stock, obsolete assets or (z) adopt for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $5 million in the aggregate;
(xvi) except as otherwise required by applicable Law, (i) increase the compensation, bonus or pension or welfare benefits of (other than those increases in the ordinary course consistent with past practice (A) to employees below the Senior Vice President level or (B) resulting from the Company’s improved performance, based on existing 2005 incentive formulas), or make any A1new equity awards to, any director, officer or employee of the Company or any of its Subsidiaries, (ii) establish, adopt, amend or terminate any Benefit Plan or amend the terms of any Benefit Plan or outstanding equity-14based awards, or (iii) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any Benefit Plan, to the extent not already required by any such Benefit Plan;
(xvii) settle, or consent to any settlement of, any actions, suits, claims or proceedings against the Company or any of its Subsidiaries or any obligation or liability of the Company (i) alleging personal injury or property damage arising from exposure to asbestos or asbestos-containing materials (other than disputes paid under the Company’s insurance not exceeding $50,000 per claimant), or (ii) alleging any other injury or damage (other than disputes with customers or suppliers in the ordinary course of business consistent with past practice and not exceeding $50,000 per claimant);
(xviii) take any action or omit to take any action that will waive, modify, compromise or extinguish any of the Company’s rights with respect to (A) any insurance coverage relating to any actions, suits or claims against the Company or any of its Subsidiaries alleging personal injury or property damage arising from exposure to asbestos or asbestos-containing materials, or (B) any agreements, understandings or arrangements relating to any such coverage;
(xix) take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Merger set forth in Article VII not being satisfied, except actions or omissions expressly permitted by Section 6.2; provided that the foregoing shall not expand, diminish or modify in any way any of the Company’s express obligations hereunder;
(xx) enter into, terminate, amend or modify any Contract or transaction with any officer, director or Affiliate of the Company or any of its Subsidiaries or any Person beneficially owning five percent or more of the outstanding Shares or of the outstanding shares of any Subsidiary of the Company;
(xxi) enter into any purchase order (other than purchase orders entered into in the ordinary course of business consistent with past practice and in an amount less than $10 million); or
(xxii) agree, authorize or commit to do any of the foregoing.
(b) Prior Parent will not and will not permit any of its Subsidiaries to take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Effective Time, except as Merger set forth in Section 7.2 or Section 7.3 not being satisfied, except actions or omissions expressly permitted by Section 6.12(c); provided that the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) foregoing shall not issue expand, diminish or modify in any shares way any of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) Parent’s or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Merger Sub’s express obligations hereunder.
Appears in 3 contracts
Sources: Merger Agreement (McJunkin Red Man Corp), Merger Agreement (Goldman Sachs Group Inc), Merger Agreement (McJunkin Red Man Holding Corp)
Interim Operations. (a) During the period commencing on the date hereof and running until the earlier of the Effective Time or the termination of this Agreement in accordance with ARTICLE VIII (the “Pre-Closing Period”), except (i) as expressly contemplated, required or permitted by this Agreement, (ii) as required by applicable Law, (iii) as approved in writing by Parent (such approval not to be unreasonably withheld, delayed or conditioned), or (iv) as set forth on Section 6.1 of the Company Disclosure Schedule, the Company will, and will cause its Subsidiaries to, use its and their commercially reasonable efforts to (A) conduct their businesses in the ordinary course of business consistent with past practice, and (B) preserve intact in all material respects their respective assets, properties, business organizations and relationships and goodwill with partners, customers, clients, suppliers, distributors, licensors, licensees, employees, contractors and other Persons with which it has material business dealings.
(b) During the Pre-Closing Period, except (1) as expressly contemplated, required or permitted by this Agreement, (2) as required by applicable Law, (3) as approved in writing by Parent (such approval not to be unreasonably withheld, delayed or conditioned), or (4) as set forth on Section 6.1 of the Company Disclosure Schedule, the Company will not, and will cause its Subsidiaries not to:
(i) (x) adopt any change in the certificate of incorporation or bylaws of the Company or (y) adopt any change in the comparable organizational documents of any of the Company’s Subsidiaries;
(ii) (A) merge or consolidate the Company or any of its Subsidiaries with any other Person, or (B) restructure, reorganize, recapitalize or completely or partially liquidate or dissolve or otherwise enter into any agreement or arrangement imposing restrictions on the assets, operations or business of the Company or any of its Subsidiaries, other than recapitalization, liquidation or dissolution of any wholly owned Subsidiary of the Company that are immaterial to the Company and its Subsidiaries, taken as a whole, and to the extent such actions are not expected to be adverse to Parent (provided that this Section 6.1(b)(ii) shall not prevent the structuring of a transaction specifically permitted by Section 6.1(b)(xiii) in the form of a merger or consolidation (provided, further, that (x) the use of such structure is consistent with past practice and (y) the Company is not merging or consolidating with any other Person));
(iii) issue, sell, pledge, encumber, dispose of or grant, or authorize the issuance, sale, pledge, encumbrance, disposition or grant of, any shares of capital stock or other equity interests of the Company or any of its Subsidiaries, or securities convertible or exchangeable into or exercisable for any shares of such capital stock or other equity interests, or any options, warrants, restricted shares, restricted share units, performance share units, stock appreciation rights, phantom stock or other rights of any kind to acquire any shares of such capital stock or other equity interests or such convertible or exchangeable securities or the value of which is otherwise derived from any shares of such capital stock or other equity interests or such convertible or exchangeable securities (collectively, “Company Securities”), in each case, other than (A) any such transaction solely among the Company and its wholly-owned Subsidiaries or solely among the Company’s wholly-owned Subsidiaries, or (B) any grant or issuance of shares of Common Stock (1) in respect of any exercise of Company Options, (2) in respect of any exercise of Company Warrants, or (3) pursuant to vesting or settlement of any Company Restricted Shares, in each case, solely to the extent such Company Options, Company Warrants or Company Restricted Shares, as applicable, are outstanding as of the date of this Agreement or granted after the date hereof in accordance with this Agreement and solely in accordance with the terms of the underlying agreement pursuant to which such Company Options, Company Warrants, or Company Restricted Shares, as applicable, were issued and, in the case of Company Equity Awards, the applicable Company Equity Plan;
(iv) make any loans, advances or capital contributions to or investments in any Person (other than to the Company or any of its wholly-owned Subsidiaries), other than (A) any delayed collection of trade payables in the ordinary course of business consistent with past practice and (B) any such transaction solely among the Company and its wholly-owned Subsidiaries or solely among the Company’s wholly-owned Subsidiaries;
(v) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise with respect to any Company Securities, except for dividends or other distributions paid by any wholly-owned Subsidiary of the Company to the Company or to any other wholly-owned Subsidiary of the Company;
(vi) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any Company Securities except for (A) any such transaction solely among any of the Company’s wholly-owned Subsidiaries, or (B) acquisitions of shares of Common Stock in satisfaction of withholding obligations in respect of the settlement or exercise of Company Equity Awards that are outstanding as of the date of this Agreement or granted after the date hereof in accordance with this Agreement;
(vii) create, incur, assume or guarantee any Indebtedness or issue any debt securities or guarantees of the same or any other Indebtedness, except for borrowings in the ordinary course of business for working capital purposes under the Existing Credit Facility; guarantees or credit support provided by the Company or any of its Subsidiaries of the obligations of the Company or any of its Subsidiaries in the ordinary course of business consistent with past practice to the extent such Indebtedness is in existence on the date of this Agreement or incurred in compliance with clause (A) of this Section 6.1(b)(vii), and any Indebtedness solely among the Company and its wholly-owned Subsidiaries or solely among the Company’s wholly-owned Subsidiaries;
(viii) (A) enter into any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement, or (B) amend, modify or waive in any material respect in a manner adverse to the Company or any of its Subsidiaries or terminate any Material Contract (other than (x) amendments, modifications or waivers in the ordinary course of business consistent with past practice or (y) expirations of any such Contract in accordance with its terms);
(ix) make any material changes with respect to financial accounting policies or procedures, except as required by Law or by U.S. GAAP or official interpretations with respect thereto or by any Governmental Authority (including the Financial Accounting Standards Board or any similar organization);
(x) settle or compromise any Action, except for any settlement or comprise that (A) does not require payments from the Company or its Subsidiaries exceeding $50,000 individually (for any single claim or of related claims) or $100,000 in the aggregate (for all such settlements or compromises from and after the date hereof), after taking into account any insurance coverage amounts with respect thereto under the policies maintained by the Company or any of its Subsidiaries, and (B) does not (x) impose any non-de minimis restriction on the business or operations of the Company or any of its Subsidiaries (or any restriction on Parent or any of its Subsidiaries other than the Company and its Subsidiaries after the Closing) or (y) include any non-de minimis non-monetary or injunctive relief, or the admission of any wrongdoing, by the Company or any of its Subsidiaries or any of their respective employees, officers or directors;
(xi) assign, transfer, sell, lease, license, sublicense, encumber (other than Permitted Liens), abandon, permit to lapse, or otherwise surrender, relinquish or dispose of any material assets or property (including any material Owned IP) except transactions solely among the Company and its wholly-owned Subsidiaries or solely among the Company’s wholly-owned Subsidiaries; provided, that, for the avoidance of doubt, the loss of a customer or client in the ordinary course of business shall not be covered by this Section 6.1(b)(xi);
(xii) except for such actions (i) required by Benefit Plans in existence as of the date hereof, (ii) required by applicable laws, (iii) otherwise reasonably necessary to renew Benefits Plans in the ordinary course of business consistent with past practice (in a manner that does not materially increase benefits or result in a material increase in administrative costs except in either case from changes in costs in the market), or (iv) otherwise expressly contemplated by the terms of this Agreement: (A) increase the compensation or other benefits payable or provided to any Service Provider; (B) increase or accelerate or commit to increase or accelerate the funding, payment or vesting of any benefits provided under any Benefit Plan; (C) grant or promise to grant any cash or equity or equity-based incentive awards, bonus, change of control, severance or retention award to any Service Provider, (D) establish, adopt, enter into, terminate or materially amend any material Benefit Plan (including any Benefit Plans and arrangements described in Section 5.1(i)(iv)), or (E) terminate the employment of (other than for cause) or hire or promote any Service Provider that receives or would receive annual base compensation in excess of $150,000;
(xiii) acquire any business, assets or capital stock or other equity interests of any Person or division thereof, whether in whole or in part (and whether by purchase of stock, purchase of assets, merger, consolidation or otherwise), other than the acquisition of assets from vendors or suppliers of the Company or any of its Subsidiaries in the ordinary course of business;
(xiv) other than where such action is required by Law, (A) make (inconsistent with past practice), change or revoke any material Tax election; (B) change any annual Tax accounting period or material method of Tax accounting, (C) file any material amended Tax Return, (D) settle or compromise any material claim related to Taxes for an amount materially in excess of amounts reserved, (E) enter into any material closing agreement with respect to Taxes, (F) surrender any right to claim a material Tax refund for an amount materially in excess of amounts reserved, or (G) file any material Tax Return (except consistent with past practice) (it being agreed and understood that, notwithstanding any other provision, including Section 6.1(b)(ix) (insofar as it relates to Taxes), no other subsection of this Section 6.1(b) shall apply to Tax compliance matters);
(xv) other than in accordance with the Company’s capital expenditure budget set forth in Section 6.1(b)(xv) of the Company Disclosure Schedule, incur or commit to any capital expenditure or expenditures, except capital expenditures of less than $50,000 individually or $100,000 in the aggregate;
(xvi) implement or announce any employee layoffs, plant closings, reductions in force, furloughs, temporary layoffs, material salary or wage reductions, or material work schedule changes, other than individual employment terminations in the ordinary course of business;
(xvii) become a party to, establish, adopt, materially amend, commence participation in or terminate any collective bargaining agreement or other agreement with a labor union, works council or similar organization;
(xviii) apply for, seek or obtain any Company Permit that (A) would prevent, materially delay or materially impede the transactions contemplated hereby, or (B) would require Parent to make any filing or notice with or disclosure to any Governmental Authority;
(xix) terminate, cancel or allow to lapse any material insurance coverage maintained by the Company or any of its Subsidiaries without replacing such coverage with a comparable amount of insurance coverage, other than in the ordinary course of business;
(xx) enter into a new line of business or abandon or discontinue any existing line of business; or
(xxi) agree, authorize or commit to do any of the foregoing.
(c) Nothing contained in this Agreement is intended to give Parent or Merger Sub or any of their Affiliates, directly or indirectly, the right to control or direct the operations of the Company and its Subsidiaries prior to the Effective Time. Prior to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision shall exercise, consistent with the terms and conditions of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, complete control and shall cause each of supervision over its Significant Subsidiaries to, conduct and its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Subsidiaries’ respective operations.
Appears in 2 contracts
Sources: Merger Agreement (Streamline Health Solutions Inc.), Merger Agreement (Streamline Health Solutions Inc.)
Interim Operations. (a) Prior to From the Effective Timedate hereof until the Closing Date, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and :
(i) operate the Business in the ordinary course in substantially of business, consistent with past practice, and, to the same manner as heretofore conductedextent consistent with such operation, use commercially reasonable efforts to: (A) preserve the present business organization intact; and (B) preserve any beneficial business relationships with all customers, suppliers, and others having business dealings with the Business; and
(ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments maintain (other than to permit A) the consummation Purchased Assets in such condition and repair as is consistent with past practice, (B) insurance upon all of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver Purchased Assets and with respect to the Purchaser true conduct of the Business in full force and correct copies of any reporteffect, statement or schedule filed with the SEC subsequent comparable in amount, scope, and coverage to that in effect on the date of this Agreement, and apply all insurance proceeds from coverage of the Purchased Assets to restore such Purchased Assets or otherwise hold such proceeds for the Buyer's account, and (C) all Permits in full force and effect; and
(iii) conduct their respective advertising activities in a manner which is not materially inconsistent with the Company's advertising budget in effect as of the date of this Agreement.
(b) Except in connection with the Mergers and the other transactions contemplated by the Merger Agreement, from the date of this Agreement until the Closing Date, neither the Company nor any of its Subsidiaries shall take any of the following actions, to the extent that any such action relates to the Purchased Assets, the Assumed Liabilities or the Business:
(i) subject any of the Purchased Assets to any further material Encumbrance, other than Permitted Encumbrances and other than in the ordinary course of business, consistent with past practice;
(ii) transfer, sell or otherwise convey any part of the Purchased Assets or make any material acquisition of assets which would become part of the Purchased Assets, except in the ordinary course of business, consistent with past practice;
(iii) make any material Tax election or settle or compromise any material Tax liability without the Buyer's prior written approval, except in the ordinary course of business consistent with past practice (including, without limitation, with respect to the Transferred Subsidiaries);
(iv) grant, convey or sell any option or right to purchase or lease any of the Purchased Assets, except in the ordinary course of business, consistent with past practice;
(v) shall not (x) except pursuant pay or promise to pay, any bonus, profit-sharing or special compensation to the exercise Available Employees or make or promise to make any increase in the compensation, severance or other benefits payable or to become payable to any of optionssuch employees, warrantsexcept (A) as required by applicable Laws, conversion rights (B) to satisfy obligations under the terms of any agreement or Compensation and other contractual rights existing on the date hereof Benefit Plan or International Compensation and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares Benefit Plan in effect as of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (yC) grantfor increases in compensation that are made in the ordinary course of business consistent with past practice (which shall include normal periodic performance reviews and related compensation and benefit increases) and as set forth on Section 8.1(b)(v) of the Disclosure Letter, confer (D) in respect of Available Employees covered by collective bargaining agreements, as would be permitted under Section 8.1(b)(vii), and (E) for employment arrangements for or award grants of awards to, newly hired employees in the ordinary course of business consistent with past practice, and who are hired in accordance with clause (viii) below and (F) as set forth on Section 8.1(b)(v) of the Disclosure Letter;
(vi) except in the ordinary course of business consistent with past practice or as required by applicable Laws, enter into or terminate any optionmaterial Contract, warrantor amend, conversion right modify or make any change in, or waive any material benefit of, any of its material Contracts;
(vii) enter into any collective bargaining agreements covering employees of the Business, except for the contemplated actions described in Section 8.1(b)(vii) of the Disclosure Letter or as required by applicable Laws;
(viii) involuntarily separate from employment with the Company any employee of the Business without due cause or hire, without the prior written consent of Buyer which shall not be unreasonably withheld, any employee who would become an Available Employee and who would be entitled to an annual base salary greater than $100,000;
(ix) split, combine or reclassify any of the capital stock of the Transferred Subsidiaries or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of the capital stock of the Transferred Subsidiaries;
(x) with respect to the Business or Purchased Assets, incur any indebtedness for borrowed money or guarantee any such indebtedness of another Person, issue or sell any debt securities or warrants or other right not existing on rights to acquire any debt securities, or guarantee any debt securities of another Person, except for the date hereof endorsement of checks in the ordinary course of business and the extension of credit in the ordinary course of business, or make any loans, advances or capital contributions to, or investments in, any other Person, other than (A) to any Transferred Subsidiary or (B) advances to employees in the ordinary course of business consistent with past practice;
(xi) repurchase, redeem or otherwise acquire any shares of capital stock or other securities of, or other ownership interests in, any of the Transferred Subsidiaries;
(xii) issue, deliver or sell any shares of capital stock of any of the Transferred Subsidiaries, or any securities convertible into or exercisable or exchangeable for shares of capital stock of any of the Transferred Subsidiaries, or any rights, warrants or options to acquire any shares of its common stock of any of the Transferred Subsidiaries, other than (A) issuances pursuant to stock- based awards or options that are outstanding on the date hereof or are granted in accordance with the following clause (B), and (B) additional options or stock-based awards to acquire shares of capital stock, or (z) adopt stock of any A1-14of the Transferred Subsidiaries required to be granted under the terms of stock plans as in effect on the date hereof;
(bxiii) Prior to amend the Effective Time, except as set forth in certificate of incorporation or bylaws or other comparable organizational documents or amend any material terms of the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company outstanding securities of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).Transferred Subsidiaries;
Appears in 2 contracts
Sources: Asset Purchase Agreement (Church & Dwight Co Inc /De/), Asset Purchase Agreement (Carter Wallace Inc /De/)
Interim Operations. (a) Prior Each of the Company and Parent covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time (unless Parent or the Company, as applicable, shall otherwise approve in writing (which approval shall not be unreasonably withheld, conditioned or delayed)), and except as otherwise expressly contemplated by this Agreement, as provided in any Contract in effect as of the date of this Agreement, or as required by applicable Law, the business of it and its Subsidiaries shall be conducted in the Ordinary Course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective commercially reasonable efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, licensors, licensees, distributors, creditors, lessors, employees and business associates. Without limiting the generality of and in furtherance of the foregoing, from the date of this Agreement until the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Companyotherwise expressly: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedcontemplated by this Agreement; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by any Contract entered into prior to, concurrently with or after the date of this AgreementAgreement by Parent with respect to the Other Parent Transactions (as such Contract may be amended, supplemented or otherwise modified from time to time); (iii) shall promptly notify required by applicable Law or the Purchaser terms of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to Contract in effect on the date of this Agreement, (iv) as approved in writing (which approval shall not be unreasonably withheld, conditioned or delayed) by the other Party; or (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser corresponding subsection of Section 7.1 of the Company Disclosure Letter or Letter, as contemplated by this Agreement, unless it relates to the Company and its Subsidiaries, or on Section 7.1 of the Special Committee have consented in writing theretoParent Disclosure Letter, the Purchaser: as it relates to Parent and its Subsidiaries, each Party, on its own account, shall not and shall not permit its Subsidiaries to:
(i) shall make any material change to the nature of its business and operations;
(ii) make any change to its Organizational Documents as in effect on the date of this Agreement in any manner that would reasonably be expected to prohibit, prevent or materially impede, hinder or delay the ability of such Party to satisfy any of the conditions to, or the consummation of, the Merger or the other Transactions;
(iii) (A) merge or consolidate itself or any of its Subsidiaries with any other Person (expressly excluding, for the avoidance of doubt, any of the Other Parent Transactions), or (B) adopt a plan or agreement of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, in each case, except (1) such transactions solely between or among, or solely involving, such Party and one or more of its wholly owned Subsidiaries, or a Subsidiary of such Party and one or more wholly owned Subsidiaries of such Subsidiary, (2) as would not issue reasonably be expected to result in a Company Material Adverse Effect or Parent Material Adverse Effect, as applicable, or (3) as would not reasonably be expected to prohibit, prevent or materially impede, hinder or delay the ability of such Party to satisfy any of the conditions to, or the consummation of, the Merger or the other Transactions;
(iv) except as required by the Company Agreement, issue, sell, grant, transfer or authorize the issuance, sale or grant, or otherwise enter into any Contract with respect to the voting of, any of its partnership interests, limited liability company interests, shares of its capital stock at less than fair market value or equity interests, as applicable (other than pursuant the issuance of partnership interests, limited liability company interests, shares of capital stock or equity interests (A) by its wholly owned Subsidiary to any Purchaser Stock Plans) it or effect any stock split another of its capital stock; wholly owned Subsidiaries or (iiB) shall promptly notify in respect of equity-based awards outstanding as of the Company date of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to this Agreement in accordance with their terms and, as applicable, the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to plan documents as in effect on the date of this Agreement; and ), or securities convertible or exchangeable into or exercisable for any partnership interests, limited liability company interests, shares of capital stock or equity interests, as applicable, or any options, warrants or other rights of any kind to acquire any partnership interests, limited liability company interests, shares of capital stock or equity interests, as applicable, or such convertible or exchangeable securities;
(ivv) shall not declarereclassify, set aside split, combine, subdivide or pay redeem, purchase or otherwise acquire, directly or indirectly, any dividend of its partnership interests, limited liability company interests, shares of capital stock or equity interests, as applicable, or securities convertible or exchangeable into or exercisable for any partnership interests, limited liability company interests, shares of capital stock or equity interests, as applicable;
(vi) waive, release, assign, settle or compromise any claim, action or proceeding, including any state or federal regulatory proceeding seeking damages or injunction or other equitable relief, which waiver, release, assignment, settlement or compromise would reasonably be expected to result in a Company Material Adverse Effect or Parent Material Adverse Effect, as applicable;
(vii) other than in the Ordinary Course, make, change or revoke any material Tax election, adopt or change any material Tax accounting method, file any material amended Tax Return, settle any material Tax claim, audit, assessment or dispute for an amount materially in excess of the amount reserved or accrued on such Party’s most recent consolidated balance sheet included in the Parent Reports or Company Reports, as applicable, or surrender any right to claim a refund of a material amount of Taxes;
(viii) make any material changes with respect to accounting policies, except as required by changes in GAAP;
(ix) make or declare any dividends or distributions to the holders of Common Units or Parent Common Stock, in each case, other distribution than in the Ordinary Course; or
(x) agree, authorize or payment commit to do any of the foregoing.
(b) Notwithstanding anything to the contrary in this Agreement, a Party’s obligations under Section 7.1(a) to take an action or not to take an action, or to cause its Subsidiaries to take an action or not to take an action, shall, with respect to any shares Persons (and their respective Subsidiaries) controlled by such Party, or in which such Party otherwise has a voting interest, but that are not wholly owned Subsidiaries of such Party or have public equity holders, only apply (i) to the extent permitted by the organizational documents and governance arrangements of such entity and its subsidiaries, (ii) to the extent a Party is authorized and empowered to bind such entity and its subsidiaries and (iii) to the extent permitted by the Party’s or its Subsidiaries’ duties (fiduciary or otherwise) to such entity and its subsidiaries or any of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)equity holders.
Appears in 2 contracts
Sources: Merger Agreement (Enbridge Energy Management L L C), Merger Agreement (Enbridge Inc)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions otherwise expressly contemplated by this AgreementAgreement or as required by applicable Laws, without the prior written consent of Parent (which shall not be unreasonably withheld or delayed); (iii) , the business of the Company and its Subsidiaries shall promptly notify be conducted in the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver ordinary and usual course and, to the Purchaser true extent consistent therewith, it and correct copies its Subsidiaries shall use their respective reasonable efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of any reportits and its Subsidiaries’ present employees and agents. Without limiting the generality of the foregoing and in furtherance thereof, statement or schedule filed with the SEC subsequent to from the date of this Agreement; (v) shall not (x) except Agreement until the earlier of the termination of this Agreement pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, its terms or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except (A) as otherwise expressly required by this Agreement or required by Law, (B) as Parent may approve in writing (which approval shall not be unreasonably withheld or delayed) or (C) as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless Section 6.1 of the Company and the Special Committee have consented in writing theretoDisclosure Letter, the Purchaser: Company will not and will not permit its Subsidiaries to:
(i) shall not issue any (A) amend its certificate of incorporation, by-laws or other applicable governing instruments; (B) split, combine, subdivide or reclassify its outstanding shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (iiC) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make distribution payable in cash, stock or property in respect of any other distribution capital stock; or payment with respect to (D) repurchase, redeem or otherwise acquire any shares of its capital stock or other ownership interests any securities convertible into or exchangeable or exercisable for any shares of its capital stock (other than regular quarterly repurchases or redemptions of restricted stock or other equity awards upon termination of employment, in accordance with the terms of such awards);
(ii) merge or consolidate itself or any of its Subsidiaries with any other Person, except for any such transactions among its wholly-owned Subsidiaries, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) spend in excess of $6,500,000 individually or $10,000,000 in the aggregate to acquire any business, whether by merger, consolidation, purchase of property or assets or otherwise (valuing any non-cash dividends consideration at its fair market value as of the date of the agreement for such acquisition); provided that neither the Company nor any of its Subsidiaries shall make any acquisition that would, or would reasonably be likely to prevent, delay or impair the Company’s ability to consummate the transactions contemplated by this Agreement; and provided, further, that the Company must also comply with the requirements set forth in Section 6.1(a)(iii) of the Company Disclosure Letter. For purposes of this clause (iii), the amount spent with respect to any acquisition shall be deemed to include the aggregate amount of capital expenditures that the Company or any of its Subsidiaries is obligated to make at any time or plans to make as a result of such acquisition within two (2) years after the date of acquisition;
(iv) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any of its debt securities or of any of its Subsidiaries, except for (A) drawings under and refinancings or replacements of the Company’s or any of its Subsidiaries’ current credit agreements in an amount not to exceed $0.05 per share25,000,000 in the aggregate at any one time outstanding, provided that the terms of any such replacement must satisfy the requirements set forth in Section 6.1(a)(iv) of the Company Disclosure Letter, (B) other indebtedness for borrowed money incurred in the ordinary course of business consistent with past practices not to exceed $10,000,000 in the aggregate or (C) interest rate or currency swaps on customary commercial terms consistent with past practice and in compliance with its risk management policies in effect on the date of this Agreement and not to exceed $5,000,000 of notional debt in the aggregate;
(v) make or commit to any capital expenditures other than in the ordinary course of business and in any event not in excess of the aggregate amount reflected in the Company’s capital expenditure budget for the year in which such capital expenditures are made, a copy of which capital expenditure budget for 2010 and 2011 has been furnished to Parent;
(vi) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any of its assets, product lines or businesses or of its Subsidiaries, including capital stock of any of its Subsidiaries and sales of obsolete assets, except for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $10,000,000 in the aggregate, other than pursuant to Contracts in effect as of the date of this Agreement;
(vii) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of its capital stock or of any its Subsidiaries (other than the issuance of shares by a wholly-owned Subsidiary to it or another of its wholly-owned Subsidiaries), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities, other than (A) the issuance of Company Shares pursuant to existing Company Options, Company Warrants, and other Company Awards, and (B) the issuance of Company Options and Company Awards in amounts and at times consistent with the Company’s historic hiring and compensation practices and not in excess of the amount set forth on Section 6.1(a)(vii) of the Company Disclosure Letter;
(viii) make any change with respect to accounting policies or procedures, except as required by changes in GAAP or by Law;
(ix) except as required by Law, (A) make any material Tax election or take any position on any Tax Return filed on or after the date of this Agreement or adopt any method therefor that is inconsistent with elections made, positions taken or methods used in preparing or filing similar Tax Returns in prior periods, (B) settle or resolve any material Tax controversy, claim or assessment, (C) enter into any material closing agreement, (D) waive or extend any statute of limitations with respect to Taxes, or (E) surrender any right to claim a refund for Taxes;
(x) make any loans, advances or capital contributions to or investments in any Person (other than the Company or any direct or indirect wholly-owned Subsidiary of the Company) in excess of $1,000,000 individually or $2,000,000 in the aggregate;
(xi) enter into (A) any non-competition Contract or other Contract that (x) purports to limit in any material respect either the type of business in which the Company or its Subsidiaries (or, after the Effective Time, Parent or its Affiliates) may engage or the manner or locations in which any of them may so engage in any business or (y) could require the disposition of any material assets or line of business of the Company or its Subsidiaries or, after the Effective Time, Parent or its Affiliates, (B) any other Contract that would have been a Material Contract had it been entered into prior to the date hereof;
(xii) except as required pursuant to Contracts in effect as of the date of this Agreement and set forth in Section 6.1(a)(xii) of the Company Disclosure Letter, or as otherwise required by applicable Law, (A) grant or provide any severance or termination payments or benefits to any of its directors, officers or employees, (B) increase the compensation, bonus or pension, welfare, severance or other benefits of, pay any bonus to, or make any new equity awards to any of its directors, officers or employees, except, in each case, for increases or awards made in the ordinary course of business and at times and in amounts consistent with the Company’s historic hiring and compensation practices as described in Section 6.1(a)(xii) of the Company Disclosure Letter, (C) establish, adopt, amend or terminate any Company Compensation and Benefit Plan or amend the terms of any outstanding equity-based awards, (D) except as provided in Section 4.4(f), take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any Company Compensation and Benefit Plans, to the extent not already provided in any such Company Compensation and Benefit Plan, (E) change any actuarial or other assumptions used to calculate funding obligations with respect to any Company Compensation and Benefit Plan or change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, or (F) forgive any loans to any of its or of any of its Subsidiaries’ directors, officers or employees;
(xiii) amend, modify or terminate any Material Contract (excluding customer or supplier contracts entered into in the ordinary course of business), or cancel, modify or waive any debts or claims held by it or waive any rights other than in the ordinary course of business having a value in excess of $1,000,000 in the aggregate;
(xiv) take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Merger set forth in Article VII not being satisfied, including the acquisition of any business or assets reasonably likely to have such an effect;
(xv) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity if such settlements would exceed $1,000,000 in the aggregate; or
(xvi) agree, authorize or commit to do any of the foregoing.
(b) After the date hereof and until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, Parent will not and will not permit its Subsidiaries knowingly to take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Merger set forth in Article VII not being satisfied, including the acquisition of any business or assets reasonably likely to have such an effect. Notwithstanding the foregoing and for the avoidance of doubt, the foregoing shall not apply to any pending or planned (i) strategic engagement or investment, (ii) joint venture, (iii) acquisition or (iv) other similar transactions, that in the case of any transaction described in any of clauses (i) through (iv) of this Section 6.1(b), has been publicly announced prior to the execution of this Agreement.
Appears in 2 contracts
Sources: Merger Agreement (Verifone Systems, Inc.), Merger Agreement (Hypercom Corp)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, from and after the date of this Agreement and prior to the Effective Time, except (A) as required by applicable Law, (B) as otherwise contemplated, required or permitted by this Agreement, (C) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed) or (D) as set forth in Section 7.1 of the Company Disclosure Letter or as contemplated by any other provision Letter, from the date of this Agreement, unless Agreement and prior to the Purchaser has consented in writing theretoEffective Time, the Company: business of the Company and its Subsidiaries shall be conducted in the ordinary course of business in all material respects consistent with past practice and it and its Subsidiaries shall use their respective commercially reasonable efforts to (i) shallpreserve their business organizations intact, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); maintain existing relations with Governmental Entities, customers and suppliers, including Parent, (iii) shall notify Parent promptly notify the Purchaser (x) after receipt of any breach material communication from any Governmental Entity or inspections of any representation manufacturing, research and development or warranty contained herein clinical trial site and before giving any material submission to a Governmental Entity and (y) prior to making any material change to a study protocol, adding new trials, making any material change to a manufacturing plan or process, or making a material change to the development timeline for any Company Material Adverse Effect; of its product candidates or programs, (iv) shall promptly deliver preserve intact and keep available the services of present employees, consultants, independent contractors and executive officers of the Company and its Subsidiaries, (v) keep in effect casualty, product liability, workers’ compensation and other insurance policies in coverage amounts substantially similar to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to those in effect at the date of this Agreement; , (vvi) shall not preserve and protect all Registered Intellectual Property listed in the Orange Book with respect to Dificid (xfidaxomicin), and (vii) preserve and protect the material Intellectual Property (other than the Registered Intellectual Property listed in the Orange Book) owned by the Company and its Subsidiaries, except pursuant to in the exercise case of optionsclause (vii) in the ordinary course of business. Without limiting the generality of, warrantsand in furtherance of, conversion rights and other contractual rights existing on the foregoing, from the date hereof and disclosed pursuant to of this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to Agreement until the Effective Time, except (A) as set forth in the Purchaser Disclosure Letter required by applicable Law, (B) as otherwise required or as contemplated expressly permitted by this Agreement, unless the Company and the Special Committee have consented (C) as Parent may approve in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends such approval not to exceed $0.05 per share).be unreasonably withheld, conditioned or delayed) or
Appears in 2 contracts
Sources: Merger Agreement (Optimer Pharmaceuticals Inc), Merger Agreement (Cubist Pharmaceuticals Inc)
Interim Operations. (a) Prior Each of the Company and EFIH covenants and agrees as to itself and each of its Subsidiaries (other than the Oncor Entities and other than with respect to any entities, assets or liabilities to be contributed to Reorganized TCEH in the Reorganized TCEH Contributions or pursuant to the Plan of Reorganization) that, except (i) as otherwise specifically permitted or required by the provisions of this Agreement and the Plan of Reorganization, and any action reasonably necessary to effectuate the Reorganized TCEH Spin-Off, the Reorganized TCEH Contributions, the Preferred Stock Sale and the Reorganized TCEH Conversion, (ii) as Parent may approve in writing (such approval, not to be unreasonably withheld, delayed or conditioned), (iii) as is required by any applicable Law or any Governmental Entity; provided that, to the extent legally permissible, the Company or EFIH shall provide prompt written notice to Parent of any such requirement; (iv) as set forth in Section 6.1(a) of the Company Disclosure Letter, or (v) as required by the Bankruptcy Court in the Chapter 11 Cases without any of the Debtors having requested or applied (or having requested that any of their respective Affiliates make such request or application) for the Bankruptcy Court to impose such requirement (and with the Company and EFIH, to the extent requested by Parent prior to such imposition, having used commercially reasonable efforts to challenge such imposition before the Bankruptcy Court), in each case after the date hereof and prior to the earlier of the Termination Date (as defined below) and the Effective Time, except as set forth in each of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) and EFIH shall, and shall cause each of its Significant their respective Subsidiaries (other than the Oncor Entities and other than with respect to any entities, assets or liabilities to be contributed to Reorganized TCEH in the Reorganized TCEH Contributions or the Plan of Reorganization) to, conduct its operations according business and the Chapter 11 Cases in accordance with the Bankruptcy Code and the orders of the Bankruptcy Court and use its reasonable best efforts to preserve its business organizations intact, and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, employees and business associates. Notwithstanding the foregoing, from the date of this Agreement until the earlier of the Termination Date and the Effective Time, except (A) as otherwise specifically permitted or required by the provisions of this Agreement and the Plan of Reorganization, and any action reasonably necessary to effectuate the Reorganized TCEH Spin-Off, the Reorganized TCEH Contributions, the Preferred Stock Sale and the Reorganized TCEH Conversion, (B) as Parent may approve in writing (such approval, not to be unreasonably withheld, delayed or conditioned), (C) as is required by any applicable Law or any Governmental Entity, (D) as set forth in Section 6.1(a) of the Company Disclosure Letter or (E) as required by the Bankruptcy Court in the Chapter 11 Cases without any of the Debtors having requested or applied (or having requested that any of their usualrespective Affiliates make such request or application) for the Bankruptcy Court to impose such requirement (and with the Company and EFIH, regular to the extent requested by Parent prior to such imposition, having used commercially reasonable efforts to challenge such imposition before the Bankruptcy Court), each of the Company and ordinary course EFIH will not and will not permit any of its respective Subsidiaries (other than the Oncor Entities and other than with respect to any asset, liability or entity to be contributed to Reorganized TCEH in substantially the same manner as heretofore conducted; Reorganized TCEH Contributions or pursuant to the Plan of Reorganization) to:
(i) adopt any change in its certificate of incorporation, bylaws, limited liability company agreement or other applicable governing instruments;
(ii) shall not amend merge or consolidate with any other Person;
(iii) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization other than the Plan of Reorganization;
(iv) make any acquisition of any assets or Person for a purchase price individually or in the aggregate in excess of $10,000,000;
(v) issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of any shares of its Certificate of Incorporation capital stock or Bylaws or comparable governing instruments other equity interests (other than (A) the issuance of shares of EFH Common Stock upon the settlement of awards under the Company Stock Plans (and dividend equivalents thereon, if applicable), (B) the issuance of equity interests by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary of the Company, or (C) pursuant to the modification, replacement, refunding, renewal, extension or refinancing of EFIH’s first lien debtor-in-possession financing facility or the modification, replacement, refunding, renewal, extension or refinancing thereof (provided that any modification, replacement, refunding, renewal, extension or refinancing shall not be for an amount greater than the then current outstanding principal amount thereof except by an amount equal to the unpaid accrued interest and premium thereon plus the reasonable amounts paid in respect of fees and expenses incurred in connection with such modification, replacement, refunding, renewal, extension or refinancing), or, securities convertible or exchangeable into or exercisable for any shares of such capital stock or other equity interests, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or other equity interests or such convertible or exchangeable securities;
(vi) make any loans, advances or capital contributions to, or investments in, any Person (other than in or to the Company or any direct or indirect wholly owned Subsidiary of the Company) individually or in the aggregate in excess of $10,000,000;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock or other equity interests (except for dividends paid by any direct or indirect wholly owned Subsidiary to the Company or to any other direct or indirect wholly owned Subsidiary of the Company) or enter into any agreement with respect to the voting of its capital stock or other equity interests or take any action that would result in the Company or any of its Subsidiaries becoming subject to any restriction not in existence on the date hereof with respect to the payment of distributions or dividends;
(viii) reclassify, split, combine or subdivide, directly or indirectly, any of its capital stock, equity interests or securities convertible or exchangeable into or exercisable for any shares of its capital stock or equity interests;
(ix) repurchase, redeem or otherwise acquire, or offer to repurchase, redeem or otherwise acquire, any of its capital stock or equity interests or any securities of convertible into or exchangeable or exercisable for capital stock or equity interests, or any warrants, calls, options or other rights to acquire any such capital stock, securities or interests;
(x) repurchase, redeem, defease, cancel, prepay, forgive, issue, sell, incur or otherwise acquire any indebtedness for borrowed money or any debt securities or rights to acquire debt securities, of the Company or any of its Subsidiaries other than pursuant to the Plan of Reorganization, or assume, guarantee or otherwise become responsible for such indebtedness of another Person (other than a wholly owned Subsidiary of the Company), except for indebtedness for borrowed money (A) incurred or repaid under EFIH’s first lien debtor-in-possession financing facility or the modification, replacement, refunding, renewal, extension, repayment or refinancing (subject to clause (v) above) thereof, in each case, to the extent approved by the Bankruptcy Court in the Chapter 11 Cases, or (B) incurred by drawing under outstanding letters of credit;
(xi) (A) grant to any Employee or any member of the board of directors (or similar governing body) or consultant any increase in compensation or benefits other than increases in the ordinary course of business, (B) grant to any Employee or any member of the board of directors (or similar governing body) or consultant any increase in change in control, severance or termination pay, (C) amend in any material respect or terminate any Assumed Plan or the EFH Retirement Plan or related agreement thereunder or establish, adopt, enter into any plan or related agreement that would be a Benefit Plan if in existence on the date hereof and, in the case of a Contributed Plan, other than in the ordinary course of business, or with respect to any actions taken to terminate and wind-down any Discharged Plan or as otherwise required under the terms of this Agreement, (D) take any action to accelerate the time of vesting, funding or payment of any compensation or benefits under any Assumed Plan or EFH Retirement Plan or related agreement thereunder (or any plan or related agreement that would be an Assumed Plan if in existence on the date hereof); provided that with respect to the EFH Retirement Plan, such actions may be taken between the date hereof and the effective date of the Split Participant Agreement that are consistent with that certain Separation Agreement between TXU Corporation and Oncor Holdings dated October 10, 2007, and provided further that with respect to the Discharged Plans, such actions may be taken that are in furtherance of the confirmation of a plan of reorganization or the termination and wind-down of such Discharged Plans, (E) grant any new awards, or any outstanding awards, under any Assumed Plan or related agreement thereunder (or any plan or related agreement that would be an Assumed Plan if in existence on the date hereof), or (F) enter into or amend any collective bargaining agreement or other agreement with a labor union, works council or similar organization, except in the case of the foregoing clauses (A) through (F) for actions required pursuant to the terms of any Benefit Plan, or in accordance with the terms and conditions of this Agreement or applicable Law; provided, however, that following the date of this Agreement, the Company and EFIH may, and may permit any of their respective Subsidiaries to, hire any individual or engage any individual, as an interim employee through a third party staffing agency or as an independent contractor or consultant, with such engagements to end in all instances prior to the Closing Date, to the extent reasonably necessary for the Company’s operations between the TCEH Effective Date and the Closing, and may, notwithstanding anything contained in this Agreement to the contrary, provide compensation and benefits that, for all such persons as a group, (i) does not exceed $15,000,000 in the aggregate in any annual period and (ii) does not impose any liability on the reorganized Company and its Subsidiaries following the Closing;
(xii) make or authorize any capital expenditure in an amount in excess of $1,000,000, in the aggregate, during any 12 month period;
(xiii) make any material changes with respect to its financial accounting methods, principles, policies, practices or procedures, except as required by Law or by changes in GAAP;
(xiv) make (excluding any elections made (a) in the ordinary course of business or (b) under Section 168(k) of the Code) or change any material Tax election, change any material method of Tax accounting, settle or compromise any material Tax liability, claim or assessment or agree to an extension or waiver of the limitation period to any material Tax claim or assessment, grant any power of attorney with respect to material Taxes, enter into any closing agreement with respect to any material Tax or refund, amend any material Tax Return, or surrender any right to claim a material Tax Refund of the Company or any of its Subsidiaries, in each case, other than with respect to any such actions agreed to in connection with any audit or other Tax proceedings disclosed in Section 6.1(a)(xiv) of the Company Disclosure Letter; provided, however, that the full details of any such actions shall be disclosed to Parent if such actions would result in the inclusion of any material item of income in, or the exclusion of any material item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date which taxable income was realized (and reflects economic income arising) prior to the Closing Date;
(xv) waive, release, assign, settle or compromise any pending or threatened claim, action, suit or proceeding against the Company or any of its Subsidiaries other than settlements or compromises (A) that would result in the payment by the Company and its Subsidiaries of less than $10,000,000 in the aggregate, and (B) that do not entail the acceptance or imposition of any material restrictions on the business or operations of the Company or its Subsidiaries;
(xvi) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets, product lines or businesses of the Company or its Subsidiaries with a fair market value in excess of $10,000,000 in the aggregate for all such actions, other than (A) sales of obsolete goods or equipment, or (B) cancellation of, abandonment of, allowing to lapse or expire, or the licensing or sublicensing of, material Intellectual Property, in each of (A) and (B) , in the ordinary course of business consistent with past practice or in accordance with the Bankruptcy Code or the orders of the Bankruptcy Court; provided, however, that in no event shall the Company or any of its Subsidiaries (other than the Oncor Entities) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any capital stock or other equity interests of any of their respective Subsidiaries other than in connection with the modification, replacement, refunding, renewal, extension or refinancing (subject to clause (v) above) of EFIH’s first lien debtor-in-possession financing facility;
(xvii) except as permitted by clause (v)(C) above, enter into, terminate (other than at the end of a term), renew or materially extend or amend any Company Material Contract or Contract (other than the Interim TSA (as such is defined in the Separation Agreement) that, if in effect on the date hereof, would be a Company Material Contract; or waive any material default under, or release, settle or compromise any material claim against the Company or any of its Subsidiaries or liability or obligation owing to the Company or any of its Subsidiaries, under any Company Material Contract or Contract (other than the Interim TSA)) that, if in effect on the date hereof, would be a Company Material Contract, other than pursuant to the Plan of Reorganization;
(xviii) enter into any Contract that contains a change of control or similar provision that would require a payment to any Person counterparty thereto in connection with the consummation of the transactions contemplated by this Agreement)Agreement that would not otherwise be due;
(xix) fail to maintain in full force and effect material insurance policies covering the Company and its Subsidiaries (other than the Oncor Entities) and their respective properties, assets and businesses in a form and amount consistent with past practice; or
(iiixx) shall promptly notify agree, authorize or commit to do any of the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14foregoing.
(b) Prior Notwithstanding anything in Section 6.1(a) to the Effective Timecontrary, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and its Subsidiaries may take commercially reasonable actions consistent with prudent industry practices that would otherwise be prohibited pursuant to Section 6.1(a) in order to prevent the Special Committee have consented in writing theretooccurrence of, or mitigate the Purchaser: (i) existence of, an emergency situation involving endangerment of life, human health, safety or the Environment or the protection of equipment or other assets; provided, however, that the Company shall not issue provide Parent with notice of such emergency situation and any shares such action taken by the Company or any of its capital stock at less than fair market value Subsidiaries (other than pursuant to any Purchaser Stock Plansthe Oncor Entities) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).as soon as rea
Appears in 2 contracts
Sources: Merger Agreement (Nextera Energy Inc), Merger Agreement (Energy Future Intermediate Holding CO LLC)
Interim Operations. (a) Prior Except (i) as required by Applicable Law, (ii) as otherwise expressly contemplated by this Agreement, (iii) as contemplated by the Conversion Agreement or the Conversion, (iv) as required by any Organizational Documents of such entities or (v) as consented to in writing by the Sponsor Parties (which consent shall not be unreasonably withheld, delayed or conditioned), during the period from the date of this Agreement until the earlier of the Effective TimeTime or the termination hereof, each CLMT Entity shall (A) conduct its business in the ordinary course of business consistent with past practice, (B) use commercially reasonable efforts to maintain and preserve intact its business organization and the goodwill of those having business relationships with it, (C) use commercially reasonable efforts to keep in full force and effect all material Permits and all material insurance policies maintained by the CLMT Entities, other than changes to such policies made in the ordinary course of business, and (D) use commercially reasonable efforts to comply in all material respects with all applicable Laws.
(b) Without limiting the generality of the foregoing, during the period from the date of this Agreement until the earlier of the Effective Time and the termination hereof, except (A) as required by Applicable Law, (B) as otherwise expressly contemplated by this Agreement or the other Transaction Documents or (C) as set forth in Schedule 6.01(b), none of the Company Disclosure Letter CLMT Entities shall, without the prior written consent of the Sponsor Parties (which consent will not be unreasonably withheld, delayed or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: conditioned):
(i) shall, and shall cause each adopt or propose any change to any of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course Organizational Documents as in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to effect on the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14;
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify other than the Company grant of any breach awards under the LTIP or issuances of any representation CLMT Common Units upon vesting or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to settlement of awards under the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to LTIP that are outstanding on the date of this Agreement; and Agreement or otherwise granted in compliance with this Agreement in the ordinary course of business consistent with past practices, issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any equity securities of the CLMT Entities, or securities convertible or exchangeable into or exercisable for any shares of such equity securities, or any options, warrants or other rights of any kind to acquire any equity securities or such convertible or exchangeable securities or interests;
(iii) split, combine or reclassify any of its equity securities or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for its equity securities;
(iv) shall not declare, set aside or pay any dividend distributions in respect of any of their equity securities or split, combine or reclassify any of their equity securities, other than (A) cash distributions by any Subsidiary of CLMT to CLMT or another Subsidiary of CLMT in the ordinary course of business or (B) cash distributions to their respective equity holders required under their respective Organizational Documents;
(v) settle, propose to settle or compromise any action before a Governmental Authority if such settlement, proposed settlement or compromise (A) with respect to the payment of monetary damages, involves the payment of monetary damages that exceed $1,000,000 in the aggregate (together with all other settlements or compromises after the date of this Agreement), net of any amounts covered by insurance that the CLMT Entities expect to be promptly paid by the applicable insurer, (B) that imposes any material equitable or non-monetary relief, penalty or restriction on any CLMT Entity or (C) that would reasonably be expected to affect the rights or defenses available to any CLMT Entity in any related or similar claims that, individually or in the aggregate, are material to the CLMT Entities, taken as a whole;
(vi) recommend, propose, announce, adopt or vote to adopt a plan of complete or partial dissolution or liquidation, in each case, that would (A) prevent or materially impede or delay the ability of the Parties to satisfy any of the conditions to, or the consummation of, the transactions set forth in this Agreement or (B) adversely affect in a material way the rights of holders of the securities of any CLMT Entity;
(vii) except otherwise permitted under Section 6.01(b)(ix)(x), make any acquisition of any other Person, business or asset or make any loans, advances or capital contributions to, or investments in, any other distribution Person with a value (including assumed debt, which term, for the avoidance of doubt, excludes any asset retirement obligations) in excess of $5,000,000 in the aggregate;
(viii) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel or payment abandon or otherwise dispose of any of the CLMT Entities’ material assets, product lines or businesses, including any equity interests of any of the CLMT Entities, except (A) in connection with goods or services provided in the ordinary course of business and sales of obsolete assets, or (B) for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $1,000,000 in the aggregate;
(ix) except for (x) transactions solely between or among the Sponsor Parties and/or the CLMT Entities that will not result in any obligation or liability to any party other than the Sponsor Parties and/or the CLMT Entities, and (y) borrowings or loans permitted under the credit facilities of the CLMT Entities existing as of the date hereof, (A) incur, assume or guarantee any indebtedness for borrowed money, (B) issue, assume or guarantee any debt securities, (C) grant any option, warrant or right to purchase any debt securities, or (D) issue any securities convertible into or exchangeable for any debt securities of others, other than any such actions contemplated in (A) through (D), as would not, taken together, result in the incurrence or guarantee of indebtedness or issuance of debt securities with a value in excess of $1,000,000 in the aggregate;
(x) make any change to any of their accounting policies or procedures, except as required by changes after the date hereof in accordance with GAAP;
(xi) (A) change any material method of Tax accounting, (B) make, change or revoke any material Tax election, (C) settle or compromise any material liability for Taxes, (D) file any materially amended Tax Return, (E) enter into any written agreement with any Governmental Authority with respect to any shares material amount of its capital stock Taxes, (F) surrender any right to claim a refund for any material amount of Taxes, or (G) consent to an extension of the statute of limitations applicable to any material Tax claim or assessment; or
(xii) agree, authorize or commit to do any of the foregoing.
(c) From the date of this Agreement until the Closing Date, each of CLMT Entities and Sponsor Parties shall promptly notify the other ownership interests Parties in writing of (other than regular quarterly cash dividends i) any event, condition or circumstance that could reasonably be expected to result in any of the conditions set forth in Article V not being satisfied at the Effective Time, and (ii) any material breach by the notifying Party of any covenant, obligation or agreement contained in this Agreement; provided, however, that the delivery of any notice pursuant to exceed $0.05 per share)this Section 6.01(c) shall not limit or otherwise affect the remedies available hereunder to the notified Party.
Appears in 2 contracts
Sources: Partnership Restructuring Agreement (Calumet Specialty Products Partners, L.P.), Partnership Restructuring Agreement (Calumet Specialty Products Partners, L.P.)
Interim Operations. Except for matters (aw) Prior to the Effective Time, except as set forth in Schedule 5.01, (x) expressly agreed to in writing by Buyer (or, prior to the Company Disclosure Letter Joinder Date, the Administrative Agent acting at the direction of the Required Lenders) (such consent not to be unreasonably withheld, conditioned or as delayed), (y) ordered by the Bankruptcy Court or (z) otherwise contemplated by any other provision the terms of this Agreement, unless during the Purchaser has consented Interim Period, Seller shall operate the Assets in writing theretoall material respects in the ordinary course in a manner substantially consistent with past practice and shall use its best efforts to preserve the value, use, ownership and operation of the Assets, taken as a whole. In addition, except as (a) set forth in Schedule 5.01, (b) ordered by the Bankruptcy Court or (c) otherwise contemplated by the terms of this Agreement, Seller shall not do (or permit any Purchased Entity to do) any of the following in connection with the Assets without the prior written consent of Buyer (or, prior to the Joinder Date, the Company: Administrative Agent acting at the direction of the Required Lenders):
(a) subject any of the Assets (or any asset of any Purchased Entity) to any Lien (other than Assumed Encumbrances);
(b) sell, lease, license, pledge, cancel, abandon, permit to lapse or otherwise dispose of any Asset (or any asset of any Purchased Entity), except sales of Hydrocarbons in the ordinary course of business and as contemplated by Section 5.15;
(c) (i) shallterminate or extend, and shall cause waive, modify, rescind or make any material amendments to any Assigned Contract or waive, release or assign any material rights or claims thereunder, in each case outside of its Significant Subsidiaries to, conduct its operations according to their usual, regular and the ordinary course in substantially the same manner as heretofore conducted; of business, (ii) shall not amend its Certificate make any assignment to BOEM/BSEE or any other Governmental Authority or Person of Incorporation any indemnification, contribution or Bylaws other similar right to payment or comparable governing instruments (other than reimbursement from third parties with respect to permit the consummation of the transactions contemplated by this Agreement); any Liabilities relating to decommissioning or plugging and abandonment or (iii) shall promptly notify take any action that would reasonably be expected to have a material adverse effect on the Purchaser expected benefits to Buyer from any Assigned Contract;
(d) initiate, settle or compromise any material action, suit, litigation or other proceeding involving the Assets (or any asset of any breach Purchased Entity), other than with respect to trade claims;
(e) alter, whether through a complete or partial liquidation, dissolution, merger, consolidation, restructuring, reorganization or in any other manner, the legal structure or ownership of itself, any Purchased Entity or any joint venture or similar arrangement to which Seller or any Purchased Entity is a party which is an Asset (or an asset of any representation Purchased Entity) hereunder;
(f) voluntarily incur any Assumed Obligations, except in the ordinary course of business, or warranty contained herein make or agree to make any capital expenditures with respect to the Assets (or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies asset of any reportPurchased Entity), statement or schedule filed with the SEC subsequent other than capital expenditures as may be required pursuant to any Contract obligations as of the date of this Agreement; hereof;
(vg) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereofequity interest, (y) grant, confer or award any option, warrant, conversion subscription, call, exchange right or other right not existing on the date hereof to acquire purchase equity of any shares of its capital stockPurchased Entity, or (z) adopt issue any A1-14obligations convertible into or exchangeable for equity in any Purchased Entity; or
(bh) Prior to the Effective Timeagree, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented whether in writing theretoor otherwise, to do any of the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)foregoing.
Appears in 2 contracts
Sources: Asset Purchase Agreement, Asset Purchase Agreement (Atp Oil & Gas Corp)
Interim Operations. (a) Prior ICE and NYBOT each covenants and agrees as to the Effective Timeitself and its Subsidiaries that, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on after the date hereof and disclosed pursuant to until the earlier of the Effective Time or the termination of this AgreementAgreement in accordance with its terms (unless ICE (in the case of NYBOT) or NYBOT (in the case of ICE) shall otherwise approve in writing, or pursuant and except as otherwise expressly contemplated by this Agreement or, in the case of NYBOT, except as otherwise set forth in Section 6.1 of the NYBOT Disclosure Letter or, in the case of ICE, except as otherwise set forth in Section 6.1 of the ICE Disclosure Letter):
(a) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practice and, to the Recapitalization issue any shares extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with all Governmental Entities, Self-Regulatory Organizations, providers of its capital stockorder flow, effect any stock split or otherwise change its capitalization customers, suppliers, distributors, creditors, lessors, Employees, business associates, Members and stockholders, as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14appropriate;
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) it shall not declare, set aside or pay any dividend type of dividend, whether payable in cash, stock or property, in respect of any Membership Interests or capital stock, as appropriate, other than, in the case of ICE, dividends payable by direct or indirect wholly owned Subsidiaries of ICE to ICE or other direct or indirect wholly owned Subsidiaries of ICE and, in the case of NYBOT, dividends payable by direct or indirect wholly owned Subsidiaries of NYBOT to NYBOT or other direct or indirect wholly owned Subsidiaries of NYBOT; Table of Contents
(c) in the case of NYBOT, neither it nor its Subsidiaries shall:
(i) issue any new Membership Interests, other membership interests, capital stock or any securities convertible into or exchangeable or exercisable for any membership interests or shares of capital stock, Trading Rights, other trading permits or trading rights, or any lease rights;
(ii) sell, pledge, dispose of or encumber, split, combine or reclassify, or repurchase, redeem or acquire any outstanding Membership Interests, other membership interests, capital stock or any securities convertible into or exchangeable or exercisable for any membership interests or shares of capital stock, Permits, Trading Rights, other trading permits or trading rights, or any lease rights;
(iii) make any structural changes to NYBOT Clearing Corporation, agree to (other distribution than in the ordinary course of business) list or payment clear any additional products or markets, change its risk policies or reduce its guaranty fund, liquidity or credit resources;
(iv) except as required by applicable Law or as set forth on Section 6.1(c)(iv) of the NYBOT Disclosure Letter, (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any NYBOT Benefit Plan, as the case may be, or any other arrangement that would be a NYBOT Benefit Plan if in effect on the date hereof, or (B) increase the salary, wage, bonus, pension, welfare, severance or other compensation of any employees or fringe benefits of any director, officer or employee or enter into any contract, agreement, commitment or arrangement to do any of the foregoing, except increases occurring in the ordinary and usual course of business consistent with past practice, or (C) provide for the grant of any stock option, restricted stock, restricted stock unit or other equity-related award, or (D) pay any change of control or severance benefits to any NYBOT director or Employee in connection with the Merger, or grant or provide for any severance, change in control or termination payments or benefits to any director, officer or employee of NYBOT or any of its Subsidiaries, or (E) take any action to accelerate the vesting or payment, or fund or in any way secure the payment, of compensation or benefits under any NYBOT Benefit Plan, to the extent not already provided in the any such NYBOT Benefit Plan, or (F) change any actuarial or other assumptions used to calculate funding obligations with respect to the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, or (G) establish, adopt, enter into or amend any shares collective bargaining agreement or (H) terminate any officer, other than for cause, in which case NYBOT shall promptly notify ICE of such termination;
(v) except in the ordinary and usual course of business consistent with past practice, settle or compromise any material claims or litigation or modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vi) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other material property or assets (including membership interests or capital stock of any of its Subsidiaries);
(vii) incur additional material indebtedness or other ownership interests liability or modify any material indebtedness or other liability or modify any material indebtedness or other liability other than in the ordinary course of business;
(viii) make or authorize or commit to any capital expenditures (other than regular quarterly cash dividends under its current business plan as disclosed to ICE prior to the date of this Agreement), acquisitions or other types of non-ordinary-course transactions;
(ix) except for a platform license and service agreement with ICE, which shall provide that ICE shall license ICE’s electronic trading platform to NYBOT for a minimum period of 18 months from and after the date of this Agreement and that the costs of operation shall not to exceed $0.05 3 million per shareyear, and which shall contain such other commercially reasonable terms as mutually agreed by ICE and NYBOT as soon as reasonably practicable after the date of this Agreement (and in any event within 45 days after the date of this Agreement) (the “Platform License Agreement”), enter into any agreement to trade any products on an Table of Contents electronic trading platform or that would restrict NYBOT’s or its Subsidiaries’ ability to trade any product on an electronic trading platform; provided, however, if ICE and NYBOT are not able to reach agreement on the terms of the Platform License Agreement in accordance with the foregoing, NYBOT may, at its own expense, license an electronic trading platform from an alternate system vendor, provided that (A) such license agreement is terminable by NYBOT as of the Closing and (B) all costs associated with such license agreement from and after the Closing shall be deducted from the calculation of the Closing Cash Amount;
(x) change any material Tax election, change any material method of Tax accounting, file any materially amended Tax Return, or settle or compromise any material audit or proceeding relating to Taxes or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business;
(xi) permit any change in its credit practices or accounting principles, policies or practice (including any of its practices with respect to accounts receivable or accounts payable), except to the extent that any such changes in accounting principles, policies or practices shall be required by changes in GAAP;
(xii) enter into any “non-compete” or similar Contract that would restrict the business of the Surviving Corporation or any of its Affiliates following the Effective Time;
(xiii) except as permitted pursuant to Section 6.1(c)(iv) of the NYBOT Disclosure Letter, enter into any Contract between itself, on the one hand, or any of its Affiliates, employees, officers or directors, on the other hand;
(xiv) (A) amend or modify any of the NYBOT Organizational Documents or the NYBOT Subsidiary Organizational Documents, except for rule amendments or modifications that are consistent with past practice, that are not material and that would not become Core Rights (as defined in the Bylaws) or (B) file with the CFTC any notice of such amendment or modification unless it shall simultaneously provide a written copy of such application to ICE; and
(xv) neither NYBOT nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing set forth in Sections 6.1(c)(i) – (xiv) if NYBOT would be prohibited by the terms of Sections 6.1(c)(i) – (xiv) from doing the foregoing. Notwithstanding anything to the contrary in this Agreement, ICE shall have the right to agree to and to consummate any acquisitions of another Person, including by agreeing to issue equity interests in ICE to such Person.
(d) In the case of NYBOT, it shall, and shall cause its Subsidiaries to, preserve their respective existing regulatory status in all jurisdictions, and shall not make any material change to their respective regulatory status in any jurisdiction.
(e) Prior to making any written or oral communications to the directors, officers or employees of NYBOT or any of its Subsidiaries pertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement, NYBOT shall provide ICE with a copy of the intended communication, ICE shall have a reasonable period of time to review and comment on the communication, and ICE and NYBOT shall cooperate in providing any such mutually agreeable communication
Appears in 2 contracts
Sources: Merger Agreement (Intercontinentalexchange Inc), Merger Agreement (Intercontinentalexchange Inc)
Interim Operations. (a) Prior Unless theglobe otherwise agrees in writing and except as otherwise expressly contemplated by this Agreement, between the date of this Agreement and the Closing, the Company shall, and the Sellers shall cause the Company and the Subsidiary to, (i) conduct the business of the Company and the Subsidiary only in the ordinary course and consistent with past practice; (ii) use reasonable best efforts to preserve and maintain their assets and properties and the Effective Timecurrent relationships of the Company and the Subsidiary with their respective customers, except suppliers, advertisers, distributors, agents, officers and Employees and other Persons with which the Company and the Subsidiary have significant business relationships; (iii) use reasonable best efforts to maintain all of the material assets owned or used by the Company and the Subsidiary in the ordinary course of business consistent with past practice; (iv) continue capital expenditures substantially in accordance with the timing and amounts forecast for capital expenditures as set forth in the schedule of capital expenditures previously provided by the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedtheglobe; (iiv) shall not amend its Certificate of Incorporation or Bylaws or maintain insurance in full force and effect substantially comparable governing instruments (other than in amount, scope and coverage to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to that in effect on the date of this Agreement; (vvi) shall not use reasonable best efforts to preserve the goodwill and ongoing operations of the business of the Company and the Subsidiary; (xvii) except pursuant to maintain the exercise books and records of optionsthe Company and the Subsidiary in the usual, warrantsregular and ordinary manner, conversion rights on a basis consistent with past practice; (viii) perform and other contractual rights existing on the date hereof comply in all material respects with its Commitments; and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (yix) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14comply in all material respects with applicable Laws.
(b) Prior Except as expressly contemplated by this Agreement, between the date of this Agreement and the Closing, the Company will not, and the Sellers will cause the Company and the Subsidiary not to, do any of the following without the prior written consent of theglobe:
(i) create any Encumbrance on any material properties or assets (whether tangible or intangible) of the Company or the Subsidiary;
(A) other than inventory in the ordinary course of business, sell, assign, transfer, lease or otherwise dispose of or agree to sell, assign, transfer, lease or otherwise dispose of any assets of the Company or the Subsidiary or (B) cancel any indebtedness owed to the Effective TimeCompany or the Subsidiary;
(iii) merge or consolidate with any Person;
(iv) acquire assets or capital stock of or other equity interests in any Person;
(v) (A) issue, incur, create, assume or otherwise become liable for any Indebtedness, (B) assume, grant, guarantee or endorse, or make any other accommodation or arrangement making the Company or the Subsidiary responsible for, any Liabilities of any other Person, (C) make any loans, advances or capital contributions to, or investments in, any Person or (D) repay any amounts owing under any Indebtedness;
(vi) change any method of accounting or accounting practice used by the Company or the Subsidiary;
(vii) (A) enter into or adopt or amend any existing Commitment relating to severance, (B) enter into or adopt or amend any existing severance plan, (C) enter into or adopt or amend any Commitment with any Employee or any Company Employee Plan (including, without limitation, the plans, programs, agreements and arrangements referred to in Section 3.20), (D) grant any options or awards pursuant to equity-based plans, or (E) grant any increases in compensation (except compensation increases associated with promotions and annual reviews in the ordinary course of business, which such compensation increases shall be subject to the prior written approval of theglobe, which approval shall not be unreasonably withheld);
(viii) make any change in the Company's or the Subsidiary's Tax accounting methods, any new election with respect to Taxes or any modification or revocation of any existing election with respect to Taxes or settle or otherwise dispose of any Tax audit, dispute, or other Tax proceeding, in each case without theglobe's express written consent thereto.
(ix) accelerate or delay the purchase of supplies or inventory, the shipment or sale of inventory, the collection of accounts or notes receivable or the payment of accounts or notes payable or accrued liabilities or expenses or otherwise operate the respective businesses of the Company and the Subsidiary, in each case, in a manner that would be inconsistent with past practice;
(x) except as set forth in Schedule 5.2(b)(x), engage in any transaction with any of the Purchaser Disclosure Letter Stockholders or as contemplated any of their Affiliates;
(xi) enter into, modify, terminate, amend, or waive, release or assign any rights or claims with respect to any Commitment other than in the ordinary course of business consistent with past practice;
(xii) allow the lapse of any rights of ownership or use by this Agreement, unless the Company and or the Special Committee have consented in writing theretoSubsidiary of any Company Intellectual Property right;
(xiii) repurchase, redeem or otherwise acquire or exchange any share of Company Common Stock, issue or sell any additional shares of the capital stock of, or other equity interests in, the Purchaser: (i) shall not Company or the Subsidiary, or issue or sell any securities convertible into or exchangeable for such shares or equity interests, or issue or grant any options, warrants, calls, subscription rights or other rights of any kind to acquire additional shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its such capital stock; , such other equity interests or such securities;
(iixiv) shall promptly notify amend the Company's Certificate of Incorporation, as amended, or Amended and Restated Bylaws or the Subsidiary's Memorandum and Articles of Association or equivalent organizational documents of either the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; the Subsidiary;
(iiixv) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside aside, make or pay any dividend or make any other distribution or payment with respect to any shares of its capital (whether in cash, stock or other ownership interests property or any combination thereof);
(other than regular quarterly cash dividends not xvi) take any action that is reasonably likely to exceed $0.05 per shareresult in the representations and warranties set forth in Article III becoming false or inaccurate in any material respect as of the Closing Date; or
(xvii) agree to take any of the actions referred to in this Section 5.2(b).
Appears in 2 contracts
Sources: Merger Agreement (Theglobe Com Inc), Merger Agreement (Theglobe Com Inc)
Interim Operations. Pursuant to the Merger Agreement, Musicland has agreed (a) Prior except to the extent expressly contemplated by the Merger Agreement or with the written consent of Best Buy), during the period from the date of the Merger Agreement to the earlier of the termination of the Merger Agreement or the Effective Time, except as set forth to carry on its and its subsidiaries' business in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore previously conducted; . Musicland has further agreed to (i) pay and to cause its subsidiaries to pay debts and taxes when due, subject to good faith disputes regarding such debts or taxes, and (ii) to use all reasonable efforts consistent with past practice and policies to preserve intact its and its subsidiaries' present business organizations, keep available the services of its and its subsidiaries' present officers and key employees and preserve its and its subsidiaries' relationships with customers, suppliers, distributors, licensors, licensees and others having business dealings with it or its subsidiaries so that its and its subsidiaries' goodwill and ongoing businesses shall be unimpaired at the Effective Time in all material respects. The Merger Agreement provides that Musicland will promptly notify Best Buy of any event or occurrence not in the ordinary course of its or its subsidiaries' business or which could have a Material Adverse Effect on Musicland. Except as expressly contemplated by the Merger Agreement or with the prior written consent of Best Buy (which shall not amend be unreasonably delayed or withheld), the Merger Agreement provides that Musicland shall not do, cause or permit any of the following, or allow, cause or permit any of its subsidiaries to do, cause or permit any of the following: (i) cause or permit any amendments to its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)Bylaws; (iiiii) shall promptly notify the Purchaser declare or pay any dividends on or make any other distributions (whether in cash, stock or property) in respect of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect or split, combine or reclassify any of its capital stock split or otherwise change its capitalization as it existed on issue or authorize the date hereofissuance of any other securities in respect of, (y) grantin lieu of, confer or award any optionin substitution for, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or repurchase or otherwise acquire, directly or indirectly, any shares of its capital stock; or (ziii) adopt take, or agree in writing or otherwise to take, any A1-14
of the actions described in (bi) Prior or (ii) above, or any other action that would make any of its representations or warranties contained in the Merger Agreement untrue or incorrect or prevent it from performing or cause it not to perform its covenants contained in the Merger Agreement in any material respect. Musicland has also agreed that, during the period from the date of the Merger Agreement and continuing until the earlier of the termination of the Merger Agreement or the Effective Time, except as set forth in the Purchaser Disclosure Letter or as expressly contemplated by this the Merger Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) Musicland shall not issue do, cause or permit any shares of the following, or allow, cause or permit any of its capital stock at less than fair market value subsidiaries to do, cause or permit any of the following, without the prior written consent of Best Buy (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) which consent shall not declare, set aside be unreasonably delayed or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).withheld):
Appears in 2 contracts
Sources: Offer to Purchase (Best Buy Co Inc), Offer to Purchase (Best Buy Co Inc)
Interim Operations. (a) Prior to the Effective Time, except as set forth in the Company OSI Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser CRA has consented in writing thereto, the Company: OSI:
(i) shallShall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; ;
(ii) Shall use its commercially reasonable efforts, and shall cause each of its Significant Subsidiaries to use its commercially reasonable efforts, to preserve intact their business organizations and goodwill, keep available the services of their respective officers and employees and maintain satisfactory relationships with those persons having business relationships with them;
(iii) Shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than Bylaw amendments which are not material to permit OSI or to the consummation of the transactions contemplated by this Agreement); ;
(iiiiv) shall Shall promptly notify the Purchaser CRA of any breach of any representation or warranty of OSI of which OSI becomes aware contained herein or any Company OSI Material Adverse Effect; ;
(ivv) shall Shall promptly deliver to the Purchaser CRA true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement;
(vi) Shall not (w) except pursuant to the conversion of the OSI Convertible Notes, the conversion of the ▇▇▇▇▇▇▇▇ Note, and the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement or in the OSI Reports, issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (x) grant, confer or award any option, warrant, conversion right or other right not existing, on the date hereof to acquire any shares of its capital stock (other than the grant of options to acquire an aggregate of up to 15,000 shares of OSI Common Stock pursuant to the terms of the OSI Stock Option Plans at an exercise price of not less than the fair market value of the OSI Common Stock on the date of grant) or grant, confer or award any bonuses or other forms of cash incentives to any officer, director, or employee except consistent with past practice, (y) increase any compensation of its present or future officers, directors, or employees (except for normal increases consistent with past practice or as required under the written terms of an OSI Employment Agreement in effect on or before December 31, 1996); enter into any employment agreement with any present or future employee, officer, or director, or amend any such agreement in any material respect; grant any severance or termination pay to any officer, director or employee other than pursuant to existing severance arrangements and policies of OSI or (z) adopt any new OSI Plan or amend any existing OSI Plan in any material respect;
(vii) Shall not (i) declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests, (ii) directly or indirectly redeem, purchase or otherwise acquire any shares of its capital stock or capital stock of any of its Subsidiaries, or make any commitment for any such action or (iii) split, combine or reclassify any of its capital stock or issue or authorize or propose the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock;
(viii) Shall not, and shall not permit any of its Subsidiaries to (A) sell, lease or otherwise dispose of any of its assets (including capital stock of Subsidiaries) except in the ordinary course of business, or (B) acquire any business or any substantial portion of the assets of any person except as identified in the OSI Disclosure Letter and acquisitions involving the payment of consideration by OSI not in excess of $10,000,000 for any single acquisition or $25,000,000 in the aggregate (it being understood that OSI will give CRA not less than fifteen (15) days prior notice of the proposed acquisition of any business or any substantial portion of the assets of any person; if such acquisition requires the written consent of CRA under this clause (viii), consent shall not be unreasonably withheld; and CRA shall be deemed to have given such consent if it does not respond within ten (10) days of receipt of the notice contemplated hereby);
(ix) Shall not incur any material amount of indebtedness for borrowed money or make any loans, advances or capital contributions to, or investments (other than non-controlling investments in the ordinary course of business or other investments permitted pursuant to clause (viii) above) in, any other person other than a wholly owned Subsidiary, or issue or sell any debt securities, other than borrowings under existing lines of credit in the ordinary course of business, in each case in an amount exceeding $1,000,000;
(x) Shall not, except as previously approved by the Board of Directors of OSI and identified to CRA prior to the date hereof, or except in the ordinary course of business, make or commit to make capital expenditures other than (A) capital expenditures budgeted for the fiscal year ending December 31, 1997, and (B) capital expenditures (not otherwise included in budgeted capital expenditures referred to in clause (A) above) that may be made by OSI in connection with the acquisitions by OSI or its Subsidiaries permitted under subsection (viii) above; provided such acquisitions would have been permitted under such subsection (viii) if such capital expenditures were deemed to be payment of consideration by OSI in connection therewith;
(xi) Shall not mortgage or otherwise encumber or subject to any lien any properties or assets except as would not be reasonably likely to have an OSI Material Adverse Effect;
(xii) Shall not make any change to its accounting (including tax accounting) methods, principles or practices, except as may be required by generally accepted accounting principles and except, in the case of tax accounting methods, principles or practices, in the ordinary course of business of OSI or any of its Subsidiaries;
(xiii) Shall not and shall not permit any of its Subsidiaries to, enter into any agreement or arrangement with any of their respective Affiliates, other than with wholly-owned Subsidiaries of OSI, on terms less favorable to OSI or such Subsidiary, as the case may be, than could be reasonably expected to have been obtained with an unaffiliated third party on an arm's-length basis;
(xiv) Shall, and shall cause its Subsidiaries to, use commercially reasonable efforts to maintain with financially responsible insurance companies insurance in such amounts and against such risks and losses as are customary for companies engaged in their respective businesses; and
(xv) Shall not (i) make or rescind any material express or deemed election relating to taxes, unless it is reasonably expected that such action will not result in an OSI Material Adverse Effect, (ii) settle or compromise any material claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to taxes, except where such settlement or compromise will not result in an OSI Material Adverse Effect, or (iii) change in any material respect any of its methods or reporting income or deductions for federal income tax purposes from those employed in the preparation of its federal income tax returns that have been filed for prior taxable years, except as may be required by applicable law or except for changes that are reasonably expected not to result in an OSI Material Adverse Effect.
(b) Prior to the Effective Time, except as set forth in the CRA Disclosure Letter or as contemplated by this Agreement, unless OSI has consented in writing thereto, CRA:
(i) Shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted;
(ii) Shall use its commercially reasonable efforts, and shall cause each of its Significant Subsidiaries to use its commercially reasonable efforts, to preserve intact their business organizations and goodwill, keep available the services of their respective officers and employees and maintain satisfactory relationships with those persons having business relationships with them;
(iii) Shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than Bylaw amendments which are not material to CRA or to the consummation of the transactions contemplated by this Agreement);
(iv) Shall promptly notify OSI of any breach of any representation or warranty of CRA of which CRA becomes aware contained herein or any CRA Material Adverse Effect;
(v) shall Shall promptly deliver to OSI true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement;
(vi) Shall not (xw) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this AgreementAgreement or in the OSI Reports, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (yx) grant, confer or award any option, warrant, conversion right or other right not existing existing, on the date hereof to acquire any shares of its capital stockstock (other than the grant of options to acquire an aggregate of up to 15,000 shares of CRA Common Stock pursuant to the terms of the CRA Stock Option Plans at an exercise price of not less than the fair market value of the CRA Common Stock on the date of grant) existing on the date hereof of CRA's stock option plan) or grant, confer or award any bonuses or other forms of cash incentives to any officer, director, or employee except consistent with past practice, (y) increase any compensation of its present or future officers, directors, or employees, (except for normal increases consistent with past practice or as required under the written terms of a CRA Employment Agreement in effect on or before December 31, 1996); enter into any employment agreement with any present or future employee, officer, or director or amend any such agreement in any material respect; grant any severance or termination pay to any officer, director or employee other than pursuant to existing severance arrangements and policies of CRA or (z) adopt any A1-14new CRA Plan or amend any existing CRA Plan in any material respect;
(bvii) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: Shall not (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests interests, (ii) directly or indirectly redeem, purchase or otherwise acquire any shares of its capital stock or capital stock of any of its Subsidiaries, or make any commitment for any such action or (iii) split, combine or reclassify any of its capital stock or issue or authorize or propose the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock;
(viii) Shall not, and shall not permit any of its Subsidiaries to (A) sell, lease or otherwise dispose of any of its assets (including capital stock of Subsidiaries) except in the ordinary course of business, or (B) acquire any business or any substantial portion of the assets of any person except as identified in the CRA Disclosure Letter and acquisitions involving the payment of consideration by CRA not in excess of $10,000,000 for any single acquisition or $25,000,000 in the aggregate (it being understood that CRA will give OSI not less than fifteen (15) days prior notice of the proposed acquisition of any business or any substantial portion of the assets of any person; if such acquisition requires the consent of OSI under this clause (viii), consent shall not be unreasonably withheld; and OSI shall be deemed to have given such consent if it does not respond within ten (10) days of receipt of the notice contemplated hereby);
(ix) Shall not incur any material amount of indebtedness for borrowed money or make any loans, advances or capital contributions to, or investments (other than regular quarterly cash dividends non-controlling investments in the ordinary course of business or other investments permitted pursuant to clause (viii) above), in each case in an amount exceeding $1,000,000;
(x) Shall not, except as previously approved by the Board of Directors of CRA and identified to OSI prior to the date hereof, or except in the ordinary course of business, make or commit to make capital expenditures other than (A) capital expenditures budgeted for the fiscal year ending December 31, 1997 and (B) capital expenditures (not otherwise included in budgeted capital expenditures referred to in clause (A) above) that may be made by CRA in connection with the acquisitions by CRA or its Subsidiaries permitted under subsection (viii) above; provided such acquisitions would have been permitted under such subsection (viii) if such capital expenditures were deemed to be payment of consideration by CRA in connection therewith.
(xi) Shall not mortgage or otherwise encumber or subject to any lien any properties or assets except as would not be reasonably likely to have a CRA Material Adverse Effect;
(xii) Shall not make any change to its accounting (including tax accounting) methods, principles or practices, except as may be required by generally accepted accounting principles and except, in the case of tax accounting methods, principles or practices, in the ordinary course of business of CRA or any of its Subsidiaries;
(xiii) Shall not and shall not permit any of its Subsidiaries to, enter into any agreement or arrangement with any of their respective Affiliates, other than with wholly-owned Subsidiaries of CRA, on terms less favorable to CRA or such Subsidiary, as the case may be, than could be reasonably expected to have been obtained with an unaffiliated third party on an arm's-length basis;
(xiv) Shall, and shall cause its Subsidiaries to, use commercially reasonable efforts to maintain with financially responsible insurance companies insurance in such amounts and against such risks and losses as are customary for companies engaged in their respective businesses; and
(xv) Shall not (i) make or rescind any material express or deemed election relating to taxes, unless it is reasonably expected that such action will not result in a CRA Material Adverse Effect, (ii) settle or compromise any material claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to taxes, except where such settlement or compromise will not result in a CRA Material Adverse Effect, or (iii) change in any material respect any of its methods or reporting income or deductions for federal income tax purposes from those employed in the preparation of its federal income tax returns that have been filed for prior taxable years, except as may be required by applicable law, or except for changes that are reasonably expected not to exceed $0.05 per share)result in a CRA Material Adverse Effect.
Appears in 2 contracts
Sources: Agreement and Plan of Reorganization (Cra Managed Care Inc), Agreement and Plan of Reorganization (Occusystems Inc)
Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that from the date of this Agreement until the Effective Time, unless Parent shall otherwise approve in writing (a) Prior such approval not to be unreasonably withheld or delayed), and except as otherwise expressly contemplated by this Agreement or as required by applicable Laws, the business of the Company and its Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, the Company and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain their existing relations and goodwill with Governmental Entities, customers, manufacturers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of the present employees and agents of the Company and its Subsidiaries. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (i) as otherwise expressly required by this Agreement, (ii) as Parent may approve in writing or (iii) as set forth in Section 6.1 of the Company Disclosure Letter Letter, the Company will not and will not permit its Subsidiaries to:
(a) adopt or as contemplated by propose any change in any provision of the Company Governing Documents;
(b) merge or consolidate the Company or any of its Subsidiaries with any other provision Person, except for any such transactions among wholly owned Subsidiaries of the Company that are not obligors or guarantors of third-party indebtedness;
(c) acquire assets outside of the ordinary course of business from any other Person with an aggregate value or purchase price in excess of $125,000, other than capital expenditures within the Company’s capital expenditure budget as set forth in Section 6.1(c) of the Company Disclosure Letter;
(d) enter into any material line of business other than the line of business in which the Company and its Subsidiaries is currently engaged as of the date of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation Agreement or Bylaws or comparable governing instruments (distribute products other than to permit the consummation type of products that the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser Company and its Subsidiaries are currently distributing as of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; ;
(ve) shall not (x) except pursuant to the exercise of optionsissue, warrantssell, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreementpledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or pursuant to authorize the Recapitalization issue issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right of or other right not existing on equity interest in the date hereof Company or any of its Subsidiaries (other than the issuance of shares by a wholly owned Subsidiary of the Company to acquire the Company or another wholly owned Subsidiary of the Company), or securities convertible into, or exchangeable or exercisable for, any shares of such capital stock or other equity interest;
(f) other than in the ordinary course of business, create or incur any Lien material to the Company or any of its Subsidiaries on any assets used in the businesses of the Company or any of its Subsidiaries having a value in excess of $125,000;
(g) make any loans, advances or capital stockcontributions to, or (z) adopt investments in, any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value Person (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; direct or indirect wholly owned Subsidiary of the Company) in excess of $125,000 in the aggregate;
(iiih) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make distribution (whether in cash, stock or property or any other distribution or payment combination thereof) with respect to any shares of capital stock of any Subsidiary, except for dividends or distributions by any direct or indirect wholly owned Subsidiaries of the Company and pro rata dividends or distributions payable to holders of interests in non wholly owned Subsidiaries;
(i) reclassify, split (including a reverse split), recapitalize, subdivide or repurchase, redeem or otherwise acquire, directly or indirectly, any of its capital stock stock;
(j) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other ownership interests rights to acquire any debt security of the Company or any of its Subsidiaries or enter into any capital lease, except for (other than regular quarterly cash dividends A) indebtedness for borrowed money incurred in the ordinary course of business under the Company’s existing revolving credit facility (or any replacement facility therefor) not to exceed $0.05 per share50,000,000 in the aggregate, (B) refinancings on commercially reasonable terms or (C) guarantees by the Company of indebtedness of wholly owned Subsidiaries of the Company or guarantees by Subsidiaries of indebtedness of the Company;
(k) except as set forth in Section 6.1(k) of the Company Disclosure Letter, make or authorize any capital expenditure;
(l) other than in the ordinary course of business, enter into any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement (other than as permitted by Section 6.1(j));
(m) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP or Regulation S-X promulgated under the Exchange Act, based upon the advice of its independent auditors after consultation with Parent;
(n) settle any pending or threatened civil, criminal or administrative actions, suits, claims, litigations, arbitrations, investigations or other proceedings for an amount to be paid by the Company or any of its Subsidiaries in excess of $150,000 or which would be reasonably likely to have any adverse impact on the operations of the Company or any of its Subsidiaries, or indemnify any Person other than pursuant to a contractual obligation to do so;
(o) other than in the ordinary course of business, (A) amend or modify in any material respect, or terminate or waive any material right or benefit under, any Material Contract (other than as permitted by Section 6.1(j)) or in respect of any pending or threatened civil, criminal or administrative actions, suits, claims, litigations, arbitrations, investigations or other proceedings, or (B) cancel, modify or waive any debts or claims held by it or waive any rights having in each case a value in excess of $250,000;
(p) except as required by Law, make any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any method therefor that is inconsistent with elections made, positions taken or methods used in preparing or filing similar Tax Returns in prior periods or settle or compromise any material tax liability;
(q) sell, transfer, lease, license or otherwise dispose of any assets of the Company or its Subsidiaries except in the ordinary course of business or obsolete assets;
(r) notwithstanding anything to the contrary in this Section 6.1, sell, lease, abandon, transfer, dispose of, license or grant material rights under any material Company IP Rights or materially modify any existing rights with respect thereto, except in the ordinary course of business consistent with past practice, or enter into any settlement regarding (i) the infringement of any material Company IP Rights or (ii) the breach of any license agreements governing use of material IP Rights;
(s) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, or accelerate vesting or payment under any Company Benefit Plans or enter into any new employment or compensatory agreements or arrangements with, or increase the salary, wage, bonus or other compensation payable or to become payable to, any directors, officers, employees or consultants of the Company or any of the Subsidiaries;
(t) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries;
(u) take any action, including the adoption of any shareholder rights plan, which would, directly or indirectly, restrict or impair the ability of Parent or Merger Sub to vote, or otherwise to exercise the rights and benefits of a shareholder with respect to, securities of the Company acquired or controlled or to be acquired or controlled by Parent or Merger Sub in accordance with this Agreement; or
(v) agree or commit to do any of the foregoing.
Appears in 2 contracts
Sources: Merger Agreement (Lowrance Electronics Inc), Merger Agreement (Simrad Yachting As)
Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement or set forth in Section 6.1 of the Company Disclosure Schedule and except for the acceleration of the vesting of outstanding options to purchase 26,000 Common Shares held by directors under the Company's 1997 Equity Incentive Plan):
(a) Prior its and its Subsidiaries' businesses shall be conducted in the ordinary and usual course (it being understood and agreed that nothing contained herein shall permit the Company to enter into or engage in (through acquisition, product extension or otherwise) the business of selling any products or services materially different from existing products or services of the Company and its Subsidiaries or to enter into or engage in new lines of business without Parent's prior written approval);
(b) to the Effective Timeextent consistent with (a) above it and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreementsuppliers, unless the Purchaser has consented in writing theretoreinsurers, the Company: distributors, creditors, lessors, employees and business associates;
(c) it shall not (i) shallissue, and shall cause each sell, pledge, dispose of or encumber any capital stock owned by it in any of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedSubsidiaries; (ii) shall not amend its Certificate of Incorporation charter or Bylaws by-laws or comparable governing instruments (other than to permit amend, modify or terminate the consummation of the transactions contemplated by this New Rights Agreement); (iii) shall promptly notify the Purchaser split, combine or reclassify its outstanding shares of any breach of any representation or warranty contained herein or any Company Material Adverse Effectcapital stock; (iv) shall promptly deliver to the Purchaser true and correct copies of any reportauthorize, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend payable in cash, stock or make property in respect of any capital stock other distribution than dividends from its direct or payment indirect wholly-owned Subsidiaries and other than regular quarterly dividends paid by the Company on its Common Shares not in excess of $0.11 per share and regular quarterly dividends paid by the Company on its Preferred Shares in accordance with respect the Company's Articles of Incorporation; or (v) repurchase, redeem or otherwise acquire, except in connection with any of the Company Stock Plans, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its stock or any securities convertible into or exchangeable or exercisable for any shares of its stock;
(d) neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other ownership interests property or assets (other than regular quarterly cash dividends pursuant to exercise of the New Rights and Shares issuable pursuant to options outstanding on the date hereof under any of the Company Stock Plans or upon conversion of the Preferred Shares); (ii) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) make or authorize or commit for any capital expenditures other than in amounts not to exceeding $5 million in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity, including by way of assumption reinsurance, in excess of $2 million individually or $5 million in the aggregate (other than in connection with ordinary course investment activities);
(e) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans, other than awards made in the normal course under the Management Incentive Plan in respect of 1997 performance or increase the salary, wage, bonus or other compensation of any employees except increases occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases);
(f) neither it nor any of its Subsidiaries shall pay, discharge, settle or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of claims, liabilities or obligations legally due and payable and arising in the ordinary and usual course of business, claims arising under the terms of products, contracts or policies issued by the Company Insurance Subsidiaries in the ordinary and usual course of business and such other claims, liabilities or obligations as shall not exceed $0.05 per share)5 million in the aggregate;
(g) neither it nor any of its Subsidiaries shall make or change any Tax election, settle any material audit, file any amended tax returns or permit any insurance policy naming it as a beneficiary or loss-payable payee to be canceled or terminated except in the ordinary and usual course of business;
(h) neither it nor any of its Subsidiaries shall enter into any agreement containing any provision or covenant limiting in any material respect the ability of the Company or any Subsidiary or affiliate to (A) sell any products or services of or to any other person, (B) engage in any line of business or (C) compete with or to obtain products or services from any person or limiting the ability of any person to provide products or services to the Company or any of its Subsidiaries or affiliates;
(i) neither it nor any of its Subsidiaries shall enter into any new quota share or other reinsurance transaction (A) which does not contain standard cancellation and termination provisions, (B) which, except in the ordinary course of business, materially increases or reduces the Company Insurance Subsidiaries' consolidated ratio of net written premiums to gross written premiums or (C) pursuant to which $5 million or more in gross written premiums are ceded by the Company Insurance Subsidiaries to any Person other than the Company or any of its Subsidiaries;
(j) neither it nor any of the Company Insurance Subsidiaries will alter or amend in any material respect their existing investment guidelines or policies;
(k) neither it nor any of its Subsidiaries shall take any action or omit to take any action that would cause any of its representations and warranties herein to become untrue in any material respect; and
(l) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 2 contracts
Sources: Merger Agreement (American Bankers Insurance Group Inc), Merger Agreement (Cendant Corp)
Interim Operations. (a) Prior Except as set forth in the corresponding section of the Company Disclosure Schedule or otherwise as expressly provided herein, subject to applicable Law, the Company covenants and agrees as to itself and its Subsidiaries that, from the date of this Agreement until the Effective Time, the business of the Company and its Subsidiaries shall be conducted only in the ordinary course and, to the extent consistent therewith, the Company and its Subsidiaries shall use their respective commercially reasonable efforts to preserve their business organizations intact and maintain their existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, key employees and business associates and keep available the services of the present key employees of the Company and its Subsidiaries.
(b) Without limiting the generality of Section 7.1(a) and in furtherance thereof, except as set forth in the corresponding section of the Company Disclosure Letter Schedule or as contemplated by any other provision otherwise expressly provided herein, from the date of this Agreement, unless Agreement until the Purchaser has consented in writing theretoEffective Time, the Company: Company shall not and shall not permit its Subsidiaries to (unless Parent shall otherwise approve in writing, in its sole discretion):
(i) shall, and shall cause each adopt or propose any change in its certificate of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; incorporation or By-Laws (or similar governing documents);
(ii) shall not amend merge or consolidate the Company or any of its Certificate of Incorporation or Bylaws or comparable governing instruments (Subsidiaries with any other than to permit the consummation Person, except for any such transactions among wholly-owned Subsidiaries of the transactions contemplated by this Agreement); Company;
(iii) shall promptly notify acquire assets outside of the Purchaser ordinary course of business from any breach Persons with a purchase price in excess of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver $100,000 in the aggregate except pursuant to the Purchaser true and correct copies Contracts in effect as of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; ;
(iv) other than (A) as required by the terms of Contracts in effect as of the date of this Agreement, (B) upon the exercise of outstanding Company Options or Company Common Warrants or warrants to purchase Series B Stock, (C) pursuant to the terms of the Debentures (to the extent required by such terms) or (D) upon conversion of outstanding shares of Series A Stock and Series B Stock, in each case, in accordance with their terms, issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any Company Subsidiary (other than the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary), or securities convertible or exchangeable or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) shall not declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (xexcept for (i) except pursuant dividends or other distributions by any direct or indirect wholly-owned Subsidiary of the Company to the exercise Company or to any other direct or indirect wholly-owned Subsidiary of optionsthe Company, warrants, conversion rights (ii) periodic dividends and other contractual rights existing on periodic distributions by non-wholly-owned Subsidiaries of the date hereof Company in the ordinary course of business, and disclosed pursuant to this Agreement, or pursuant (iii) declaration and payment of scheduled dividends with respect to the Recapitalization issue Series A Stock);
(vi) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(vii) incur any third-party indebtedness for borrowed money or guarantee indebtedness or any other obligation of another Person other than in the ordinary course of business consistent with past practice and in compliance with the Company’s existing Contracts;
(viii) enter into any Contract that would have been a Material Contract had it been entered into prior to the execution of this Agreement, effect other than any stock split such Contract (A) entered into in the ordinary course of business or (B) providing for any capital expenditure to the extent permitted by Section 7.1(c)(ii);
(ix) other than in the ordinary course of business, amend or modify in any material respect, or terminate or waive any material right or benefit under, any Material Contract;
(x) make any changes with respect to accounting policies or practices, except as required by changes in GAAP or by Law;
(xi) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity or arbitral proceeding for an amount payable by or on behalf of the Company or any Subsidiary in excess of $100,000 in the aggregate for all such litigation or proceedings (exclusive of any amounts to be received by the Company in reimbursement of such settlement amount, whether under any insurance policy or indemnity, other than such amounts that are contested) or which would be reasonably likely to have any material adverse impact on the operations of the Company or any of its Subsidiaries or on any current or future litigation or other proceeding of the Company or any of its Subsidiaries;
(xii) sell, lease, license or otherwise change dispose of any assets of the Company or its capitalization Subsidiaries except for sales of (A) products or services provided in the ordinary course of business or (B) other assets in aggregate amount not in excess of $100,000 in the aggregate, and other than pursuant to Contracts in effect as it existed on of the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14this Agreement;
(bxiii) Prior engage in the conduct of any new line of business; or
(xiv) agree, resolve or commit to do any of the Effective Timeforegoing.
(c) Without limiting the generality of Section 7.1(a) and in furtherance thereof, except as set forth in the Purchaser corresponding section of the Company Disclosure Letter Schedule or as contemplated by otherwise expressly provided herein, from the date of this AgreementAgreement until the Effective Time, unless the Company shall not and shall not permit its Subsidiaries to (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed and which shall be subject to the Special Committee have consented in writing thereto, procedures set forth on Schedule 7.1(c) of the Purchaser: Company Disclosure Schedule):
(i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or Contracts in effect any stock split as of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and , make any loan, advance or capital contribution to or investment in any Person (other than a wholly-owned Subsidiary of the Company) outside the ordinary course of business;
(ii) make or authorize any capital expenditure in excess of $100,000 in the aggregate;
(iii) except as required by Law, make any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any material method therefor that is inconsistent with elections made, positions taken or methods used in preparing or filing similar Tax Returns in prior periods;
(iv) shall not declareother than pursuant to Contracts in effect as of the date of this Agreement or as otherwise required by Law, set aside (A) enter into any new employment or pay compensatory agreements with, or increase the compensation and employee benefits of, any dividend employee, consultant, or make director of the Company or any of its Subsidiaries (including entering into any bonus, severance, change of control, termination, reduction-in-force or consulting agreement or other distribution employee benefits arrangement or agreement pursuant to which such person has the right to any form of compensation from the Company or any of its Subsidiaries), (B) hire any employee to fill a position at the level of (i) executive officer or (ii) vice president or above who reports directly to an executive officer, or (C) adopt or amend in any respect, or accelerate vesting or payment with respect to under, any shares Benefit Plan in the case of its capital stock or other ownership interests clauses (A) and (C) above other than regular quarterly cash dividends not in the ordinary course of business consistent with past practice; or
(v) agree, resolve or commit to exceed $0.05 per share)do any of the foregoing.
Appears in 2 contracts
Sources: Merger Agreement (Moscow Cablecom Corp), Merger Agreement (Renova Media Enterprises Ltd.)
Interim Operations. (a) Prior to the Effective Time, except Except as set forth in Section 6.01 of the Company Disclosure Letter Letter, required by Law or as contemplated consented to in writing in advance by any other provision Parent (such consent not to be unreasonably withheld, conditioned or delayed), during the period from the date hereof until the earlier of the Effective Time and the valid termination of this Agreement, unless the Purchaser has consented in writing theretoAgreement pursuant to Section 9.01, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to carry on its business only in the exercise ordinary course of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereofbusiness, (y) grantuse commercially reasonable efforts to preserve intact its current business organization and to preserve its relationships and goodwill with customers, confer suppliers, employees, licensors, licensees, distributors, lessors and others having significant business dealings with the Company or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or Subsidiaries and (z) adopt any A1-14
(b) Prior to comply with applicable Law in all material respects. Without limiting the Effective Timegenerality of the foregoing, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless Section 6.01 of the Company Disclosure Letter, required by Law or consented to in writing in advance by Parent (such consent not to be unreasonably withheld, conditioned or delayed), during the period from the date hereof until the earlier of the Effective Time and the Special Committee have consented in writing theretovalid termination of this Agreement pursuant to Section 9.01, the Purchaser: Company shall not, and shall not permit any of its Subsidiaries to, directly or indirectly:
(i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend dividends on, or make any other distribution distributions (whether in cash, stock or payment property) in respect of, any Company Securities or Company Subsidiary Securities or set any record date therefor, other than dividends or distributions by a direct or indirect wholly owned Subsidiary of the Company to its parent (provided that neither the Company nor any of its Subsidiaries shall repatriate any material amount of cash as a dividend from any Subsidiary outside of the United States to the Company or any of its U.S. Subsidiaries);
(ii) split, combine, reclassify or otherwise amend the terms of any Company Securities or Company Subsidiary Securities or issue or authorize the issuance of any other securities in lieu of or in substitution for shares of Company Securities;
(iii) repurchase, redeem or otherwise acquire any Company Securities or Company Subsidiary Securities or any options, warrants or other rights to acquire any such Company Securities or Company Subsidiary Securities, other than (A) the acquisition by the Company of shares of Company Common Stock in connection with the surrender of shares of Company Common Stock by holders of Company Stock Options in order to pay all or a portion of the exercise price of the Company Stock Options, (B) the withholding of shares of Company Common Stock to satisfy all or a portion of any Tax obligations with respect to Company Equity Awards, and (C) the acquisition by the Company of Company Equity Awards in connection with the forfeiture of such awards;
(iv) issue, deliver or sell any shares of its Company Securities or Company Subsidiary Securities or other voting securities or equity interests, any securities convertible or exchangeable into any such shares, voting securities or equity interests, any options, warrants or other rights to acquire any such shares, voting securities, equity interests or convertible or exchangeable securities, any stock-based performance units, any Voting Company Debt or any other rights that give any person the right to receive any economic interest of a nature accruing to the holders of Company Common Stock, other than, in each case, (A) upon the exercise or settlement of Company Equity Awards outstanding on the date hereof or issuances pursuant to the ESPP, in each case in accordance with their terms as of the date hereof, (B) by a wholly owned Subsidiary of the Company of such Subsidiary’s capital stock to the Company or another wholly owned Subsidiary of the Company and (C) as described in Section 6.01(a)(iv) of the Company Disclosure Letter;
(v) mortgage, pledge, hypothecate, grant an easement with respect to, or otherwise encumber or restrict the use of Company Securities or Company Subsidiary Securities or assets, properties or rights (including Intellectual Property rights) of the Company or any of its Subsidiaries, or otherwise create, assume or suffer to exist any Liens thereupon except Permitted Liens and Liens granted as of the date of this Agreement with respect to the Company’s Existing Credit Facility;
(vi) amend the Company Certificate of Incorporation or the Company Bylaws or the comparable organizational documents of any Subsidiary of the Company;
(vii) acquire or agree to acquire from any third person (A) by merging or consolidating with, purchasing an equity interest in or a substantial portion of the assets of, making an investment in or loan or capital contribution to or in any other manner, any person or business, or (B) any assets that are otherwise material to the Company and its Subsidiaries, other than (x) inventory, supplies or raw materials acquired in the ordinary course of business, (y) equipment and other assets acquired as contemplated under the Fixed Asset Plan as permitted pursuant to Section 6.01(a)(xi) below, and (z) any other assets for which the consideration payable by the Company or any of its Subsidiaries does not exceed $1,000,000 in the aggregate for all such assets;
(A) sell, lease, license, sub-license or otherwise dispose of, or otherwise encumber any of its properties, rights or assets (including Intellectual Property rights), other than (1) sales of inventory, licenses of Software or sales of professional services in the Ordinary Course of Business, (2) sales, relinquishment or other ownership interests disposition of assets that are obsolete or that are no longer used in, or useful for, the conduct of the business of the Company and its Subsidiaries, in each case, in the Ordinary Course of Business, (3) sales, licenses, sublicenses or other dispositions in the Ordinary Course of Business permitted under Contracts existing as of the date of this Agreement, or (4) sales of assets with a value of less than $500,000 individually or in a series of related transactions, or $1,000,000 in the aggregate; or (B) abandon or permit to lapse any Company Registered IP; provided, however, that in any of the foregoing cases described in clause (A) or (B), neither the Company nor any of its Subsidiaries will distribute or make available (including by contribution to an open source project or community) any Software developed by the Company or any of its Subsidiaries as Open Source Materials without first obtaining Parent’s prior written consent;
(ix) adopt or enter into any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries;
(x) (A) incur, create, assume or otherwise become liable for, any Indebtedness (excluding letters of credit put in place, and capital leases entered into, in each case, in the Ordinary Course of Business) owed to any third person, or amend, modify or refinance any Indebtedness owed to any third person (excluding with respect to letters of credit and capital leases in existence as of the date of this Agreement in the Ordinary Course of Business), (B) make any loans, advances or capital contributions to, or investments in, any other person, other than the Company or any of its wholly owned Subsidiaries (other than regular quarterly cash dividends advances of expenses and other routine amounts to employees in the Ordinary Course of Business) or (C) redeem, repurchase, prepay, defease, cancel or otherwise acquire any Indebtedness (other than letters of credit and capital leases in the Ordinary Course of Business);
(xi) purchase, or commit to purchase, fixed or other capital assets except as contemplated by and in accordance with the FY18 Fixed Asset Plan set forth in Section 6.01(a)(xi) of the Company Disclosure Letter (the “Fixed Asset Plan”), which Fixed Asset Plan was approved as part of the Company’s FY2018 AOP by the Company Board on February 16, 2017;
(xii) pay, discharge, settle or satisfy any material claims, liabilities or obligations (whether absolute, accrued, asserted or unasserted, contingent or otherwise), other than (A) the payment, discharge or satisfaction in the Ordinary Course of Business, or as required by their terms as in effect on the date hereof of claims, liabilities or obligations reflected or reserved against in the most recent audited financial statements (or the notes thereto) of the Company included in the Filed SEC Documents (for amounts not in excess of such reserves) or incurred since the date of such financial statements in the Ordinary Course of Business, (B) payment of severance or other termination benefits to employees in the Ordinary Course of Business to the extent otherwise permitted pursuant to Section 6.01(a)(xix), (C) payment of fees and expenses to Representatives of the Company incurred in connection with the transactions contemplated by this Agreement; or (D) compromises, settlements or agreements to settle any Action which would not require Parent consent pursuant to Section 6.01(a)(xiii);
(xiii) commence any Action (other than any Action against Parent and Merger Sub with respect to the enforcement of this Agreement), or compromise, settle or agree to settle any Action made or pending by, or against, the Company or any of its Subsidiaries, other than the commencement or settlement of Actions in the Ordinary Course of Business that are unrelated to Intellectual Property Rights and involve only the payment by or to the Company or any of its Subsidiaries of money damages (net of insurance proceeds received) in an amount of no more than $1,000,000 individually or $5,000,000 in the aggregate; provided that the foregoing shall not permit the Company or any of its Subsidiaries to settle any Action (x) that would impose any restrictions or changes (other than de minimis restrictions or changes) to the business or operations of, or result in the imposition of equitable relief on, or require any admission of wrongdoing by, the Company or any of its Subsidiaries, or (y) for which such settlement is not permitted pursuant to Section 7.02;
(xiv) (A) enter into, terminate (except a termination of any Material Contract by its terms due solely to the passage of time), cancel, amend in any material respect or modify in any material respect any Material Contract or enter into any Contract that, if in effect on the date hereof, would have been a Material Contract, excluding, in each of the foregoing cases but subject to the following proviso, any such Contract which (1) is or would constitute a Material Contract under subsections (ii), (iii), (iv) or (xii) of Section 4.11(a), (2) is a renewal of a Contract made available to Parent on terms no less favorable in all material respects in the aggregate to Company and its Subsidiaries than the terms of such Contract as made available to Parent, (3) is a customer Contract providing for the sale of Company Products, (4) is a distributor Contract providing for third-party distribution of Company Products or (5) is a supplier or vendor Contract providing for the supply of goods or services for use in the production of Company Products, so long as such supplier or vendor Contract does not require and would not reasonably be expected to result in any payments (whether made directly or indirectly via a third person) by the Company or any of its Subsidiaries to any counterparty to such Contract (or any of such counterparty’s Affiliates) in an aggregate amount in excess of $3,000,000 per Contract or series of related Contracts or $15,000,000 in the aggregate, in each case, in any fiscal quarter of the Company, with the foregoing threshold amounts to be pro rated for the remaining period of the current fiscal quarter as of the date of this Agreement; provided that no Contract described in any of the foregoing clauses (1) through (5) shall be so excluded from the restrictions of this Section 6.01(a) if such Contract is (or, if entered into prior to the date hereof, would have been) a Material Contract pursuant to subsection (v), (vi), (viii) or (ix) of Section 4.11(a); and provided, further that no Contract described in the foregoing clause (5) shall be so excluded from the restrictions of this Section 6.01(a) if such Contract contains any purchasing commitment by the Company or any of its Subsidiaries for a term in excess of six (6) months from the date thereof; (B) waive any material term of or any material default under, or release, settle or compromise any material claim against the Company or any of its Subsidiaries or any material liability or material obligation owing to the Company or any of its Subsidiaries under, any Material Contract (except, in each case, as permitted pursuant to Section 6.01(a)(xiii)); (C) enter into any Contract which contains a change of control or similar provision that would require a payment to the other party or parties thereto in connection with the Offer, the Merger, the Support Agreement or the other transactions contemplated herein (including in combination with any other event or circumstance); or (D) amend or modify the Financial Advisor Agreement;
(xv) change its fiscal year or change any of its financial accounting methods, principles or practices, except insofar as may have been required by a change in GAAP or applicable Law, or (other than as required by GAAP for any assets that are required to be marked-to-market on a periodic basis) revalue any of its material assets;
(xvi) (A) change any material method of Tax accounting or make, change or revoke any material Tax election, (B) file any material amended Tax Return or claim for Tax refund, (C) settle or compromise any material Tax liability or refund, (D) extend the statutory period of limitations with respect to the assessment or collection of any material Tax, (E) change any tax period, (F) prepare or file any material Tax Return other than on a basis consistent with past practice (except as otherwise required by a change in applicable Tax Law), or (F) enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local or foreign law) or any Tax allocation, indemnification or sharing agreement (excluding any commercial agreements entered into in the ordinary course of business and not primarily relating to Taxes) or request any Tax ruling or Tax holiday;
(xvii) fail to keep in force insurance policies or replacement or revised provisions regarding insurance coverage with respect to the material assets, operations and activities of the Company and its Subsidiaries as currently in effect;
(xviii) enter into any new lease of real property involving payments of more than $200,000 in the aggregate per year, or amend the terms of any existing lease of real property that would require payments over the remaining term of such lease in excess of $200,000 per year, other than renewals of existing leases in the ordinary course of business;
(xix) except as required by the terms of any Company Benefit Plan as in effect on the date of this Agreement or as described in Section 6.01(a)(xix) of the Company Disclosure Letter, (A) increase the compensation or benefits payable or to become payable to any of its directors, officers, employees or individual independent contractors (except for annual merit increases in base salary of employees who are not officers in the Ordinary Course of Business by no more than 10% per individual and not to exceed $0.05 per share4.0% in the aggregate)., (B) grant to any of its directors, officers, employees or individual independent contractors any increase in severance or termination pay, (C) pay or award, or commit to pay or award, any bonuses or incentive compensation, (D) enter into any employment, consulting, severance, retention or termination agreement (including, for the avoidance of doubt, offer letters) with any of its directors, officers, employees or individual independent contractors, other than offer letters that do not provide any severance, retention, change in control or equity award commitments with new non-executive employee hires, and new contractor or consultant engagements, that are permitted under clause (H) or clause (I) hereof or in connection with any promotions of existing employees in the Ordinary Course
Appears in 2 contracts
Sources: Merger Agreement (Nimble Storage Inc), Merger Agreement (Hewlett Packard Enterprise Co)
Interim Operations. (a) Prior From the date of this Agreement to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries to, (i) conduct its operations according to their its usual, regular and ordinary course in substantially the same manner as heretofore conductedof business consistent with past practice; (ii) shall not amend use its Certificate reasonable best efforts to preserve intact their business organizations, maintain in effect all existing qualifications, licenses, permits, approvals and other authorizations referred to in Sections 6.1 and 6.14, keep available the services of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)their officers and employees and maintain satisfactory relationships with those persons having business relationships with them; (iii) shall promptly upon the discovery thereof notify Purchaser of the Purchaser existence of any breach of any representation or warranty contained herein (or, in the case of any representation or any Company warranty that makes no reference to Material Adverse Effect, any breach of such representation or warranty in any material respect) or the occurrence of any event that would cause any representation or warranty contained herein no longer to be true and correct (or, in the case of any representation or warranty that makes no reference to Material Adverse Effect, to no longer be true and correct in any material respect); and (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement, any internal monthly reports prepared for or delivered to the Board of Directors after the 26 31 date hereof and monthly financial statements for the Company and its Subsidiaries for and as of each month end subsequent to the date of this Agreement.
(b) From and after the date of this Agreement to the Effective Time, unless Purchaser has consented in writing thereto, the Company shall not, and shall not permit any of its Subsidiaries to, (i) amend its Certificate of Incorporation or Bylaws or comparable governing instruments; (vii) shall not issue, sell, pledge or register for issuance or sale any shares of its capital stock or other ownership interest in the Company (x) except pursuant to the other than issuances of Common Stock in respect of any exercise of options, warrants, conversion rights and other contractual rights existing Options outstanding on the date hereof and disclosed pursuant to this Agreementin the Disclosure Letter) or any of the Subsidiaries, or pursuant any securities convertible into or exchangeable for any such shares or ownership interest, or any rights, warrants or options to the Recapitalization issue acquire or with respect to any such shares of its capital stock, ownership interest, or convertible or exchangeable securities; or accelerate any right to convert or exchange or acquire any securities of the Company or any of its Subsidiaries for any such shares or ownership interest; (iii) effect any stock split or conversion of any of its capital stock or otherwise change its capitalization as it existed exists on the date hereof, other than as set forth in this Agreement or contemplated by a Stockholder Agreement; (yiv) grant, confer or award any option, warrant, conversion right convertible security or other right not existing on the date hereof to acquire any shares of its capital stockstock or take any action, or (z) adopt any A1-14
(b) Prior to the Effective Time, except other than as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue to cause to be exercisable any shares of its capital otherwise unexercisable option under any existing stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stockoption plan; (iiv) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends such payments by a wholly-owned Subsidiary); (vi) directly or indirectly redeem, purchase or otherwise acquire any shares of its capital stock or capital stock of any of its Subsidiaries; (vii) sell, lease or otherwise dispose of any of its assets (including capital stock of Subsidiaries), except in the ordinary course of business, none of which dispositions individually or in the aggregate will be material; (viii) settle or compromise any pending or threatened Litigation, other than settlements which involve solely the payment of money (without admission of liability) not to exceed $0.05 per share).250,000 in any one case; (ix) acquire by merger, purchase or any other manner, any business or entity or otherwise acquire any assets that are material, individually or in the aggregate, to the Company and its Subsidiaries taken as a whole, except for purchases of inventory, supplies or capital equipment in the ordinary course of business consistent with past practice; (x) incur or assume any long-term or short-term debt, except for working capital purposes in the ordinary course of business under the Company's existing credit agreement set forth in the Disclosure Letter; (xi) assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person except wholly owned Subsidiaries of the Company; (xii) make or forgive any loans, advances or capital contributions to, or investments in, any other person; (xiii) make any Tax election or settle any Tax liability; (xiv) waive or amend any term or condition of any confidentiality or "standstill" agreement to which the Company is a party; (xv) grant any stock related or performance awards; (xvi) enter into any new employment, severance, consulting or salary continuation agreements with any newly hired employees other than in the ordinary course of business or enter into any of the foregoing with any
Appears in 2 contracts
Sources: Merger Agreement (Sinter Metals Inc), Merger Agreement (GKN Powder Metallurgy Inc)
Interim Operations. (a) Prior NYSE Euronext covenants and agrees as to itself and its Subsidiaries that, after the date hereof and until the earlier of the Effective TimeTime or the termination of this Agreement in accordance with its terms, unless NASDAQ OMX and ICE shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement (including with respect to Section 4.14) or except as otherwise set forth in Section 4.1 of the Company NYSE Euronext Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: Letter:
(i) shallthe business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practice, and NYSE Euronext shall take such actions as are necessary so that (1) if the number of any restricted stock units issued after January 1, 2011 by NYSE Euronext or its Subsidiaries (“NYSE Euronext RSUs”) exceeds the number of any NYSE Euronext RSUs forfeited after January 1, 2011 (any such excess, the “Excess Number”), then NYSE Euronext shall cause each a number of its Significant Subsidiaries to▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ equal to the Excess Number to be settled in cash instead of NYSE Euronext Shares and (2) any stock options issued after January 1, conduct its operations according to their usual, regular and ordinary course 2011 by NYSE Euronext shall be settled in substantially the same manner as heretofore conducted; cash instead of NYSE Euronext Shares;
(ii) (A) it shall not issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) it shall not amend its Certificate certificate of Incorporation incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)bylaws; (iiiC) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) it shall not (x) except pursuant to the exercise of optionssplit, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, combine or pursuant to the Recapitalization issue any reclassify its outstanding shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (iiD) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) it shall not declare, set aside or pay any type of dividend, whether payable in cash, stock or property, in respect of any capital stock other than the quarterly dividends payable by NYSE Euronext in an amount per share not to exceed its most recent quarterly per share dividend and with the timing of such dividend to be consistent with past practice) or make dividends payable by its direct or indirect wholly owned Subsidiaries to it or another of its direct or indirectly wholly owned Subsidiaries; and (E) it shall not repurchase, redeem or otherwise acquire, or permit any other distribution of its Subsidiaries to purchase or payment with respect to otherwise acquire, any interests or shares of its capital stock, as applicable, or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(iii) neither it nor any of its Subsidiaries shall (A) solely except as may be necessary to effect the Internal Reorganization, issue, sell, pledge, dispose of or encumber (v) any shares of, or (w) securities convertible into or exchangeable or exercisable for, or (x) options, warrants, calls, commitments or rights of any kind to acquire, capital stock of any class, as appropriate, or (y) any bonds, debentures, notes or other obligations the holders of which have the right to vote (or convertible into or exercisable for securities having the right to vote) with its stockholders on any matter or any other property or assets other than NYSE Euronext Shares issuable pursuant to stock-based awards outstanding on or awarded prior to the date hereof under the NYSE Euronext Stock Plans; (B) other than in the ordinary and usual course of business and consistent with past practice and other than any incurrence of indebtedness that is less than $235,000,000 in the aggregate, incur any long-term indebtedness for borrowed money (including any guarantee of such indebtedness); or (C) make or authorize or commit for any capital expenditures, except for in accordance with the 2011 capital expenditure target for NYSE Euronext that has been provided to NASDAQ OMX and ICE prior to the date of this Agreement or such other capital expenditures targets as may be agreed by NYSE Euronext, NASDAQ OMX and ICE (provided that (1) NYSE Euronext shall be permitted to make or authorize or commit for any capital expenditures in an amount that is between 75% and 110% of its capital expenditure target and (2) if the Effective Time shall not have occurred on or prior to December 31, 2011, then, for purposes of this Section 4.1(a)(iii), NYSE Euronext’s capital expenditure target will be adjusted upwards to take into account the number of days between December 31, 2011 and the Effective Time and assuming that the 2012 capital expenditure target shall be equal to the 2011 capital expenditure target);
(iv) neither NYSE Euronext nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Benefit Plan, as the case may be, or any other arrangement that would be a NYSE Euronext Stock Plan if in effect on the date hereof other than offer letters provided to newly hired or promoted employees (but excluding offer letters to executive officers of NYSE Euronext and its Subsidiaries or to employees whose target compensation is in excess of the average compensation of executive officers of NYSE Euronext or its Subsidiaries or of the employees, as the case may be), or (B) except for increases occurring in the ordinary and usual course of business consistent with past practice, increase the salary, wage, bonus or other compensation of any employees or fringe benefits of any director, officer or employee or enter into any contract, agreement, commitment or arrangement to do any of the foregoing;
(v) neither NYSE Euronext nor any of its Subsidiaries shall lease, license, transfer, exchange or swap, mortgage (including securitizations), or otherwise dispose (whether by way of merger, consolidation, sale of stock or assets, or otherwise) of any material portion of its assets, including the capital stock of Subsidiaries (it being understood that the foregoing shall not prohibit the sale of inventory in the ordinary course of business), except for (A) dispositions of assets that in total have an aggregate fair market value of less than $135,000,000, or (B) transactions between NYSE Euronext and any Subsidiary or transactions between Subsidiaries;
(vi) neither NYSE Euronext nor any of its Subsidiaries shall acquire or agree to acquire (whether by merger, consolidation, purchase or otherwise) any Person or assets, in which the expected gross expenditures and commitments (including the amount of any indebtedness assumed) (A) for all such acquisitions exceeds, in the aggregate, $270,000,000 (it being understood that if NYSE Euronext intends to make one or more acquisitions that would exceed such amount, then NYSE Euronext, NASDAQ OMX and ICE will discuss in good faith as to whether to permit such acquisitions based on the best interests of NASDAQ OMX and ICE after the Effective Time), or (B) is reasonably likely, individually or in the aggregate, to materially delay the satisfaction of the conditions set forth in Article V or prevent the satisfaction of such conditions;
(vii) except in the ordinary and usual course of business consistent with past practice, neither NYSE Euronext nor any of its Subsidiaries shall (i) settle or compromise any material claims or litigation if such settlement or compromise would involve, individually or together with all such other ownership settlements or compromises, the payment of money by NYSE Euronext or its Subsidiaries of $70,000,000 or more or would involve any admission of material wrongdoing or any material conduct requirement or restriction by NYSE Euronext or its Subsidiaries or (ii) modify, amend or terminate in any material respect any of its Material Contracts or waive, release or assign any material rights or claims thereunder in excess of $70,000,000 individually or in the aggregate;
(viii) except to the extent otherwise required by Law, neither NYSE Euronext nor any of its Subsidiaries shall make or change any Tax election, change any method of Tax accounting, file any amended Tax Return, or settle or compromise any audit or proceeding relating to Taxes, in each case, if such action would reasonably be expected to have an adverse effect on NYSE Euronext that is material; or permit any material insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business;
(ix) neither NYSE Euronext nor any of its Subsidiaries shall permit any change in its financial accounting principles, policies or practice (including any of its practices with respect to accounts receivable or accounts payable), except to the extent that any such changes in financial accounting principles, policies or practices shall be required by changes in GAAP;
(x) neither NYSE Euronext nor any of its Subsidiaries shall enter into any “non-compete” or similar Contract that would materially restrict the business of NASDAQ OMX Group or ICE Group following the Effective Time;
(xi) except as permitted pursuant to Section 4.1(a)(iv), neither NYSE Euronext nor any of its Major Subsidiaries shall enter into any Contract between itself, on the one hand, and any of its employees, officers or directors, on the other hand, if such Contract is not entered into on an arm’s length basis; and
(xii) neither NYSE Euronext nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing set forth in Sections 4.1(a)(i) through (xi) if NYSE Euronext would be prohibited by the terms of Sections 4.1(a)(i) through (xi) from doing the foregoing.
(b) Each of NASDAQ OMX and ICE covenants and agrees as to itself and its Subsidiaries that, after the date hereof and until the earlier of the Effective Time or the termination of this Agreement in accordance with its terms, unless NYSE Euronext shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement or except as otherwise set forth in Section 4.1 of the NASDAQ OMX Disclosure Letter or Section 4.1 of the ICE Disclosure Letter, as the case may be:
(i) (A) it shall not amend its certificate of incorporation or bylaws in a manner adverse to the stockholders of NYSE Euronext as opposed to any other holders of its common stock; (B) it shall not split, combine or reclassify its outstanding shares of capital stock; (C) it shall not declare, set aside or pay any type of dividend, whether payable in cash, stock or property, in respect of any capital stock; and (D) it shall not repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any interests or shares of its capital stock, as applicable, or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(ii) it shall not issue, sell, dispose of or grant, or authorize the issuance, sale, disposition or grant of, any shares of any class of its capital stock except (A) for fair market value or (B) upon the vesting of restricted stock units or the exercise of options, warrants, convertible securities or other rights of any kind to acquire any of its capital stock which were issued with an exercise or conversion price of not less than regular quarterly cash dividends the market price at the time of issuance; provided, however, that the foregoing shall not prohibit issuances of common stock, restricted stock units, options or rights as part of normal employee compensation in the ordinary course of business; provided, further, that this subsection (B) shall not prohibit the issuance of capital stock, restricted stock units, options, warrants, convertible securities or other rights in connection with any equity financing contemplated by NASDAQ OMX or ICE, as applicable, in connection with the transactions contemplated by this Agreement;
(iii) neither it nor any of its Subsidiaries shall acquire or agree to exceed $0.05 per share)acquire (whether by merger, consolidation, purchase or otherwise) any Person or assets, in which the expected gross expenditures and commitments (including the amount of any indebtedness assumed) is reasonably likely, individually or in the aggregate, to materially delay the satisfaction of the conditions set forth in Article V or prevent the satisfaction of such conditions;
(iv) it shall not fail to make in a timely manner any filings with the SEC required under the Securities Act of 1933, as amended (including the rules and regulations promulgated thereunder, the “Securities Act”) or the Securities Exchange Act of 1934, as amended (including the rules promulgated thereunder, the “Exchange Act”) or the rules and regulations promulgated thereunder; and
(v) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing set forth in Section 4.1(b)(i) through (iv) if it would be prohibited by the terms of Section 4.1(b)(i) through (iv) from doing the foregoing.
Appears in 2 contracts
Sources: Merger Agreement (Nasdaq Omx Group, Inc.), Merger Agreement (Intercontinentalexchange Inc)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective TimeTime (unless SBC shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed, and except as set forth otherwise expressly contemplated by this Agreement or the Stock Option Agreement, in the Company Disclosure Letter or as contemplated required by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: applicable Law):
(i) shallthe business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall cause each of use all reasonable efforts to preserve its Significant Subsidiaries tobusiness organization intact and maintain its existing relations and goodwill with customers, conduct its operations according to their usualsuppliers, regular regulators, distributors, creditors, lessors, employees and ordinary course in substantially the same manner as heretofore conducted; business associates;
(ii) it shall not (A) amend its Certificate certificate of Incorporation incorporation or Bylaws by-laws or comparable governing instruments (other than to permit amend, modify or terminate the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Rights Agreement; (vB) shall not (x) except pursuant to the exercise of optionssplit, warrantscombine, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, subdivide or pursuant to the Recapitalization issue any reclassify its outstanding shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (iiC) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend payable in cash, stock or make property in respect of any capital stock, other distribution than per share regular quarterly cash dividends not in excess of $0.44 per Company Share; or payment with respect (D) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries (other than the Company's Employee Stock Ownership Plan) to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(iii) neither it nor any of its Subsidiaries shall knowingly take any action that would prevent the Merger from qualifying for "pooling of interests" accounting treatment or as a tax-free "reorganization" within the meaning of Section 368(a) of the Code or that would cause any of its representations and warranties herein to become untrue in any material respect;
(iv) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other ownership interests compensation of any directors, officers or employees except (A) for grants or awards to directors, officers and employees of it or its Subsidiaries under existing Compensation and Benefit Plans in such amounts and on such terms as are consistent with past practice, (B) in the normal and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases and the provision of individual Compensation and Benefit Plans consistent with past practice for promoted or newly hired officers and employees and the adoption of Compensation and Benefit Plans for employees of new Subsidiaries in amounts and on terms consistent with past practice) or (C) for actions necessary to satisfy existing contractual obligations under Compensation and Benefit Plans existing as of the date hereof;
(v) neither it nor any of its Subsidiaries shall issue any preferred stock or incur any indebtedness for borrowed money (other than regular quarterly indebtedness incurred solely for the purpose of funding the Escrow Account or the replacement or refinancing of existing short-term indebtedness) or guarantee any such indebtedness if the Company should reasonably anticipate that as a result of such incurrence any of the Company's or any of its Subsidiaries' outstanding senior indebtedness would be rated lower than A by Standard & Poor's;
(vi) neither it nor any of its Subsidiaries shall make any capital expenditures in any calendar year in an aggregate amount in excess of the aggregate amount reflected in the Company's capital expenditure budget for such year, a copy of which has been provided to SBC, plus $100 million;
(vii) except as contemplated by Section 6.1(a)(iv), neither the Company nor any of its Subsidiaries shall issue, deliver, sell, or encumber shares of any class of its common stock or any securities convertible into, or any rights, warrants or options to acquire, any such shares except the option granted under the Stock Option Agreement, options outstanding on the date hereof under the Stock Plans, awards of options and restricted stock granted hereafter under the Stock Plans in the ordinary course of business in accordance with this Agreement and shares issuable pursuant to such options and awards;
(viii) neither it nor any of its Subsidiaries shall spend in excess of $50 million in any calendar year to acquire any business, whether by merger, consolidation, purchase of property or assets or otherwise (valuing any non-cash dividends not consideration at its fair market value as of the date of the agreement for such acquisition). For purposes of this clause (viii), the amount spent with respect to exceed $0.05 per share).any acquisition shall be deemed to include the aggregate amount of capital expenditures that the Company is obligated to make at any time or plans to make as result of such acquisition within two years after the date of acquisition; (ix) neither it nor its Subsidiaries shall enter any business other than the telecommunications business and those businesses traditionally associated with the telecommunications business or enter into or extend any telecommunications business outside the geographic areas served by it and its Subsidiaries as of the date of this Agreement; and
Appears in 2 contracts
Sources: Merger Agreement (SBC Communications Inc), Merger Agreement (SBC Communications Inc)
Interim Operations. (a) Prior EchoStar agrees that, during the period from the date of this Agreement through the earlier of the Closing or the date of termination of this Agreement, except (1) to the Effective Timeextent DISH shall otherwise give its prior consent in writing (such consent not to be unreasonably withheld, except conditioned or delayed), (2) as set forth in Section 4.1(a) of the Company EchoStar Disclosure Letter Letter, (3) as required by applicable Legal Requirements (including any applicable Covid-19 Measures that are Legal Requirements) or (4) as contemplated expressly required by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) EchoStar shall, and shall cause each of its Significant the EchoStar Subsidiaries to, conduct its operations according to their usual, regular and business in the ordinary course in substantially all material respects and in a manner consistent with past practice, and use reasonable best efforts to maintain and preserve intact its business organization, keep available the same manner services of key employees, maintain satisfactory relationships with Governmental Entities, customers, suppliers, distributors and other commercial counterparties and maintain its material assets and properties in their current condition (normal wear and tear excepted). Without limiting the foregoing, during the period from the date of this Agreement through the earlier of the Closing or the date of termination of this Agreement, except (1) to the extent DISH shall otherwise give its prior consent in writing (such consent not to be unreasonably withheld, conditioned or delayed), (2) as heretofore conducted; set forth in Section 4.1(a) of the EchoStar Disclosure Letter, (ii3) as required by applicable Legal Requirements or (4) as expressly required by this Agreement, EchoStar shall not (and shall not permit any EchoStar Subsidiary to):
(i) amend its Certificate EchoStar’s Organizational Documents or the Organizational Documents of Incorporation any EchoStar Subsidiary (except for immaterial amendments to the Organizational Documents of any EchoStar Subsidiary which would not reasonably be expected to materially delay or Bylaws or comparable governing instruments (other than to permit prevent the consummation of the transactions contemplated by this AgreementClosing or would reasonably be expected to adversely impact DISH and the DISH Subsidiaries); ;
(ii) split, combine, subdivide, amend the terms of or reclassify any shares of EchoStar’s capital stock or the capital stock of any EchoStar Subsidiary (other than any wholly owned EchoStar Subsidiary) (or any securities convertible into any of the foregoing);
(iii) shall promptly notify declare, set aside, make or pay any dividend or other distribution (whether in cash, stock, property or otherwise) with respect to any shares of EchoStar’s capital stock or the Purchaser capital stock of any breach of EchoStar Subsidiary, except for dividends or other distributions paid by any representation wholly owned EchoStar Subsidiary to EchoStar or warranty contained herein or any Company Material Adverse Effect; another wholly owned EchoStar Subsidiary;
(iv) shall promptly deliver (A) form any Subsidiary that would constitute an EchoStar Subsidiary, (B) make any capital contributions to, or investments in, any other Person (including any officer, director, Affiliate, agent or consultant of EchoStar or any EchoStar Subsidiary) other than to wholly owned EchoStar Subsidiaries that are not H▇▇▇▇▇ Satellite Systems Corporation or any “Restricted Subsidiary” under the Secured Indenture or the Unsecured Indenture or (C) acquire (by merger, consolidation, acquisition of stock or assets, formation of a joint venture or otherwise) (1) any other Person, (2) any equity interest in any other Person, (3) any business, or (4) any assets, except, in the case of clause (C), in one or more transactions with respect to which the aggregate consideration for all such transactions does not exceed $5,000,000 and which would not reasonably be expected to materially delay or prevent the consummation of the Closing;
(v) issue, sell, grant or otherwise permit to become outstanding any additional shares of, or securities convertible or exchangeable for, or options, warrants or rights to acquire, any shares of its capital stock or the capital stock of any EchoStar Subsidiary, other than: (A) shares of capital stock of a wholly owned Subsidiary of EchoStar issued to either EchoStar or another wholly owned Subsidiary of EchoStar; (B) shares of EchoStar Common Stock issuable upon exercise of EchoStar Options or the vesting of EchoStar RSU Awards outstanding on the date of this Agreement; (C) pursuant to the Purchaser true EchoStar ESPP in accordance with the terms of this Agreement; and correct copies (D) shares of EchoStar Class A Common Stock issuable upon conversion from other classes of EchoStar Common Stock in accordance with the EchoStar Articles.
(vi) except in a transaction solely between EchoStar and any wholly owned Subsidiary of EchoStar or solely among any wholly owned Subsidiaries of EchoStar, sell, assign, transfer, lease or license to any third party, or encumber (other than EchoStar Permitted Encumbrances), or otherwise dispose of, any EchoStar IP or any material assets of EchoStar, other than: (A) sales of inventory or of obsolete assets in the ordinary course of business; (B) pursuant to written Contracts or commitments existing as of the date of this Agreement and set forth on Section 4.1(a)(vi) of the EchoStar Disclosure Letter; (C) non-exclusive licenses of EchoStar IP granted in the ordinary course of business; or (D) disposals of any reportimmaterial EchoStar Registered IP resulting from a cancellation, statement abandonment or schedule filed with failure to renew any immaterial EchoStar Registered IP in the SEC subsequent ordinary course of business;
(vii) directly or indirectly repurchase, redeem or otherwise acquire any shares of EchoStar’s capital stock, or any other securities or obligations convertible (currently or after the passage of time or the occurrence of certain events) into or exchangeable for any shares of EchoStar’s capital stock, except: (A) shares of EchoStar Common Stock repurchased from employees or consultants or former employees or consultants of EchoStar pursuant to the exercise of repurchase rights binding on EchoStar and existing prior to the date of this Agreement; or (vB) shall not (x) except shares of EchoStar Common Stock accepted as payment for the exercise price of EchoStar Options outstanding on the date of this Agreement pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, applicable EchoStar Equity Plan or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth for withholding Taxes incurred in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed connection with the SEC subsequent to exercise, vesting or settlement of EchoStar Options and EchoStar RSU Awards outstanding on the date of this Agreement, as applicable, in accordance with past practice and the terms of the applicable award;
(viii) (A) incur any indebtedness for borrowed money, guarantee any such indebtedness, issue or sell any debt securities or rights to acquire any debt securities (directly, contingently or otherwise) or make any loans or advances to any other person; (B) incur any Lien on any of its material property or assets, except for EchoStar Permitted Encumbrances; or (C) enter into any transactions that amend or otherwise alter available capacity under Section 4.7 of either the Unsecured Indenture or the Secured Indenture;
(ix) (A) adopt, terminate or materially amend any EchoStar Plan or any collective bargaining or other labor agreement, (B) increase, or accelerate the vesting or payment of, the compensation or benefits of any director, independent contractor or employee of EchoStar or any EchoStar Subsidiary, other than, (1) in the event the Closing has not occurred by April 2, 2024, increases in base salary to any such individuals who are not directors or officers of EchoStar or any EchoStar Subsidiary in the ordinary course of business consistent with past practice that do not exceed 5% in the aggregate and (2) increases in connection with promotions permitted under clause (D) in the ordinary course of business consistent with past practice, (C) grant any rights to severance, retention, change in control or termination pay to any director, independent contractor or employee of EchoStar or any EchoStar Subsidiary, (D) hire or promote any employee to a position with EchoStar or any EchoStar Subsidiary with an annual rate of base salary in excess of $300,000 or a title of Senior Vice President or higher, or (E) terminate the employment of any employee of EchoStar or any EchoStar Subsidiary with an annual rate of base salary in excess of $300,000 or a title of Senior Vice President or higher (other than for cause), except for: (1) amendments to EchoStar Plans determined by EchoStar in good faith to be required to comply with applicable Legal Requirements; and (iv2) increases required pursuant to any EchoStar Plan as in effect on the date of this Agreement;
(x) other than in the ordinary course of business consistent with past practice (A) amend, supplement or otherwise modify or terminate any Material Contracts or waive, release or assign any material rights under any Material Contracts (except for (1) terminations pursuant to the expiration of the existing term of any Material Contract and (2) extensions at the option of EchoStar or any EchoStar Subsidiary under the terms thereof exercised in the ordinary course of business consistent with past practice), or (B) enter into any Contract that, if in effect on the date of this Agreement, would constitute a Material Contract;
(xi) change any of its methods of financial accounting or accounting practices in any material respect other than as required by changes in GAAP;
(xii) (A) make, change or revoke any material Tax election, (B) change or adopt any Tax accounting period or material method of Tax accounting, (C) amend any material EchoStar Return, (D) settle or compromise any liability for material Taxes or any Tax audit, claim, or other proceeding relating to any material Taxes, (E) enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar state, local or non-U.S. Legal Requirement), (F) request any Tax ruling from any Governmental Entity, (G) surrender any right to claim a refund of material Taxes or (H) extend or waive (other than automatically granted extensions and waivers) of the statute of limitations with respect to a material amount of Taxes;
(xiii) make any capital expenditure that is not contemplated by the capital expenditure budget set forth in Section 4.1(a)(xiii) of the EchoStar Disclosure Letter (a “EchoStar Non-Budgeted Capital Expenditure”), except that EchoStar or any Subsidiary of EchoStar may make any EchoStar Non-Budgeted Capital Expenditure that, when added to all other EchoStar Non-Budgeted Capital Expenditures made by EchoStar and the EchoStar Subsidiaries since the date of this Agreement, would not exceed $5,000,000, individually, or $10,000,000, in the aggregate;
(xiv) convene any annual or special meeting (or any adjournment or postponement thereof) of EchoStar’s stockholders;
(xv) enter into any agreement, understanding or arrangement with respect to the sale or voting of its capital stock or other equity interests;
(xvi) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization;
(xvii) commence, settle or compromise any litigation, claim, suit, action, proceeding or other Legal Proceeding, except for settlements or compromises that (A) involve solely monetary remedies and, in the case of settlements involving the payment of money by EchoStar or the EchoStar Subsidiaries, have a value not in excess of $5,000,000 in the aggregate, (B) do not impose any material restriction on EchoStar’s business or the business of the EchoStar Subsidiaries, (C) do not relate to any litigation, claim, suit, action, proceeding or other Legal Proceeding by EchoStar’s stockholders in connection with this Agreement or the Merger and (D) do not include an admission of liability or fault on the part of EchoStar or any EchoStar Subsidiary;
(xviii) materially reduce the amount of insurance coverage or fail to renew or maintain any material existing insurance policies;
(xix) amend, terminate or allow to lapse any EchoStar Permits in a manner that adversely impacts EchoStar’s ability to conduct its business in any material respect;
(xx) (A) fail to pay any issuance, renewal, maintenance and other payments that become due with respect to the EchoStar Registered IP or otherwise abandon, cancel, or permit to lapse any material EchoStar IP or agreements pursuant to which EchoStar or any EchoStar Subsidiary licenses or obtains the right to use any Intellectual Property, other than any abandonment of any EchoStar Registered IP at the end of the applicable statutory term or otherwise in the ordinary course of business consistent with past practice, or (B) disclose to any third party any Trade Secret included in the EchoStar IP, other than pursuant to a non-disclosure agreement restricting the disclosure and use of such Trade Secret, or in connection with any regulatory filing or any publication of any patent application;
(xxi) except in the ordinary course of business, enter into any Contract under which EchoStar or any EchoStar Subsidiary grants or agrees to grant any right, or agrees to pay any royalties or similar obligations, with respect to any Intellectual Property;
(xxii) enter into any material new line of business or line of business of any kind competitive with DISH and the DISH Subsidiaries;
(xxiii) take any action, or knowingly fail to take any action, which action or failure to act could be reasonably expected to prevent the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code; or
(xxiv) authorize, enter into any Contract or make any commitment to do any of the foregoing.
(b) DISH agrees that, during the period from the date of this Agreement through the earlier of the Closing or the date of termination of this Agreement, except (1) to the extent EchoStar shall otherwise give its prior consent in writing (such consent not to be unreasonably withheld, conditioned or delayed), (2) as set forth in Section 4.1(b) of the DISH Disclosure Letter, (3) as required by applicable Legal Requirements (including any applicable Covid-19 Measures that are Legal Requirements) or (4) as expressly required by this Agreement, DISH shall, and shall cause the DISH Subsidiaries to, conduct its business in the ordinary course in all material respects and in a manner consistent with past practice, and use reasonable best efforts to maintain and preserve intact its business organization, maintain satisfactory relationships with Governmental Entities, customers, suppliers, distributors and other commercial counterparties and maintain its material assets and properties in their current condition (normal wear and tear excepted). Without limiting the foregoing, during the period from the date of this Agreement through the earlier of the Closing or the date of termination of this Agreement, except (1) to the extent EchoStar shall otherwise give its prior consent in writing (such consent not to be unreasonably withheld, conditioned or delayed), (2) as set forth in Section 4.1(b) of the DISH Disclosure Letter, (3) as required by applicable Legal Requirements or (4) as expressly required by this Agreement, DISH shall not (and shall not permit any DISH Subsidiary to):
(i) amend DISH’s Organizational Documents in any manner which would reasonably be expected to materially delay or prevent the consummation of the Closing or would be adverse in any material respect to the holders of EchoStar Class A Common Stock relative to holders of DISH Class A Common Stock;
(ii) split, combine, subdivide, amend the terms of or reclassify any shares of the DISH’s capital stock or the capital stock of any DISH Subsidiary (other than any wholly owned DISH Subsidiary) (or any securities convertible into or exchangeable for, or options, warrants or rights to acquire, any of the foregoing);
(iii) declare, set aside aside, make or pay any dividend or make any other distribution (whether in cash, stock, property or payment otherwise) with respect to any shares of its DISH’s capital stock or the capital stock of any DISH Subsidiary, except for dividends or other ownership interests distributions paid by any wholly owned DISH Subsidiary to DISH or another wholly owned DISH Subsidiary;
(other than regular quarterly cash dividends not iv) directly or indirectly repurchase, redeem or otherwise acquire any shares of DISH Common Stock (excluding, for clarity, securities convertible into shares of DISH Common Stock), except: (A) shares of DISH Common Stock repurchased from employees or consultants or former employees or consultants of DISH pursuant to exceed $0.05 per share).the exercise of repurchase rights binding on DISH and existing prior to t
Appears in 2 contracts
Sources: Agreement and Plan of Merger (EchoStar CORP), Agreement and Plan of Merger (DISH Network CORP)
Interim Operations. (a) Prior to During the Effective Timeperiod commencing on the date hereof and running until the earlier of the Closing Date and the termination of this Agreement in accordance with Article VIII (the “Pre-Closing Period”), except (i) as expressly contemplated, required or permitted by this Agreement (including, for the avoidance of doubt, the Company LLC Units Redemptions), (ii) as required by applicable Law, (iii) as approved in writing by Parent (such approval not to be unreasonably withheld, delayed or conditioned), or (iv) as set forth in on Section 6.1 of the Company Disclosure Letter Schedule, the Company will, and will cause its Subsidiaries to use reasonable efforts to, (A) conduct their businesses in the ordinary course of business consistent with past practice, (B) manage their working capital in the ordinary course of business consistent with past practice, and (C) preserve intact in all material respects their respective assets, properties, business organizations and relationships with partners, clients, suppliers, distributors and other Persons with which it has material business dealings; provided that no action by the Company or as contemplated its Subsidiaries with respect to matters specifically permitted by any provision of Section 6.1(b) shall be deemed a breach of this sentence unless such action would otherwise constitute a breach of such provision of Section 6.1(b).
(b) During the Pre-Closing Period, except (i) as expressly contemplated, required or permitted by this Agreement, (ii) as required by applicable Law, (iii) as approved in writing by Parent (such approval not to be unreasonably withheld, delayed or conditioned) or (iv) as set forth on Section 6.1 of the Company Disclosure Schedule, the Company will not, and will cause its Subsidiaries not to:
(i) (A) adopt any change in the certificate of incorporation or bylaws of the Company or (B) adopt any change in the comparable organizational document of any of the Company’s Subsidiaries (including any amendment to the Company LLC Agreement);
(ii) merge or consolidate the Company or any of its Subsidiaries with any other provision Person, or restructure, reorganize, recapitalize or completely or partially liquidate or dissolve or otherwise enter into any agreement or arrangement imposing restrictions on the assets, operations or business of the Company or any of its Subsidiaries, other than restructuring, reorganization, recapitalization, liquidation or dissolution of any Subsidiary of the Company that are immaterial to the Company and its Subsidiaries, taken as a whole, and to the extent such actions are not expected to be adverse to Parent;
(iii) issue, sell, pledge, encumber, dispose of or grant, or authorize the issuance, sale, pledge, encumbrance, disposition or grant of, any shares of capital stock of the Company or any of its Subsidiaries, or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants, restricted shares, restricted share units, performance share units, stock appreciation rights, phantom stock or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities, in each case, other than (A) any such transaction among the Company and its Subsidiaries or among the Company’s Subsidiaries or (B) any grant or issuance of shares of Company Stock or Company LLC Units (1) in redemption of Company LLC Units in accordance with the terms of the Company LLC Agreement, (2) in respect of any exercise of Company Options or Company SARs, (3) in settlement of any Company RSUs or Company PSUs or (4) in connection with the conversion or cancellation of any Class G Units or Class G Common Stock;
(iv) make any loans, advances or capital contributions to or investments in any Person (other than to the Company or any of its Subsidiaries);
(v) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise with respect to any of its capital stock, except for (A) dividends or other distributions paid by any Subsidiary of the Company to the Company or to any other Subsidiary of the Company and (B) distributions in accordance with Section 5.03 of the Company LLC Agreement, to the extent consistent with past practice;
(vi) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock except for (A) any such transaction solely among the Company and any of its Subsidiaries or solely among any of the Company’s Subsidiaries, (B) acquisitions of shares of Company Stock or Company LLC Units in satisfaction of withholding obligations in respect of Company Equity Awards, or (C) acquisitions of Company LLC Units in connection with a redemption of such Company LLC Units in accordance with the terms of the Company LLC Agreement;
(vii) create, incur, assume or guarantee any Indebtedness for borrowed money or issue any debt securities or guarantees of the same or any other Indebtedness, except for (A) borrowings in the ordinary course of business under the Company Credit Agreement, (B) guarantees or credit support provided by the Company or any of its Subsidiaries of the obligations of the Company or any of its Subsidiaries in the ordinary course of business consistent with past practice to the extent such Indebtedness is in existence on the date of this Agreement or incurred in compliance with clause (A) of this Section 6.1(b)(vii), and (C) any Indebtedness solely among the Company and its Subsidiaries or among the Company’s Subsidiaries;
(viii) (A) other than in the ordinary course of business consistent with past practice, enter into any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement, unless (B) amend, modify or waive in any material respect or in a manner adverse to the Purchaser has consented Company or any of its Subsidiaries, or terminate, any Material Contract (other than renewals or expirations of any such Contract in writing accordance with its terms), or (C) make any materially adverse changes to the Company’s policies regarding minimum quality, revenue or commission rates with respect to entry into new homeowner customer contracts or renewals of existing homeowner customer contracts;
(ix) make any material changes to the Company’s sales and marketing budget set forth on Section 6.1(b)(ix) of the Company Disclosure Schedule;
(x) make any material changes with respect to financial accounting policies or procedures, except as required by Law or by U.S. GAAP or official interpretations with respect thereto or by any Governmental Authority or quasi-Governmental Authority (including the Financial Accounting Standards Board or any similar organization);
(xi) settle any Action for an amount in excess of $500,000 individually or $1,500,000 in the aggregate other than (A) any settlement or compromise where the amount paid or to be paid by the Company or any of its Subsidiaries is fully covered (less retention or deductible under the applicable insurance policy) by insurance coverage amounts maintained by the Company or any of its Subsidiaries, and (B) settlements or compromises of any Action for an amount not materially in excess of the amount, if any, reflected or specifically reserved in the balance sheet (or the notes thereto) of the Company included in the Company Reports filed prior to the date hereof (with materiality measured relative to the amount so reflected or reserved, if any); provided that, in the case of each of the foregoing clause (A) and clause (B), the settlement or compromise of such Action does not (x) impose any non-de minimis restriction on the business or operations of the Company or any of its Subsidiaries (or Parent or any of its Subsidiaries after the Closing) and (y) include any non-de minimis non-monetary or injunctive relief, or the admission of wrongdoing, by the Company or any of its Subsidiaries or any of their respective officers or directors;
(xii) assign, transfer, sell, lease, license, encumber (other than Permitted Liens), abandon, permit to lapse, or otherwise dispose of any material assets or property (including any material Intellectual Property rights) except (A) as may be required by a Governmental Authority to permit or facilitate the consummation of the Mergers or any of the other transactions contemplated in this Agreement solely to the extent required pursuant to Section 6.5, (B) transactions among the Company and its Subsidiaries or among the Company’s Subsidiaries, (C) as permitted under the Company Credit Agreement, or (D) in the ordinary course of business and in no event in an amount or value exceeding $750,000 individually or $2,000,000 in the aggregate;
(xiii) except as required by the terms of any Plan in effect on the date of this Agreement: (A) grant any equity or equity-based awards or increase the compensation or other benefits payable or provided to the current or former employees, officers, directors or other individual service providers of the Employer Entities; (B) increase or accelerate the funding, payment or vesting of compensation or benefits provided under any Plan; (C) grant any cash or equity or equity-based incentive awards, bonus, change of control, severance or retention award or similar types of payments or benefits to any current or former employees, officers, directors or other individual service providers of the Employer Entities; (D) establish, adopt, enter into, terminate or materially amend any Plan (or any plan, program, agreement or arrangement that would be a Plan if in effect on the date hereof) other than (x) offer letters or similar arrangements extended to newly hired individuals following the date hereof where such letters or arrangements do not provide for severance or equity-based compensation or (y) in connection with routine, immaterial or ministerial amendments to health and welfare plans that do not materially increase benefits or result in a material increase in administrative costs; or (E) amend or modify any performance criteria, metrics or targets under any Plan such that, as compared to those criteria, metrics or targets under any Plan in effect as of the date of this Agreement, the performance criteria, metrics or targets would reasonably be expected to be more likely to be achieved than in the absence of such amendment or modification;
(xiv) acquire any business, assets or capital stock of any Person or division thereof, whether in whole or in part (and whether by purchase of stock, purchase of assets, merger, consolidation or otherwise), other than the acquisition of assets from vendors or Suppliers of the Company or any of its Subsidiaries in the ordinary course of business consistent with past practice;
(xv) make (other than in a manner consistent with past practice), change or revoke any material Tax election or change any annual Tax accounting period or method of Tax accounting, intentionally surrender any right to claim for a material Tax refund, credit, offset or other reduction in Tax liability, file any amended income Tax Return or other material amended Tax Return; enter into any closing agreement in respect of any material Tax; waive or extend the statute of limitations in respect of any Taxes, or settle, resolve or otherwise dispose of any material Action in respect of Taxes;
(xvi) incur, or commit to incur, any capital expenditures that are in excess of $500,000 individually or $1,500,000 in the aggregate, other than any capital expenditure (or series of related capital expenditures) made in accordance with the Company’s annual capital expenditure budget for periods following the date of this Agreement, as provided to Parent prior to the date hereof;
(xvii) (A) make any material modifications to any material Business Systems, excluding, for the avoidance of doubt, any routine updates or previously scheduled upgrades necessary for the continued performance, function or operation of such Business Systems, or (B) enter into, terminate, or materially amend or modify, any Contract for the purchase, license or integration of any material property management system Software;
(xviii) voluntarily terminate, suspend, abrogate, amend or modify any material Company Permit in a manner materially adverse to the Company and its Subsidiaries, taken as a whole;
(xix) waive or release any noncompetition, nonsolicitation, nondisclosure, noninterference, nondisparagement, or other restrictive covenant obligation of any current or former officer, manager, employee or independent contractor of the Employer Entities;
(xx) (A) negotiate or enter into any Collective Bargaining Agreement, (B) voluntarily certify or recognize any labor union, labor organization, works council, or group of employees as the bargaining representative for any employees of the Company or any Company Subsidiary, or (C) implement or announce any plant closings, mass layoffs, group terminations, or other actions affecting employees of the Company or any Company Subsidiary that trigger notice requirements under the WARN Act;
(xxi) enter into any Real Property Lease, or modify, renew or terminate any Real Property Lease, in each case, unless in the ordinary course of business and the annual payment obligations thereunder by the Company or any of its Subsidiaries do not exceed $500,000 individually or $2,000,000 in the aggregate; or
(xxii) agree, authorize or commit to do any of the foregoing.
(c) Nothing contained in this Agreement is intended to give Parent or Merger Subs or any of their Affiliates, directly or indirectly, the right to control or direct the operations of the Company and its Subsidiaries prior to the Company Merger Effective Time. Prior to the Company Merger Effective Time, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations.
(d) Subject to the terms of this Agreement, including Section 6.5 and Section 6.13, from the date of this Agreement until the Company Merger Effective Time, none of Parent, Merger Subs or their respective Subsidiaries shall (i) shallknowingly take any action that would prevent, and shall cause each materially delay or materially impede the consummation of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedEquity Financing; or (ii) shall not amend its Certificate acquire or agree to acquire by merging or consolidating with, or by purchasing substantially all of Incorporation the assets of or Bylaws equity in, any Person (a “Specified Acquisition”), if the entering into of a definitive agreement relating to or comparable governing instruments (other than the consummation of such a Specified Acquisition, as applicable, would reasonably be expected to permit materially increase the risk of any Governmental Authority entering an Order, ruling, judgment or injunction prohibiting the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify , including the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Mergers.
Appears in 2 contracts
Sources: Agreement and Plan of Merger (Vacasa, Inc.), Agreement and Plan of Merger (Vacasa, Inc.)
Interim Operations. (a) Prior From and after the date of this Agreement to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries to, :
(i) conduct their respective businesses and operations only in its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; of business consistent with past practice;
(ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments use their reasonable efforts to (A) preserve intact their business organizations, (B) maintain in effect all existing material qualifications, licenses, permits, approvals and other than authorizations referred to permit in Section 5.1 and Section 5.12, (C) keep available the consummation services of the transactions contemplated by this Agreement); officers and key employees of the Company and each Subsidiary, and (D) preserve existing relationships with material customers and suppliers and those Persons having business relationships with them;
(iii) shall promptly upon the discovery thereof notify Purchaser of the Purchaser existence of any breach of any representation or warranty contained herein (or, in the case of any representation or any warranty that makes no reference to Company Material Adverse Effect; , any breach of such representation or warranty in any material respect) or the occurrence of any event that would cause any representation or warranty contained herein no longer to be true and correct (or, in the case of any representation or warranty that makes no reference to Company Material Adverse Effect, to no longer be true and correct in any material respect);
(iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; .
(vb) Without limiting the generality of the foregoing, from and after the date of this Agreement to the Effective Time, unless Purchaser has consented in writing thereto, the Company shall not, and shall not permit any of its Subsidiaries to:
(xi) propose to its stockholders or amend its certificate of incorporation or bylaws or comparable governing instruments, except for any amendment required in connection with the performance by the Company or its Subsidiaries of their respective obligations under this Agreement;
(ii) grant, issue, sell, pledge, encumber, transfer, deliver or register for issuance or sale any shares of capital stock or other ownership interest in the Company (other than issuances of Common Stock pursuant to (A) the exercise of Options outstanding on the date hereof or (B) the conversion of any Class B Common Stock outstanding on the date hereof into Class A Common Stock) or any of its Subsidiaries (other than issuances of capital stock of the Company’s Subsidiaries pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing Options outstanding on the date hereof and disclosed hereof), or any securities convertible into or exchangeable for any such shares or ownership interest, or any rights, warrants or options to acquire or with respect to any such shares of capital stock, ownership interest or convertible or exchangeable securities; or accelerate any right to convert or exchange or acquire any securities of the Company (other than Options pursuant to this AgreementSections 4.2(d) and 5.2(c)) or any of its Subsidiaries for any such shares or ownership interest;
(iii) effect any stock split, combination, reclassification or pursuant to the Recapitalization issue conversion of any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed exists on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14;
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declaredirectly or indirectly redeem, set aside purchase or pay any dividend otherwise acquire, or make any other distribution offer to redeem, purchase or payment with respect to otherwise acquire, any shares of its capital stock or other ownership interests (capital stock of any of its Subsidiaries, other than regular quarterly cash dividends by repurchasing restricted stock or upon the cashless exercise of options, in each case in the ordinary course of business;
(v) sell, lease, license, encumber or otherwise dispose of any of its assets (including Intellectual Property of the Company or its Subsidiaries or capital stock of any of its Subsidiaries), except in the ordinary course of business (excluding capital stock of its Subsidiaries);
(vi) merge with or acquire (by merger, consolidation, acquisition of stock or assets, joint venture or otherwise of a direct or indirect ownership interest or investment) in one transaction or a series of related transactions any Person, for an aggregate consideration in excess of $1.0 million, any equity interests or other securities of any Person, any division or business of any Person or all or substantially all of the assets of any Person;
(vii) incur or assume any indebtedness for borrowed money, issue or sell any debt securities of the Company or any of its Subsidiaries or assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person (except wholly owned Subsidiaries of the Company or in the ordinary course of business up to $1.0 million), in any such case in excess of $1.0 million, except for the incurrence of indebtedness for working capital purposes in the ordinary course of business under the Company’s or its Subsidiaries’ existing credit facilities and capital expenditures made in accordance with the Company’s or its Subsidiaries’ previously adopted capital budgets, copies of which have been provided to Purchaser;
(viii) make or forgive any loans, advances or capital contributions to, or investments in, any other Person;
(ix) (A) enter into any new employment, severance, consulting or salary continuation agreements with any newly hired employees other than in the ordinary course of business or enter into any of the foregoing with any existing officers or directors or alter or amend in any way, except as may be required by Law or pursuant to any Contract or commitment in existence as of the date hereof, any compensation or benefits due to employees other than increases or new incentive awards in the ordinary course of business consistent with past practices; (B) except as required by Law or any existing Company Employee Plan or Material Contract or in the ordinary course of business consistent with past practice, increase the amount of compensation of or grant new incentive awards to any director or officer of the Company or any of its Subsidiaries other than annual restricted stock granted to directors; (C) except as required by Law, a Material Contract existing on the date hereof or pursuant to a Company severance policy or Company Employee Plan existing on the date hereof, grant any severance or termination pay to any director or officer of the Company or any of its Subsidiaries; (D) except as required by Law, adopt any additional employee benefit plan; (E) except as required by any existing Company Employee Plan or agreement thereunder, provide for the payment of any amounts as a result of the consummation of the transactions contemplated by this Agreement; or (F) pay any bonuses except to the extent earned under existing awards or new incentive awards listed in Section 5.10(h)(i)(6) of the Company Disclosure Letter;
(x) adopt or amend in any material respect or terminate any employee benefit plan or arrangement;
(xi) make any material changes in the type or amount of their insurance coverage or permit any material insurance policy naming the Company or any of its Subsidiaries as a beneficiary or a loss payee to be canceled or terminated other than in the ordinary course of business;
(xii) except as required by changes in applicable Law or GAAP, change any accounting methods, principles or practices used by the Company or its Subsidiaries, in each case, as concurred by its independent public accountants;
(xiii) (A) settle, pay or discharge, any litigation, investigation, arbitration, proceeding or other claim, liability or obligation arising from the conduct of business in the ordinary course for an amount in excess of $1.0 million, except for any settlement, payment or discharge by FTD, Inc. and ▇▇▇.▇▇▇ Inc. of their obligations under that certain Stipulation and Agreement of Compromise, Settlement and Release, dated as of August 4, 2003 (the “Stipulation”) entered into in settlement of the consolidated shareholder class actions entitled “In re ▇▇▇.▇▇▇, Inc. Shareholders Litigation,” Delaware ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇. ▇▇▇▇▇-▇▇, provided, that the Settlement (as defined in the Stipulation) has not to exceed $0.05 per share).been and shall not be changed or altered in any material way since the date of such Stipulation;
Appears in 2 contracts
Sources: Merger Agreement (FTD Inc), Merger Agreement (FTD Inc)
Interim Operations. Except as expressly contemplated hereby, without the prior written consent of Omnipoint, the Company shall conduct its business in all material respects in the ordinary course consistent with past practice and use all reasonable efforts to: (ai) Prior preserve intact its present business organization; (ii) keep available the services of its officers; (iii) maintain in effect all material foreign, federal, state and local licenses, approvals and authorizations, including, without limitation, the Company FCC Licenses, all material licenses and permits that are required for the Company to carry on its business as currently conducted or proposed to be conducted; and (iv) preserve existing relationships with its material partners, lenders, suppliers and others having material business relationships with it so that the business or prospects of the Company shall not be adversely affected in any material respect as of the Effective Time. Further, and without limiting the generality of the foregoing, from the date hereof until the Effective Time, except as set forth in without the prior written consent of Omnipoint, the Company Disclosure Letter or as contemplated by any other provision of this Agreementshall not:
(a) subject to Section 6.2, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate certificate of Incorporation incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right bylaws or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14applicable governing instrument;
(b) Prior subject to the Effective TimeSection 6.2, except as set forth in the Purchaser Disclosure Letter amend any term of any of its outstanding securities;
(c) split, combine, subdivide or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue reclassify any shares of its capital stock at less than fair market value (or other than pursuant to any Purchaser Stock Plans) equity interests or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution (whether in cash, stock or payment property or any combination thereof) in respect of its capital stock, or redeem, repurchase or otherwise acquire or offer to redeem, repurchase, or otherwise acquire any of its securities, other than the issuance of shares of Company Preferred Stock as dividends on outstanding shares of Company Preferred Stock as of the date hereof in accordance with respect the terms of the Company Preferred Stock;
(d) adopt a plan or agreement of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization;
(e) subject to Section 6.2, issue, deliver or sell, or authorize the issuance, delivery or sale of, any shares of its capital stock of any class or other ownership equity interests (or any securities convertible into or exercisable for, or any rights, warrants or options to acquire, any such capital stock or other equity interests, other than regular quarterly cash the issuance of shares of Company Preferred Stock as dividends on outstanding shares of Company Preferred Stock as of the date hereof in accordance with the terms of the Company Preferred Stock;
(f) make any capital expenditures, except for capital expenditures not exceeding $500,000 in the aggregate;
(g) acquire (by merger, consolidation, acquisition of stock or assets or otherwise) any corporation, limited liability company, partnership, other business organization or division thereof, licenses or other assets of any Person, other than in the ordinary course of business;
(h) sell, lease, license, encumber or otherwise transfer any assets (including any licenses);
(i) incur, assume or guarantee any Indebtedness other than pursuant to exceed $0.05 per share)agreements in effect on the date hereof and listed on the Company Disclosure Schedules;
(j) create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired, other than Liens for Taxes that are not yet due, statutory liens or to secure Indebtedness or other obligations permitted by this Agreement;
(k) make any loan, advance or capital contributions to or investment in any Person, or acquire any Investment Interest;
(l) enter into any contract or agreement, other than in the ordinary course of business, or relinquish or amend in any material respect any material contract (as defined in Item 601(b)(1) of Regulation S-K of the SEC) to which the Company is a party, other than transactions and commitments contemplated by this Agreement;
(n) enter into any agreement or arrangement that materially limits or otherwise materially restricts the Company or any of its Affiliates or any successor thereto or that could, after the Effective Time, limit or restrict any of Omnipoint, the Surviving Corporation or any of its Affiliates, from engaging in the business of providing wireless communications services or developing wireless communications technology anywhere in the world or otherwise from engaging in any other business;
(o) enter into any employment, deferred compensation or other similar agreement with any director or officer of the Company or with any other Person; or establish or adopt any collective bargaining, bonus, profit-sharing, thrift, pension, retirement, deferred compensation, compensation, stock option, restricted stock or other benefit plan or arrangement covering any director, officer of the Company or any other Person; increase the compensation, bonus or other benefits payable to any director, or officer of the Company; or amend the terms of any outstanding option or right to purchase shares of Company Common Stock or other capital stock of the Company;
(p) change (1) its methods of accounting or accounting practices in any material respect, except as required by concurrent changes in GAAP or by law or (2) its fiscal year;
(q) acquire any Investment Interest;
(r) settle any material litigation, investigation, arbitration, proceeding or other claim;
(s) make any material tax election or enter into any settlement or compromise of any material tax liability;
(t) take any action, other than as expressly permitted by this Agreement, that would make any representation or warranty of the Company hereunder inaccurate in any material respect at the Effective Time; or
(u) agree or commit to do any of the foregoing.
Appears in 2 contracts
Sources: Merger Agreement (East West Communications Inc), Merger Agreement (Omnipoint Corp \De\)
Interim Operations. (a) Prior to From the Effective Time, except as set forth in date of this Agreement and until the Company Disclosure Letter Closing or as contemplated by any other provision the earlier termination of this Agreement, unless the Purchaser has consented in writing theretoexcept that Seller may incur up to an additional $3,000,000 of debt from Perceptive Credit Opportunities Fund, the Company: L.P. and as (iw) shallrequired by Law, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as expressly contemplated by this Agreement, unless (y) set forth in Section 6.1 of the Company and the Special Committee have Seller Disclosure Letter or (z) consented to in writing theretoby Buyer (which consent will not be unreasonably withheld, the Purchaser: (i) shall not issue any shares conditional or delayed), Seller will, and will cause each of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split Subsidiaries to, conduct the Business in the ordinary course of business consistent with past practice and in material compliance with all material applicable Laws and Permits, and will, and will cause each of its capital stock; (ii) shall promptly notify Subsidiaries to, use its commercially reasonable efforts to preserve intact its present Business organization, maintain in effect all of its Permits, keep available the Company services of any breach its directors, officers and employees and maintain existing relations and goodwill with Governmental Entities, customers, distributors, lenders, partners, suppliers and others having material business associations with it or its Subsidiaries. Without limiting the generality of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver the foregoing and subject to the Company true exceptions set forth in the foregoing clauses (w), (x), (y) and correct copies of any report(z), statement or schedule filed with the SEC subsequent to from the date of this Agreement; Agreement until the Closing, Seller will not and will not permit its Subsidiaries to:
(i) adopt or propose any change in its certificate of incorporation or bylaws or other applicable governing instruments;
(ii) merge or consolidate Seller or any of its Subsidiaries with any other Person, or restructure, reorganize or completely or partially liquidate or otherwise enter into any Contracts imposing material changes or restrictions on its assets, operations or businesses;
(iii) create or incur any Lien or other encumbrance on any of the Acquired Assets, other than Permitted Liens and operating Liens incurred in the ordinary course of business consistent with past practice;
(iv) shall make any changes with respect to accounting policies or procedures used by it in the preparation of the Financial Statements or revalue or reclassify in any material respect any of the Acquired Assets or the Assumed Liabilities, except as required by changes in applicable GAAP;
(A) waive, release, settle or compromise any pending or threatened Action against Seller or any of its Subsidiaries relating to the Business other than settlements or compromises of any Action (1) in which the amount paid by or on behalf of Seller or any of its Subsidiaries in settlement or compromise does not declareexceed $500,000 individually or $1,000,000 in the aggregate and (2) that would entail the incurrence of (I) any obligation or liability of Seller or any of its Subsidiaries in excess of such amount, set aside including costs or revenue reductions or (II) any obligation that would impose any material restrictions on the business or operations of Seller or its Subsidiaries or (B) commence, join or appeal in any Action, other than in the ordinary course of business;
(vi) other than in the ordinary course of business and consistent with past practices, (A) make or change any material Tax election, (B) change Seller’s or any of its Subsidiaries’ method of accounting for Tax purposes, (C) file any material amended Tax Return, (D) settle, concede, compromise or abandon any material Tax claim or assessment, (E) surrender any right to a refund of material Taxes or (F) consent to any extension or waiver of the limitation period applicable to any claim or assessment with respect to material Taxes;
(vii) fail to maintain in full force and effect material Insurance Policies or comparable replacement policies covering Seller and its Subsidiaries and their respective properties, assets and businesses in a form and amount consistent with past practice;
(viii) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any of the Acquired Assets, except in the ordinary course of business consistent with past practice and sales of obsolete assets;
(ix) except as required pursuant to any Employee Plan, consistent with past practice, or as otherwise required by applicable Law, (A) pay, grant or provide any severance or termination payments or benefits to any Continuing Employee; (B) increase the compensation, bonus or pension, welfare, severance or other benefits of, pay any dividend bonus, incentive or retention payments to, or make any new equity awards to any Continuing Employee, except for increases in base salary in the ordinary course of business consistent with past practice for employees who are not officers; (C) establish, adopt, amend or terminate any Employee Plan or amend the terms of any outstanding equity-based awards; (D) take any action to accelerate the vesting or payment, or fund or in any other distribution way secure the payment, of compensation or payment benefits under any Employee Plan; (E) change in any material respect any actuarial or other assumptions used to calculate funding obligations with respect to any shares Employee Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP; or (F) forgive any loans to any Continuing Employee;
(x) enter into any new line of business; or
(xi) agree, authorize or commit to do any of the foregoing actions or enter into any letter of intent (binding or non-binding) or similar Contract with respect to any of the foregoing actions.
(b) Nothing contained in this Agreement is intended to give Buyer, directly or indirectly, the right to control or direct the Business prior to the Closing, and nothing contained in this Agreement is intended to give Seller, directly or indirectly, the right to control or direct Buyer’s operations. Prior to the Closing, each of Buyer and Seller will exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)and its Subsidiaries’ respective business and operations.
Appears in 2 contracts
Sources: Asset Purchase Agreement, Asset Purchase Agreement (Alliqua BioMedical, Inc.)
Interim Operations. (a) Prior to Without limiting the Effective TimeCompany's obligations under Section 6.5 of this Agreement, except as set forth in the corresponding section of the Company Disclosure Letter or otherwise as expressly contemplated hereby, the Company covenants and agrees as to itself and its Subsidiaries that, from the date of this Agreement until the Effective Time (unless Cingular shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed), the business of it and its Subsidiaries shall be conducted in the ordinary course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of the present employees and agents of the Company and its Subsidiaries. Without limiting the Company's obligations under Section 6.5 of this Agreement and without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, the Company will not and will not permit its Subsidiaries to (unless Cingular shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed):
(i) adopt or propose any change in its certificate of incorporation or by-laws or other applicable governing instruments;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among wholly-owned Subsidiaries of the Company that are not obligors or guarantors of third party indebtedness;
(iii) acquire assets outside of the ordinary course of business from any other Person with a value or purchase price in the aggregate in excess of $50,000,000, other than acquisitions pursuant to Contracts to the extent in effect immediately prior to the execution of this Agreement and set forth in Section 6.1(a)(iii) of the Company Disclosure Letter or as contemplated otherwise set forth in Section 6.1(a)(iii) of the Company Disclosure Letter;
(iv) other than pursuant to Contracts to the extent in effect as of immediately prior to the execution of this Agreement and set forth in Section 6.1(a)(iv) of the Company Disclosure Letter, and other than the issuance of shares of Common Stock upon the exercise of outstanding Company Options and pursuant to other equity-based awards granted under the Stock Plans and shares under the Company's 401(k) plan and the deferred compensation plans, in each case, in accordance with their terms, issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any its Subsidiaries (other than the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary), or securities convertible or exchangeable or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) other than in connection with existing receivables facilities and securitizations and renewals thereof in the ordinary course of business, create or incur any Lien on assets of the Company or any of its Subsidiaries that is material, individually or in the aggregate, to the Company and its Subsidiaries taken as a whole;
(vi) other than acquisitions pursuant to Contracts to the extent in effect as of immediately prior to the execution of this Agreement and set forth in Section 6.1(a)(vi) of the Company Disclosure Letter, make any loan, advance or capital contribution to or investment in any Person (other than a wholly-owned Subsidiary of the Company) in excess of $25,000,000 in the aggregate;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends or other distributions by any direct or indirect wholly-owned Subsidiary of the Company to the Company or to any other provision direct or indirect wholly-owned Subsidiary of the Company and periodic dividends and other periodic distributions by non-wholly-owned Subsidiaries consistent with past practices) or enter into any agreement with respect to the voting of its capital stock;
(viii) other than the redemption of the Series C Preferred Stock or the Series E Preferred Stock in accordance with the Company's certificate of incorporation, reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any share of its capital stock;
(ix) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for (A) indebtedness for borrowed money incurred in the ordinary course of business not to exceed $50,000,000 in the aggregate, (B) indebtedness for borrowed money in replacement of existing indebtedness for borrowed money on customary commercial terms, (C) guarantees incurred in compliance with this Section 6.1(a) by the Company of indebtedness of wholly-owned Subsidiaries of the Company or (D) interest rate swaps on customary commercial terms, consistent with past practices and not to exceed $750,000,000 of notional debt in the aggregate;
(x) except as set forth in Section 6.1(a)(x) of the Company Disclosure Letter, make or authorize any capital expenditure;
(xi) enter into any Material Contract that would have been a Material Contact as described in clauses (J), (L) or (M) of Section 5.1(j)(i) had it been entered into prior to the execution of this Agreement, unless and other than in the Purchaser has consented ordinary course of business, enter into any other Material Contract that would have been a Material Contract as described in writing theretoSection 5.1(j)(i) (other than as described in clauses (J), (L) or (M)) had it been entered into prior to the execution of this Agreement;
(xii) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP or by Law or except as the Company, based on the advice of its independent auditors and after consultation with Cingular, determines in good faith is advisable to conform to best accounting practices;
(xiii) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity for an amount in excess of $10,000,000 or which would be reasonably likely to have any adverse impact on the operations of the Company or any of its Subsidiaries or on any current or future litigation or other proceeding of the Company or any of its Subsidiaries; provided, that any litigation or other proceeding with respect to an item relating to Taxes may be settled for an amount that is not in excess of the amount reserved or accrued for such item on the most recent balance sheet contained in the Company Reports filed prior to the date of this Agreement (which reserve and accrual information shall be furnished by the Company to Cingular upon Cingular's request);
(xiv) other than in the ordinary course of business, amend or modify in any material respect, or terminate or waive any material right or benefit under any Material Contract;
(xv) except as required by Law, make any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any material method therefor that is inconsistent with elections made, positions taken or methods used in preparing or filing similar Tax Returns in prior periods. Notwithstanding the foregoing, the Company shall consult with Cingular and its Representatives prior to claiming any depreciation allowance under Section 168(k) of the Code;
(xvi) sell, lease, license, or otherwise dispose of any assets of the Company or its Subsidiaries except for ordinary course sales of mobile telephone equipment to customers of the Company: , services provided in the ordinary course of business or obsolete assets and except for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $25,000,000 in the aggregate, other than pursuant to Contracts in effect prior to the execution of this Agreement and set forth in Section 6.1(a)(iii) of the Company Disclosure Letter or as otherwise set forth in Section 6.1(a)(iii) of the Company Disclosure Letter and other than any dispositions of assets to the extent used as consideration for acquisitions that are permitted pursuant to Section 6.1(a)(iii);
(xvii) except as required pursuant to existing written, binding agreements in effect prior to the execution of this Agreement, as otherwise required by Law, or in the ordinary course of business consistent with past practice (which with respect to annual bonus plans and performance share awards is set forth in Section 6.1(a)(xvii) of the Company Disclosure Letter), (i) shallenter into any commitment to provide any severance or termination benefits to (or amend any existing arrangement with) any director, and shall cause each officer or employee of the Company or any of its Significant Subsidiaries toSubsidiaries, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation increase the benefits payable under any existing severance or Bylaws termination benefit policy or comparable governing instruments employment agreement (other than as required to permit be increased pursuant to the consummation existing terms of any such policy or agreement), (iii) enter into any employment, deferred compensation or other similar agreement (or amend any such existing agreement) with any director or officer of the Company or any of its Subsidiaries other than for new hires, (iv) establish, adopt, amend, terminate or make any new awards under any bonus, profit-sharing, thrift, pension, retirement, deferred compensation, compensation, stock option, restricted stock or other benefit plan or arrangement covering any director, officer or employee of the Company or any of its Subsidiaries (v) increase the compensation, bonus or other benefits payable to any director, officer, employee, consultant or independent contractor of the Company or any of its Subsidiaries, or (vi) amend the terms of any outstanding Company Option or other equity-based award; provided, that the Company shall in no event take any action to amend its severance plans, except as required by applicable Law;
(xviii) fail to initiate appropriate steps to renew any material FCC Licenses held by the Company or its Subsidiaries that are scheduled to terminate prior to or within 60 days after the Effective Time;
(xix) engage in the conduct of any business requiring the receipt or transfer of a License issued by a Governmental Entity other than engaging in the mobile wireless voice and data business in the U.S. and activities incident thereto, other than any other current lines of business and geographic locations of the Company or any of its Subsidiaries and other than as expressly permitted by Section 6.1(a)(iii) of the Company Disclosure Letter;
(xx) except as otherwise permitted hereby with respect to employees, enter into any material Contract with or engage in any material transaction with DoCoMo or any other Affiliate of the Company;
(xxi) adopt a technology platform other than existing technologies, (including analog, TDMA, EDGE, GSM and GPRS), HSDPA or UMTS and W-CDMA (including in each case the standards set forth on Section 6.1(a)(xxi) of the Company Disclosure Letter);
(xxii) amend, modify or waive any provision under the Rights Agreement; and
(xxiii) agree or commit to do any of the foregoing.
(b) Each of SBC and BellSouth will cause Cingular and Cingular Wireless to take all action necessary to consummate the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver Agreement subject to the Purchaser true terms and correct copies of conditions hereof. Neither SBC nor BellSouth will take or permit any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect Subsidiaries to take any stock split or otherwise change its capitalization as it existed on action that at the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on time of taking such action is reasonably likely to prevent the date hereof to acquire any shares consummation of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except Merger. Except as set forth in the Purchaser corresponding section of the disclosure letter delivered by SBC to the Company at the time of entering into this Agreement (the "SBC Disclosure Letter Letter"), neither SBC nor BellSouth shall, and each shall cause its Subsidiaries not to, prior to the Termination Date, (i) enter into any definitive agreement for the acquisition of any business or Person which provides commercial mobile wireless voice and data services offered to the public utilizing frequencies and spectrum licensed by the FCC, other than the provision of such services in de minimis amounts or (ii) take any action which would, at the time the action is taken, reasonably be expected to materially interfere with its ability to make available to Cingular or the Paying Agent as contemplated by of the Effective Time funds sufficient for its Specified Interest of the Merger Consideration. Each of SBC and BellSouth will, subject to the terms and conditions of this Agreement, unless make available to Cingular or the Company and Paying Agent its Specified Interest of the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Merger Consideration.
Appears in 2 contracts
Sources: Merger Agreement (At&t Wireless Services Inc), Merger Agreement (SBC Communications Inc)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, from the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing (such approval not to be unreasonably withheld, delayed or conditioned)), except as otherwise expressly contemplated or permitted by this Agreement or as required by a Governmental Entity or applicable Laws, the business of it and its Subsidiaries shall be conducted in all material respects in the ordinary course of business consistent with past practice and, to the extent consistent with the foregoing, the Company and its Subsidiaries shall use their respective commercially reasonable efforts to (u) preserve their business organizations substantially intact, (v) maintain satisfactory relationships with Governmental Entities, customers and suppliers, and (w) keep available the services of their key employees, key consultants and executive officers, (x) in connection with any and all clinical trial(s) for DX-2930, notify Parent (i) promptly after receipt of any material communication from any Regulatory Authority or inspections of any manufacturing, research and development or clinical trial site and before giving any material submission to a Regulatory Authority and (ii) a reasonable time prior to making any material change to a study protocol, adding new trials, making any material change to a manufacturing plan or process, or making a material change to the development timeline, and (z) preserve and protect the Intellectual Property owned by the Company and its Subsidiaries; provided, however, that no action taken by the Company or its Subsidiaries with respect to matters specifically addressed by clauses (i)-(xvii) of this Section 6.1(a) shall be deemed a breach of this sentence unless such action would constitute a breach of such other provision. From the date of this Agreement until the Effective Time, except (A) as otherwise expressly contemplated or permitted by this Agreement, (B) as Parent may approve in writing, (C) as is required by applicable Law or any Governmental Entity or (D) as set forth in Section 6.1(a) of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing theretoLetter, the Company: Company will not and will not permit its Subsidiaries to:
(i) shalladopt any change in its certificate of incorporation or bylaws or other applicable governing instruments, and shall cause each other than, in the case of its Significant Subsidiaries toSubsidiaries, conduct in a manner that would not materially restrict the operation of its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; business;
(ii) shall not amend (x) merge or consolidate the Company or any of its Certificate Subsidiaries with any other Person or (y) adopt a partial or complete plan of Incorporation dissolution, liquidation, consolidation, recapitalization, restructuring or Bylaws other reorganization of the Company or comparable governing instruments its Subsidiaries;
(iii) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries (other than to permit the consummation issuance of Shares upon (x) the exercise or vesting, as applicable, of Company Options or Company RSUs outstanding as of the transactions contemplated by date hereof or in compliance with this Agreement or (y) in connection with the ESPP in compliance with this Agreement); (iii) shall promptly notify the Purchaser , or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any breach kind to acquire any shares of any representation such capital stock or warranty contained herein such convertible or any Company Material Adverse Effect; exchangeable securities;
(iv) shall promptly deliver make any loans, advances or capital contributions to or investments in any Person (other than the Company or any direct or indirect wholly owned Subsidiary of the Company) in excess of $1,000,000 in the aggregate;
(v) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly owned Subsidiary to the Purchaser true and correct copies Company or to any other direct or indirect wholly owned Subsidiary) or enter into any agreement with respect to the voting of its capital stock;
(vi) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock (other than the retention or acquisition of any report, statement Shares tendered by current or schedule filed former employees or directors in order to pay Taxes in connection with the SEC subsequent exercise or vesting, as applicable, of Company Options or Company RSUs or in connection with the ESPP in the ordinary course of business consistent with past practice);
(vii) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person (other than a wholly owned Subsidiary of the Company), or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, other than indebtedness in an aggregate principal amount not to exceed $1,000,000 outstanding at any time;
(x) other than in the ordinary course of business consistent with past practice, acquire any assets or equity interests in any other Person for a fair market value in an amount in excess of (1) $1,000,000 in a single transaction or series of related transactions or (2) $5,000,000 in the aggregate and (y) except for expenditures set forth in capital budgets made available to Parent prior to the date of this Agreement; , make or authorize any capital expenditure in excess of $1,000,000 in the aggregate during any calendar year;
(vix) shall not (x) make any material changes with respect to financial accounting policies or procedures, except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreementas required by GAAP, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grantexcept as required by applicable Laws or GAAP, confer or award revalue in any option, warrant, conversion right or other right not existing on the date hereof to acquire material respect any shares of its capital stockassets, including writing off accounts or (z) adopt any A1-14
(b) Prior to the Effective Timenotes receivable, except as set forth other than in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company ordinary course of business and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed consistent with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).past practice;
Appears in 2 contracts
Sources: Merger Agreement (Shire PLC), Merger Agreement (Dyax Corp)
Interim Operations. (a) Prior Except as required by applicable Law or expressly contemplated by this Agreement, the Company covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of its and its Subsidiaries’ present employees and agents. Without limiting the generality of, and in furtherance of, the foregoing, from the date of this Agreement until the Effective Time, except as (A) required by applicable Law, (B) otherwise expressly contemplated by this Agreement or as set forth in Section 6.1 of the Company Disclosure Letter, or (C) Parent may approve in writing (such approval not to be unreasonably withheld), the Company will not and will not permit its Subsidiaries to:
(i) adopt or propose any change in its articles of incorporation or by-laws or other similar governing documents;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among wholly owned Subsidiaries of the Company, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) acquire assets outside of the ordinary course of business from any other Person with a value or purchase price in the aggregate in excess of $25 million in any transaction or series of related transactions, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement;
(iv) except for the issuance of Shares upon the exercise of Company Options or upon the vesting or settlement of Company Units, Deferred Shares or Company Awards, in all cases outstanding on the date of this Agreement, issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries (other than the issuance of shares by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) create or incur any Lien material to the Company or any of its Subsidiaries on any assets of the Company or any of its Subsidiaries having a value in excess of $5 million;
(vi) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than the Company or any direct or indirect wholly owned Subsidiary of the Company) in excess of $25 million in the aggregate;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly owned Subsidiary to the Company or to any other direct or indirect wholly owned Subsidiary) or enter into any Contract with respect to the voting of its capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(ix) incur, or enter into, amend, modify or terminate any Contract with respect to, any indebtedness for borrowed money or guarantee, or enter into, amend, modify or terminate any guarantee of, such indebtedness of another Person, or issue, sell, enter into, amend, modify or terminate any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for (i) indebtedness for borrowed money incurred in the ordinary course of business consistent with past practices not to exceed $25 million in the aggregate, (ii) indebtedness for borrowed money incurred in replacement of existing indebtedness for borrowed money on terms substantially consistent with or more beneficial than the indebtedness being replaced, (iii) guarantees incurred in compliance with this Section 6.1 by the Company of indebtedness of wholly owned Subsidiaries of the Company or (iv) interest rate swaps that the Company or any of its Subsidiaries enters into on customary commercial terms consistent with past practice and not to exceed $20 million in notional amount in the aggregate;
(x) except as set forth in the capital budgets set forth in Section 6.1(a)(x) of the Company Disclosure Letter and consistent therewith, make or authorize any capital expenditure in excess of $5 million in the aggregate during any 12 month period;
(xi) other than in the ordinary course of business consistent with past practice, enter into any Contract that would have been a Material Contract (under clause (A), (B), (C), (D), (E) or (F) of the definition of such term) or an IP Contract had it been entered into prior to this Agreement;
(xii) make any changes with respect to financial accounting policies or procedures, except as contemplated required by changes in GAAP or the rules or policies of the Public Company Accounting Oversight Board;
(xiii) settle any litigation or other proceedings before a Governmental Entity (A) for an amount in excess of $1.25 million or any obligation or liability of the Company in excess of such amount, (B) on a basis that would result in (I) the imposition of any writ, judgment, decree, settlement, award, injunction or similar order of any Governmental Entity that would restrict the future activity or conduct of the Company or any of its Subsidiaries or (II) a finding or admission of a violation of Law or violation of the rights of any Person by the Company or any of its Subsidiaries, or (C) that is brought by any other provision current, former or purported holders of this Agreement, unless any capital stock or debt securities of the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each Company or any of its Significant Subsidiaries to, conduct its operations according relating to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement;
(xiv) other than in the ordinary course of business consistent with past practice, amend, modify or terminate any Material Contract (under clause (A); , (iiiB), (C), (D), (E) shall promptly notify or (F) of the Purchaser definition of such term) or IP Contract, or cancel, modify or waive any debts or claims held by it or waive any rights having in each case a value in excess of $500,000 or in the aggregate a value in excess of $5 million;
(xv) make any material Tax election or material change in any Tax election, change or consent to change the Company’s or any of its Subsidiaries’ method of accounting for Tax purposes, file any material amended Tax Return or enter into any settlement or compromise of any breach material Tax liability of the Company or any of its Subsidiaries;
(xvi) transfer, sell, assign, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of (A) the i2 government software assets or business, (B) the marketing services business, (C) capital stock of any representation of its Subsidiaries or warranty contained herein (D) any other material assets, product lines, operation rights or any businesses of the Company Material Adverse Effect; or its Subsidiaries, except in the case of subclause (ivD), (x) shall promptly deliver in connection with services provided in the ordinary course of business and sales of obsolete assets, (y) except for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $10 million in the aggregate and (z) other than pursuant to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent Contracts in effect prior to the date of this Agreement; ;
(v) shall not (xxvii) except as required pursuant to Company Benefit Plans set forth in Sections 5.1(h)(i) and 5.1(h)(viii) of the exercise of options, warrants, conversion rights and other contractual rights existing Company Disclosure Letter as in effect on the date hereof and disclosed pursuant to of this Agreement, or pursuant as otherwise required by applicable Law, (i) grant or provide any severance or termination payments or benefits to the Recapitalization issue any shares of its capital stockSubsidiaries, effect any stock split directors, officers or otherwise change its capitalization as it existed on the date hereofemployees, (yii) grantincrease the compensation, confer bonus or award any optionpension, warrantwelfare, conversion right severance or other right not existing on the date hereof benefits of, pay any bonus to, or make any new equity awards to acquire any shares of its capital stockor its Subsidiaries’ directors, officers or employees, (iii) establish, adopt, amend or terminate any Company Benefit Plan or amend the terms of any outstanding equity-based awards, (iv) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any of the Company Benefit Plans, (v) change any actuarial or other assumptions used to calculate funding obligations with respect to any Company Benefit Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, or (zvi) adopt forgive any A1-14loans to any of its or of any of its Subsidiaries’ directors, officers or employees;
(xviii) take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Merger set forth in ARTICLE VII not being satisfied; or
(xix) agree, authorize or commit to do any of the foregoing.
(b) Prior to making any written material broad-based communications to the Effective Timedirectors, except as set forth in officers or employees of the Purchaser Disclosure Letter Company or as any of its Subsidiaries pertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement, unless the Company shall provide Parent with a copy of the intended communication, Parent shall have a reasonable period of time to review and comment on the communication, and Parent and the Special Committee have consented Company shall cooperate in writing thereto, the Purchaser: providing any such mutually agreeable communication.
(ic) Parent shall not issue knowingly take or permit any shares of its capital stock at less than fair market value (other than pursuant Subsidiaries to take any Purchaser Stock Plans) or effect any stock split action that is reasonably likely to prevent the consummation of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Merger.
Appears in 2 contracts
Sources: Merger Agreement (Choicepoint Inc), Merger Agreement (Reed Elsevier PLC)
Interim Operations. (a) Prior The Company agrees that, during the period from the date of this Agreement through the earlier of the Closing or the termination of this Agreement, except (1) to the Effective Timeextent Parent shall otherwise give its prior consent in writing (which consent shall not be unreasonably withheld, except conditioned or delayed), (2) as set forth in Part 4.1(a) of the Company Disclosure Letter Schedule, (3) as may be required by applicable Legal Requirements or (4) as contemplated expressly required by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant the Company Subsidiaries to, conduct its operations according to their usual, regular and business in the ordinary course consistent with past practice in substantially all material respects and use commercially reasonable efforts to maintain and preserve intact its business organization and maintain satisfactory relationships with customers, suppliers and distributors and other Persons with whom the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein Company or any Company Material Adverse Effect; (iv) shall promptly deliver to Subsidiary has material business relations. Without limiting the Purchaser true and correct copies of any reportforegoing, statement or schedule filed with during the SEC subsequent to period from the date of this Agreement; (v) shall not (x) except pursuant to Agreement through the exercise earlier of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to Closing or the termination of this Agreement, or pursuant except (1) to the Recapitalization issue any shares of extent Parent shall otherwise give its capital stockprior consent in writing (which consent shall not be unreasonably withheld, effect any stock split conditioned or otherwise change its capitalization as it existed on the date hereofdelayed), (y2) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in Part 4.1(a) of the Purchaser Company Disclosure Letter Schedule, (3) as may be required by applicable Legal Requirements or (4) as contemplated expressly or required by this Agreement, unless the Company shall not (and the Special Committee have consented shall not permit any Company Subsidiary to), in writing theretoeach case by merger, the Purchaser: consolidation, division, operation of law, or otherwise:
(i) shall not issue amend the Company’s Organizational Documents or the Organizational Documents of any Company Subsidiary;
(ii) split, combine, subdivide, change, exchange, amend the terms of or reclassify any shares of its the Company’s capital stock at less than fair market value (or other than pursuant to any Purchaser Stock Plans) or effect any stock split equity interests of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; Company Subsidiary;
(iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside aside, make or pay any dividend or make any other distribution (whether payable in cash, stock or payment property) with respect to any shares of the Company’s capital stock or the capital stock or other equity interest of any Company Subsidiary, other than (A) the Company’s regular quarterly dividend on the Company Common Stock to be declared and paid in the third quarter of the Company’s 2021 fiscal year, in a quarterly amount not to exceed the amount set forth in Part 4.1(a)(iii) of the Company Disclosure Schedule, provided, that if the initial End Date is extended pursuant to Section 6.1(b), the Company may resume its regular quarterly dividend (provided, that any such quarterly dividend may not be in an aggregate amount that exceeds the aggregate amount of the Company’s most recent quarterly dividend prior to the date hereof) on the Company Common Stock until the earlier of the Closing or termination of this Agreement, or (B) dividends or distributions only to the extent paid by any wholly owned Company Subsidiary to the Company or another wholly owned Subsidiary of the Company;
(iv) acquire (by merger, consolidation, operation of law, acquisition of stock, other equity interests or assets, formation of a joint venture or otherwise) (A) any other Person, (B) any equity interest in any other Person, (C) any business, or (D) any assets, except, (1) acquisitions by the Company from any wholly owned Subsidiary or among any wholly owned Subsidiaries of the Company; (2) the purchase of equipment, supplies and inventory in the ordinary course of business, (3) inbound licenses of Intellectual Property in the ordinary course of business or (4) acquisitions in one or more transactions with respect to which the aggregate consideration for all such transactions does not exceed $20,000,000 or (5) investments in any other Person in one or more transactions with respect to which the aggregate investment amount for all such transactions does not exceed $20,000,000;
(v) except in connection with any transaction between the Company and any wholly owned Subsidiary of the Company or among any wholly owned Subsidiaries of the Company, issue, sell, grant or otherwise permit to become outstanding any additional shares of, or securities convertible or exchangeable for, or options, warrants or rights to acquire, any shares of its capital stock or other ownership interests equity interests, other than: (A) shares of Company Common Stock issuable upon exercise of outstanding Company Options or the vesting of outstanding Company RSUs; and (B) pursuant to the Company ESPP in the ordinary course of business consistent with past practice and in accordance with the terms thereof and of this Agreement;
(vi) except in connection with any transaction between the Company and any wholly owned Subsidiary of the Company or among any wholly owned Subsidiaries of the Company, sell, assign, transfer, lease or license to any third party, or encumber, or otherwise dispose of (by merger, consolidation, operation of law, division or otherwise), any Company IP or material assets of the Company, other than regular quarterly cash dividends than: (A) sales of inventory, goods or services in the ordinary course of business or of obsolete equipment or assets in the ordinary course of business; (B) pursuant to written Contracts or commitments existing as of the date of this Agreement and set forth in Part 4.1(a)(vi) of the Company Disclosure Schedule; (C) as security for any borrowings permitted by Section 4.1(a)(viii); (D) licenses granted to customers or other third parties in the ordinary course of business consistent with past practice; or (E) dispositions of assets which do not constitute Company IP, and with respect to which the fair market value of all such assets does not exceed $10,000,000 in the aggregate;
(vii) directly or indirectly repurchase, redeem or otherwise acquire any shares of the Company’s or any Company Subsidiary’s capital stock or equity interests, or any other securities or obligations convertible (currently or after the passage of time or the occurrence of certain events) into or exchangeable for any shares of the Company’s or any Company Subsidiary’s capital stock or equity interests, except: (A) shares of Company Common Stock repurchased from employees or consultants or former employees or consultants of the Company pursuant to the exercise of repurchase rights binding on the Company and existing prior to the date of this Agreement; or (B) shares of Company Common Stock accepted as payment for the exercise price of options to purchase Company Common Stock pursuant to the Company Equity Plan or for withholding Taxes incurred in connection with the exercise, vesting or settlement of Company Options and Company RSUs, as applicable, in accordance with the terms of the applicable award;
(viii) (A) incur, redeem, repurchase, prepay, defease, or cancel any indebtedness for borrowed money, guarantee any such indebtedness, issue or sell any debt securities or rights to acquire any debt securities (directly, contingently or otherwise) or make any loans or advances or capital contributions to any other Person, except for: (1) repayment of the 2021 Notes when due in accordance with their terms, including pursuant to the Company’s Rule 10b5-1 plan; (2) borrowings in an aggregate principal amount outstanding at any time not to exceed $0.05 per share25,000,000 incurred in the ordinary course of business pursuant to existing credit facilities or letters of credit, (3) any indebtedness among the Company and its wholly owned Subsidiaries or among any wholly owned Subsidiaries of the Company (and guarantees by the Company or its Subsidiaries in respect thereof) and (4) purchase money financings and capital leases entered into in the ordinary course of business in an aggregate amount not to exceed $25,000,000 at any time outstanding; or (B) incur any Lien on any of its material property or material assets other than in the ordinary course of business consistent with past practice and except for Company Permitted Encumbrances;
(A) except in the ordinary course of business consistent with past practice adopt, terminate or amend any Company Plan other than if such action would not increase the annual expense of the given Company Plan by a material amount (but in no event will the aggregate amount of all increases in such expenses exceed $10,000,000)., provided, that the Company may enter into offer letters, employment agreements and similar arrangements with employees below the level of Corporate Vice President in the ordinary course of business consistent with past practice, (B) increase, or accelerate the vesting or payment of, the compensation or benefits of any director, independent contractor or current or former employee of the Company or any Company Subsidiary, (C) grant any rights to severance, retention, change in control or termination pay to any director, independent contractor or current or former employee of the Company or any Company Subsidiary, (D) except in the ordinary course of business consistent with past practice, in respect of employees at a level below Corporate Vice President that would not increase the number of Vice Presidents by more than 10% over the number of Vice Presidents employed by the Company as of the date of this Agreement, hire or promote any employee, or (E) terminate the employment of any employee at or above the level of Corporate Vice President (other than for cause); except, in each case, for: (1) amendments to Company Plans determined by the Company in good faith to be required to comply with applicable Legal Requirements; (2) increases in compensation or benefits required pursuant to any Company Plan in effect on the date hereof and listed in Part 4.1(a)(ix) of the Company Disclosure Schedule; (3) increases to total target cash opportunities (i.e., annual base salary or wage rates and target annual cash bonus opportunities) as set forth in Part 4.1(a)(ix) of the Company Disclosure Schedule; (4) payment of cash incentive compensation to the extent set forth in Part 4.1(a)(ix) of the Company Disclosure Schedule and (5) any other actions set forth in Part 4.1(a)(ix) of the Company Disclosure Schedule;
(x) except in the ordinary course of business and for renewals or extensions of any existing Material Contract or Material Real Property Lease entered into in the ordinary course of business, (i)(A) materially amend or terminate (except for terminations pursuant to the expiration of the existing term of any Material Contract or Material Real Property Lease) any Material Contract or Material Real Property Lease or (B) waive, release or assign any material rights under any Material Contracts or Material Real Property Leases, or (ii) enter into any Contract or agreement that, if in effect on the date of this Agreement, would constitute a Material Contract or Material Real Property Lease;
(xi) change any of its methods of financial accounting or accounting practices in any material respect other than as required by changes in GAAP;
(xii) make, change or revoke any Tax election, change or adopt any Tax accounting period or method of Tax accounting, amend any Company Return if such amendment would reasonably be expected to result in a Tax liability, file any Company Return prepared in a manner inconsistent with past practice, settle or compromise any material liability for Taxes or any Tax audit, claim, or other proceeding relating to a material amount of Taxes (except to the extent that a reserve for such Taxes has been established in the financial statements contained or incorporated by reference into the Company SEC Documents), enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar state, local or non-U.S. Legal Requirement) (except to the extent that a reserve for such Taxes has been established in the financial statements contained or incorporated by reference into the Company SEC Documents), request any Tax ruling from any Governmental Entity, surrender any right to claim a refund of Taxes, or, other than in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to Taxes, to the extent, in each case, that such actions would reasonably be expected, individually or in the aggregate, to have a material adverse impact on any Tax liabilities of Parent or any of the Parent Subsidiaries (which would include the Company and the Company Subsidiaries) after the Closing Date;
(xiii) sell, transfer, assign, exclusively license, or otherwise dispose of to any third party (by merger, consolidation, operation of law, division or otherwise), or mortgage, encumber or exchange any material Intellectual Property owned, or purported to be owned, by the Company or any Subsidiary of the Company;
(xiv) make any capital expenditure that is not contemplated by the capital expenditure budget (the “CapEx Budget”) set forth in Part 4.1(a)(xiv) of the Company Disclosure Schedule (a “Non-Budgeted Capital Expenditure”), except that the Company or any Subsidiary of the Company may make any Non-Budgeted Capital Expenditure that, when added to all other Non-Budgeted Capital Expenditures made by the Company and the Company Subsidiaries in the same fiscal year (and with respect to the 2021 fiscal year, since the date of this Agreement) would not, in the aggregate, exceed twenty percent (20%) of the aggregate CapEx Budget for such fiscal year;
(xv) except as expressly required by applicable Legal Requirements or the Company’s Organizational Documents, convene (A) any special meeting of the Company’s stockholders other than the Company Stockholder Meeting or (B) any other meeting of the Company’s stockholders to consider a proposal that would reasonably be expected to impair, prevent or delay the consummation of the transactions contemplated hereby;
(xvi) enter into any agreement, understanding or arrangement with respect to the voting of any capital stock or other equity interests of the Company (including any voting trust), other than with respect to awards under the Company Equity Plan otherwise permitted under this Agreement or in connection with the granting of revocable proxies in connection with any meeting of the Company’s stockholders;
(xvii) adopt a plan of (A) complete or partial liquidation of the Company or any Subsidiary of the Company or (B) dissolution, merger, consolidation, division, restructuring, recapitalization or other reorganization, other than, in the case of clause (B), transactions between or among direct or indirect wholly owned Subsidiaries of the Company;
(xviii) (A) settle or compromise any litigation, claim, suit, action or proceeding, except for settlements or compromises that (1) involve solely monetary remedies with a value not in excess of $35,000,000 in the aggregate to be paid by the Company and its Subsidiaries, (2) do not impose any restriction on the Company’s business or the business of the Company Subsidiaries, (3) do not relate to any litigation, claim, suit, action or proceeding by the Company’s stockholders in connection with this Agreement or the Merger and (4) do not include an admission of liability or fault on the part of the Company or any Company Subsidiary, or (B) commence any material litigation or other claim, suit, action or proceeding, other than (1) in the ordinary course of business consistent with past practice or (2) commencing any counterclaim to preserve, protect or enforce any Company IP or material assets of the Company;
(xix) materially reduce the amount of insurance coverage or fail to renew or maintain any material existing insurance policies;
(xx) (A) amend any Company Permits in a manner that adversely impacts the Company’s ability to conduct its business in any material respect or (B) terminate or allow to lapse any material Company Permits;
(xxi) (A) fail to pay any issuance, renewal, maintenance and other payments that become due with respect to any material Company Registered IP or otherwise abandon, cancel, or permit to lapse any material Company Registered IP, other than in its reasonable business judgment or in the ordinary course of business consistent with past practice, or (B) authorize the disclosure to any third party of any material Trade Secret included in the Company IP in a way that results in loss of trade secret protection, other than in the ordinary course of business consistent with past practice;
(xxii) except in the ordinary course of business, enter into any ind
Appears in 2 contracts
Sources: Merger Agreement (Xilinx Inc), Merger Agreement (Advanced Micro Devices Inc)
Interim Operations. (a) Prior The Debtor covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective TimeClosing, except (i) as otherwise expressly required or contemplated by this Agreement or the Original Plan Sponsor Agreement, (ii) as QCP and ProMedica may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (iii) as otherwise required by applicable Laws or (iv) as set forth in Section 4.1 of the Debtor Disclosure Letter, the Business shall be conducted in the ordinary and usual course and, to the extent consistent therewith, the Debtor and its Subsidiaries shall use their respective commercially reasonable efforts to preserve their business organizations intact, preserve governmental licenses, permits, consents, approvals, authorizations and qualifications and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates, and keep available the services of its and its Subsidiaries’ present employees and agents. Without limiting the generality of, and in furtherance of, the foregoing, from the date of this Agreement until the Closing, except (i) as otherwise expressly required or contemplated by this Agreement or the Original Plan Sponsor Agreement, (ii) as QCP and ProMedica may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (iii) as otherwise required by applicable Laws or (iv) as set forth in Section 4.1 of the Debtor Disclosure Letter, the Debtor will not and will not permit any of its Subsidiaries to:
(i) adopt or propose any change in its certificate of incorporation or by-laws or other applicable governing instruments;
(ii) merge or consolidate the Debtor or any of its Subsidiaries with any other Person, or restructure, reorganize or completely or partially liquidate the Debtor or any of its Subsidiaries or otherwise enter into any agreements providing for the sale of their respective material assets, operations or business (other than (A) the sale or disposition of obsolete or worn-out assets in the ordinary course of business and (B) sales and dispositions of such facilities and related assets as are contemplated by the SNF/AL Remarketing Process (as defined in the Original Plan Sponsor Agreement));
(iii) acquire assets outside of the ordinary course of business from any other Person with a value or purchase price in the aggregate in excess of $1,000,000 in any transaction or series of related transactions, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement which have been provided to ProMedica and QCP prior to the date of this Agreement;
(iv) acquire any corporation, partnership or other business organization or division thereof or collection of assets constituting all or substantially all of a business or business unit, whether by merger or consolidation, purchase of substantial assets or equity interest or any other manner, from any other Person;
(v) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer or encumbrance of, any shares of capital stock of the Debtor or any of its Subsidiaries (other than the issuance of shares by a wholly-owned Subsidiary of the Debtor to the Debtor or another wholly-owned Subsidiary), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities, other than such dispositions as are contemplated by the SNF/AL Remarketing Process;
(vi) create or incur any Lien securing indebtedness for borrowed money (other than a Lien currently provided for under the Centerbridge Facility, any Permitted Lien (other than a Permitted Lien under clause (iv) of such definition) and/or the grant of any cash collateral in respect of letters of credit issued in respect of, or otherwise securing, ordinary course operating liabilities) on any assets of the Debtor or any of its Subsidiaries having a value in excess of $1,000,000 in the aggregate;
(vii) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than the Debtor or any direct or indirect wholly-owned Subsidiary of the Debtor);
(viii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly-owned Subsidiary to the Debtor or to any other direct or indirect wholly-owned Subsidiary) or enter into any agreement with respect to the voting of its capital stock (other than the Original Restructuring Support Agreement and the Alternative Restructuring Support Agreement);
(ix) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(x) incur any indebtedness for borrowed money (which, for the avoidance of doubt, shall not include obligations in respect of cash-collateralized letters of credit issued in respect of, or other grants of cash collateral securing, ordinary course operating liabilities) or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Debtor or any of its Subsidiaries, except for indebtedness for borrowed money incurred in the ordinary course of business consistent with past practice (A) not to exceed $2,000,000 in the aggregate, (B) guarantees incurred in compliance with this Section 4.1 by the Debtor of indebtedness of wholly-owned Subsidiaries of the Debtor or (C) indebtedness owed to the Debtor or another wholly-owned Subsidiary of the Debtor;
(xi) except as set forth in the Company capital expenditures budget set forth in Section 4.1(a)(xi) of the Debtor Disclosure Letter, make or authorize any capital expenditure in excess of $2,000,000 in the aggregate, excluding any capital expenditure required by any Contract set forth on Section 4.1(a)(xi) of the Debtor Disclosure Letter or as contemplated capital expenditure determined in good faith by the Debtor Board to be required for (A) the protection of, or to avoid injury to, any other provision Person, (B) the care or safety of any patient under the care of any facility operated by the Debtor or any of its Subsidiaries or (C) compliance with Law;
(xii) enter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement, unless other than such Contracts as are contemplated by the Purchaser has consented SNF/AL Remarketing Process;
(xiii) make any material changes with respect to material accounting policies or procedures, except as required by changes in writing thereto, applicable Law or GAAP;
(xiv) settle any litigation or other Proceeding brought against the Company: Debtor or its Subsidiaries by a Governmental Entity (iA) shall, and shall cause each for an amount in excess of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course $100,000 individually or $1,000,000 in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments aggregate for all such Proceedings (other than any resolution of claims processing for government reimbursement in the ordinary course of business, and excluding recoupment actions) or (B) in a manner that would impose any restrictions on its assets, operations or businesses or result in any injunction or equitable relief against the Debtor or any of its Subsidiaries;
(xv) settle any Proceeding other than against or brought by a Governmental Entity, (A) for an amount in excess of $500,000 individually or $8,000,000 in the aggregate for all such Proceedings in any one-calendar-month period (in each case, with respect to permit Proceedings in the consummation state of Pennsylvania, net of applicable insurance proceeds) or (B) in a manner that would impose any restrictions on its assets, operations or businesses or result in any injunction or equitable relief against the Debtor or any of its Subsidiaries;
(xvi) amend, modify or terminate any Material Contract, including the Centerbridge Facility, in a manner adverse to the Debtor or its Subsidiaries;
(xvii) (A) change in any material respect any material method of accounting of the transactions contemplated by this Agreement)Debtor or its Subsidiaries for Tax purposes; (iiiB) shall promptly notify enter into any agreement with any Governmental Entity (including a “closing agreement” under Code Section 7121) with respect to any material Tax or Tax Returns of the Purchaser Debtor or its Subsidiaries; (C) surrender a right of the Debtor or its Subsidiaries to a material Tax refund; (D) change an accounting period of the Debtor or its Subsidiaries with respect to any material Tax; (E) file an amended Tax Return; (F) change or revoke any material election with respect to Taxes; (G) make any material election with respect to Taxes that is inconsistent with past practice; (H) file any Tax Return that is inconsistent with past practice; or (I) consent to any extension or waiver of the limitations period applicable to any material Tax claim or assessment (other than in the ordinary course of business);
(xviii) transfer, sell, lease, license, mortgage, pledge, divest or otherwise dispose of any breach material tangible or intangible assets (including Intellectual Property Rights), licenses, operations, rights, product lines, businesses or interests therein of the Debtor or its Subsidiaries, including the capital stock of any representation of its Subsidiaries, except (A) in connection with services provided in the ordinary course of business and sales or warranty contained herein other dispositions of obsolete or any Company Material Adverse Effect; worn-out assets, (ivB) shall promptly deliver sales, leases, licenses, divestitures, cancellations, abandonments, lapses, expirations or other dispositions of assets with a fair market value not in excess of $500,000 in the aggregate, (C) pursuant to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent Contracts in effect prior to the date of this Agreement; Agreement and (vD) shall such sales, leases, licenses, divestitures, cancellations, abandonments, lapses, expirations or other dispositions of assets as are contemplated by the SNF/AL Remarketing Process;
(xix) (A) enter into, adopt, amend in any material respect or terminate any Company Plan (other than entry into any new employment agreement with any individual whose hiring is not restricted by, or who is otherwise hired in accordance with, clause (H) below), (B) increase or accelerate the compensation, bonus, pension, welfare, fringe or other benefits, severance or termination pay of any director, officer or employee of the Debtor or any of its Subsidiaries, (C) grant any new awards, or amend or modify the terms of any outstanding awards, under any Company Plan (other than grants of any new awards to any individual whose hiring is not restricted by, or who is otherwise hired in accordance with, clause (H) below), (D) take any action to accelerate the vesting or lapsing of restrictions or payment, or fund or in any other way secure the payment, of compensation or benefits under any Company Plan, (E) change any actuarial or other assumptions used to calculate funding obligations with respect to any Company Plan that is required by applicable Law to be funded or change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by the terms of any existing Company Plan set forth on Section 2.1(h)(i) of the Debtor Disclosure Letter or GAAP, (F) forgive any loans or issue any loans (other than routine travel advances issued in the ordinary course of business) to any director, officer or employee of the Debtor or any of its Subsidiaries, (G) terminate the employment of any officer of the Debtor or its Subsidiaries other than for “cause”, (H) hire (x) except pursuant any officer of the Debtor or its Subsidiaries with a title of Vice President or higher or (y) any employee of the Debtor or its Subsidiaries with aggregate annual base salary and target bonus of more than $250,000, except, in the case of the foregoing clauses (x) and (y), to the exercise extent jointly determined by the Chief Restructuring Officer of optionsthe Debtor (“CRO”) and the Debtor Board in their reasonable business judgment in good faith necessary in the interests of patient care (any such individual described in the foregoing clauses (x) and (y) and hired to replace any such employee, warrantsa “New Hire”), conversion rights provided that (i) any such officer New Hire (and other contractual rights existing on the date hereof his or her terms and disclosed conditions of employment, including any base and target incentive compensation) hired pursuant to this Agreementclause (H) shall be reasonably acceptable to ProMedica and QCP and (ii) the terms and conditions of employment of any New Hire that is not an officer, or pursuant including base and target incentive compensation, shall be subject to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stocknotice and consultation with ProMedica and QCP, or (zI) adopt make any A1incentive payment or payment in respect of severance or any nonqualified deferred compensation entitlement to any current or former director, officer or employee of the Debtor or its Subsidiaries (including making any payments to any rabbi trust or taking any action that would cause the trustee of any rabbi trust to make payments to any current or former director, officer or employee of the Debtor or its Subsidiaries), except, with respect to clause (I) payment of any nondiscretionary incentive payments under existing Company Plans, nondiscretionary severance payments under existing Company Plans, and nondiscretionary payments of nonqualified deferred compensation (other than as set forth on Section 4.1(a)(xix)(I) of the Debtor Disclosure Letter) or as otherwise required by applicable Law; provided that payment in respect of any severance or nonqualified deferred compensation amount in excess of $200,000 shall be subject to prior notice and consultation with ProMedica and QCP and, with respect to clauses (A) through (H) above, (1) amendments to welfare plans in the ordinary course of business, consistent with past practices that do not materially increase the costs of such welfare plans, (2) with respect to any hourly employees and salaried facility-14level employees of the Debtor or its Subsidiaries, and any other employees of the Debtor or its Subsidiaries whose annual base salary does not exceed $150,000, increases in compensation in the ordinary course materially consistent with the Debtor’s 2018 operating budget or otherwise as reasonably determined by the CRO, in consultation with ProMedica and QCP, to be necessary to respond to market demand, (3) with respect to each other employee of the Debtor or its Subsidiaries whose annual base salary exceeds $150,000 (other than any Eligible Employee), increases in compensation in the ordinary course of business consistent with past practice that do not exceed 1.5% of the aggregate annual base salaries of such other employees or 7.5% of the annual base salary for any individual and (4) as required pursuant to existing Company Plans, or as otherwise required by applicable Law;
(xx) become a party to, establish, adopt, amend, commence participation in or terminate any collective bargaining agreement or other agreement with a labor union, works council or similar organization;
(xxi) enter into any Contract adversely affecting in any material respect the Debtor’s or any of its Subsidiaries’ ability to use or otherwise exploit any material Intellectual Property Rights;
(xxii) fail to use commercially reasonable efforts to keep in full force the material Insurance Policies under substantially the same levels of coverage as the current policies of the Debtor and its Subsidiaries;
(xxiii) change in any material respect any of the Debtor’s or its Subsidiaries’ material policies or procedures for or timing of the collection of accounts receivable (or any other trade receivables), payment of accounts payable (or any other trade payables), billing of its customers, pricing and payment terms, cash collections, cash payments or terms with suppliers, in each case, other than changes required by suppliers, vendors and service providers;
(xxiv) dismiss the QCP Consultants other than in accordance with Section 5.1(b);
(xxv) modify or amend in any respect any Contract pursuant to which HCR III or any of its Subsidiaries currently subleases real property to any other Subsidiary of the Debtor; or
(xxvi) agree, authorize or commit to do any of the foregoing.
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) ProMedica shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).knowingly take
Appears in 2 contracts
Sources: Alternative Plan Sponsor Agreement, Alternative Plan Sponsor Agreement (Quality Care Properties, Inc.)
Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement or the Stock Option Agreement or set forth in Section 7.1 of the Company Disclosure Letter):
(a) Prior The business of all Company Entities shall be conducted in the ordinary and usual course (it being understood and agreed that nothing contained herein shall permit the Company to enter into or engage in (through acquisition, product extension or otherwise) the Effective Timebusiness of selling any products or services materially different from existing products or services of the Company Entities or to enter into or engage in new lines of business without Parent's prior written approval), and it shall be conducted in compliance in all material respects with all applicable Laws.
(b) To the extent consistent with (a) above, each Company Entity shall use all commercially reasonable efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, reinsurers, distributors, creditors, lessors, employees and business associates, and maintain all Permits necessary for the Company Entities to conduct business in the jurisdictions in which they currently conduct business.
(c) No Company Entity shall permit a material change in any of its underwriting, investment, actuarial, financial reporting or accounting practices or policies or in any material assumption underlying an actuarial practice or policy, except as set forth in the Company Disclosure Letter or as contemplated may be required by any other provision of this Agreementchange in GAAP, unless the Purchaser has consented in writing thereto, the Company: statutory accounting principles or applicable Law.
(d) The Company shall not (i) shallissue, and shall cause each sell, pledge, dispose of or encumber any capital stock owned by it in any of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedSubsidiaries; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit amend, modify or terminate the consummation of the transactions contemplated by this Rights Agreement); (iii) shall promptly notify the Purchaser split, combine or reclassify its outstanding shares of any breach of any representation or warranty contained herein or any Company Material Adverse Effectcapital stock; (iv) shall promptly deliver to the Purchaser true and correct copies of any reportauthorize, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend payable in cash, stock or make property in respect of any capital stock other distribution than (A) dividends from its direct or payment indirect wholly owned Subsidiaries, (B) regular quarterly cash dividends on the Company Common Stock not to exceed $.12 per share per quarter, and (C) regular semi-annual cash dividends required to be paid by the Company on the Company 9% Preferred Stock in accordance with respect the Company's Certificate of Incorporation; or (v) repurchase, redeem or otherwise acquire or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its stock or any securities convertible into or exchangeable or exercisable for any shares of its stock, other than as may be required pursuant to the terms of the Company Stock Plans.
(e) No Company Entity shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other ownership interests property or assets (other than regular quarterly cash dividends shares of Company Common Stock issuable pursuant to Company Options outstanding on the date hereof under any of the Company Stock Plans); (ii) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other Assets (including capital stock of any of Company Subsidiary) or incur or modify any material indebtedness or other material Liability; (iii) make or authorize or commit for any capital expenditures other than in amounts not exceeding $1 million in the aggregate; (iv) by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity, including by way of assumption reinsurance, in excess of $100,000 individually or $1 million in the aggregate (other than in connection with ordinary course investment activities); or (v) make any capital investment in or loan to NHP Holding Company, Inc. or any entity controlled by it.
(f) No Company Entity shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans, or increase the salary, wage, bonus or other compensation of any employees, except annual base salary (and corresponding benefit) increases occurring in the ordinary and usual course of business (which shall not exceed on an annual basis the lesser of 10% or $5,000 for any individual employee) or as required by applicable Law or under existing Contracts.
(g) Each Company Entity shall use all commercially reasonable efforts to ensure that no payments are paid or become due under the change of control employment agreements listed in Section 5.6 of the Company Disclosure Letter.
(h) No Company Entity shall pay, discharge, settle or satisfy any claims, Liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of (A) claims arising under the terms of products, contracts or policies issued by the Company Insurance Subsidiaries in the ordinary and usual course of business, and (B) such other claims, Liabilities or obligations (including Litigation) as shall not exceed $0.05 250,000 per shareclaim.
(i) No Company Entity shall make or change any material Tax election, settle any material audit, file any material amended Tax Returns or permit any insurance policy naming it as a beneficiary or loss-payable payee to be canceled or terminated except in the ordinary and usual course of business.
(j) No Company Entity shall enter into any Contract containing any provision or covenant limiting in any material respect the ability of any Company Entity to (A) sell any products or services of or to any other Person, (B) engage in any line of business, or (C) compete with or to obtain products or services from any Person or limiting the ability of any Person to provide products or services to any Company Entity.
(k) No Company Entity shall enter into any new quota share or other reinsurance transaction (A) that does not contain standard cancellation and termination provisions, (B) that, except in the ordinary course of business, materially increases or reduces the Company Insurance Subsidiaries' consolidated ratio of net written premiums to gross written premiums, or (C) pursuant to which $5 million or more in gross written premiums are ceded by the Company Insurance Subsidiaries to any Person other than a Company Entity.
(l) No Company Entity shall enter into, amend or terminate any Material Contract (including for this purpose the Amended Shareholders Agreement, dated May 23, 1994, by and among JA Services, Inc., Dimension Holding Company, Inc. and NHP Holding Company, Inc.).
(m) The Company Entities shall make new investments only in Qualified Investments.
(n) The Company shall use all commercially reasonable efforts to ensure that there will be no downgrade in any Company Insurance Subsidiary's rating relating to its financial strength or claims-paying ability as published by A.M. Best Company.
(o) No Company Entity shall take any action or omit to take any action that would cause any of the conditions set forth in Sections 8.2(a) or (b) not being satisfied (other than by waiver).
(p) No Company Entity shall authorize or enter into a Contract to do any of the foregoing.
Appears in 2 contracts
Sources: Merger Agreement (Fortis Inc /Nv/), Agreement and Plan of Merger (Alden John Financial Corp)
Interim Operations. (a) Prior to the Effective Time, except Except as set forth in the corresponding sections or subsections of the Company Disclosure Letter and the Parent Disclosure Letter, as appropriate:
(a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time (unless Parent shall otherwise approve in writing and except as otherwise required by applicable Law, in which case, the Company shall provide Parent with prior reasonable notice of such requirement, or as unless expressly contemplated by this Agreement or the Stock Option Agreement):
(i) Its business and that of its Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their commercially reasonable efforts to preserve their business organizations intact and maintain their existing relations and goodwill with customers, suppliers, regulators, distributors, creditors, lessors, employees and business associates; provided, however, that no action by the Company or its Subsidiaries with respect to matters specifically addressed by any other provision of this Agreement, Section 6.1(a) shall be deemed a breach of this Section 6.1(a)(i) unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each such action would constitute a breach of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; one or more such other provisions;
(ii) It shall not not: (A) amend its Certificate certificate of Incorporation incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)bylaws; (iiiB) shall promptly notify the Purchaser of any breach of any representation split, combine, subdivide or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any reclassify its outstanding shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (iiC) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend on the Common Shares or make other capital stock of the Company payable in cash, stock or property in respect of any such capital stock (other distribution than regular quarterly dividends on the Common Shares not to exceed $.11 per common share per quarter); or payment (D) repurchase, redeem or otherwise acquire, except in connection with respect existing commitments under the Company Stock Plans but subject to the Company's obligations under subparagraph (iii) below, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(iii) Neither it nor any of its Subsidiaries shall take any action that would prevent the Merger from qualifying for "pooling-of-interests" accounting treatment in accordance with the Pooling Requirements or as a "reorganization" within the meaning of Section 368(a) of the Code;
(iv) Neither it nor any of its ERISA Affiliates shall: (A) accelerate, amend or change the period of exercisability of or terminate, establish, adopt, enter into, make any new grants or awards of stock-based compensation or other ownership interests benefits under any Compensation and Benefit Plans; (B) amend or otherwise modify any Compensation and Benefit Plans; or (C) increase the salary, wage, bonus or other compensation of any directors, officers or employees except, in the case of (A), (B) and (C), (x) for grants or awards to employees with annual salaries below $150,000 under existing Compensation and Benefit Plans in such amounts and on such terms as are consistent with past practice, (y) in the normal and usual course of its business (which may include normal periodic performance reviews and related compensation and benefit increases and the provision of individual Company Compensation and Benefit Plans consistent with past practice for promoted or newly hired employees below the level of Company Vice President on terms consistent with past practice), or (z) for actions necessary to satisfy existing contractual obligations under Compensation and Benefit Plans existing as of the date of this Agreement, including pursuant to rights and obligations under such Compensation and Benefit Plans that vest or mature automatically with the passage of time or the satisfaction of other conditions; provided, that it shall not take such action unless it shall provide Parent with prior reasonable notice; or to comply with applicable law or regulations;
(v) Except for transactions between the Company and one or more of its wholly-owned Subsidiaries or between wholly-owned Subsidiaries of the Company, neither it nor any of its Subsidiaries shall incur, repay or retire prior to maturity or refinance any indebtedness for borrowed money or guarantee any such indebtedness or issue, sell, repurchase or redeem prior to maturity any debt securities or warrants or rights to acquire any debt securities or guarantee any debt securities of others in all such cases in excess of $10,000,000 in the aggregate or except for the use of foreign bank lines of credit in the ordinary course;
(vi) Neither it nor any of its Subsidiaries shall (A) make any capital expenditures prior to December 31, 1999 in an aggregate amount in excess of $8,000,000, except as set forth in the Company's 1999 capital budget which has been made available to Parent or (B) make any capital expenditures subsequent to December 31, 1999 in an amount in excess of an average of $10,000,000 per month;
(vii) Neither it nor any of its Subsidiaries shall issue, deliver, sell, pledge or encumber shares of any class of its capital stock or any securities convertible or exchangeable into, any rights, warrants or options to acquire, or any bonds, debentures, notes or other debt obligations having the right to vote or convertible or exercisable for any such shares except for transactions between the Company and one or more of its wholly-owned Subsidiaries, or between wholly-owned Subsidiaries of the Company and except for Company Shares issued pursuant to options and other awards outstanding on the date of this Agreement under the Company Stock Plans or otherwise permitted by Section 6.1(a)(iv);
(viii) Except as permitted by Sections 6.2 and 8.3(b), neither it nor any of its Subsidiaries shall authorize, propose or announce an intention to authorize or propose or enter into an agreement with respect to, any merger, consolidation or business combination (other than the Merger), or any purchase, sale, lease, license or other acquisition or disposition of any business or of a material amount of assets or securities excluding sales of inventory or products in the ordinary course of business;
(ix) It shall not make any material change in its financial accounting policies or procedures, other than any such change that is required by GAAP, or revalue any assets, including, without limitation, writing down the value of material inventory or writing off notes or accounts receivable in a material amount other than as required by GAAP;
(x) Except in the ordinary and usual course of business or as is required by law, it shall not release, assign, settle or compromise any material claims or litigation or make any material tax election or settle or compromise any material United States federal, state, local or foreign tax liability; and
(xi) Neither it nor any of its Subsidiaries shall authorize or enter into any agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time (unless the Company shall otherwise approve in writing and except as otherwise required by applicable Law, in which case, Parent shall provide the Company with prior reasonable notice of such requirement, or unless expressly contemplated by this Agreement or the Stock Option Agreement):
(i) It shall not: (A) amend its certificate of incorporation or bylaws in any manner that would adversely affect the Merger or the other transactions contemplated by this Agreement or the Stock Option Agreement; (B) split, combine, subdivide or reclassify its outstanding shares of capital stock; (C) declare, set aside or pay any dividend on the Parent Common Stock or other capital stock of Parent payable in cash, stock or property in respect of any such capital stock (other than regular quarterly cash dividends not on the Parent Common Stock consistent with past practice and other than any dividend that would be received by the holders of Company Common Stock on an equivalent basis per share of Parent Common Stock after the Effective Time); or (D) repurchase, redeem or otherwise acquire, except in connection with existing commitments under Parent's employee benefit plans but subject to exceed $0.05 per share)Parent's obligations under subparagraph (iii) below, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(ii) Neither it nor any of its Subsidiaries shall take any action that would prevent the Merger from qualifying for "pooling-of-interests" accounting treatment in accordance with the Pooling Requirements or as a "reorganization" within the meaning of Section 368(a) of the Code; and
(iii) Neither it nor any of its Subsidiaries shall authorize or enter into any agreement to do any of the foregoing.
(c) Parent and the Company agree that any written approval obtained under Section 6.1(a) must be signed by the Chief Executive Officer or Senior Vice President, General Counsel and Secretary of Parent and any written approval obtained under Section 6.1(b) must be signed by the Chief Executive Officer or Senior Vice President, General Counsel and Secretary of the Company.
(d) Parent and the Company agree that prior to the Closing, the record date for determining shareholders of the Company or Parent entitled to receive the regular quarterly dividends permitted hereunder that may be declared by the board of directors of either Parent or the Company after the date of this Agreement but prior to the Closing shall be the close of business on the day on which Parent's then current fiscal quarter ends.
Appears in 2 contracts
Sources: Merger Agreement (Premark International Inc), Merger Agreement (Premark International Inc)
Interim Operations. Each of FMCTI and Technip covenants and agrees as to itself and its respective Subsidiaries that, after the date of the MOU and until the earlier of the FMCTI Effective Time or the termination of this Agreement in accordance with its terms, unless FMCTI (in the case of any action proposed to be taken by Technip or any Subsidiary of Technip) or Technip (in the case of any action proposed to be taken by FMCTI or any Subsidiary of FMCTI) shall otherwise approve in writing (which approval, other than with respect to Section 5.1(b)(iii) and Section 5.1(b)(v), shall not be unreasonably withheld, conditioned or delayed by the party from whom it is requested), and except as required by applicable Law, Self-Regulatory Organization, or as expressly contemplated by this Agreement (including with respect to the Preliminary Transactions and actions that are incidental thereto) or, in the case of Technip, as otherwise set forth in Section 5.1 of the Technip Disclosure Letter or, in the case of FMCTI, as otherwise set forth in Section 5.1 of the FMCTI Disclosure Letter:
(a) Prior to the Effective Time, except as set forth business of it and its Subsidiaries shall be conducted in the Company Disclosure Letter ordinary and usual course consistent with past practice and it and its Subsidiaries shall use their respective commercially reasonable efforts to preserve intact its business organization and maintain its existing relations and goodwill with all Governmental Entities (including applicable Regulatory Authorities) and Self-Regulatory Organizations, clients, customers, suppliers, distributors, creditors, lessors, employees, stockholders and other Persons with which it or its Subsidiaries has significant business relations, as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: applicable;
(i) shall, and shall cause each neither it nor any of its Significant Subsidiaries toshall amend or propose to amend, conduct modify, waive, rescind or otherwise change any provisions of its operations according to their usualOrganizational Documents, regular and ordinary course in substantially the same manner as heretofore conductedwhether by merger or otherwise); (ii) neither FMCTI nor Technip, as applicable, shall split, combine or reclassify its outstanding shares of capital stock or other equity interests; (iii) neither it nor any of its Subsidiaries shall declare, set aside or pay any type of dividend or other distribution, whether payable in cash, stock, property or a combination thereof, in respect of any capital stock or other equity interests, as appropriate, other than dividends payable by its direct or indirect wholly owned Subsidiaries to it or another of its direct or indirect wholly owned Subsidiaries in the ordinary and usual course of business and consistent with past practice; (iv) it shall not amend adopt a plan of merger, consolidation or complete or partial liquidation or resolutions providing for a merger, consolidation or complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization; or (v) except (x) for the acquisition by such party of shares of its Certificate capital stock or other equity interests in connection with the surrender of Incorporation such shares by holders of FMCTI Stock Awards or Bylaws Technip Stock Awards, as applicable, in order to pay the exercise price of such Stock Awards in accordance with the terms of such Stock Awards or comparable governing instruments (y) for the withholding or disposition of shares of capital stock or other equity interests to satisfy withholding Tax obligations with respect to FMCTI Stock Awards or Technip Stock Awards, as applicable, granted pursuant to the FMCTI Stock Plan and the Technip Stock Plans, as applicable, in accordance with the terms of such Stock Awards, neither it nor any of its Subsidiaries shall repurchase, redeem or otherwise acquire any shares of its or their capital stock or other equity interests, as applicable, or any securities convertible into or exchangeable or exercisable for any shares of its or their capital stock or other equity interests, as applicable;
(c) neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, profits interests, conversion rights, stock appreciation rights, stock-based units (performance based or otherwise), redemption rights, repurchase rights, commitments or rights of any kind to acquire or other rights that relate to or are derivative of any of its or their capital stock, voting securities or other equity interests, or any bonds, debentures, notes or other obligations the holders of which have the right to vote (or which are convertible into or exercisable for securities having the right to vote) with its stockholders on any matter, other than FMCTI Shares or Technip Shares (as applicable) issuable or transferable pursuant to permit (A) Technip OCÉANEs outstanding prior to the date of the MOU or (B) FMCTI Stock Awards or Technip Stock Awards outstanding on or awarded prior to the date of the MOU or made by FMCTI or Technip, as applicable, after the date of the MOU in accordance with Section 5.1(d), except, in each case, in connection with internal reorganizations entered into in the ordinary and usual course of business solely among such party’s wholly owned Subsidiaries which will not adversely affect the Technip Intended French Tax Treatment or otherwise be reasonably expected to have a material adverse Tax consequence on the Topco Group after the Closing, (ii) incur any indebtedness for borrowed money (including any guarantee of indebtedness) or issue any debt securities, except (x) in connection with refinancings of existing indebtedness for borrowed money upon market terms and conditions or (y) for drawdowns of credit facilities outstanding as of the date of the MOU (or refinancings of such credit facilities permitted under clause (x)) in the ordinary and usual course of business and consistent with past practice; or (iii) make or authorize or commit to any capital expenditures, other than in the ordinary and usual course of business and consistent with past practice;
(d) except as required by applicable Law or the terms of any Benefit Plan or Labor Agreement existing and in effect on the date of the MOU, neither it nor any of its Subsidiaries shall (i) terminate, establish, adopt, enter into, or materially amend any Benefit Plan, Technip Stock Award, FMCTI Stock Award or any other arrangement that would be a FMCTI Benefit Plan or a Technip Benefit Plan if in effect on the date of the MOU, (ii) increase the salary, wage, bonus, pension, severance, fringe benefits or other compensation payable to any current or former Service Provider or enter into any contract, agreement, commitment or arrangement to do any of the foregoing, other than in the ordinary and usual course of business and consistent with past practice and in a manner which will not adversely impact the ability of either of the counsel listed in Section 7.2(e) to render the opinion described in Section 7.2(e) at the expected Merger Effective Date, (iii) take any action to accelerate the vesting, payment or funding of (A) any compensation or benefits with respect to any current or former Service Provider under any Benefit Plan or (B) any stock option, restricted stock, restricted stock unit or other equity-related award, in each case, except (x) if such accelerated vesting, payment or funding is a result of a termination of employment or service without cause upon or following the consummation of the transactions contemplated by this Agreement or (y) in the ordinary and usual course of business and consistent with past practice and in a manner which will not adversely impact the ability of either of the counsel listed in Section 7.2(e) to render the opinion described in Section 7.2(e) at the expected Merger Effective Date, or (iv) grant any stock option, restricted stock, restricted stock unit, performance stock unit or other equity-based award;
(e) neither it nor any of its Subsidiaries shall establish, adopt, enter into, materially amend or terminate any Labor Agreement;
(f) except with respect to Intellectual Property, neither it nor any of its Subsidiaries shall lease, license, transfer, exchange or swap, mortgage (including securitizations); , pledge, abandon or otherwise dispose of (whether by way of merger, consolidation, sale of stock or assets, or otherwise) any material portion of its assets, including the capital stock or other equity interests of its Subsidiaries, except for (i) dispositions of assets (including the amount of indebtedness assigned in such dispositions) that individually or in the aggregate with all other such dispositions have fair market value of less than $50,000,000, (ii) transactions between it and any of its direct or indirect Subsidiaries or transactions between such Subsidiaries or (iii) shall promptly notify the Purchaser sale of goods in the ordinary and usual course of business consistent with past practice;
(g) neither it nor any of its Subsidiaries shall, except in the ordinary and usual course of business and consistent with past practices, sell, lease, license, transfer, exchange or swap, mortgage (including securitizations) pledge, abandon, allow to lapse or otherwise dispose of any breach of any representation or warranty contained herein Material Intellectual Property owned by such party or any Company Material Adverse Effect; of its Subsidiaries;
(ivh) neither it nor any of its Subsidiaries shall promptly deliver acquire or agree to the Purchaser true and correct copies of acquire (whether by merger, consolidation, purchase or otherwise) any reportPerson, statement division or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not assets, except for acquisitions (x) entered into on an arm’s length basis, (y) the expected gross expenditures and commitments (including the amount of any indebtedness assumed) of which do not exceed $50,000,000 individually or in the aggregate with all other such acquisitions and (z) which are not reasonably likely, individually or in the aggregate, to prevent or materially delay the satisfaction of the conditions set forth in Section 6.1(d);
(i) except pursuant for litigation or arbitration addressed in Section 5.7, neither it nor any of its Subsidiaries shall settle or compromise, or offer to settle or compromise (other than any litigation or arbitration brought by FMCTI against Technip or brought by Technip against FMCTI arising out of or relating to this Agreement) any litigation or arbitration if such settlement or compromise (x) would involve individually the exercise payment of optionsmoney by such party or its Subsidiaries in excess of $10,000,000 or together with all such other settlements or compromises the payment of money by such party or its Subsidiaries in excess of $20,000,000 or (y) would involve any admission of material wrongdoing or include any other material non-monetary remedy, warrantsincluding any material conduct requirement or restriction by such party or its Subsidiaries, conversion except, in the case of each clause (x) and clause (y), in the ordinary and usual course of business consistent with past practice;
(j) neither it nor any of its Subsidiaries shall (x) renew, amend in any material respect or terminate any of its Material Contracts, (y) waive, release or assign any material rights and other contractual rights or claims thereunder or (z) enter into or subsequently amend in any material respect any Contract that, if existing on the date hereof of the MOU, would be a Material Contract, except, in each case, as permitted pursuant to Section 5.1(c)(ii) or Section 5.1(d) and, in the case of clause (x), in the ordinary and disclosed pursuant usual course of business consistent with past practice;
(k) neither it nor any of its Subsidiaries shall make or change any material Tax election, adopt or change any material method of Tax accounting, file any material amended Tax Return or enter into a closing agreement or advance pricing agreement in respect of a material amount of Taxes or settle or compromise any material audit, assessment, notice, Tax claim or proceeding relating to Taxes, or agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes (except in the ordinary course of business), or enter into any closing agreement within the meaning of Section 7121 of the Code (or any similar provision of state, local or non-U.S. law) with respect to a material amount of Taxes, surrender any material right to claim a refund or offset of any Taxes, or change the classification of FMCTI or Technip, as applicable, or any of their Subsidiaries for United States Tax purposes, except, in each case, to the extent otherwise required by Law, required as part of the completion of the Preliminary Transactions or in the ordinary and usual course of business consistent with past practice;
(l) neither it nor any of its Subsidiaries shall make a request for a Tax ruling (other than the French Tax Ruling or any additional ruling request from the French Ministry of Budget having the purpose of obtaining the Technip Intended French Tax Treatment and the transfer to Topco of French Tax losses of the Technip Tax consolidated group, any confirmation requested from Her Majesty’s Revenue and Customs (“HMRC”) as referred to in Section 5.9 or Section 5.11, any additional ruling request from any other Governmental Entity the parties agree is desirable as part of the consummation of the Preliminary Transactions or except as otherwise provided in this Agreement or any schedule to this Agreement);
(m) neither it nor any of its Subsidiaries shall permit any change in its financial accounting principles, policies or practices, except to the extent that any such changes in financial accounting principles, policies or practices shall be required by changes in GAAP or SEC rules and regulations or Regulation S-X of the Exchange Act and, in each case, authoritative interpretations thereof (in the case of FMCTI) or IFRS and authoritative interpretations thereof (in the case of Technip);
(n) neither it nor any of its Subsidiaries shall enter into any Contract that grants “most favored nation” status to any counterparty or any “non-compete” or similar Contract that, in any case, would (or would purport to) materially restrict the business of the Topco Group following the FMCTI Effective Time with respect to engaging or competing in any line of business or in any geographic area;
(o) neither it nor any of its Subsidiaries shall make any loans, advances or capital contributions to, or pursuant investments in, any other Person (other than any wholly owned Subsidiary), other than (x) any routine travel, relocation and business advances to the Recapitalization issue any shares employees of it or its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, Subsidiaries and (y) granttrade credit to customers, confer in either case, made in the ordinary and usual course of business consistent with past practice;
(p) neither it nor any of its Subsidiaries shall enter into any material new line of business outside of its existing business segments;
(q) it shall not convene any regular or award special meeting (or any optionadjournment or postponement thereof) of its stockholders other than a (i) stockholder meeting to adopt this Agreement, warrantincluding the FMCTI Stockholders’ Meeting and the Technip Stockholders’ Meetings, conversion right and approve the Mergers and (ii) a regular annual meeting to address matters arising in the ordinary course consistent with past practice other than this Agreement and the Mergers;
(r) neither it nor any of its Subsidiaries shall implement or announce any material plant closing, material reduction in labor force or other right not material layoff of employees or service providers other than routine employee terminations for cause or following performance reviews in the ordinary and usual course of business and consistent with past practice;
(s) neither it nor any of its Subsidiaries shall enter into, renew, amend or terminate any Contract that, if existing on the date hereof of the MOU, would need to acquire be disclosed on Section 4.21 of the FMCTI Disclosure Letter or Technip Disclosure Letter, as applicable; and
(t) neither it nor any shares of its capital stockSubsidiaries shall authorize or enter into an agreement, arrangement or understanding to do any of the foregoing set forth in Section 5.1(a) through (s) if FMCTI or Technip, as applicable, would be prohibited by the terms of Section 5.1(a) through (s) from doing the foregoing. Nothing contained in this Agreement shall give (x) Technip, directly or indirectly, the right to control or direct the operations of FMCTI or Topco, or (zy) adopt any A1-14
(b) FMCTI or Topco, directly or indirectly, the right to control or direct the operations of Technip, prior to consummation of the Technip Merger and FMCTI Merger, respectively. Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, each of Technip and its Subsidiaries, on the Purchaser: one hand, and FMCTI and its Subsidiaries (i) shall not issue any shares of its capital stock at less than fair market value (including Topco), on the other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any reporthand, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).sh
Appears in 2 contracts
Sources: Business Combination Agreement (FMC Technologies Inc), Business Combination Agreement (FMC Technologies Inc)
Interim Operations. (a) Prior From the date of this Agreement to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of otherwise required pursuant to this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries to, :
(i) conduct its operations according to their its usual, regular and ordinary course in substantially the same manner as heretofore conductedof business consistent with past practice; (ii) shall not amend use its Certificate reasonable best efforts to preserve intact their business organizations and goodwill, to maintain in effect all existing qualifications, licenses, Permits, approvals and other authorizations referred to in Sections 6.1 and 6.15, to keep available the services of Incorporation or Bylaws or comparable governing instruments (their officers and employees and to maintain satisfactory relationships with customers, suppliers, distributors, brokers, sales agents and all other than persons having business relationships with them, including through the payment of additional compensation reasonably acceptable to permit Purchaser to such distributors, brokers and sales agents reasonably calculated to maintain at least the consummation current level of the transactions contemplated by this Agreement)merchandising, distribution and shelving; (iii) shall promptly notify Purchaser upon becoming aware of any material breach of any representation, warranty or covenant contained in this Agreement, the Purchaser occurrence of any event that would cause any representation, warranty or covenant contained in this Agreement no longer to be true and correct in all material respects or any breach of any representation or warranty contained herein or any Company Material Adverse Effectthe representations and warranties specified in Section 6.17(iii); (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this AgreementAgreement and any internal monthly reports prepared for or delivered to the Board of Directors after the date hereof; and (v) shall not (x) except pursuant deliver, within 20 business days after the end of each accounting month, monthly consolidated financial statements, in the same format as heretofore furnished to Purchaser, for the exercise Company and its Subsidiaries for and as of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares end of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14each such month.
(b) Prior From the date of this Agreement to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this AgreementLetter, unless the Company and the Special Committee have Purchaser has consented in writing thereto, the Purchaser: Company shall not, and shall not permit any of its Subsidiaries to:
(i) shall amend its Certificate of Incorporation or Bylaws or comparable governing instruments; (ii) except with respect to the issuance of treasury stock under the Company's savings plan, the Directors' Plans and the 1991 Employee Stock Purchase Plan in the ordinary course of business consistent with the terms of the governing documents, or where the documents do not issue govern such issuances, in accordance with the past practice of the Company representing in the aggregate no more than 40,000 shares of Common Stock, issue, sell, pledge or otherwise dispose of any shares of its capital stock at less than fair market value or other ownership interest in the Company (other than pursuant issuances of Common Stock in respect of any exercise of Options outstanding on the date hereof and disclosed in the Disclosure Letter) or any of the Subsidiaries, or any securities convertible into or exchangeable for any such shares or ownership interest, or any rights, warrants or options to acquire or with respect to any Purchaser Stock Plans) such shares of capital stock, ownership interest, or effect convertible or exchangeable securities; or accelerate any stock split right to convert or exchange or acquire any securities of the Company or any of its capital stock; (ii) shall promptly notify the Company of Subsidiaries for any breach of any representation such shares or warranty contained herein or any Purchaser Material Adverse Effectownership interest; (iii) shall promptly deliver to the Company true and correct copies of effect any reportstock split, statement reverse stock split, stock dividend, subdivision, reclassification or schedule filed with the SEC subsequent to similar transaction, or otherwise change its capitalization as it exists on the date of this Agreementhereof; and (iv) shall not grant, confer, award or amend any option, warrant, convertible security or other right to acquire any shares of its capital stock or take any action to cause to be exercisable any otherwise unexercisable option under any stock option plan or restricted stock plan; (v) declare, set aside or pay any dividend (other than regular quarterly cash dividends at a rate not in excess of $.46 per share of Common Stock) or make any other distribution or payment with respect to any shares of its Common Stock or other capital stock or other ownership interests (other than regular quarterly cash dividends such payments by a wholly-owned Subsidiary to the Company or another wholly-owned Subsidiary); (vi) directly or indirectly redeem, purchase or otherwise acquire any shares of its capital stock or the capital stock of any of its Subsidiaries; (vii) sell, lease, assign, transfer or otherwise dispose of (by merger or otherwise) any of its property, business or assets (including, without limitation, receivables, leasehold interests or Intellectual Property and including any sale leaseback transaction) except for (i) the sale of inventory in the ordinary course of business, (ii) the disposition of assets pursuant to the Restructuring as contemplated by Section 8.2(c)(i) and (iii) other asset sales for fair value in the ordinary course of business provided that the proceeds of such other asset sales do not exceed $2,000,000 in any single transaction or $10,000,000 in the aggregate prior to the Effective Time; (viii) settle or compromise any pending or threatened Litigation without Purchaser's consent (which consent will not be unreasonably withheld or delayed), other than settlements (a) of product liability Litigation in the ordinary course of business consistent with the Company's past practice of settling similar product liability claims, provided, in the case of settlements of product liability Litigations in excess of $100,000 only (I) the Company has kept Purchaser reasonably apprised of the status of such Litigation and has provided Purchaser with reasonable advance notice of its intention to settle any such Litigation and (II) the settlement would not have a Material Adverse Effect, (b) of other Litigations which involve solely the payment of money (without admission of liability) not to exceed $0.05 per share200,000 in any one case and (c) of Tax Litigation, which is governed by paragraph (xiii); (ix) make any advance, loan, extension of credit or capital contribution to, or purchase or acquire (by merger or otherwise) any stock, bonds, notes, debentures or other securities of, or any assets constituting a business unit of, or make any other investment in, any person, firm or entity, except (a) extensions of trade credit and endorsements of negotiable instruments and other negotiable documents in the ordinary course of business, (b) investments in cash and cash equivalents, (c) payroll and travel advances in the ordinary course of business, (d) investments in wholly owned Subsidiaries, and (e) the acquisition by the Company of the Minority JV Interest as contemplated by Section 8.2(c)(ii); (x) make any capital expenditures in the aggregate for the Company and its Subsidiaries in excess of the amounts specified in the Company's budget for capital expenditures, a true and complete copy of which has previously been delivered to Purchaser, or otherwise acquire assets having a value, in the aggregate, in excess of $500,000 not in the ordinary course of business; (xi) incur, assume or create any indebtedness for borrowed money or the deferred purchase price for property or services or pursuant to any capital lease or other financing, except indebtedness incurred in the ordinary course of business consistent with past practice for working capital purposes pursuant to the Company's existing credit facilities or commercial paper program as disclosed in the Disclosure Letter and except for the incurrence, assumption or creation of indebtedness in the ordinary course of business consistent with the past practice of the Company not exceeding $2,000,000 in any one instance or $10,000,000 in the aggregate at any one time outstanding; or amend in a manner materially adverse to the Company, any of the Company's existing credit facilities; (xii) assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person except wholly-owned Subsidiaries of the Company and except for obligations in the ordinary course of business consistent with the past practice of the Company not exceeding $1,000,000 individually and $5,000,000 in the aggregate; (xiii) make any material Tax election (unless required by law or unless consistent with prior practice) or settle or compromise any material income tax liability except, in each case, if Purchaser is given reasonable prior notice thereof; (xiv) waive or amend any term or condition of any confidentiality or "standstill" agreement to which the Company is a party and which relates to a business combination with the Company or the purchase of shares or assets of the Company; (xv) grant or amend any stock-related or performance awards; (xvi) except with respect to agreements which are terminable at will by the Company without any material penalty to the Company, enter into or amend any legally binding employment, severance, consulting or salary continuation agreements with any officers, directors or employees or grant any increases in compensation or benefits to employees other than increases to officers and employees in the ordinary course of business consistent with the past practice of the Company; (xvii) adopt, amend or terminate any employee benefit plan or arrangement (except as expressly contemplated by this Agreement); (xviii) enter into (a) any agreements with distributors or sales agents other than agreements terminable without penalty on less than 30 days' notice, (b) any agreements to distribute products for others or which restrict the ability of the Company or its Subsidiaries or affiliates to compete or (c) any other agreements, other than agreements relating to product promotions, that would constitute Material Contracts; or amend any of the foregoing agreements as exist on the date hereof; (xix) amend, change or waive (or exempt any person or entity from the effect of) the Rights Agreement, except in connection with the exercise of its fiduciary duties by the Board of Directors as set forth in Section 8.1 of this Agreement or in connection with the transactions contemplated under this Agreement; (xx) make any material changes in the type or amount of their insurance coverages; (xxi) except as may be required by law or generally acceptable accounting principles and with prior written notice to the Purchaser, change any material accounting principles or practices used by the Company or its Subsidiaries; (xxii) effect any material change in the Company's advertising, product promotion or brand support policies or programs or commit to any significant new product promotion or advertising campaign except, in each case, for matters in the ordinary course of business consistent with the past practice of the Company; (xxiii) effect any material change in the Company's billing practices or sales terms, or cause a material acceleration or delay in the manufacture, shipment or sale of inventory, the collection of accounts or notes receivable or the payment of accounts or notes payable except, in each case, for matters in the ordinary course of business consistent with the past practice of the Company; (xxiv) enter into any Contracts for Derivatives, except for spot, option and forward Contracts entered into in the ordinary course of business consistent with the past practice of the Company and with the Company's policies regarding Derivatives as previously disclosed to Purchaser; (xxv) waive, relinquish, release or terminate any right or claim, including any such right or claim under any Material Contract or permit any rights of material value to use any Intellectual Property to lapse or be forfeited, in each case, except in the ordinary course of business consistent with the past practice of the Company; (xxvi) apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for any substantial part of the property of the Company or any Significant Subsidiary, or make a general assignment for the benefit of creditors, or permit or suffer to exist the commencement of any bankruptcy, reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Company or any Significant Subsidiary; (xxvii) take any action to cause the Common Stock to be delisted from the New York Stock Exchange prior to the completion of the Offer or (if no Offer is made) the Merger; or (xxviii) agree in writing or otherwise to take any of the foregoing actions.
(c) The Company will use reasonable best efforts to (i) carry out its restructuring announced during the third quarter of fiscal 1996 as described in the Disclosure Letter (the "Restructuring") in a manner and on a schedule materially consistent with its plans as previously disclosed to Purchaser, including the sale of its manufacturing facilities in Rutland, Vermont and Tipperary, Ireland and (ii) to acquire, for a purchase price not to exceed $1,000,000 and on other terms reasonably acceptable to Purchaser, the minority interest (the "Minority JV Interest") held by its joint venture partner (Northeast No. 6 Pharmaceutical Factory of China) in the Company's Chinese joint venture subsidiary. At Purchaser's request, the Company will cooperate with Purchaser (including, by conducting mutual negotiations or by seeking declaratory relief) to minimize the possible impact on Purchaser and/or its Subsidiaries of any non-compete covenants to which the Company or any of its Subsidiaries or affiliates may be subject or may be parties following the Closing. The Company shall keep Purchaser reasonably apprised of the status of each of the matters referred to in this Section 8.2(c).
Appears in 2 contracts
Sources: Merger Agreement (Procter & Gamble Co), Merger Agreement (Procter & Gamble Co)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing (such approval not to be unreasonably withheld or delayed)), and except as otherwise expressly contemplated by this Agreement, as set forth in Section 6.1 of the Company Disclosure Letter or as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of its and its Subsidiaries’ present employees and agents. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly required by this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld or delayed), (C) as set forth in Section 6.1 of the Company Disclosure Letter or (D) as required by applicable Laws, the Company will not and will not permit its Subsidiaries to:
(i) adopt or propose any change in its articles of incorporation or by-laws or other applicable governing instruments;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, or restructure, reorganize or completely or partially liquidate any operations or businesses;
(iii) acquire assets outside of the ordinary course of business from any other Person with a value or purchase price in excess of $1 million in the aggregate, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement;
(iv) except for the issuance of Shares upon the exercise of Company Options outstanding on the date of this Agreement or in accordance with the terms of the 401(k) Plans as in effect on the date of this Agreement, issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries (other than the issuance of shares by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) create or incur any Encumbrance (other than the exclusion set forth in clauses (a) and (d) of the definition of Encumbrance) on any assets of the Company or any of its Subsidiaries;
(vi) make any loans, advances or capital contributions to or investments in any Person (other than the Company or any direct or indirect wholly owned Subsidiary of the Company);
(vii) other than regular quarterly cash dividends on Shares of $0.18 per Share and the Special Dividend, declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly owned Subsidiary to the Company or to any other direct or indirect wholly owned Subsidiary) or enter into any agreement with respect to the voting of its capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(ix) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for indebtedness for borrowed money incurred in the ordinary course of business consistent with past practices;
(x) except as set forth in the capital budgets set forth in Section 6.1(a)(x) of the Company Disclosure Letter and consistent therewith, make or as contemplated by authorize any other provision capital expenditure in excess of $2 million in the aggregate;
(xi) enter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement, unless except for customer Contracts entered into in the Purchaser has consented ordinary course of business consistent with past practice that do not contain any of the provisions referred to in writing theretoSection 5.1(j)(i)(F);
(xii) make any changes with respect to accounting policies or procedures, except as required by changes in applicable generally accepted accounting principles, the Company: rules or policies of the Public Company Accounting Oversight Board or applicable Law;
(xiii) settle any litigation or other proceedings before a Governmental Entity for an amount in excess of $500,000 or any claim against the Company in excess of such amount;
(xiv) (i) shallamend or modify any Material Contract in any material respect or in manner adverse to the Company or its Subsidiaries, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall terminate any Material Contract, or (iii) cancel, modify or waive any debts or claims held by it or waive any rights having in each case a value in excess of $500,000;
(xv) make any material Tax election, settle any material Tax claim or change any material method of Tax accounting;
(xvi) transfer, sell, lease, license, mortgage, pledge, suffer a Lien, divest, abandon, or allow to lapse or expire, or otherwise dispose of any assets, product lines or businesses of the Company or its Subsidiaries, including capital stock of any of its Subsidiaries, except in the ordinary course of business or sales of obsolete assets;
(xvii) except as provided in Section 6.9(g), as required pursuant to existing agreements in effect prior to the date of this Agreement and set forth in Section 5.1(h)(i) of the Company Disclosure Letter, or as otherwise required by applicable Law, (i) grant or provide any severance or termination payments or benefits to any director, officer or employee of the Company or any of its Subsidiaries, except, in the case of employees who are not officers, in the ordinary course of business consistent with past practice as disclosed to the Parent prior to the date hereof, (ii) increase the compensation, bonus or pension, welfare, severance or other benefits of, pay any bonus to, or make any new equity awards to any director, officer or employee of the Company or any of its Subsidiaries, except for increases in base salary or bonus in the ordinary course of business consistent with past practice for employees who are not officers, (iii) establish, adopt, amend or terminate any Benefit Plan or amend the terms of any outstanding equity-based awards, (iv) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any Benefit Plan, to the extent not already provided in any such Benefit Plan, (v) change any actuarial or other assumptions used to calculate funding obligations with respect to any U.S. Benefit Plan or Non-U.S. Benefit Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, or (vi) forgive any loans to directors, officers or employees of the Company or any of its Certificate Subsidiaries.
(xviii) take any action or omit to take any action that is reasonably likely to result in any of Incorporation the conditions to the Merger set forth in Article VII not being satisfied;
(xix) perform any services or Bylaws provide any products to any Person that would expand in any material respect the scope of services or comparable governing instruments products subject to any non-compete provision to which the Company or any of its Subsidiaries is subject; or (other than xx) agree, authorize or commit to permit do any of the consummation foregoing.
(b) Prior to making any written or broad-based oral communications to the directors, officers or employees of the Company or any of its Subsidiaries pertaining to the effect upon employment, compensation or benefit matters that will result as a consequence of the transactions contemplated by this Agreement); , the Company shall provide Parent with a copy of the intended communication, Parent shall have a reasonable period of time to review and comment on the communication, and Parent and the Company shall cooperate in providing any such mutually agreeable communication.
(iiic) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to From the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Agreement until Effective Time, except (A) as otherwise expressly required by this Agreement, (B) as the Company may approve in writing (such approval not to be unreasonably withheld or delayed), (C) as set forth in Section 6.1(c) of the Purchaser Parent Disclosure Letter or (D) as contemplated required by this Agreementapplicable Laws, unless Parent will not and will not permit its Subsidiaries to take any action or omit to take any action that is reasonably likely to result in any of the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver conditions to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall Closing set forth in Article VII not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)being satisfied.
Appears in 2 contracts
Sources: Merger Agreement (Banta Corp), Merger Agreement (Banta Corp)
Interim Operations. (a) Prior Except as otherwise expressly (A) required by this Agreement, (B) required by applicable Law, (C) approved in writing by Parent or (D) set forth on Section 6.1(a) of the Company Disclosure Letter, the Company covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time (unless Parent shall otherwise approve in writing (such approval not to be unreasonably withheld, conditioned or delayed)), the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, SROs, customers, clearing brokers, suppliers, licensors, licensees, distributors, creditors, lessors, employees, independent contractors and business associates and keep available the services of its and its Subsidiaries’ present officers, employees, independent contractors and agents, except as required by applicable Laws. Without limiting the generality of and in furtherance of the foregoing, after the date of this Agreement and prior to the Effective Time, except as otherwise expressly (A) required by this Agreement, (B) required by applicable Law, (C) approved in writing (such approval not to be unreasonably withheld, conditioned or delayed) by Parent or (D) set forth in on Section 6.1(a) of the Company Disclosure Letter Letter, the Company will not and will not permit its Subsidiaries to:
(i) adopt or as contemplated by propose any change in its articles of incorporation or bylaws or comparable governing documents;
(ii) merge or consolidate itself or any of its Subsidiaries with any other provision Person, except for any such transactions among its wholly owned Subsidiaries, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) acquire assets outside of the ordinary course of business from any other Person in any transaction or series of related transactions, other than (A) acquisitions pursuant to and in accordance with the terms of Contracts in effect as of the date of this Agreement, unless the Purchaser has consented in writing theretotrue, the Company: (i) shall, correct and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct complete copies of any report, statement which have been provided or schedule filed with the SEC subsequent otherwise made available to Parent prior to the date of this Agreement; Agreement or (vB) shall not (x) except underwritten transactions and/or transactions effected pursuant to Rule 144A of the exercise Securities Act which are not in excess of options$20,000,000 in the aggregate;
(iv) issue, warrantssell, conversion rights and pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or Encumbrance of, or otherwise enter into any Contract or understanding with respect to the voting of, any shares of its capital stock or that of any of its Subsidiaries (other contractual rights existing than (A) the Company Voting Agreements or (B) the issuance of shares (i) by its wholly owned Subsidiary to it or another of its wholly owned Subsidiaries, (ii) in respect of Company Equity Awards outstanding as of the date of this Agreement or permitted to be granted under this Section 6.1(a) following the date of this Agreement, in each case, in accordance with their terms and, as applicable, the Stock Plan as in effect on the date hereof and disclosed pursuant to of this Agreement, or (iii) pursuant to the Recapitalization issue Investor Option), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) create or incur any Encumbrance on any of its assets or any of its Subsidiaries assets except in the ordinary course of business;
(vi) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than to or from the Company and any of its wholly owned Subsidiaries) except in connection with securities lending in the ordinary course of business or capital markets transactions in the ordinary course of business and not in excess of $2,500,000;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for (i) dividends paid by any direct or indirect wholly owned Subsidiary to the Company or to any other direct or indirect wholly owned Subsidiary or (ii) the Pre-Closing Dividend);
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(ix) incur any Indebtedness (including the issuance of any debt securities, effect warrants or other rights to acquire any stock split debt security) except in connection with securities lending in the ordinary course of business or capital markets transactions in the ordinary course of business and not in excess of $2,500,000;
(x) except to the extent specifically provided by, and consistent with the line items set forth in, the Company’s capital budget set forth in Section 6.1(a)(x) of the Company Disclosure Letter, make or authorize any payment of, or accrual or commitment for, capital expenditures;
(xi) other than in the ordinary course of business consistent with past practice, enter into any Contract that would have been a Company Material Contract had it been entered into prior to this Agreement or amend, modify, supplement, waive, terminate, assign, convey, encumber or otherwise transfer, in whole or in part, rights or interest pursuant to or in any Company Material Contract, other than expirations of any such Contract in the ordinary course of business in accordance with the terms of such Contract, or cancel, modify or waive any debts or claims held by it or waive any rights except in the ordinary course of business; provided that for the purpose of this Section 6.1(a)(xi) the thresholds in Section 4.16(a)(vi) shall be deemed to refer to $200,000 and $400,000, respectively;
(xii) settle any action, suit, claim, hearing, arbitration, investigation or other proceedings (except in the ordinary course of business or for money damages not to exceed $500,000 in the aggregate) or on a basis that would result in the imposition of any writ, judgment, decree, settlement, award, injunction or similar order of any Governmental Entity or SRO that would restrict the future activity or conduct of the Company or any of its Subsidiaries or a finding or admission of a violation of Law or violation of the rights of any Person or that is brought by any current, former or purported holders of any capital stock or debt securities of the Company or any of its Subsidiaries relating to the Merger or the other transactions contemplated by this Agreement;
(xiii) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP;
(xiv) take any action that would result in a material diminution for the net capital of a Broker-Dealer Subsidiary not in the ordinary course of business consistent with past practice or a failure to comply with the net capital requirements of the SEC, FINRA and any SRO applicable to any Broker-Dealer Subsidiary, except, for the avoidance of doubt, the payment of the Pre-Closing Dividend;
(xv) fail to duly and timely file all material reports and other material documents required to be filed with FINRA, the SEC or any other Governmental Entity or SRO, subject to extensions permitted by Law or applicable rules and regulations;
(xvi) fail to maintain in full force and effect all Insurance Policies covering the Company and its Subsidiaries and their respective properties, assets and businesses in a form and amount consistent with past practice;
(xvii) make, change or revoke any material Tax election, change an annual Tax accounting period, adopt or change any material Tax accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle any material Tax claim, audit, assessment or dispute, surrender any right to claim a refund of a material amount of Taxes, take any action which is reasonably likely to result in a material increase in the Tax liability of the Company or its capitalization Subsidiaries, or, in respect of any taxable period (or portion thereof) ending after the Closing Date, the Tax liability of Parent or its Affiliates;
(xviii) transfer, sell, lease, assign, divest, cancel or otherwise dispose of, or permit or suffer to exist the creation of any Encumbrance upon, any assets, product lines or businesses material to it or any of its Subsidiaries, including capital stock of any of its Subsidiaries, except in connection with services provided in the ordinary course of business and sales of obsolete assets, other than pursuant to Company Material Contracts as it existed on in effect prior to the date of this Agreement true, correct and complete copies of which have been made available to Parent;
(xix) sell, assign or otherwise transfer any Intellectual Property Rights to any Person, (B) grant any license, covenant not to ▇▇▇, release, waiver or other right under any Intellectual Property Rights to any Person, except for non-exclusive licenses granted in the ordinary course of business consistent with past practice, or (C) cancel, abandon or allow to lapse or expire any material Intellectual Property Rights;
(xx) except as required by applicable Law or pursuant to the terms of any Plan in effect as of the date hereof, (yA) grantincrease the cash compensation or benefits payable or to become payable to its directors, confer officers, employees or individual independent contractors, except, for employees who are not executive officers for purposes of Section 16 of the Exchange Act, increases in annual salary or wage rate in the ordinary course of business consistent with past practice that do not exceed 6% individually or 3% in the aggregate, (B) grant any rights to severance or termination pay to, or enter into any employment or severance agreement with, any director, officer or other employee of the Company or any Company Subsidiary, (C) take any action to amend or waive any vesting criteria or accelerate vesting, exercisability or funding under any Plan or award granted thereunder, (D) become a party to, establish, adopt, materially amend, commence participation in or terminate any optionPlan or any arrangement that would have been a Plan had it been entered into prior to this Agreement, warrant(E) grant any new awards, conversion right or amend or modify the terms of any outstanding awards, under any Plan, (F) forgive any loans or issue any loans (other than routine travel advances issued in the ordinary course of business) to any Company Employee, (G) hire any employee or engage any independent contractor (who is a natural person) with an annual salary or wage rate or consulting fees in excess of $200,000 individually or $1,000,000 in the aggregate or (H) terminate the employment of any executive officer other than for cause;
(xxi) become a party to, establish, adopt, amend, commence participation in or terminate any collective bargaining agreement or other right agreement with a labor union, works council or similar organization;
(xxii) change in any material respect the cash management practices, policies or procedures of the Company or any of its Subsidiaries with respect to collection of accounts receivable, establishment of reserves for uncollectible accounts receivable, accrual of accounts receivable, payment of accounts payable, purchases, prepayment of expenses or deferral of revenue, from the Company’s and its Subsidiaries’ practices, policies and procedures with respect thereto in the ordinary course of business consistent with past practice, including (i) taking (or omitting to take) any action that would have the effect of accelerating revenues, accelerating cash receipts or accelerating the collection of accounts receivable to pre-Closing periods that would otherwise be expected to take place or be incurred in post-Closing periods, or (ii) taking (or omitting to take) any action that would have the effect of delaying or postponing the payment of any accounts payable to post-Closing periods that would otherwise be expected to be paid in pre-Closing periods;
(xxiii) take any action or omit to take any action that is intended to or would reasonably be likely to result in any of the conditions to the Merger set forth in Article VII not existing being satisfied; or
(xxiv) agree, authorize or commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time (unless the Company shall otherwise approve in writing (such approval not to be unreasonably withheld, conditioned or delayed)), except as otherwise expressly (A) required by this Agreement, (B) required by applicable Law or (C) set forth on Section 6.1(b) of the Parent Disclosure Letter, Parent will not, and will not permit its Subsidiaries to:
(i) adopt or propose any change in Parent’s certificate of incorporation or bylaws in any manner that would prohibit the Merger or the consummation of the other transactions contemplated by this Agreement or would reasonably be expected to have a material and adverse impact on the date hereof value of the Parent Common Stock that disproportionately affects the holders of Company Common Stock;
(ii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to acquire any of its capital stock (except for dividends paid by any direct or indirect wholly owned Subsidiary to it or to any other direct or indirect wholly owned Subsidiary or for quarterly dividends on Parent Common Stock not in excess of 25% of Parent’s adjusted EBITDA as to any given quarter calculated in a manner consistent with Parent’s historical practices);
(iii) to the extent such action would prevent, materially delay or materially impair the ability of Parent to consummate the Merger, make any repurchase or other acquisition of any outstanding shares of Parent Common Stock (other than repurchases or other acquisitions of Parent Common Stock in open market transactions at market prices or in connection with an accelerated share repurchase transaction or similar transaction on customary terms);
(iv) split, combine, reduce or reclassify any of its issued or unissued shares of its capital stock, or (z) adopt issue or authorize the issuance of any A1-14other securities in respect of, in lieu of or in substitution for, any shares of its capital stock in any manner that would reasonably be expected to have a material and adverse impact on the value of the Parent Common Stock;
(bv) take any action or omit to take any action that is intended to or would reasonably be likely to result in any of the conditions to the Merger set forth in Article VII not being satisfied; or
(vi) agree, authorize or commit to do any of the foregoing.
(c) Nothing contained in this Agreement shall give Parent or the Company, directly or indirectly, the right to control or direct the other party’s operations prior to the Effective Time. Prior to the Effective Time, except as each party will exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations. Notwithstanding anything to the contrary set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless no consent of Parent or the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment be required with respect to any shares matter set forth in this Section 6.1 or elsewhere in this Agreement to the extent that the requirement of its capital stock such consent would, upon the advice of legal counsel, violate applicable Antitrust Laws. Nothing in this Agreement, including any of the actions, rights or other ownership interests (other than regular quarterly cash dividends not restrictions set forth herein, will be interpreted in such a way as to exceed $0.05 per share)require compliance by any party hereto if such compliance would result in the violation of any rule, regulation or policy of any Governmental Antitrust Entity or applicable Law.
Appears in 2 contracts
Sources: Merger Agreement (FBR & Co.), Merger Agreement (B. Riley Financial, Inc.)
Interim Operations. (a) Prior to Without limiting the Effective TimeCompany's obligations under Section 6.5 of this Agreement, except as set forth in the corresponding section of the Company Disclosure Letter or otherwise as expressly contemplated hereby, the Company covenants and agrees as to itself and its Subsidiaries that, from the date of this Agreement until the Effective Time (unless Cingular shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed), the business of it and its Subsidiaries shall be conducted in the ordinary course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of the present employees and agents of the Company and its Subsidiaries. Without limiting the Company's obligations under Section 6.5 of this Agreement and without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, the Company will not and will not permit its Subsidiaries to (unless Cingular shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed):
(i) adopt or propose any change in its certificate of incorporation or by-laws or other applicable governing instruments;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among wholly-owned Subsidiaries of the Company that are not obligors or guarantors of third party indebtedness;
(iii) acquire assets outside of the ordinary course of business from any other Person with a value or purchase price in the aggregate in excess of $50,000,000, other than acquisitions pursuant to Contracts to the extent in effect immediately prior to the execution of this Agreement and set forth in Section 6.1(a)(iii) of the Company Disclosure Letter or as contemplated otherwise set forth in Section 6.1(a)(iii) of the Company Disclosure Letter;
(iv) other than pursuant to Contracts to the extent in effect as of immediately prior to the execution of this Agreement and set forth in Section 6.1(a)(iv) of the Company Disclosure Letter, and other than the issuance of shares of Common Stock upon the exercise of outstanding Company Options and pursuant to other equity-based awards granted under the Stock Plans and shares under the Company's 401(k) plan and the deferred compensation plans, in each case, in accordance with their terms, issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any its Subsidiaries (other than the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary), or securities convertible or exchangeable or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) other than in connection with existing receivables facilities and securitizations and renewals thereof in the ordinary course of business, create or incur any Lien on assets of the Company or any of its Subsidiaries that is material, individually or in the aggregate, to the Company and its Subsidiaries taken as a whole;
(vi) other than acquisitions pursuant to Contracts to the extent in effect as of immediately prior to the execution of this Agreement and set forth in Section 6.1(a)(vi) of the Company Disclosure Letter, make any loan, advance or capital contribution to or investment in any Person (other than a wholly-owned Subsidiary of the Company) in excess of $25,000,000 in the aggregate;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends or other distributions by any direct or indirect wholly-owned Subsidiary of the Company to the Company or to any other provision direct or indirect wholly-owned Subsidiary of the Company and periodic dividends and other periodic distributions by non-wholly-owned Subsidiaries consistent with past practices) or enter into any agreement with respect to the voting of its capital stock;
(viii) other than the redemption of the Series C Preferred Stock or the Series E Preferred Stock in accordance with the Company's certificate of incorporation, reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any share of its capital stock;
(ix) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for (A) indebtedness for borrowed money incurred in the ordinary course of business not to exceed $50,000,000 in the aggregate, (B) indebtedness for borrowed money in replacement of existing indebtedness for borrowed money on customary commercial terms, (C) guarantees incurred in compliance with this Section 6.1(a) by the Company of indebtedness of wholly-owned Subsidiaries of the Company or (D) interest rate swaps on customary commercial terms, consistent with past practices and not to exceed $750,000,000 of notional debt in the aggregate;
(x) except as set forth in Section 6.1(a)(x) of the Company Disclosure Letter, make or authorize any capital expenditure;
(xi) enter into any Material Contract that would have ' been a Material Contact as described in clauses (J), (L) or (M) of Section 5.1(j)(i) had it been entered into prior to the execution of this Agreement, unless and other than in the Purchaser has consented ordinary course of business, enter into any other Material Contract that would have been a Material Contract as described in writing theretoSection 5.1(j)(i) (other than as described in clauses (J), (L) or (M)) had it been entered into prior to the execution of this Agreement;
(xii) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP or by Law or except as the Company, based on the advice of its independent auditors and after consultation with Cingular, determines in good faith is advisable to conform to best accounting practices;
(xiii) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity for an amount in excess of $10,000,000 or which would be reasonably likely to have any adverse impact on the operations of the Company or any of its Subsidiaries or on any current or future litigation or other proceeding of the Company or any of its Subsidiaries; provided, that any litigation or other proceeding with respect to an item relating to Taxes may be settled for an amount that is not in excess of the amount reserved or accrued for such item on the most recent balance sheet contained in the Company Reports filed prior to the date of this Agreement (which reserve and accrual information shall be furnished by the Company to Cingular upon Cingular's request);
(xiv) other than in the ordinary course of business, amend or modify in any material respect, or terminate or waive any material right or benefit under any Material Contract;
(xv) except as required by Law, make any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any material method therefor that is inconsistent with elections made, positions taken or methods used in preparing or filing similar Tax Returns in prior periods. Notwithstanding the foregoing, the Company shall consult with Cingular and its Representatives prior to claiming any depreciation allowance under Section 168(k) of the Code;
(xvi) sell, lease, license, or otherwise dispose of any assets of the Company or its Subsidiaries except for ordinary course sales of mobile telephone equipment to customers of the Company: , services provided in the ordinary course of business or obsolete assets and except for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $25,000,000 in the aggregate, other than pursuant to Contracts in effect prior to the execution of this Agreement and set forth in Section 6.1(a)(iii) of the Company Disclosure Letter or as otherwise set forth in Section 6.1(a)(iii) of the Company Disclosure Letter and other than any dispositions of assets to the extent used as consideration for acquisitions that are permitted pursuant to Section 6.1(a)(iii);
(xvii) except as required pursuant to existing written, binding agreements in effect prior to the execution of this Agreement, as otherwise required by Law, or in the ordinary course of business consistent with past practice (which with respect to annual bonus plans and performance share awards is set forth in Section 6.1(a)(xvii) of the Company Disclosure Letter), (i) shallenter into any commitment to provide any severance or termination benefits to (or amend any existing arrangement with) any director, and shall cause each officer or employee of the Company or any of its Significant Subsidiaries toSubsidiaries, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation increase the benefits payable under any existing severance or Bylaws termination benefit policy or comparable governing instruments employment agreement (other than as required to permit be increased pursuant to the consummation existing terms of any such policy or agreement), (iii) enter into any employment, deferred compensation or other similar agreement (or amend any such existing agreement) with any director or officer of the Company or any of its Subsidiaries other than for new hires, (iv) establish, adopt, amend, terminate or make any new awards under any bonus, profit-sharing, thrift, pension, retirement, deferred compensation, compensation, stock option, restricted stock or other benefit plan or arrangement covering any director, officer or employee of the Company or any of its Subsidiaries (v) increase the compensation, bonus or other benefits payable to any director, officer, employee, consultant or independent contractor of the Company or any of its Subsidiaries, or (vi) amend the terms of any outstanding Company Option or other equity-based award; provided, that the Company shall in no event take any action to amend its severance plans, except as required by applicable Law;
(xviii) fail to initiate appropriate steps to renew any material FCC Licenses held by the Company or its Subsidiaries that are scheduled to terminate prior to or within 60 days after the Effective Time;
(xix) engage in the conduct of any business requiring the receipt or transfer of a License issued by a Governmental Entity other than engaging in the mobile wireless voice and data business in the U.S. and activities incident thereto, other than any other current lines of business and geographic locations of the Company or any of its Subsidiaries and other than as expressly permitted by Section 6.1(a)(iii) of the Company Disclosure Letter;
(xx) except as otherwise permitted hereby with respect to employees, enter into any material Contract with or engage in any material transaction with DoCoMo or any other Affiliate of the Company;
(xxi) adopt a technology platform other than existing technologies, (including analog, TDMA, EDGE, GSM and GPRS), HSDPA or UMTS and W-CDMA (including in each case the standards set forth on Section 6.1(a)(xxi) of the Company Disclosure Letter);
(xxii) amend, modify or waive any provision under the Rights Agreement; and
(xxiii) agree or commit to do any of the foregoing.
(b) Each of SBC and BellSouth will cause Cingular and Cingular Wireless to take all action necessary to consummate the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver Agreement subject to the Purchaser true terms and correct copies of conditions hereof. Neither SBC nor BellSouth will take or permit any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect Subsidiaries to take any stock split or otherwise change its capitalization as it existed on action that at the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on time of taking such action is reasonably likely to prevent the date hereof to acquire any shares consummation of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except Merger. Except as set forth in the Purchaser corresponding section of the disclosure letter delivered by SBC to the Company at the time of entering into this Agreement (the "SBC Disclosure Letter Letter"), neither SBC nor BellSouth shall, and each shall cause its Subsidiaries not to, prior to the Termination Date, (i) enter into any definitive agreement for the acquisition of any business or Person which provides commercial mobile wireless voice and data services offered to the public utilizing frequencies and spectrum licensed by the FCC, other than the provision of such services in de minimis amounts or (ii) take any action which would, at the time the action is taken, reasonably be expected to materially interfere with its ability to make available to Cingular or the Paying Agent as contemplated by of the Effective Time funds sufficient for its Specified Interest of the Merger Consideration. Each of SBC and BellSouth will, subject to the terms and conditions of this Agreement, unless make available to Cingular or the Company and Paying Agent its Specified Interest of the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Merger Consideration.
Appears in 2 contracts
Sources: Agreement and Plan of Merger (Cingular Wireless LLC), Agreement and Plan of Merger (Cingular Wireless LLC)
Interim Operations. (a) Prior Versum and Entegris each covenant and agree as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time (unless Versum or Entegris, as applicable, shall otherwise approve in writing (which approval shall not be unreasonably withheld, conditioned or delayed)), and except as otherwise expressly contemplated by this Agreement or as set forth in Section 7.1(a) of such Party’s Disclosure Letter, (i) the business of it and its Subsidiaries shall be conducted in all material respects in the Ordinary Course and (ii) to the extent consistent therewith, it and its Subsidiaries shall use their respective commercially reasonable efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, licensors, licensees, distributors, creditors, lessors, Employees and business associates and keep available the services of its and its Subsidiaries’ present officers, Employees and agents, except as otherwise expressly contemplated by this Agreement.
(b) Without limiting the generality of and in furtherance of Section 7.1(a), from the date of this Agreement until the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: otherwise (iw) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions expressly contemplated by this Agreement); , (x) required by applicable Law, (y) as approved in writing by the other Party (which approval shall not be unreasonably withheld, conditioned or delayed) or (z) set forth in Section 7.1(b) of such Party’s Disclosure Letter, each Party, on its own account, shall not and shall cause its Subsidiaries not to:
(i) make or propose any change to such Party’s Organizational Documents or, except for amendments that would both not materially restrict the operations of such Party’s businesses and not reasonably be expected to prevent, materially delay or materially impair the ability of such Party to consummate the Transactions, the Organizational Documents of any of such Party’s Subsidiaries;
(ii) other than in the Ordinary Course, except for any such transactions among its direct or indirect wholly owned Subsidiaries, (A) merge or consolidate itself or any of its Subsidiaries with any other Person, or (B) restructure, reorganize or completely or partially liquidate;
(iii) shall promptly notify acquire assets outside of the Purchaser Ordinary Course from any other Person (A) with a fair market value or purchase price in excess of $75 million in the aggregate in any breach transaction or series of related transactions (including incurring any representation Indebtedness related thereto), in each case, including any amounts or warranty contained herein value reasonably expected to be paid in connection with a future earn-out, purchase price adjustment, release of “holdback” or any Company Material Adverse Effect; similar contingent payment obligation, or (B) that would reasonably be expected to prevent, materially delay or materially impair the ability of such Party to consummate the Transactions, in each case, other than acquisitions of inventory or other goods in the Ordinary Course and transactions among such Party and its direct or indirect wholly owned Subsidiaries or among such Party’s direct or indirect wholly-owned Subsidiaries;
(iv) shall promptly deliver issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or Encumbrance of, or otherwise enter into any Contract or understanding with respect to the Purchaser true and correct copies voting of, any shares of its capital stock or of any reportof its Subsidiaries (other than the issuance of shares (A) by its direct or indirect wholly owned Subsidiary to it or another of its direct or indirect wholly owned Subsidiaries, statement or schedule filed with the SEC subsequent to (B) in respect of equity-based awards outstanding as of the date of this Agreement; , or (vC) shall not (xgranted in accordance with Section 7.1(b)(xvi) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue Entegris ESPP, in each of clauses (B) and (C), in accordance with their terms and, as applicable, the plan documents as in effect on the date of this Agreement), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) create or incur any Encumbrance (other than any Permitted Encumbrances) over any material portion of such Party’s and its Subsidiaries’ consolidated properties and assets that is not incurred in the Ordinary Course on any of its assets or any of its Subsidiaries, except for Encumbrances (A) that are required by or automatically effected by Contracts in place as of the day hereof, (B) that do not materially detract from the value of such assets or (C) that do not materially impair the operations of such Party or any of its Subsidiaries;
(vi) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than to or from Versum and any of its direct or indirect wholly owned Subsidiaries or to or from Entegris and any of its direct or indirect wholly owned Subsidiaries, as applicable, or in accordance with Section 7.1(b)(xvi)) in excess of $10 million in the aggregate;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly owned Subsidiary to it or to any other direct or indirect wholly owned Subsidiary) or modify in any material respect its dividend policy; provided, that (A) Entegris may make, declare and pay one regular quarterly cash dividend in each fiscal quarter in an amount per share of up to $0.07 per quarter with a record date consistent with the record date for each quarterly period and (B) Versum may make, declare and pay one regular quarterly cash dividend in each fiscal quarter in an amount per share of up to $0.08 per quarter and with a record date consistent with the record date for each quarterly period, in each case, solely to the extent (I) such Party has given the other Party sufficient notice prior to the declaration date to enable the Parties to coordinate dividend payments in accordance with to Section 7.16 and (II) such payment is coordinated pursuant to, and permitted by, Section 7.16;
(viii) reclassify, split, combine, subdivide or redeem, purchase (through such Party’s share repurchase program or otherwise) or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock, effect any other than with respect to (A) the capital stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on equity interests of a direct or indirect wholly owned Subsidiary of such Party or (B) the acquisition of shares of Versum Common Stock or Entegris Common Stock, as applicable, tendered by Employees in connection with a cashless exercise of Versum Options or Entegris Options, as applicable, outstanding as of the date hereof or in order to acquire pay Taxes in connection with the exercise or vesting of Versum equity awards or Entegris equity awards, as applicable, outstanding as of the date hereof or granted in accordance with Section 7.1(b)(xvi), pursuant to the terms of the Versum Stock Plan or Entegris Stock Plan, as applicable, and the applicable award agreement, in the Ordinary Course;
(ix) except to the extent expressly provided by, and consistent with, Section 7.1(b)(ix) of such Party’s Disclosure Letter, make or authorize any shares payment of, or accrual or commitment for, capital expenditures, except any such expenditure (A) not in excess of $25 million in the aggregate during any consecutive twelve (12) month period (other than capital expenditures within the thresholds set forth in Section 7.1(b)(ix) of such Party’s Disclosure Letter), (B) expenditures not in excess of $10 million (net of insurance proceeds) in the aggregate that such Party reasonably determines are necessary to avoid a material business interruption or maintain the safety and integrity of any asset or property or (C) paid by any direct or indirect wholly owned Subsidiary to such Party or to any other direct or indirect wholly owned Subsidiary of such Party, in each case in response to any unanticipated and subsequently discovered events, occurrences or developments (provided that such Party will use its reasonable best efforts to consult with the other Party prior to making or agreeing to any such capital expenditure);
(x) other than in the Ordinary Course, enter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement, adversely amend, modify, supplement or waive, terminate, assign, convey, Encumber or otherwise transfer, in whole or in part, rights or interest pursuant to or in any Material Contract other than (A) expirations and renewals of any such Contract in the Ordinary Course in accordance with the terms of such Contract, (B) non-exclusive licenses, covenants not to ▇▇▇, releases, waivers or other non-exclusive rights under Intellectual Property owned by Versum and its Subsidiaries or Entegris or any of its capital stockSubsidiaries, as applicable, in each case, granted in the Ordinary Course, or (zC) adopt any A1-14agreement among such Party and its direct or indirect wholly owned Subsidiaries or among such Party’s direct or indirect wholly owned Subsidiaries;
(bxi) Prior other than in the Ordinary Course or with respect to amounts that are not material to such Party and its Subsidiaries, taken as a whole, cancel, modify or waive any debts or claims held by it or any of its Subsidiaries or waive any rights held by it or any of its Subsidiaries except debts or claims among such Party and its direct or indirect wholly owned Subsidiaries or among such Party’s direct or indirect wholly owned Subsidiaries;
(xii) settle or compromise, or offer or propose to settle or compromise any material Proceeding, including before a Governmental Entity, except in accordance with the parameters set forth in Section 7.1(b)(xii) of such Party’s Disclosure Letter; provided that no such settlement or compromise, or offer in respect thereof, may involve any injunctive or other non-monetary relief which, in either case, imposes any material restrictions on the business operations of such Party and its Subsidiaries or Affiliates, or, after the Effective Time, the Combined Company;
(xiii) materially amend any material financial accounting policies or procedures, except as set forth required by changes to GAAP;
(xiv) enter into any material closing agreement with respect to Taxes, settle any material Tax claim, audit, assessment or dispute materially in excess of the amount reserved therefore, surrender any right to claim a refund of a material amount of Taxes, or fail to file when due (taking into account any available extensions) any material Tax Return;
(xv) transfer, sell, lease, divest, cancel, abandon, allow to lapse or expire or otherwise dispose of, or permit or suffer to exist the creation of any Encumbrance upon, any assets (tangible or intangible), product lines or businesses material to it and its Subsidiaries, taken as a whole, including capital stock of any of its Subsidiaries, except in connection with (A) sales of or non-exclusive licenses of the foregoing provided in the Purchaser Disclosure Letter Ordinary Course, (B) sales of obsolete assets, (C) sales, leases, licenses or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: other dispositions of assets (inot including services) shall not issue any shares of its capital stock at less than with a fair market value (not in excess of $15 million in the aggregate other than pursuant to any Purchaser Stock Plans) or Material Contracts in effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent prior to the date of this Agreement; , or entered into after the date of this Agreement in accordance with this Agreement and (ivD) shall not declaresales among such Party and its direct or indirect wholly owned Subsidiaries or among such Party’s direct or indirect wholly owned Subsidiaries;
(xvi) except as required by the terms of any Benefit Plan as in effect on the date hereof, set aside as permitted under this Agreement or pay any dividend as required by applicable Law, increase or make any other distribution change the compensation or payment with respect benefits payable to any shares Employee other than in the Ordinary Course; provided that, notwithstanding the foregoing, except as expressly disclosed in Section 7.1(b)(xvi) of its capital stock such Party’s Disclosure Letter or other ownership interests required pursuant to a Versum Benefit Plan or Entegris Benefit Plan, as applicable, in effect as of the date of this Agreement, the Parties shall not: (A) grant any new long-term incentive or equity-based awards or amend or modify the terms of any such outstanding awards under any Versum Benefit Plan or Entegris Benefit Plan, as applicable, (B) grant any retention or transaction bonuses, (C) increase or change the compensation or benefits payable to any executive officer (other than regular quarterly cash dividends (x) changes in health and welfare benefits that are generally applicable to all salaried Employees in the Ordinary Course or (y) increases in the base salaries and benefits of any executive officer in the Ordinary Course), (D) terminate, enter into, amend or renew (or communicate any intention to take such action) any material Benefit Plan, other than routine amendments to health and welfare plans (other than severance plans) that do not materially increase benefits or result in a material increase in administrative costs, or, other than as permitted by Section 7.1(b)(xvi) of such Party’s Disclosure Letter, adopt any compensation or benefit arrangement that would be a material Benefit Plan if it were in existence as of the date of this Agreement, (E) accelerate the vesting of any compensation for the benefit of any Employee, (F) increase or change the severance terms applicable to exceed $0.05 per shareany Employee, (G) take any action to fund or secure the payment of any amounts under any Benefit Plan, (H) other than as required by GAAP, change any assumptions used to calculate funding or contribution obligations under any Benefit Plan, or increase or accelerate the funding rate in respect of any Benefit Plan, or (I) terminate the employment of any executive officer (other than for cause) or hire any new executive officer (other than as a replacement hire receiving substantially similar terms of employment).; provided, that, to the extent that a Party intends to hire an individual to replace a named executive officer of such Party, such Party shall first consult in good faith with the other Party prior to, and with respect to, the hiring of such individual;
(xvii) recognize any Labor Organization as the representative of any of the employees of the Party or its Subsidiaries, or become a party to, establish, adopt, amend, commence negotiations for or terminate any collective bargaining agreement or other similar written agreement with a Labor Organization, in each case, other than in the Ordinary Course or as required by applicable Law;
(xviii) incur any Indebtedness (including the issuance of any debt securities, warrants or other rights to acquire any debt security) or guarantee any such Indebtedness, except for (A) Indebtedness for borrowed money incurred in the Ordinary Course under Versum’s or Entegris’s, as applicable, revolving credit facilities and other lines of credit existing as of the date of this Agreement, (B) guarantees by Versum or any direct or indirect wholly owned Subsidiary of Versum of Indebtedness of Versum or any other direct or indirect wholly owned Subsidiary of Versum, (C) guarantees by Entegris or any direct or indirect wholly owned Subsidiary of Entegris of Indebtedness of Entegris or any other direct or indirect wholly owned Subsidiary of Entegris, (D) Indebtedness incurred in connection with a refinancing or replacement of existing Indebtedness (but in all cases which refinancing or replacement shall not increase the aggregate amount of Indebtedness permitted to be outstanding thereunder and in each case on customary commercial terms consistent in all material respects with the Indebtedness being refinanced or replaced), (E) Indebtedness incurred pursuant to letters of credit, performance bonds or other similar arrangements in the Ordinary Course, (F) interest, exchange rate and commodity swaps, options, futures, forward contracts and similar derivatives or other hedging Contracts (1) not entered for speculative purposes and (2) entered into in the Ordinary Course and in compliance with its risk management and hedging policies or practices in effect on the date of this Agreement (G) Indebtedness incurred by mutual agreement of the Parties in accordance with Section 7.7 or (H) Indebtedness in
Appears in 2 contracts
Sources: Agreement and Plan of Merger (Versum Materials, Inc.), Merger Agreement (Entegris Inc)
Interim Operations. (a) Prior to the Effective Time, except Except as set forth in Section 6.1 of the Company Disclosure Letter or Letter, the Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement or the Stock Option Agreement):
(a) its and its Subsidiaries' businesses shall be conducted only in the ordinary and usual course (it being understood and agreed that nothing contained herein shall permit the Company to enter into or engage in (through acquisition, product extension or otherwise) the business of selling any other provision products or services materially different from existing products or services of this Agreementthe Company and its Subsidiaries or to enter into or engage in new lines of business (as such term is defined in the National Association of Insurance Commissioner's instructions for the preparation of the annual statement form) without Parent's prior written approval);
(b) to the extent consistent with (a) above, unless the Purchaser has consented in writing theretoit and each of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, the Company: suppliers, reinsurers, distributors, creditors, lessors, employees and business associates;
(c) it shall not (i) shallamend any Governing Document or amend, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially modify or terminate the same manner as heretofore conductedRights Agreement; (ii) shall not amend split, combine or reclassify its Certificate outstanding shares of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)capital stock; (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any reportauthorize, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend payable in cash, stock or make property in respect of any capital stock other distribution than dividends from its wholly owned Subsidiaries and other than regular quarterly dividends paid by the Company on its Common Shares not in excess of $0.18 per share, with usual record and payment dates and in accordance with the Company's past dividend policy; or payment with respect (iv) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its stock or any securities convertible into or exchangeable or exercisable for any shares of its stock;
(d) neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire any shares, of its or any Subsidiary's capital stock of any class or any other ownership interests property or assets (other than regular quarterly cash dividends Common Shares issuable pursuant to options outstanding on the date hereof under any of the Company Stock Plans); (ii) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; or (iii) except as set forth in Section 6.1(d) of the Company Disclosure Letter, make or authorize or commit for any capital expenditures, including entering into capital lease obligations, other than in amounts not exceeding $1,000,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity, including by way of assumption reinsurance, in excess of $1,000,000 individually or $5,000,000 in the aggregate (other than in connection with ordinary course investment activities);
(e) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans including the Stay Bonus Plan, or increase the salary, wage, bonus or other compensation of any employees except increases occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases) or promote any employee into any of bands 1, 2, 3 or 4, or from one of such bands into another of such bands;
(f) neither it nor any of its Subsidiaries shall pay, discharge, settle or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, settlement, discharge or satisfaction of claims, liabilities or obligations legally due and payable and arising in the ordinary and usual course of business, claims arising under the terms of products, contracts or policies issued by the Company Insurance Subsidiaries in the ordinary and usual course of business and such other claims, liabilities or obligations as shall not, subject to Section 5.1(a) of the Company Disclosure Letter, exceed $2,000,000 in the aggregate;
(g) neither it nor any of its Subsidiaries shall make, change or revoke any material Tax election, settle or compromise any material Tax liability arising in any audit, change its method of accounting if such change would have a material impact on Taxes, enter into any closing or other agreement with respect to a material amount of Taxes, file a request for refund of a material amount of Taxes (but not including the prosecution of any refund claim pending on the date hereof), or file an amended Tax Return if such Tax Return is materially different from the original return to which it relates, except, in each case, (i) in the ordinary course of business and consistent with the Company's past practice in respect of the Tax at issue in the jurisdiction in question or (ii) with the consent of Parent, such consent not to exceed be unreasonably withheld;
(h) neither it nor any of its Subsidiaries shall enter into any agreement containing any provision or covenant limiting in any material respect the ability of the Company or any Subsidiary or affiliate to (i) sell any products or services of or to any other Person, (ii) engage in any line of business or (iii) compete with or to obtain products or services from any Person or limiting the ability of any Person to provide products or services to the Company or any of its Subsidiaries or Affiliates;
(i) neither it nor any of its Subsidiaries shall enter into any (A) commutations or (B) new quota share or other reinsurance transaction, in the case of clause (B), (i) which does not contain cancellation and termination provisions reasonably customary in the industry for that type of transaction, (ii) which, except in the ordinary course of business, materially increases or reduces the Company Insurance Subsidiaries' consolidated ratio of net written premiums to gross written premiums or (iii) except as set forth in Section 6.1(i) of the Company Disclosure Letter, pursuant to which $0.05 per share)5,000,000 or more in gross written premiums are ceded by the Company Insurance Subsidiaries to any Person other than the Company or any of its Subsidiaries;
(j) neither it nor any of the Company Insurance Subsidiaries will alter or amend in any material respect their existing investment guidelines or policies;
(k) neither it nor any of its Subsidiaries shall take any action or omit to take any action that would cause any of its representations and warranties herein to become untrue in any material respect;
(l) neither it nor its Subsidiaries shall permit a material change in any of its underwriting, investment, actuarial, financial reporting or accounting practices or policies or in any material assumption underlying an actuarial practice or policy, except as may be required by any change in GAAP, statutory accounting principles or applicable Law; and
(m) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 2 contracts
Sources: Merger Agreement (Orion Capital Corp), Merger Agreement (Royal Group Inc/)
Interim Operations. (a) Prior From the date of this Agreement through the earlier of the Closing or the termination of this Agreement, except as otherwise expressly contemplated by this Agreement (including, for the avoidance of doubt, Exhibit A), required by applicable Law, disclosed in Section 5.4 of the Seller Disclosure Schedule or with respect to the Effective TimeRetained Plants, Retained Plant Assets, Retained Plant Liabilities, Put Assets and Put Liabilities, and except for commercially reasonable actions taken in response to a business emergency or other unforeseen operational matters (but limited to necessary repairs due to breakdown or casualty and in the reasonable judgment of Seller for no longer than is required by any such emergency or unforeseen matter and with prompt notice thereafter to IPH with respect to such actions taken, and in no event later than 48 hours after the taking of such actions), Seller shall cause AER and each of its Subsidiaries to (1) conduct their respective businesses only in the ordinary course of business consistent with past practice and (2) use reasonable best efforts to preserve intact their respective business organizations and goodwill, keep available the services of their respective present officers and key employees, and preserve the goodwill and business relationships with customers, suppliers, Governmental Entities and others having business relationships with them. Without limiting the generality of the foregoing, from the date of this Agreement through the earlier of the Closing or the termination of this Agreement, except as otherwise expressly contemplated by this Agreement (including, for the avoidance of doubt, Exhibit A), required by applicable Law, disclosed in Section 5.4 of the Seller Disclosure Schedule or with respect to the Retained Plants, Retained Plant Assets, Retained Plant Liabilities, Put Assets and Put Liabilities, without IPH’s prior written consent (which shall not be unreasonably withheld, conditioned or delayed), Seller shall not in respect of AER and each of its Subsidiaries, and shall cause AER and each of its Subsidiaries not to:
(i) (A) amend or propose to amend their respective certificates of incorporation or by-laws or equivalent organizational documents, (B) split, combine or reclassify their outstanding membership interests or capital stock or (C) repurchase, redeem or otherwise acquire any shares of the capital stock or other equity interests of the Transferred Company or its Subsidiaries;
(ii) issue, sell, transfer, pledge, encumber or dispose of, or agree to issue, sell, transfer, pledge, encumber or dispose of, any membership interests or shares of capital stock or any other class of debt or equity securities of the Transferred Company or its Subsidiaries (it being understood that Seller makes no such covenant with respect to any shares of EEI not owned directly or indirectly by the Transferred Company), or any options, warrants or rights of any kind to acquire any membership interests or shares of capital stock or any other class of debt or equity securities of the Transferred Company or its Subsidiaries (it being understood that Seller makes no such covenant with respect to any shares of EEI not owned directly or indirectly by the Transferred Company);
(iii) (A) except for Intercompany Accounts to be cancelled or otherwise settled as of the Closing pursuant to Section 5.7, incur, assume, guarantee or otherwise become liable for (whether directly, contingently or otherwise) any Debt, (B) merge or consolidate with any Person or make any material acquisition of any assets, businesses, stock or other properties in excess of $375,000, other than acquisitions of (1) inventory, materials or supplies in the ordinary course of business consistent with past practice or (2) already contracted by Seller, the Transferred Company or any of its Subsidiaries prior to the date of this Agreement, (C) sell, lease, transfer, pledge, dispose of or encumber any assets, rights, securities or businesses, other than sales or dispositions of (1) electricity, obsolete, damaged or broken equipment or other commodities or Derivative Products, in each case, in the ordinary course of business consistent with past practice and subject to the terms of Section 5.4(a)(xiii), (2) already contracted by Seller, the Transferred Company or any of its Subsidiaries prior to the date of this Agreement, or (3) items or materials not exceeding $375,000 in the aggregate, or (D) enter into any binding Contract with respect to the foregoing;
(iv) (A) accelerate the receipt of amounts due with respect to any receivables, (B) lengthen the period for payment of accounts payable, or (C) fail to make any payment as it comes due, except in connection with a good faith dispute and, in each case of clauses (A), (B) and (C), other than in the ordinary course of business consistent with past practice to maintain customary levels of working capital for the operation of the business of the Transferred Company and its Subsidiaries;
(v) other than as required by the terms of a Benefit Plan or collective bargaining agreement or pursuant to actions in the ordinary course of business consistent with past practice that apply uniformly to, respectively, Transferred Company Employees and similarly situated other employees of Seller and its Affiliates (without regard to EEI Employees) or EEI Employees and similarly situated other employees of Seller and its Affiliates, not (A) enter into, amend or extend any collective bargaining or other labor agreements (B) enter into or amend any employment, severance or special pay agreement with any Transferred Company Employee or EEI Employee, provided that Seller or its Affiliates may enter into retention agreements (which may include customary severance provisions) for which Seller is solely liable, (C) increase the annual base salary of any Transferred Company Employee or EEI Employee or (D) adopt, enter into, or amend any Transferred Company Benefit Plan or, except as would not materially increase costs to IPH, adopt, enter into or amend, any Seller Benefit Plan in respect of Transferred Company Employees or EEI Employees;
(vi) other than in the ordinary course of business, cause the Transferred Company or its Subsidiaries to hire any individual or permit the Transferred Company or its Subsidiaries to terminate the employment of any individual other than for cause;
(vii) modify in any material respect the Commodity Risk Policy, the Company Trading Guidelines or any similar policy, other than modifications that are more restrictive to the Transferred Company and its Subsidiaries;
(viii) effect or permit a “plant closing,” “mass layoff” or similar event under the Worker Adjustment and Retraining Notification Act or any corresponding state or local Laws (collectively, the “WARN Act”) without (A) the consent of IPH and (B) complying with all provisions of the WARN Act;
(ix) make any change in methods, principles or practices of financial accounting in effect, except insofar as may be required by a change in GAAP or Law;
(x) (A) make or change any material Tax election, (B) change an annual accounting period or adopt or change any material accounting method with respect to Taxes, (C) amend any Tax Return, (D) enter into any closing agreement, settle or compromise any proceeding with respect to any material Tax claim or assessment relating to the Transferred Company or any of its Subsidiaries, (E) surrender any right to claim a refund of a material amount of Taxes, or (F) consent to any extension or waiver of the limitation period applicable to any material Tax claim or assessment relating to the Transferred Company or any of its Subsidiaries, in each case, to the extent such action could reasonably be expected to result in a material increase in the Tax Liabilities of IPH or any of its Affiliates after the Closing;
(xi) waive, release, settle or compromise any pending or threatened Action, other than waivers, releases, settlements or compromises of any Action in the ordinary course of business consistent with past practice where the amount paid in such does not exceed $150,000 individually or $1,000,000 in the aggregate and where such waiver, release, settlement or compromise (A) does not impose future restrictions or requirements on the Business or the Transferred Company and its Subsidiaries or any of their respective assets or properties and (B) are paid or otherwise irrevocably satisfied in full prior to Closing (it being understood that this clause (xi) shall not apply with respect to Tax matters, which shall be governed by clause (x));
(xii) fail to maintain in full force and effect insurance coverage in form and amount equivalent in all material respects to the insurance coverage currently maintained with respect to the Transferred Company and its Subsidiaries and their assets and properties;
(xiii) (A) enter into, assume, amend, modify, terminate (partially or completely) (i) any Material Contract (including any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement) that would be reasonably expected to involve the payment or receipt by AER or one of its Subsidiaries in excess of $1,000,000 for each individual Contract or series of related Contracts (including, for the avoidance of doubt, the Put Option Agreement and the Put Option Asset Purchase Agreement), (ii) Material Contracts with a term in excess of one year and (iii) any other Material Contract other than in the ordinary course of business consistent with past practice and (B) enter into, assume, amend, modify, terminate (partially or completely) (except as such termination is required pursuant to Section 5.8) or waive, or amend rights or obligations under, any Affiliate Contracts or Subsidiary Contracts or any other Contract the existence of which would have been required to be disclosed on Section 3.17(a) of the Seller Disclosure Schedule; provided, further, with respect to both (A) and (B) above, Seller shall not take or forego taking, or permit any of its Affiliates to take or forego taking, any action the effect of which could cause or result in (immediately or with the passage of time) the occurrence of any of the restricted actions specified in (A) or (B) above;
(xiv) unless necessary to maintain the specified Minimum Coal Inventory, and notwithstanding clause (xiii) above, enter into any contract for the purchase of coal with a term of greater than 12 months, or amend or modify any existing contract for the purchase of coal to extend the term of such contract for more than 12 months; and
(xv) agree or commit to do or engage in any of the foregoing. For the avoidance of doubt, the parties acknowledge that any hedging activities, including, without limitation, forward-hedging programs and the use of derivative financial instruments such as forward contracts, futures contracts, options contracts and financial swap contracts, by the Transferred Company and its Subsidiaries in accordance with management programs and policies and/or for reducing Seller’s financial obligations with respect to the Post-Closing Credit Support to the extent permitted by Section 5.9(c) of this Agreement shall be considered activities “in the ordinary course of business”; provided that any such programs and policies (including the Commodity Risk Policy and the Company Trading Guidelines) shall have been in effect as of the date of this Agreement and shall have been made available to IPH.
(b) Notwithstanding the above provisions of this Section 5.4, prior to Closing, Seller may, and may cause its Affiliates to, remove all Cash from the Transferred Company or any of its Subsidiaries to Seller or its Subsidiaries, in such manner as Seller shall determine (provided that it does not violate any existing contractual obligations, including the Indenture); provided that (i) Seller may not permit the distribution or dividend of any assets (other than Cash in accordance with this Section 5.4(b)) or properties of the Transferred Company and its Subsidiaries to any of the Transferred Company’s equity holders, (ii) Seller may not remove from the Transferred Company or any of its Subsidiaries any Insurance Proceeds and must leave at the Transferred Company and its Subsidiaries an amount in Cash equal to, and must maintain in segregated accounts for the benefit of the Transferred Company or its applicable Subsidiary, all such Insurance Proceeds, (iii) in addition to any aggregate Cash amount to be transferred to Genco pursuant to Section 5.7, Seller shall cause to be retained at Closing at Genco an aggregate amount of Cash equal to the sum of (w) $70,000,000, (x) the Put Option Down Payment ($100,000,000), (y) the Put Option Additional Purchase Price (in an amount equal to at least $33,000,000) and (z) the amount, if any, by which the Alternative Gas Plant Transaction Consideration exceeds the sum of (A) the Put Option Down Payment and (B) the Put Option Additional Purchase Price (subject to the proviso in the first sentence of Section 5.24(d)) (such sum, the “Genco Retained Cash”), (iv) Seller shall cause to be retained at Closing at AERG an aggregate amount in Cash equal to $7,689,000 (or the gross proceeds of the sales described in item (i) on Section 3.7(a) of the Seller Disclosure Schedule to the extent completed at Closing) (the “AERG Retained Cash”) and (v) Seller shall cause to be retained at Closing at AEM an aggregate amount of Cash equal to $15,000,000 (the “AEM Retained Cash”). Notwithstanding anything to the contrary herein or elsewhere, but subject to Section 5.9(a), for the avoidance of doubt, Seller shall have the right to any Cash or instrument posted as collateral, which right shall be considered in the Marketing Company Note.
(c) Except as otherwise expressly contemplated by this Agreement or required by applicable Law, during the period from the date of this Agreement to the Closing Date, IPH shall not, and, with respect to clauses (ii) and (iii) shall cause its Affiliates not to, without the prior written consent of Seller, (i), except as set forth in on Section 5.4(c) of the Company IPH Disclosure Letter Schedule, amend, repeal or as contemplated by any other provision otherwise modify its certificate of this Agreementincorporation, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws bylaws or comparable governing instruments (other than to permit the consummation of organizational documents in a manner that would materially and adversely affect the transactions contemplated by this Agreement); , (ii) take any action or willfully fail to take any action that is intended or may reasonably be expected to result in any of the conditions to the Closing set forth in Article VIII not being satisfied, or (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any reportagree to, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to commitment to, engage in any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per sharethe actions prohibited by this Section 5.4(c).
Appears in 2 contracts
Sources: Transaction Agreement (Ameren Energy Generating Co), Transaction Agreement (Dynegy Inc.)
Interim Operations. Except (ai) Prior to the Effective Timeas required by this Agreement, except (ii) as set forth in Section 6.1 of the Company Disclosure Letter Schedule, (iii) as required by applicable Law, or (iv) as contemplated consented to in writing by any other provision Parent, which consent will not be unreasonably withheld, conditioned or delayed, the Company covenants that, from the date of this Agreement, unless Agreement until the Purchaser has consented earlier of the termination of this Agreement in writing thereto, accordance with its terms and the Company: Effective Time:
(a) the Company and each of its Subsidiaries will (i) shall, conduct business only in the Ordinary Course and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall to the extent consistent therewith, use commercially reasonable efforts to (A) preserve intact its current business organization, (B) keep available the services of key employees and (C) maintain its existing relationships with its customers and suppliers; provided that no action or failure to take action by the Company or any of its Subsidiaries with respect to matters specifically addressed by any provision of Section 6.1(b) through (s) will constitute a breach under this Section 6.1(a) unless such action or failure to take action would constitute a breach of such provision of Section 6.1(b) through (s), as applicable;
(b) the Company will not amend its Certificate of Incorporation or Bylaws, the Company will not permit any of its Subsidiaries to amend any of the organizational documents of any of its Subsidiaries, and none of the Company or any of its Subsidiaries will otherwise take any action to exempt any Person from any provision of its Certificate of Incorporation or Bylaws or comparable governing instruments any of the organizational documents of any of its Subsidiaries;
(c) the Company will not, and will not permit any of its Subsidiaries to, authorize or pay any dividends on or make any distribution with respect to its outstanding Shares or other securities (whether in cash, assets, stock or other securities of the Company or its Subsidiaries), except dividends and distributions made by a direct or indirect wholly owned Subsidiary of the Company to its parent, or directly or indirectly redeem, purchase or otherwise acquire any Shares or other securities;
(d) except for (i) transactions exclusively among the Company and its direct or indirect wholly owned Subsidiaries or among the Company’s direct or indirect wholly owned Subsidiaries, (ii) issuances of Shares in respect of any exercise of Company Stock Options or settlement of Company Units or Company Stock-Based Awards outstanding on the date of this Agreement, in each case in accordance with the terms of the applicable award agreement as in effect as of the date of this Agreement, and (iii) issuance of the Committed Shares, the Company will not, and will not permit any of its Subsidiaries to, issue, sell, pledge, dispose of or encumber (other than Permitted Liens), or authorize the issuance, sale, pledge, disposition or encumbrance (other than Permitted Liens) of, any Shares or any securities convertible into or exchangeable for Shares, or any rights, warrants or options to permit acquire or with respect to Shares or convertible or exchangeable securities, or split, combine or reclassify the consummation Shares or any outstanding capital stock of any of the transactions contemplated Company’s Subsidiaries;
(e) except to the extent required by Contracts in existence as of the date of this Agreement or by Company Benefit Plans set forth on Section 4.10(a) of the Company Disclosure Schedule, the Company will not and will not permit any of its Subsidiaries to:
(i) increase in any manner the compensation and benefits (including severance, termination, change-in-control, incentive and retention compensation or benefits) of any current or former directors, officers or employees of the Company and its Subsidiaries; provided, that the Company may issue the Committed Shares to the persons entitled thereto;
(ii) grant any Company Stock Awards or other equity or equity-based awards (other than the Committed Shares), or amend the terms of any Company Stock Awards outstanding as of the date of this Agreement); ;
(iii) shall promptly notify enter into, amend (other than de minimis administrative amendments to Company Benefit Plans that do not increase the Purchaser level of benefits or cost to the Company or any of its Subsidiaries of maintaining the applicable compensation or benefit program, policy, arrangement or agreement), adopt, implement or otherwise commit itself to any Company Benefit Plan or other compensation or benefit plan, program, policy or Contract that would be a Company Benefit Plan if in effect as of the date of this Agreement, including any pension, retirement, profit-sharing, bonus, collective bargaining or other employee benefit or welfare benefit plan, policy, arrangement or agreement or employment or consulting agreement with or for the benefit of any breach employee, director, consultant, independent contractor or service provider of the Company or its Subsidiaries;
(iv) other than pursuant to the terms of this Agreement, take any action to amend, waive or accelerate the vesting of, or the lapsing of restrictions or performance criteria with respect to, any Company Benefit Plan or Company Stock Option, Company Stock-Based Award or Company Unit or otherwise accelerate any rights or benefits, or make any determinations under any Company Benefit Plan;
(v) establish or fund (or provide any funding for) any rabbi trust or other funding arrangement, including in respect of any representation Company Benefit Plan;
(vi) hire or warranty contained herein promote any person at the level of Director or above or terminate (other than for cause) the employment or services of any employee at the level of Director or above; or
(vii) enter into, establish or adopt any collective bargaining or similar agreement with any union, works council or labor organization;
(f) the Company will not, and will not permit any of its Subsidiaries to, make any loans or advances to any of its directors and executive officers (other than travel and payroll advances in the Ordinary Course in type and amount) or make any change in its existing borrowing or lending arrangements for or on behalf of any such Persons;
(g) the Company will not, and will not permit any of its Subsidiaries to, (i) incur, assume, guarantee or prepay any indebtedness for borrowed money (directly, contingently or otherwise), except for (A) any indebtedness for borrowed money among the Company and its direct or indirect wholly owned Subsidiaries or among the Company’s direct or indirect wholly owned Subsidiaries, (B) indebtedness for borrowed money in an amount not to exceed $5,000,000 in aggregate principal amount, and (C) letters of credit issued in the Ordinary Course or (ii) incur any Lien securing indebtedness for borrowed money, except for Liens securing borrowing expressly permitted by the foregoing clause (i);
(h) the Company will not, and will not permit any of its Subsidiaries to, change in any material respect any of the accounting methods, principles or practices used by it unless required by or advisable under a change in GAAP or any other accounting standard used by any such Subsidiary as of the date of this Agreement;
(i) other than in the Ordinary Course, the Company will not, and will not permit any of its Subsidiaries to (A) make, change or revoke any material income Tax election, (B) file any material amended income Tax Return, or (C) settle or compromise any material liability for income Taxes or surrender any claim for a refund of a material amount of income Taxes, other than in the case of clauses (B) and (C) hereof in respect of any income Taxes that have been identified in the reserves for income Taxes in the Company’s GAAP financial statements;
(j) the Company will not, and will not permit any of its Subsidiaries to, acquire, except in respect of any mergers, consolidations, business combinations among the Company and its direct or indirect wholly owned Subsidiaries or among the Company’s direct or indirect wholly owned Subsidiaries, including by merger, consolidation or acquisition of stock or assets, any corporation, partnership, limited liability company, other business organization or any division thereof, or any material amount of assets in connection with acquisitions or investments, other than the purchase of supplies, equipment and products in the Ordinary Course;
(k) the Company will not, and will not permit any of its Subsidiaries to, renew, extend, terminate, amend in any material respect or waive any of its material rights under any Company Material Adverse Effect; Contract of the type described in Section 4.17(a)(iv), (ivv), (vi), (viii), (xvi) shall promptly deliver to or (xvii) or enter into any Contract that would constitute a Company Material Contract of the Purchaser true and correct copies of any reporttype described in Section 4.17(a)(iv), statement (v), (vi), (viii), (xvi) or schedule filed with the SEC subsequent (xvii) if entered into prior to the date of this Agreement; (v) shall , and except in the Ordinary Course, the Company will not, and will not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue permit any shares of its capital stockSubsidiaries to, effect renew, extend, terminate, amend in any stock split material respect or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award waive any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt material rights under any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value Material Contract (other than pursuant to any Purchaser Stock Plansof the type described in Section 4.17(a)(iv), (v), (vi), (viii), (xvi) or effect (xvii)) or enter into any stock split Contract that would constitute a Company Material Contract (other than of its capital stock; the type described in Section 4.17(a)(iv), (iiv), (vi), (viii), (xvi) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iiixvii)) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent if entered into prior to the date of this Agreement;
(l) the Company will not, and will not permit any of its Subsidiaries to, make or authorize any capital expenditure, other than capital expenditures in the Ordinary Course or that do not otherwise exceed the Company’s existing capital budget by more than $1,000,000 in the aggregate;
(m) the Company will not, and will not permit any of its Subsidiaries to, (A) sell, transfer, mortgage, encumber or otherwise dispose of any of its tangible assets, tangible properties or businesses, except for sales, transfers, mortgages, encumbrances or other dispositions in the Ordinary Course (including dispositions of inventory or of obsolete equipment in the Ordinary Course) or pursuant to an existing contract set forth in Section 6.1(m) of the Company Disclosure Schedule, or (B) cancel, release or assign any indebtedness of any person owed to it or any claims held by it against any Person other than the release of claims held by it in the Ordinary Course;
(n) except in the Ordinary Course, the Company will not, and will not permit any of its Subsidiaries to (i) abandon, disclaim, dedicate to the public, sell, assign or grant any security interest in, to or under any Company-Owned IP, including failing to perform or cause to be performed all applicable filings, recordings and other acts, or to pay or cause to be paid all required fees and Taxes, to maintain and protect its interest in the Company-Owned IP, or (ii) grant to any third party any license, or enter into any covenant not to ▇▇▇, with respect to any Company-Owned IP;
(o) the Company will not, and will not permit any of its Subsidiaries to, commence, settle or compromise any litigation, suit, action or proceeding, except for commencements, settlements or compromises that (i) involve monetary remedies with a value not in excess of $1,000,000, with respect to any individual litigation, suit, action or proceeding or $5,000,000 in the aggregate; provided that the Company will notify Parent of commencements, settlements or compromises that involve monetary remedies with a value in excess of $500,000, (ii) do not involve any material equitable remedy or impose any material restriction on its business or the business of its Subsidiaries, and (iii) do not relate to any litigation by the Company’s stockholders in connection with this Agreement or the transactions contemplated hereby;
(p) the Company will not, and will not permit any of its Subsidiaries to, materially reduce the amount of insurance coverage or fail to renew any material existing insurance policies;
(q) the Company will not, and will not permit any of its Subsidiaries to, amend any franchises, grants, authorizations, licenses, permits, easements, variances, exceptions, consents, certificates, approvals, clearances, permissions, qualifications or registrations or orders of any Governmental Entity in a manner that adversely impacts its ability to conduct its business in any material respect, or (ii) other than in the Ordinary Course, terminate or allow to lapse, any such franchises, grants, authorizations, licenses, permits, easements, variances, exceptions, consents, certificates, approvals, clearances, permissions, qualifications or registrations or orders;
(r) the Company will not, and will not permit any of its Subsidiaries to, adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization (other than this Agreement); and
(s) the Company will not, and will not permit any of its Subsidiaries to, agree to do, or make any commitment to do, any of the foregoing. The Company may request consent from Parent (such consent not to be unreasonably withheld, conditioned or delayed) with respect to the actions proscribed in this Section 6.1 by delivering written notice. The Company, on the one hand, and Parent and Merger Sub, on the other hand, acknowledge and agree that (i) nothing contained in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the right to control or direct the operations of the Company or any of its Subsidiaries prior to the Effective Time, (ii) prior to the Effective Time, the Company will exercise, consistent with the terms and conditions of this Agreement, control and supervision over its and its Subsidiaries’ operations, (iii) notwithstanding anything to the contrary in this Agreement, no consent of Parent will be required with respect to any matter set forth in this Section 6.1 or elsewhere in this Agreement to the extent the requirement of such consent would reasonably be expected to be a violation of applicable Law, and (iv) shall notwithstanding anything to the contrary in this Agreement, Parent’s consent will not declarebe required for the Company to take, or fail to take, any action set aside forth in Section 6.1(a), Section 6.1(e)(i) or pay any dividend Section 6.1(l) if the Company determines in good faith that such action or make any other distribution or payment inaction is reasonably necessary in light of then-current operating conditions and developments with respect to the business of the Company and its Subsidiaries as a result of COVID-19; provided, in the case of this clause (iv), that the Company will provide reasonable advance notice to and consult with Parent prior to any shares of its capital stock such action or other ownership interests (other than regular quarterly cash dividends not inaction and will keep Parent fully informed on a current basis with respect to exceed $0.05 per share)such action or inaction.
Appears in 2 contracts
Sources: Merger Agreement (Home Depot, Inc.), Merger Agreement (HD Supply Holdings, Inc.)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time (unless Parent shall otherwise approve in writing (such approval not to be unreasonably withheld, delayed or conditioned), and except as otherwise set forth in Section 6.1 of the Company Disclosure Letter) and except as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of its and its Subsidiaries’ present employees and agents. Without limiting the generality of, and in furtherance of, the foregoing, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly provided in this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, delayed or conditioned), (C) as set forth in Section 6.1 of the Company Disclosure Letter or (D) as required by applicable Laws, the Company will not and will not permit its Subsidiaries to:
(i) adopt or propose any change in its certificate of incorporation or by-laws or other applicable governing instruments;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) acquire assets outside of the ordinary course of business from any other Person with a value or purchase price in excess of $1 million in the aggregate, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries (other than the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary and as permitted by Section 6.1(a)(vii)), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities, other than, in each case, (A) the issuance of Shares upon conversion of the Debentures, (B) the issuance of Shares pursuant to Company Awards, including upon exercise thereof and (C) the issuance of Shares in connection with “cashless” or “net settled” exercises of Company Awards);
(v) create or incur any Lien material to the Company or any of its Subsidiaries on any assets of the Company or any of its Subsidiaries (other than the exclusions set forth in clauses (A), (B), (C) and (F) of the definition of Encumbrance);
(vi) make any loans, advances, guarantees (other than guarantees of service granted in the ordinary course of business) or capital contributions to or investments in any Person (other than the Company or any direct or indirect wholly-owned Subsidiary of the Company) in excess of $500,000 in the aggregate during any 12-month period;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly-owned Subsidiary to the Company or to any other direct or indirect wholly-owned Subsidiary or regular quarterly dividends not to exceed $0.055 per share payable in cash, declared and paid consistent with prior timing) or enter into any agreement with respect to the voting of its capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(ix) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for (A) indebtedness for borrowed money incurred in the ordinary course of business consistent with past practices, provided that the aggregate amount of outstanding indebtedness for borrowed money will not exceed $60 million at any one time or (B) interest rate swaps on customary commercial terms consistent with past practice and in compliance with the Company’s risk management policies in effect on the date of this Agreement and not to exceed $500,000 of notional debt in the aggregate;
(x) except as set forth in the capital budgets set forth in Section 6.1(a)(x) of the Company Disclosure Letter and consistent therewith, make or authorize any capital expenditure in excess of $1 million in the aggregate during any 12-month period;
(xi) enter into any Contract that (A) would have been a Material Contract had it been entered into prior to the date of this Agreement or (B) is not terminable without liability within one year of the date of this Agreement and involves payment or receipt by the Company and its Subsidiaries of more than $5 million over the entire term of such Contract, except in the case of each of (A) and (B), for customer, vendor or technology licensing Contracts entered into in the ordinary course of business consistent with past practice that do not contain any of the provisions referred to in Section 5.1(j)(i)(D) and, in the case of vendor and technology licensing Contracts, do not have a term of longer than twelve (12) months;
(xii) make any material changes with respect to accounting policies or procedures, except as required by changes in applicable generally accepted accounting principles;
(xiii) settle any litigation or other proceedings before a Governmental Entity for an amount in excess of $250,000 or any obligation or liability of the Company in excess of such amount;
(xiv) (A) amend or modify any Material Contract in any material respect or in a manner adverse to the Company or its Subsidiaries, (B) terminate any Material Contract or (C) cancel, modify or waive any debts or claims held by it or waive any rights in each case other than in the ordinary course of business and having a value in excess of $250,000;
(xv) make any material Tax election, settle any material Tax claim or change any material method of Tax accounting;
(xvi) (A) grant, extend, amend (except as required in the diligent prosecution of the Intellectual Property), waive or modify any material rights in or to, nor sell, assign, lease, license, let lapse, abandon or cancel, or extend or exercise any option to sell, assign, lease or license, any material Intellectual Property, in each case, other than in the ordinary course of business, (B) fail to diligently prosecute the Company’s and its Subsidiaries’ patent and trademark applications or (C) fail to exercise a right of renewal or extension under any material inbound license for material Intellectual Property;
(xvii) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or otherwise dispose of any material assets, licenses, operations, rights, product lines, businesses or interests therein of the Company or its Subsidiaries, including capital stock of any of its Subsidiaries, except in connection with services provided in the ordinary course of business or sales of obsolete assets;
(xviii) hire any employee or individual independent contractor with total expected annual compensation, excluding commissions, in excess of $150,000, other than to fill vacancies arising in the ordinary course of business at compensation levels consistent with past practice;
(xix) except as required pursuant to Benefit Plans or as contemplated otherwise required by applicable Law, (i) grant or provide any severance or termination payments or benefits to any Employee or any director or officer of the Company or any of its Subsidiaries, (ii) increase the compensation, bonus opportunity or pension, welfare, severance or other provision benefits of, pay any bonus (other than the 2009 Bonus which may be paid in the ordinary course of business consistent with past practice and in accordance with its terms as in effect on the date of this Agreement), unless or make any new equity awards to any Employee or any director or officer of the Purchaser has consented Company or any of its Subsidiaries, (iii) establish, adopt, amend or terminate any Benefit Plan or amend the terms of any outstanding equity-based awards, (iv) take any action to accelerate the vesting or payment, or fund or in writing theretoany other way secure the payment, of compensation or benefits under any Benefit Plan, to the extent not already provided in any such Benefit Plan, (v) enter into or establish any (1) employment, severance, change in control, termination, deferred compensation or other similar agreement with any Employee or any director or officer of the Company or any of its Subsidiaries or (2) other agreement, program or policy that would otherwise qualify as a material Benefit Plan had it been in place as of the date of this Agreement (it being understood and agreed that such plan, program or policy that cannot be terminated at any time by the Company or after Closing, Parent, without liability in excess of $500,000 in the aggregate is deemed per se material); (vi) change any discount rate assumptions or materially change any other actuarial or other assumptions used to calculate funding obligations with respect to any Benefit Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP; or (vii) forgive any loans to Employees, directors or officers of the Company: ;
(ixx) shallknowingly take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Closing set forth in Article VII not being satisfied; or
(xxi) agree, and shall cause each authorize or commit to do any of the foregoing.
(b) Prior to making any written or material broad-based oral communications to the directors, officers or employees of the Company or any of its Significant Subsidiaries topertaining to the effect upon employment, conduct its operations according to their usual, regular and ordinary course in substantially the same manner compensation or benefit matters that will result as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation a consequence of the transactions contemplated by this Agreement); , the Company shall provide Parent with a copy of the intended communication, Parent shall have a reasonable period of time to review and comment on the communication, and Parent and the Company shall cooperate in providing any such mutually agreeable communication.
(iiic) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to From the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to Agreement until the Effective Time, except (A) as otherwise expressly provided in this Agreement, (B) as the Company may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (C) as set forth in Section 6.1(c) of the Purchaser Parent Disclosure Letter or (D) as contemplated required by this Agreementapplicable Laws, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall Parent will not issue knowingly take or permit any shares of its capital stock at less than fair market value (other than pursuant Subsidiaries to take any Purchaser Stock Plans) action or effect omit to take any stock split action that is reasonably likely to result in any of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver conditions to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall Closing set forth in Article VII not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)being satisfied.
Appears in 2 contracts
Sources: Merger Agreement (RR Donnelley & Sons Co), Merger Agreement (Bowne & Co Inc)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably denied and except as otherwise expressly contemplated by this Agreement) and except as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to (i) preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates, (ii) make all filings, pay all fees and take all other actions necessary and reasonable to protect, preserve and maintain the Scheduled Intellectual Property, and (iii) keep available the services of its and its Subsidiaries’ present employees and agents. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly required by this Agreement, (B) as Parent may approve in writing, which approval shall not be unreasonably denied or (C) as set forth in Section 7.1(a) of the Company Disclosure Schedule, the Company will not and will not permit its Subsidiaries to:
(i) adopt or propose any change in its articles of organization or by laws or other applicable governing instruments;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among wholly-owned Subsidiaries of the Company, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) acquire assets outside of the ordinary course of business, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries (other than (A) the issuance of shares pursuant to outstanding stock options, warrants or rights or (B) by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) create or incur any Lien material to the Company or any of its Subsidiaries on any assets (including Intellectual Property) of the Company or any of its Subsidiaries having a value in excess of $100,000;
(vi) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than the Company or any direct or indirect wholly owned Subsidiary of the Company) in excess of $100,000 in the aggregate;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly owned Subsidiary to the Company or to any other direct or indirect wholly owned Subsidiary or regular quarterly dividends, not to exceed $.07 per share, declared and paid consistent with prior timing) or enter into any agreement with respect to the voting of its capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(ix) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for (i) indebtedness for borrowed money at any one time outstanding incurred in the ordinary course of business consistent with past practices for working capital incurred pursuant to the Bank of America Credit Facility not to exceed indebtedness as of March 2, 2007 plus $15,000,000, (ii) in replacement of existing indebtedness for borrowed money on terms substantially consistent with or more beneficial than the indebtedness being replaced, or (iii) guarantees incurred in compliance with this Section 7.1 by the Company of indebtedness of wholly-owned Subsidiaries of the Company;
(x) except as set forth in the capital budgets set forth in Section 7.1(a)(x) of the Company Disclosure Letter Schedule and consistent therewith, make or as contemplated by authorize any other provision capital expenditure in excess of this Agreement, unless $1,000,000 in the Purchaser has consented in writing thereto, the Company: aggregate during any 12-month period;
(ixi) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of enter into any breach of any representation or warranty contained herein or any Company Contract that would have been a Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant Contract had it been entered into prior to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14;
(bxii) Prior make any changes with respect to the Effective Timeaccounting policies or procedures, except as required by changes in applicable generally accepted accounting principles;
(xiii) amend, modify or terminate any Material Contract or Intellectual Property Contract, or cancel, modify or waive any debts or claims held by it or waive any rights in excess of $250,000 in the aggregate;
(xiv) settle any litigation or other proceedings before a Governmental Entity for an amount in excess of the amount of any reserve on the balance sheet as of March 2, 2007 as set forth on Section 7.1(a)(xiv) of the Company Disclosure Schedule plus $150,000 in the Purchaser Disclosure Letter aggregate or as contemplated by this Agreement, unless any obligation or liability of the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares excess of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).such amount;
Appears in 2 contracts
Sources: Merger Agreement (Stride Rite Corp), Merger Agreement (Payless Shoesource Inc /De/)
Interim Operations. (a) Prior to From the Effective Timedate hereof and until the earliest of the Acceleration Time and the termination of this Agreement, except (w) as set forth in Section 7.1(a) of the Company Disclosure Letter Letter, (x) as otherwise expressly contemplated or as contemplated expressly permitted or required by any other provision of this Agreement, unless (y) to the Purchaser has extent consented to in writing theretoby Parent (which consent shall not be unreasonably withheld, delayed or conditioned) or (z) as required by applicable Law, the Company: (i) Company shall, and shall cause its Subsidiaries to, cause the business of it and its Subsidiaries to be conducted in the ordinary course, and the Company shall use reasonable best efforts to, and shall cause each of its Significant Subsidiaries to use reasonable best efforts to, conduct preserve its operations according to their usualbusiness organizations intact and maintain existing relations and goodwill with Governmental Entities, regular customers, suppliers, employees and ordinary course in substantially business associates. Notwithstanding the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation generality of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver foregoing, and subject to the Purchaser true exceptions set forth in clauses (w), (x), (y) and correct copies (z) of any reportthe immediately preceding sentence, statement or schedule filed with the SEC subsequent to Company, from the date of this Agreement through earlier of the Acceleration Time and the termination of this Agreement, shall not, and shall cause its Subsidiaries not to:
(i) amend the certificate of incorporation, bylaws or comparable governing documents of the Company or any of its Subsidiaries;
(ii) issue, sell, pledge, dispose of, grant, transfer or otherwise encumber any shares of capital stock, voting securities, partnership interest, membership interest or similar interest or any option, warrant, right or security convertible, exchangeable or exercisable therefor or other instrument or right the value of which is based on any of the foregoing of the Company or any of its Subsidiaries (including any Company Equity Awards) (collectively, “Equity Interests”), other than (A) issuance of Shares pursuant to Company Stock Options outstanding on date hereof under the Company Plans in accordance with the terms thereof, (B) issuances of Shares in connection with the matching of contributions under the (1) Dynegy Midwest Generation, Inc. 401(k) Savings Plan for Employees Covered under a Collective Bargaining Agreement (As Amended and Restated Effective January 1, 2009); (2) Dynegy Midwest Generation, Inc. 401(k) Savings Plan (As Amended and Restated Effective January 1, 2009); (3) Dynegy Inc. 401(k) Savings Plan (As Amended and Restated Effective January 1, 2009); and (4) Dynegy Northeast Generation, Inc. Savings Incentive Plan (As Amended and Restated Effective January 1, 2009), in each case in accordance with the terms thereof, (C) the issuance of the Top-Up Option Shares pursuant to the Top-Up Option and (D) issuances of Equity Interests in accordance with the Rights Agreement;
(iii) split, combine, subdivide or reclassify any of its Equity Interests;
(iv) declare, set aside, establish a record date for, or pay any dividends on or make any other distributions (whether payable in cash, stock, property or a combination thereof) in respect of any of its Equity Interests, other than any dividends (A) from any wholly owned Subsidiary of the Company to the Company or to another such Subsidiary of the Company and (B) any dividends or distributions issued in accordance with the Rights Agreement;
(v) shall not repurchase, redeem or otherwise acquire any of its Equity Interests, except for (xA) except mandatory sinking fund obligations existing on the date hereof and disclosed in Section 7.1(a)(v) of the Company Disclosure Letter, (B) redemptions, purchases or acquisitions pursuant to the exercise or settlement of optionsCompany Stock Options, warrantsemployee severance, conversion rights retention, termination, change of control and other contractual rights existing on the date hereof and disclosed pursuant to of this Agreement on the terms in effect on the date of this Agreement, including with respect to Company Restricted Stock and (C) acquisition or pursuant exchange of Rights in accordance with Rights Agreement;
(vi) incur, issue, or modify in any material respect the terms of, any Indebtedness, or assume, prepay, defease, cancel, acquire, guarantee or endorse, or otherwise become responsible for (whether directly or indirectly, contingently or otherwise), the Indebtedness of any Person, except for (A) advances of credit incurred under the Company’s existing credit facilities in an aggregate amount not to exceed $2,500,000, (B) letters of credit issued under the Credit Agreement (x) in the ordinary course of business consistent with past practices for non-trading activities but in any event in an aggregate amount not to exceed $25,000,000 or (y) in connection with the sale or purchase of Derivative Products, physical electricity products, or fuel commodities for the Company’s assets in the ordinary course of business consistent with past practices, (C) letters of credit issued under the Credit Agreement to support positions in place as of the date hereof, or (D) Indebtedness owed by any wholly owned Subsidiary of the Company to the Recapitalization issue Company or any shares other wholly owned Subsidiary of the Company;
(vii) grant or incur any Lien, other than (A) Permitted Liens, (B) Liens for current Taxes, assessments or other charges of a Governmental Entity not yet due and payable or which is being contested in good faith through appropriate proceedings, (C) pledges or deposits by the Company or any of its capital stockSubsidiaries in the ordinary course of business under workmen’s compensation Laws, effect any stock split unemployment insurance Laws or otherwise change similar legislation, (D) good faith deposits in connection with Contracts (other than for the payment of Indebtedness) or leases to which the Company or one of its capitalization Subsidiaries is a party, in each case, in the ordinary course of business consistent with past practice, (E) deposits to secure public or statutory obligations of the Company or one of its Subsidiaries, or to secure surety or appeal bonds to which such entity is a party, or deposits as it existed on security for contested Taxes, in each case incurred or made in the ordinary course of business consistent with past practice, (F) licenses granted to third parties in the ordinary course of business consistent with past practice by the Company or its Subsidiaries, (G) Liens required under the outstanding Indebtedness of the Company and its Subsidiaries as of the date hereof, (yH) grantLiens granted in connection with any Indebtedness permitted under Section 7.1(a)(vi), confer and (I) Liens granted or award any optionincurred in connection with the sale or purchase of Derivative Products, warrantphysical electricity products, conversion right or other right not fuel commodities for the Company’s assets in the ordinary course of business consistent with past practices or to support positions in place as of the date of this Agreement;
(viii) (A) except (1) to the extent required by applicable Law or (2) to the extent required by written agreements existing on the date hereof to acquire of this Agreement, grant or announce any shares stock option, equity or incentive awards or increase in the salaries, bonuses or other compensation and benefits payable by the Company or any of its capital stockSubsidiaries to any of the employees, officers, directors or other independent contractors who provide services in an individual capacity of the Company or any of its Subsidiaries, (B) except to the extent required by written agreements existing on the date of this Agreement, pay or agree to pay any pension, retirement allowance, termination or severance pay, bonus or other employee benefit not required by any existing Company Plan to any employee, officer, director or other independent contractor who provide services in an individual capacity of the Company or any of its Subsidiaries, whether past or present, or take any action to accelerate vesting of any right to compensation or benefits, (C) except to the extent required by written agreements existing on the date of this Agreement, enter into or amend any Contracts of employment or any consulting, bonus, severance, retention, retirement or similar agreement, (D) change any actuarial or other assumptions used to calculate funding obligations with respect to any Company Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, (E) change the accrual rate for the Company’s short-term incentive plans used to prepare the Company’s financial statements, (F) forgive any loans to directors, officers or employees of the Company or any of its Subsidiaries, or (zG) except as required to ensure that any Company Plan is not then out of compliance with applicable Law, enter into or adopt any new or renew, amend or terminate any existing Company Plan or benefit arrangement if such adoption, renewal, amendment or termination would result in a material cost to the Company or any of its Subsidiaries;
(ix) hire any employee or individual independent contractor with total expected annual base salary, including commissions, in excess of $100,000, other than to fill vacancies arising in the ordinary course of business at annual base salary levels not in excess of 120% of prevailing market rates, or, without consulting with Parent in advance, terminating any such employee or independent contractor;
(x) other than in the ordinary course of business and consistent with past practice, (A) make or change any material Tax election, or change the Company’s or such Subsidiary of the Company’s method of accounting for Tax purposes, (B) file any amended Tax Return involving a material amount of additional Taxes, (C) settle or compromise any material Tax liability, or any claim for a material refund of Taxes or enter into any closing agreement with respect to any material amount of Tax, or (D) agree to an extension or waiver of the statute of limitations applicable to the assessment or collection of any material Taxes except, in each case, as required by applicable Law;
(xi) except as required by GAAP, the SEC or applicable Law, change any material accounting policies or principles;
(xii) except in the ordinary course of business (A) enter into or assume any Contract that would have been a Company Material Contract had it been entered into prior to the date hereof, (B) terminate, materially amend or waive any material rights under any Company Material Contract or any Contract that would have been a Company Material Contract had it been entered into prior to the date hereof excluding any termination upon expiration of a term in accordance with the terms of such Company Material Contract or (C) or waive any material default under, or release, settle or compromise any material claim against the Company or liability or obligation owing to the Company under any Company Material Contract; provided in each case that the Company or any of its Subsidiaries shall be permitted to renew or replace any Company Material Contract with one or more Contracts on substantially similar terms;
(xiii) subject to Section 7.16, waive, release, settle or compromise any pending or threatened action, litigation, claim or arbitration or other proceedings before a Governmental Entity if such waiver, release, settlement or compromise by the Company or any of its Subsidiaries (A) is for an amount in excess of $2,500,000 individually or $5,000,000 in the aggregate, or (B) would entail the incurrence of (1) any obligation or liability of the Company in excess of such amount, including costs or revenue reductions or (2) obligations that would impose any material restrictions on the business or operations of the Company or its Subsidiaries;
(xiv) acquire (including by merger, consolidation, or acquisition of stock or assets) any interest in any Person or any division thereof or any assets thereof, excluding acquisitions of supplies, parts, fuel, materials and other inventory in the ordinary course of business consistent with past practice, or make any loan, advance or capital contribution to, or investment in, any Person or any division thereof, other than (A) any such acquisitions, loans, advances, contributions or investments that are for consideration not in excess of $1,000,000 individually or $5,000,000 for all such transactions by the Company and its Subsidiaries in the aggregate or (B) loans, advances or capital contributions to or among the Company and wholly owned Subsidiaries of the Company;
(xv) sell, transfer, lease, license, assign, allow to lapse or otherwise dispose of (including, by merger, consolidation, or sale of stock or assets) any entity, business, assets, rights or properties of the Company or any of its Subsidiaries having a current value in excess of $1,000,000 individually, or $5,000,000 for all such transactions by the Company and its Subsidiaries in the aggregate other than (A) sales, transfers, leases, licenses assignments and other dispositions of inventory, electricity or other commodities or Derivative Products in the ordinary course of business consistent with past practice, (B) dispositions of obsolete or worthless assets or properties in the ordinary course of business consistent with past practice or (C) transactions solely among the Company and/or any of its Subsidiaries;
(xvi) authorize or make any capital expenditure, other than (A) any capital expenditures contemplated by the Company’s current business plan, (B) capital expenditures that are not, in the aggregate, in excess of $5,000,000 above the capital expenditures provided for in such business plan or (C) capital expenditures required by Law or in response to a casualty loss or property damage;
(xvii) adopt or enter into a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any A1-14of its Subsidiaries;
(xviii) merge or consolidate the Company or any of its Subsidiaries with and into any other Person;
(xix) enter into, with respect or related to Dynegy ▇▇▇▇ Landing, LLC, Dynegy Morro Bay, LLC, Dynegy Oakland, LLC and Casco Bay Energy Company, LLC, any Contracts with a term extending beyond December 31, 2013;
(xx) fail to maintain in full force and effect material insurance policies covering the Company and its Subsidiaries and their respective properties, assets and businesses in a form and amount consistent with past practice unless the Company determines in its reasonable commercial judgment that the form or amount of such insurance should be modified;
(xxi) permit any letters of credit to be issued other than letters of credit issued under the Credit Agreement by JPMorgan Chase Bank, N.A., Citibank, N.A, Credit Suisse, Cayman Islands Branch and ABN AMRO BANK N.V.;
(xxii) subject to Section 7.2, take any action which would reasonably be expected to result in any of the Tender Offer Conditions or the conditions to the Merger set forth in Article VIII not being satisfied or delaying the satisfaction of any such conditions, or that would reasonably be expected to prevent, delay, impair or interfere with the ability of Parent to consummate the Offer or of Parent, Merger Sub or the Company to consummate the Merger; or
(xxiii) commit, authorize or agree to take any of the foregoing actions or enter into any letter of intent (binding or non binding) or similar agreement or arrangement with respect to any of the foregoing actions.
(b) Neither Parent nor Merger Sub shall take or permit any of their Affiliates to take any action that is reasonably likely to prevent or delay the consummation of the Offer or the Merger. Prior to making any written communications to the Effective Time, except as set forth in officers or employees of the Purchaser Disclosure Letter Company or as any of its Subsidiaries pertaining to compensation or benefit matters that are directly affected by the transactions contemplated by this Agreement, unless the Company shall, to the extent legally permissible, provide Parent with a copy of the intended communication, Parent shall review and comment on the communication promptly (but in any event, Parent shall provide any comments it may have within forty-eight (48) hours after such communication has been provided to Parent for review), and the Special Committee have consented Company shall consider in writing theretogood faith any comments reasonably proposed by Parent.
(c) Nothing contained in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the Purchaser: (i) shall not issue any shares of right to control or direct the Company’s or its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver Subsidiaries’ operations prior to the Company true earlier of the Offer Closing and correct copies of any reportthe Effective Time, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).nothing contained in this
Appears in 2 contracts
Sources: Merger Agreement (Icahn Enterprises L.P.), Merger Agreement (Dynegy Inc.)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, during the period beginning as of the execution of this Agreement on the Effective Date and ending on the earlier of the Effective Time and the termination of this Agreement in accordance with Article VIII (such period, the “Interim Period”), unless Parent shall otherwise approve in advance in writing (such approval not to be unreasonably withheld, conditioned or delayed), and except as otherwise expressly required by this Agreement or applicable Laws, the business of the Company and its Subsidiaries shall be conducted in the ordinary course consistent with past practice and, to the Effective Timeextent consistent therewith, the Company and its Subsidiaries shall use their respective commercially reasonable efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, licensors, suppliers, distributors, creditors, lessors, Employees, sales representatives and business associates and keep available the services of its and its Subsidiaries’ present Employees and agents. Without limiting the generality of the foregoing, and in furtherance thereof, during the Interim Period, except (A) as otherwise expressly required or permitted by this Agreement or applicable Law, (B) as Parent may approve in advance in writing (such approval not to be unreasonably, delayed, conditioned or withheld) or (C) as set forth in Section 6.1(a) of the Company Disclosure Letter, the Company shall not and shall not permit its Subsidiaries to:
(i) adopt or propose any change in its certificate of incorporation or bylaws or other applicable governing instruments;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) acquire assets outside of the ordinary course of business from any other Person, other than acquisitions pursuant to Contracts in effect as of the date hereof;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries (other than the issuance of shares (A) by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary or (B) in respect of the exercise of Company Options or Company Warrants outstanding as of the date of this Agreement in accordance with their terms and, with respect to Company Options, as applicable, the Stock Plans as in effect as of the date of this Agreement), or securities convertible or exchangeable into, exercisable for or with a value measured by reference to any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(v) create or incur any Lien (other than a Permitted Lien) not incurred in the ordinary course of business consistent with past practice;
(vi) make any loans, advances, guarantees or capital contributions to or investments in any Person;
(vii) incur any Indebtedness, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries;
(viii) except as set forth in the capital budgets in Section 6.1(a)(viii) of the Company Disclosure Letter and in material compliance therewith, make or as contemplated by authorize any other provision capital expenditure in excess of this Agreement, unless the Purchaser has consented in writing thereto, the Company: $50,000;
(iix) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of enter into any breach of any representation or warranty contained herein or any Company Contract that would have been a Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant Contract had it been entered into prior to this Agreement, in each case not done in the ordinary course of business consistent with past practice;
(x) make any changes with respect to accounting policies or procedures, except as required by changes in applicable generally accepted accounting principles;
(xi) settle any actions, suits, claims, hearings, arbitrations, investigations or other proceedings before a Governmental Entity for an amount in excess of $50,000 or any obligation or liability of the Company in excess of such amount;
(xii) amend, modify or terminate any Material Contract, or cancel, modify or waive any material debts or claims held by it or waive any material rights;
(xiii) (A) make, change, or rescind any material Tax election (other than an election made on a Tax Return filed in the ordinary course of business consistent with past practice); (B) file any material amended Tax Return; (C) adopt or change any material method or period of Tax accounting; (D) settle or compromise any material claim, audit, assessment or dispute relating to Taxes; (E) surrender any material claim for a refund of Taxes; (F) enter into any closing agreement relating to Taxes; (G) file any material Tax Return that is inconsistent with past practice; or (H) consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment (other than pursuant to extensions of time to file Tax Returns obtained in the Recapitalization issue ordinary course of business);
(xiv) transfer, assign, sell, lease, license, grant any shares material right in, mortgage, pledge, surrender, encumber, divest, fail to maintain, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets or properties (tangible or intangible, including any Intellectual Property Rights), licenses, operations, rights, product lines, businesses or interests therein of the Company or any of its Subsidiaries, including capital stockstock of any of its Subsidiaries, except for Permitted Liens or in connection with services provided in the ordinary course of business and sales of obsolete assets and except for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $50,000 in the aggregate, other than pursuant to Contracts in effect any stock split prior to the date hereof; provided, that with respect to Company Intellectual Property, the foregoing exceptions shall be limited to granting non-exclusive licenses to customers (solely to permit such customers’ use of the Company’s and its Subsidiaries’ products and services) or otherwise change to third-party service providers (solely for the purpose of facilitating their provision of services to or on behalf of the Company and its capitalization Subsidiaries), in each case, in the ordinary course of business consistent with past practice;
(xv) except (1) as it existed on required pursuant to existing written, binding agreements in effect prior to the date hereof, (y2) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in Section 5.1(j)(i) of the Purchaser Company Disclosure Letter or (3) as contemplated otherwise required by applicable Law, (A) grant or provide any severance or termination payments or benefits to any director, officer, employees or consultants of the Company or any of its Subsidiaries, (B) increase in any manner the compensation or consulting fees, bonus, pension, welfare, fringe, severance, termination pay or other benefits of, or pay any bonus to, any current or former director, officer, employee or consultant (who is a natural person) of the Company or any of its Subsidiaries, (C) grant any new awards, or amend or modify the terms of any outstanding awards, under any Benefit Plan, (D) become a party to, establish, adopt, commence participation in, amend or terminate any Benefit Plan or any arrangement that would have been a Benefit Plan had it been entered into prior to this Agreement, unless other than termination of the Company and 401(k) Plan pursuant to Section 6.9(b), (E) take any action to accelerate the Special Committee have consented vesting, lapsing of restrictions or payment in writing thereto, the Purchaser: (i) shall not issue respect of any shares of its capital stock at less than fair market value (other than award or benefit provided pursuant to any Purchaser Stock PlansBenefit Plan, other than acceleration of vesting of Company Options pursuant to Section 4.3, (F) fund or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make in any other distribution way secure the payment of compensation or payment benefits under any Benefit Plan, (G) hire any employee or engage any consultant (who is a natural person), (H) change any actuarial or other assumptions used to calculate funding obligations with respect to any shares Benefit Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, (I) forgive any loans or issue any loans to any current or former directors, officers, employees or consultants (who are natural persons) of the Company or any of its capital stock Subsidiaries, or (J) terminate the employment of any employee other than for cause;
(xvi) become a party to, establish, adopt, amend or commence participation in any collective bargaining agreement or other ownership interests agreement with a labor union, works council or similar organization;
(xvii) take any action or omit to take any action that would reasonably be expected to result in any of the conditions to the Merger set forth in Article VII not being satisfied;
(xviii) engage in (A) any trade loading practices or any other promotional sales or discount activity or other practice with the effect of accelerating to pre-Closing periods sales to the trade or otherwise that would otherwise be expected (in the ordinary course of business) to occur in post-Closing periods, (B) any practice which would have the effect of accelerating collections to pre-Closing periods of receivables that would otherwise be expected (in the ordinary course of business) to occur in post-Closing periods, (C) any practice which would have the effect of postponing to post-Closing payments by the Company that would otherwise be expected (in the ordinary course of business) to be made in pre-Closing periods, or (D) any promotional sales, discount activity, deferred revenue activity or inventory overstocking or understocking activity, in each case in this clause (D) in a manner outside the ordinary course of business or contrary to generally accepted industry practices;
(xix) sell, transfer or otherwise move any Inventory from the Company other than regular quarterly cash dividends not in the ordinary course of business or hold;
(xx) form one or more additional Subsidiaries; or
(xxi) agree, authorize or commit to exceed $0.05 per share)do any of the foregoing.
Appears in 1 contract
Sources: Merger Agreement (CONMED Corp)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective TimeTime or earlier termination of this Agreement (unless Parent shall otherwise approve in writing (which approval shall not be unreasonably withheld, delayed or conditioned), and except as otherwise expressly contemplated or permitted by this Agreement or as set forth in Section 6.1(a) of the Company Disclosure Letter) and except as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the Ordinary Course of Business and, to the extent consistent therewith, it shall and shall cause its Subsidiaries to use their respective commercially reasonable efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, Insurance Regulators, rating agencies, customers, reinsurers, Agents, insureds, suppliers, service providers, distributors, creditors, lessors, employees, Contract counterparties and business associates and keep available the services of its and its Subsidiaries’ present employees and agents. Without limiting the generality of, and in furtherance of, the foregoing, from the date of this Agreement until the Effective Time or earlier termination of this Agreement, except (A) as required by applicable Laws, (B) as otherwise contemplated by this Agreement or by the U.S. Life Restructuring in accordance with Annex A in all material respects, (C) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed) or (D) as set forth in Section 6.1(a) of the Company Disclosure Letter, the Company will not and will not permit its Subsidiaries (subject to the terms of the provisos in the definition of “Subsidiary” in Article X) to:
(i) adopt any change in the Fundamental Documents of it or any of its Subsidiaries;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements contemplating any of the foregoing;
(iii) acquire assets outside of the Ordinary Course of Business from any other Person with a value or purchase price in the aggregate in excess of $2,000,000 in any transaction or series of related transactions, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement;
(iv) issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber (other than pursuant to the existence of any Permitted Lien), or authorize the issuance, sale, pledge, disposition, grant, transfer or encumbrance of (other than pursuant to the existence of any Permitted Lien), any shares of capital stock of the Company or any of its Subsidiaries (other than Genworth Australia and other than the issuance of shares by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities, other than the issuance of Shares in settlement of Company Equity Awards in accordance with their terms, the issuance of capital stock by any Specified Entity in settlement of any equity awards issued by such Specified Entity in accordance with their terms and the issuance of Company Equity Awards or equity awards issued by a Specified Entity that would not otherwise constitute a breach of this Agreement;
(v) except for Permitted Liens, create or incur any Lien material to the Company and its Subsidiaries, taken as a whole, that is not incurred in the Ordinary Course of Business;
(vi) make any loans, advances, guarantees (other than guarantees that are features of the products offered to customers by the Company’s mortgage insurance business in the Ordinary Course of Business), or capital contributions to or investments in any Person in excess of $5,000,000 in the aggregate, other than acquisitions of Investment Assets pursuant to investment activities in the Ordinary Course of Business and, in the case of acquisitions of Investment Assets by the Insurance Subsidiaries, consistent with the Investment Guidelines of such Insurance Subsidiary;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock or enter into any agreement with respect to the voting of its capital stock (except dividends paid by any Specified Entity or by any Subsidiary of the Company other than an Insurance Subsidiary);
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock (other than (A) the withholding of shares to satisfy withholding Tax obligations (1) in respect of Company Equity Awards outstanding as of the date of this Agreement in accordance with their terms and, as applicable, the Stock Plans, in each case in effect on the date of this Agreement or (2) in respect of equity awards issued by, or stock-based employee benefit plans of, the Specified Entities in their respective Ordinary Course of Business and (B) the repurchase of shares of capital stock of Genworth Australia or Genworth Canada by Genworth Australia or Genworth Canada, as applicable, pursuant to share repurchase programs in effect as of the date hereof (or renewals thereof on substantially similar terms) with respect to such entities in accordance with their terms);
(ix) incur any Indebtedness or guarantee such Indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for Indebtedness incurred in the Ordinary Course of Business (A) not to exceed $10,000,000 in the aggregate, or (B) in replacement of existing Indebtedness on terms substantially consistent with or more beneficial to the Company or its Subsidiaries than the Indebtedness being replaced, and other than guarantees that are features of the products offered to customers by the Company’s mortgage insurance business in the Ordinary Course of Business;
(x) except as set forth in the capital budgets set forth in Section 6.1(a)(x) of the Company Disclosure Letter and consistent therewith, make or authorize any capital expenditure in excess of $5,000,000 in the aggregate during any 12-month period;
(xi) other than in the Ordinary Course of Business, enter into any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement;
(xii) other than (A) in the Ordinary Course of Business or (B) between or among the Company and its Subsidiaries, enter into any new Reinsurance Contract or other reinsurance transaction (including, for the avoidance of doubt, any Reserve Financing Contracts), or amend, modify or terminate any existing Reinsurance Contract or other reinsurance transaction (including, for the avoidance of doubt, any Reserve Financing Contracts);
(xiii) surrender any material License held by the Company or any of its Subsidiaries;
(xiv) enter into or engage in (through acquisition, product extension or otherwise) the business of selling any products or services materially different from the products or services of the Company and its Subsidiaries as contemplated of the date of this Agreement or enter into or engage in new lines of business (as such term is defined in the National Association of Insurance Commissioners’ instructions for the preparation of the annual statement form or in comparable instructions of the relevant Insurance Regulator);
(xv) make any material changes with respect to accounting policies or procedures, except as required by changes in GAAP, SAP or, with respect to any Subsidiaries of the Company that are not based in the United States, the accounting principles that are applicable to the preparation of the financial statements of such Subsidiary;
(xvi) except in the Ordinary Course of Business, alter or amend in any material respect any existing underwriting, reserving, hedging, marketing, pricing, risk management, reinsurance, claim handling, loss control, actuarial practice, guideline or policy of the Company or any Insurance Subsidiary, except as may be required by (or, in the reasonable good faith judgment of the Company, advisable under), GAAP, SAP, any Governmental Entity or, with respect to any Subsidiaries of the Company that are not based in the United States, the accounting principles that are applicable to the preparation of the financial statements of such Subsidiary;
(xvii) make any material change to the Investment Guidelines or acquire or dispose of any Investment Assets in any manner inconsistent with the Investment Guidelines, except as may be required by GAAP, SAP or, with respect to any Subsidiaries of the Company that are not based in the United States, the accounting principles that are applicable to the preparation of the financial statements of such Subsidiary;
(xviii) except as required by Section 6.1(b), enter into any Regulatory Agreement other than in the Ordinary Course of Business;
(xix) enter into (A) any material funding obligations of any kind, or material obligation to make any additional advances or investments in respect of, any of the Investment Assets (other than any Specified Investment Securities) or (B) any material outstanding commitments, options, put agreements or other similar arrangements relating to the Investment Assets (other than Specified Investment Securities) to which the Company or any of its Subsidiaries may be subject upon or after the Closing, in each case, other than (i) in accordance with the Investment Guidelines or (ii) as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect;
(xx) settle any litigation or other Proceedings for an amount in excess of $5,000,000 individually or $25,000,000 in the aggregate, other than ordinary course settlements or compromises of claims and related Proceedings under Insurance Contracts within applicable policy limits;
(xxi) other than in the Ordinary Course of Business, amend, modify or terminate any Material Contract, or cancel, modify or waive any material debts or claims held by it or waive any material rights having in each case a value in excess of $1,000,000;
(xxii) file or amend any material Tax Return except in the Ordinary Course of Business, settle or compromise any material Tax liability, make, change or revoke any material Tax election, change any material method of Tax accounting, or take any action which would materially adversely affect the Tax position of the Company or of any of its Subsidiaries;
(xxiii) transfer, sell, lease, license, mortgage, pledge, surrender, encumber (other than pursuant to the existence of any Permitted Lien), divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets (except for Intellectual Property, Investment Assets in the Ordinary Course of Business and the encumbrance of assets pursuant to any Reinsurance Contract), licenses, operations, rights, product lines, businesses or interests therein that are material to the Company and its Subsidiaries, taken as a whole, including capital stock of any of its Subsidiaries (other than Genworth Australia and its Subsidiaries), except in connection with services provided in the Ordinary Course of Business and sales of obsolete assets and except for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $2,000,000 in the aggregate, other than pursuant to Contracts in effect prior to the date of this Agreement;
(xxiv) (A) abandon or allow any registrations for material domain names or any other provision Intellectual Property registrations (including any pending applications for registration but excluding domain name registrations) to lapse or expire for failure to pay any registration, maintenance, renewal or other fee or (B) sell, assign, lease, license, pledge, surrender, encumber (other than pursuant to the existence of any Permitted Lien), divest, cancel, transfer or otherwise dispose of any Company Intellectual Property, other than licenses granted in the Ordinary Course of Business;
(xxv) except as required pursuant to the terms of any Company Plan in effect as of the date of this Agreement, unless (A) increase in any manner the Purchaser has consented compensation, bonus, pension, welfare, fringe or other benefits, severance or termination pay of any employee, officer or director of the Company or any of its Subsidiaries (other than annual, promotion-related or merit based increases in writing theretobase salaries and any corresponding increase in annual bonus opportunities (to the extent based on base salary) made to non-executive officer employees in the Ordinary Course of Business), (B) become a party to, establish, adopt, materially amend, commence participation in or terminate any Company Plan or any arrangement that would have been a Company Plan had it been entered into prior to this Agreement (other than routine annual plan renewals and routine annual changes to welfare plans, that in either case do not materially increase the Company: ’s cost for such plans), (iC) shallgrant any new equity or equity-based awards, and shall cause each or amend or modify the terms of any such outstanding awards, under any Company Plan, (D) take any action to accelerate the vesting or lapsing of restrictions on payment, or fund or in any other way secure the payment, of compensation or benefits under any Company Plan, (E) change any actuarial or other assumptions used to calculate funding obligations with respect to any Company Plan that is required by applicable Law to be funded or change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, or with respect to Non-U.S. Company Plans, IFRS or other accounting requirements of the local jurisdiction, as applicable, (F) forgive any loans or issue any loans (other than routine advances for business expenses issued in the Ordinary Course of Business) to any employee, officer or director of the Company or any of its Significant Subsidiaries toSubsidiaries, conduct its operations according to their usual, regular and ordinary course (G) hire any employee in substantially the same manner as heretofore conducted; an L-series role (iiGrade J or above) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit fill vacancies in the consummation Ordinary Course of Business) or (H) terminate the employment of any executive officer, other than for cause. For the avoidance of doubt, the right of the Board or any board of directors of any of the Company’s Subsidiaries (including any committee thereof) to take any of the foregoing actions under the terms of any Company Plan shall not be deemed “required” for purposes of this Section 6.1(a)(xxv);
(xxvi) become a party to, establish, adopt, amend, commence participation in or terminate any collective bargaining agreement or other agreement with a labor union, works council or similar organization; or
(xxvii) agree, authorize or commit to do any of the foregoing.
(b) After the date of this Agreement and prior to the Effective Time or earlier termination of this Agreement, the Company will take the actions set forth in Section 6.1(b) of the Company Disclosure Letter.
(c) Prior to making any material written or oral communications to the directors, officers or employees of the Company or any of its Subsidiaries pertaining to compensation or benefit obligations of Parent arising on or after the Effective Time that are affected by the transactions contemplated by this Agreement); (iii) shall promptly notify , including any communications that would be required to be filed under the Purchaser of any breach of any representation or warranty contained herein Securities Act, the Exchange Act or any rules and regulations promulgated thereunder, the Company Material Adverse Effect; (iv) shall promptly deliver provide Parent with a copy of the intended communication, Parent shall have a reasonable period of time to the Purchaser true review and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing comment on the date hereof communication, and disclosed pursuant the Company shall consider in good faith Parent’s comments on any such communication; provided that the Company is not obligated to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth seek Parent’s prior review and comment in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: case of (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant responses to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein individual inquiries by a Continuing Employee or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).oral communica
Appears in 1 contract
Interim Operations. Between the Signing Date and the Closing Date or the earlier termination of this Agreement in accordance with Article IX, except as (a) Prior may be required by applicable Law, (b) may be consented to the Effective Timein writing by Buyer (which consent shall not be unreasonably withheld, except as conditioned or delayed), (c) is expressly required or expressly permitted pursuant to this Agreement or (d) set forth in Schedule 7.1 of the Company Disclosure Letter or as contemplated by Schedules, (x) Seller and the Company shall use their respective commercially reasonable efforts to conduct the business of the Group Companies in the Ordinary Course of Business consistent with past practice and, with respect to matters pertaining to the Acquired Business, Seller and the Company shall use their commercially reasonable efforts to preserve intact the Acquired Business in all material respects, including the business organization, ongoing business, material assets and its significant business relationships with third parties; (y) the Company shall not, and Seller shall not permit any other provision of this Agreementthe Group Companies to, unless incur any Liabilities in respect of the Purchaser has consented in writing thereto, the Company: Excluded Business and (iz) shallSeller shall not, and shall cause each of its Significant Subsidiaries to not (with respect to the Acquired Business) to, conduct its operations according to their usualand the Group Companies shall not:
(a) (i) sell, regular and ordinary course in substantially transfer, license, assign or otherwise dispose of any material property or assets of or used by the same manner as heretofore conducted; Acquired Business, (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit Permitted Liens or other Liens that do not impede, impair or restrict the consummation operation of the transactions contemplated Acquired Business by this Agreement); any Group Company in any material respect, mortgage, encumber or subject to any Lien any property or assets of the Company and its Subsidiaries, New LLC and TaxSmart that is material to the Company and its Subsidiaries, New LLC and TaxSmart (taken as a whole) or that will not be released as of the Closing or (iii) shall promptly notify cancel any material debts owed to or material claims held by the Purchaser of any breach of any representation or warranty contained herein Company or any Company Material Adverse Effect; (iv) shall promptly deliver to of the Purchaser true Subsidiaries, New LLC and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).TaxSmart;
Appears in 1 contract
Interim Operations. The Parties agree as follows with respect to the period from and after the execution of this Agreement.
(a) Prior Company shall not knowingly take or permit any of its Subsidiaries to take any action or refrain from taking any action the result of which would be reasonably and foreseeably likely to prevent the consummation of the Merger by the Termination Date. Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time, unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement or the Interim Agreement or as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact, maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of the present employees and agents of Company and its Subsidiaries, maintain the validity of the Communications Licenses and, except as disclosed in Section 5.1 of the Company Disclosure Letter, comply in all material respects with all requirements of the Communications Licenses and the rules and regulations of the FCC and State PUCs. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly required by this Agreement or as otherwise contemplated by the Interim Agreement or as permitted in Section 5.6(d), (B) as Parent may approve in writing, (C) as set forth in Section 5.1(a) of the Company Disclosure Letter or (D), in the case of any of the following clauses in this Section 5.1(a), as contemplated may be expressly permitted by another of the following clauses in this Section 5.1(a), the Company will not and will not permit its Subsidiaries to:
(1) adopt or propose any material change in its articles of incorporation or by-laws or other applicable governing instruments or amend any term of the Company Shares;
(2) merge or consolidate Company or any of its Subsidiaries with any other provision Person, except for any such transactions among wholly owned Subsidiaries of Company that are not obligors or guarantors of third-party indebtedness, or adopt a plan of liquidation;
(3) acquire assets outside of the Ordinary Course of Business from any other Person with a value or purchase price in excess of $50,000 in the aggregate, other than acquisitions pursuant to Contracts to the extent in effect immediately prior to the execution of this Agreement, unless Agreement and as otherwise set forth in Section 5.1(a)(3) of the Purchaser has consented in writing thereto, the Company: (i) shallCompany Disclosure Letter, and shall cause each other than capital expenditures as permitted by Section 5.1(a)(12);
(4) (x) enter into any material line of business in any geographic area other than the current lines of business of Company or any of its Significant Subsidiaries toSubsidiaries, and in the geographic areas where they are currently conducted, as of the date hereof or (y) engage in the conduct its operations according to their usual, regular and ordinary course of any business in substantially any state that would require the same manner as heretofore conducted; receipt or transfer of a Communications License;
(ii5) shall not amend its Certificate file for any License outside of Incorporation or Bylaws or comparable governing instruments the Ordinary Course of Business;
(6) other than to permit the consummation as set forth in Section 5.1(a)(6) of the transactions contemplated by this Agreement); (iii) shall promptly notify Company Disclosure Letter and other than the Purchaser issuance of any breach shares of any representation Common Stock upon exercise of Employee Stock Options or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies conversion of any report, statement or schedule filed with the SEC subsequent to shares of Preferred Stock outstanding as of the date of this Agreement; , issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of Company or any of its Subsidiaries (v) shall not (x) except pursuant other than the issuance of shares by a wholly owned Subsidiary of Company to the exercise Company or another wholly owned Subsidiary), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants, conversion rights, stock appreciation rights, redemption rights, repurchase rights, agreements, arrangements, calls, commitments or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;
(7) other than (i) in connection with receivables, facilities and other contractual rights existing securitizations as in effect on the date hereof and disclosed pursuant to this Agreement, or pursuant to in the Recapitalization issue any shares Company Disclosure Letter and renewals thereof in the Ordinary Course of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereofBusiness, (yii) grant, confer or award any option, warrant, conversion right or other right not existing in connection with the refinancing of Company’s indebtedness under its credit facility as in effect on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth and disclosed in the Purchaser Company Disclosure Letter or as contemplated by this AgreementLetter, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver Liens created or incurred to secure the Company true and correct copies purchase price of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; assets acquired as permitted by Section 5.1(a)(12) and (iv) shall Liens described in clause (ii), (iii), (iv), (v) or (vi) of Section 3.8, create or incur any Security Interest on any assets of the Company or any of its Subsidiaries;
(8) other than loans and advances to employees of Company or its Subsidiaries in the Ordinary Course of Business and not in excess of $10,000 at any time outstanding to any employee, make any loans, advances or capital contributions to or investments in any Person (other than Company or any direct or indirect wholly owned Subsidiary of Company);
(9) declare, set aside or pay any dividend or make any other distribution or payment with respect to Company’s capital stock (whether in cash, stock or property or any combination thereof) or redeem, purchase or acquire any of its capital stock;
(10) reclassify, split, combine, subdivide or repurchase, redeem or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock stock;
(11) other than (i) in connection with receivables, facilities and securitizations as in effect on the date hereof and disclosed in the Company Disclosure Letter and renewals thereof in the Ordinary Course of Business, (ii) in connection with the refinancing of Company’s indebtedness under its credit facility as in effect on the date hereof and disclosed in the Company Disclosure Letter, and (iii) indebtedness incurred to finance the capital expenditures permitted by Section 5.1(a)(12) and guarantees thereof, incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other ownership interests rights to acquire any debt security of the Company or any of its Subsidiaries;
(12) except for the capital expenditures set forth in Section 5.1(a)(12) of the Company Disclosure Letter and asset acquisitions otherwise permitted by Section 5.1(a)(3) (without giving effect to the exception therein for capital expenditures as permitted by this clause (12)), make or authorize any capital expenditure;
(13) enter into any contract or other agreement (x) that would have been a Material Contract as described in Section 3.18 (d), (f) or (g) had it been entered into prior to the date of this Agreement, (y) other than in the Ordinary Course of Business, that involves annual consideration in excess of $50,000 or (z) that involves annual consideration in excess of $250,000 and is not terminable by Company and its Subsidiaries without additional payment or penalty (including by any acceleration of remaining amounts), upon not more than 90 days’ notice;
(14) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP or by applicable Laws or except as Company, based upon the advice of its independent auditors after consultation with Parent, determines in good faith is advisable to conform to best accounting practices;
(15) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity for an amount to be paid by Company or any of its Subsidiaries in excess of $25,000 or that would be reasonably likely to have any adverse impact on the operations of Company or any of its Subsidiaries;
(16) other than in the Ordinary Course of Business or as disclosed in Section 5.1(a)(16) of the Company Disclosure Letter, (i) amend or modify in any material respect adverse to Company or its Subsidiaries, or terminate or waive any material right or benefit of Company or its Subsidiaries under, any Material Contract, or (ii) cancel, modify or waive any debts or claims held by it or waive any rights;
(17) sell, lease, license or otherwise dispose of any assets of Company or its Subsidiaries except (i) in the Ordinary Course of Business or obsolete assets or (ii) as set forth in Section 5.1(a)(17) of the Company Disclosure Letter;
(18) except as (x) required pursuant to existing written, binding agreements in effect prior to the date of this Agreement or as otherwise required by applicable Laws, (y) set forth in Section 5.1(a)(18) of the Company Disclosure Letter or (z) the costs and expenses of which will be a Transaction Cost or Severance Amount, (i) enter into any commitment to provide any severance or termination benefits to (or amend any such existing arrangement with) any director, officer or employee of Company or any of its Subsidiaries, other than for severance or termination benefits to employees (other than officers) in the Ordinary Course of Business and pursuant to the terms of plans, programs or arrangements in effect prior to the date of this Agreement and disclosed on Section 3.18 or 3.25 of the Company Disclosure Letter, (ii) increase the benefits payable under any existing severance or termination benefit policy or employment agreement (other than as required to be increased pursuant to the existing terms of any such policy or agreement or as a result of ordinary pay raises or promotions), (iii) enter into any employment, severance, change in control, termination, deferred compensation or other similar agreement (or amend any such existing agreement) with any director, officer or employee of the Company or any of its Subsidiaries other than pursuant to the terms of any plan or agreement in effect on the date hereof and disclosed on Section 3.18 or 3.25 of the Company Disclosure Letter, (iv) establish, adopt, amend or terminate any employee or director compensation or other benefit, employment or severance plan, program or agreement (including Employee Benefit Plans, each, a “Compensation Plan”), except for technical amendments in the Ordinary Course of Business, provided that such amendments do not materially increase the cost of such arrangements to Company, (v) increase the compensation, bonus or other benefits of, make any new awards under any Compensation Plan to, or pay any bonus to any director, officer, employee, consultant or independent contractor of the Company or any of its Subsidiaries, except for (1) the payment of the first half 2005 bonus amounts set forth in Section 5.1(a)(18) of the Company Disclosure Letter and accrued for in the Most Recent Financial Statements by the Company and (2) increases, new awards or payments in the Ordinary Course of Business for employees who are not officers of Company, (vi) take any action to fund or in any other way secure the payment of compensation or benefits under any Compensation Plan, except as required pursuant to the terms thereof as in effect as of the date of this Agreement, (vii) take any action to accelerate the vesting or payment of any compensation or benefits under any Compensation Plan, to the extent not already required in any such Compensation Plan, or (viii) enter into any collective bargaining agreements; provided, however, that the prohibitions contained in the foregoing clauses (i) and (v) shall not apply in connection with newly hired or newly promoted employees, in each case to the extent consistent with past practice;
(a) take any action that may reasonably be expected to jeopardize the validity of any of the Communications Licenses or result in the revocation, surrender or any adverse modification of, forfeiture of, or fail to renew under regular quarterly cash dividends terms, any of the Communications Licenses, (b) fail to use commercially reasonable efforts to prosecute with due diligence any pending applications with respect to the Communications Licenses, including any renewals thereof, and (c) with respect to Communications Licenses, fail to make all material filings and reports and pay all material fees necessary or reasonably appropriate for the continued operation of the Business, as and when such approvals, consents, permits, licenses, filings, or reports or other authorizations are necessary or appropriate or (d) fail to initiate appropriate steps to renew any material Licenses held by Company or any of its Subsidiaries that are scheduled to terminate prior to or within 60 days after the Effective Time or to prosecute any pending applications for any material License; or
(20) agree or commit to do any of the foregoing.
(b) Parent shall not knowingly take or permit any of its Subsidiaries to exceed $0.05 per share)take any action or refrain from taking any action the result of which would be reasonably and foreseeably likely to prevent the consummation of the Merger by the Termination Date.
Appears in 1 contract
Interim Operations. (a) Prior During the period from the date of this Agreement to the Effective TimeClosing Date, each of Parent, on the one hand, and the Company, on the other hand (each of Parent and the Company being referred to as a “Covenanting Party” for purposes of this Section 5.1), except with the other Covenanting Party’s prior written consent (not to be unreasonably withheld, conditioned or delayed), as set forth in the Company Disclosure Letter specifically required by this Agreement or as contemplated required by any other provision of this Agreementapplicable Law, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant their respective Subsidiaries to, conduct carry on its operations according to their usual, regular and business in the ordinary course consistent with past practice and, to the extent consistent with the foregoing, use its reasonable best efforts to (a) preserve intact its current business organization and reputation, (b) preserve its assets, rights and properties in substantially good repair and condition, (c) keep available the same manner as heretofore conducted; services of its and its Subsidiaries’ current directors, officers and other key employees and (iid) shall not amend preserve its Certificate of Incorporation goodwill and its relationships with customers, suppliers, licensors, licensees, distributors and others having business dealings with it and/or its Subsidiaries, and with Governmental Entities with jurisdiction over the Covenanting Party’s or Bylaws or comparable governing instruments (other than its Subsidiaries’ significant operations. In addition to permit and without limiting the consummation generality of the transactions contemplated by this Agreement); (iii) shall promptly notify foregoing, during the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to period from the date of this Agreement; (v) shall not (x) except pursuant Agreement to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective TimeClosing Date, except as set forth in Section 5.1 of the Purchaser relevant Covenanting Party’s Disclosure Letter Schedule, as specifically required by this Agreement or as contemplated required by this Agreementapplicable Law, unless each Covenanting Party shall not, and shall cause its Subsidiaries not to, take any of the Company and following actions without the Special Committee have consented in writing theretoother Covenanting Party’s prior written consent (not to be unreasonably withheld, the Purchaser: conditioned or delayed):
(ia) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock PlansA) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend dividends on, or make any other distribution distributions (whether in cash, stock or payment property) in respect of, any of its capital stock or other equity interests, except for dividends by a wholly owned Subsidiary of such Covenanting Party to its parent (it being understood that no dividends or distributions whatsoever from Parent or from the Company shall be permitted), (B) purchase, redeem or otherwise acquire shares of capital stock or other equity interests of itself or its Subsidiaries or any options, warrants, or rights to acquire any such shares or other equity interests (other than in connection with satisfaction of required tax withholding in connection with the vesting or exercise of awards outstanding under the Parent Stock Plans on the Execution Date in accordance with their terms as in effect on such date) or (C) split, combine, reclassify or otherwise amend the terms of any of its capital stock or other equity interests or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock or other equity interests;
(b) issue, deliver, sell, grant, pledge or otherwise encumber or subject to any Lien any shares of its capital stock or other ownership equity interests or any securities convertible into, or exchangeable for or exercisable for any such shares or other equity interests, or any rights, warrants or options to acquire, any such shares or other equity interests, or any stock appreciation rights, “phantom” stock rights, performance units, rights to receive shares of capital stock of such Covenanting Party on a deferred basis or other rights linked to the value of shares of such Covenanting Party’s capital stock, including pursuant to Contracts as in effect on the date hereof (other than regular quarterly cash dividends (A) the grant of such Covenanting Party’s options, restricted stock units or performance share units in the ordinary course of business, as provided in Section 5.1(b) of such Covenanting Party’s Disclosure Schedule; provided, that the aggregate number of shares of such Covenanting Party’s outstanding common stock subject to issuance or underlying the same shall not exceed the number shares of such Covenanting Party’s outstanding common stock as provided in Section 5.1(b) of such Covenanting Party’s Disclosure Schedule, and (B) the issuance of shares of such Covenanting Party’s common stock upon the exercise of such Covenanting Party’s options or settlement of such Covenanting Party’s restricted stock units or performance share units that are outstanding on the Execution Date in accordance with their terms as in effect on such date, including, with respect to Parent, net share withholding for Taxes);
(c) amend or otherwise change (whether by merger, consolidation or otherwise), or authorize or propose to amend or otherwise change (whether by merger, consolidation or otherwise), its articles of incorporation or bylaws (or similar organizational documents) of it or its Subsidiaries;
(d) directly or indirectly acquire or agree to acquire (A) by merging or consolidating with, purchasing an equity interest in or a portion of the assets of, making an investment in or loan or capital contribution to or in any other manner, any corporation, partnership, association or other business organization or division thereof (or any ownership, membership, investment or profit interest therein), or (B) any assets, real property, or personal property, except (1) acquisitions of supplies, materials and similar assets in the ordinary course of business consistent with past practice, (2) transactions involving only one or more of such Covenanting Party and any direct or indirect wholly-owned Subsidiaries of such Covenanting Party, or (3) in one or more transactions with respect to which the aggregate consideration for all such transactions during the period from the Execution Date to the Closing Date does not exceed $30,000,000, in each case (1) through (3) subject to the restrictions set forth in Section 5.7(a);
(e) directly or indirectly sell, assign, lease, license, transfer, exchange, dispose of, sell and leaseback, abandon, let lapse, mortgage or otherwise encumber or subject to any Lien (other than a Permitted Lien) or otherwise dispose in whole or in part of any of its material properties, assets or rights or any interest therein (including any material Representing Party Intellectual Property), other than (1) in the ordinary course of business consistent with past practice and (2) in addition to clause (1), except with respect to Representing Party Intellectual Property, in one or more transactions with respect to which the aggregate consideration for all such transactions during the period from the date of this Agreement to the Closing Date does not exceed $20,000,000;
(f) adopt or publicly propose or enter into a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, or resolve or authorize a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, in each case of such Covenanting Party or any of its material Subsidiaries, or create any new Subsidiaries, other than to complete internal restructurings or dissolutions involving only wholly-owned entities;
(g) incur, create, assume or otherwise become liable for any Indebtedness, or amend, modify, repay, prepay or refinance any Indebtedness except (A) for Indebtedness incurred, repaid or prepaid in the ordinary course of business and consistent with past practice under such Covenanting Party’s current revolving credit facilities or any refinancing, substitution or replacement thereof in terms no less favorable to such Covenanting Party than the existing financing (including in respect of call protection), not to exceed $0.05 per share50,000,000 in the aggregate outstanding at any time incurred by such Covenanting Party or any of its Subsidiaries, (B) for any intercompany Indebtedness solely involving such Covenanting Party and/or direct or indirect wholly-owned Subsidiaries, (C) guarantees by such Covenanting Party of Indebtedness of its Subsidiaries, which Indebtedness is incurred in compliance with this Section 5.1(g)., or (D) for the repayment of any Indebtedness existing on the date of this Agreement that comes due following the date hereof, in accordance with its terms;
(h) make any loans, advances or capital contributions to any other Person, other than loans, advances or capital contributions solely involving only one or more of such Covenanting Party and any direct or indirect wholly-owned Subsidiaries of such Covenanting Party;
(i) incur or commit to any capital expenditures or any obligations or liabilities in respect thereof, except for (i) those as contemplated by the Covenanting Party’s fiscal 2017 budget and capital expenditure plan made available to the other Covenanting Party prior to the Execution Date (whether or not such capital expenditures are made during the Company’s 2017 fiscal year), (ii) capital expenditures for vehicle lease facilities with an aggregate amount of Indebtedness not exceeding $20,000,000 or (iii) any other capital expenditures not to exceed $5,000,000 in the aggregate;
(j) other than as permitted by Section 5.1(m), (A) pay, discharge, compromise, settle or satisfy any material claims, liabilities or obligations (whether absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business consistent with past practice or as required by their terms as in effect on the date of this Agreement of claims, liabilities or obligations reflected or reserved against in the most recent audited financial statements (or the notes thereto) of such Covenanting Party prior to the Execution Date (for amounts not in excess of such reserves) or incurred since the date of such financial statements in the ordinary course of business consistent with past practice, or (B) cancel any material Indebtedness owed to such Covenanting Party or any of its Subsidiaries;
(k) other than in the ordinary course of business consistent with past practice , (A) materially modify, materially amend, terminate, cancel or extend any of such Covenanting Party’s Material Contracts or waive, release or assign any material rights, benefits or claims thereunder, or (B) enter into any Contract that if in effect on the date hereof would be a Material Contract of such Covenanting Party;
(l) notwithstanding Section 5.1(k), enter into, amend or renew any (i) vendor Contract with a term in excess of one year that would require payments over the term of such vendor Contract in excess of $1,000,000, or (ii) lease of real property for a term in excess of three years or that would require annual payments in excess of $1,000,000;
(m) other than with respect to any Parent Stockholder Litigation or Company Stockholder Litigation or any appraisal proceeding, commence any Action (other than (A) in the ordinary course of business or (B) an Action as a result of an Action commenced against such Covenanting Party or any of its Subsidiaries), or compromise, settle or agree to settle any Action (including any Action relating to this Agreement, the Voting Agreements, the Stockholders Agreements or the Transactions) other than compromises, settlements or agreements in the ordinary course of business consistent with past practice that involve only the payment of money damages not in excess of $1,000,000 individually (in each case, net of insurance proceeds), in any case without the imposition of any equitable relief on, or the admission of wrongdoing by, such Covenanting Party; provided, that the restrictions in this clause (m) shall not apply to claims that a Party has against one or more other Parties arising out of this Agreement, the Voting Agreements, the Stockholders Agreements or the Transactions; provided, that the Company shall take the actions set forth in Section 5.1(m) of the Company Disclosure Schedule;
(n) change its financial accounting methods, principles or practices, except insofar as required by GAAP, Regulation S-X of the Exchange Act or any Governmental Entity;
(o) (A) settle or compromise any material liability for Taxes, (B) file any amended Tax Return or claim for Tax refund, (C) make, revoke or modify any Tax election, (D) file any Tax Return other than on a basis consistent with past practice, (E) enter into or amend any Tax Sharing Agreement or similar agreement, or (F) change any method of accounting for Tax purposes;
(p) change its fiscal year;
(q) except as required to comply with any such Parent Benefit Plan if the Parent is the covenanting party and Company Benefit Plan if the Company is the covenanting party (each the “Covenanting Party’s Benefit Plan”), as in effect as of the date hereof, or the terms of this Agreement and subject to Section 5.1(b), (A) with respect to any current or former director, employee, independent contractor or consultant of such Covenanting Party, grant any such individual any increase in compensation, bonus or other benefits, or grant any type of compensation or benefits to any such individual not previously receiving or entitled to receive such type of compensation or benefit, or pay any bonus of any kind or amount to any such individual, other than increases in compensation or benefits or the payment of bonuses in the ordinary course of business consistent with past practice, (B) grant or pay to any current or former director, employee, independent contractor or consultant of such Covenanting Party any severance, change in control, retention, termination or similar compensation or benefit, or modifications thereto or increases therein, other than severance payments in the ordinary course of business consistent with past practice, (C) pay any benefit or grant or amend any equity compensation award (including in respect of the removal or modification of any restrictions in any such Covenanting Party’s Benefit Plan or awards made thereunder) to any current or former director, employee, independent contractor or consultant of such Covenanting Party, other than in the ordinary course of business consistent with past practice, (D) adopt or enter into any collective bargaining agreement or other labor union contract or recognize any new labor organization, union, employee association, trade union, works council or other similar employee representative, (E) take any action to amend such Covenanting Party’s Benefit Plan or Contract in any material respect or accelerate the vesting, funding or payment of any compensation or benefit under any such Covenanting Party’s Benefit Plan or other Contract or (F) adopt any new employee benefit or compensation plan or arrangement that would otherwise be considered a Covenanting Party’s Benefit Plan if in effect of the date of this Agreement;
(r) enter into any new line of business outside of its existing business that would be material to the Covenanting Party and its Subsidiaries, taken as a whole;
(s) other than in the ordinary course of business consistent with past practice of such Covenanting Party (in effect and amount), engaging in any practice which would have the effect of (A) postponing payments payable by such Covenanting Party in connection with the operation or conduct of such Covenanting Party’s operations (including by failing to make prepayments in the ordinary course of business or failing to pay vendor invoices by their applicable due date, negotiating the deferral of invoicing or delivery of goods or services, or otherwise failing to pay vendors in accordance with the terms of the applicable vendor Contract), (B) accelerating collections of accounts receivable or other payments owed by any Person to such Covenanting Party (whether or not through concessions, early payment discounts or other benefits), (C) drawing advances under any Contracts with customers, or (D) failing to maintain a customary level of inventory, supplies, services and purchase order activity consistent with historical levels;
(A) enter into, amend or renew (1) any Contracts (other than compensation and employee benefits which are subject to Section 5.1(q)) with any officer, director or affiliate (other than a wholly-owned Subsidiary of such Covenanting Party) or sponsor of such Covenanting Party or any of their respective “associates” or “immediate family” members (as such terms are defined in Rule 12b-2 and Rule 16a-1 of the Exchange Act), including any Contract pursuant to which such
Appears in 1 contract
Interim Operations. (a) Prior to the Effective Time, except as set forth in the Company Disclosure Letter Schedule or as contemplated by any other provision of this Agreement, unless the Purchaser Parent has consented in writing theretothereto (which consent shall not be unreasonably withheld), the Company: :
(i) shall, and shall cause each of its Significant the Company Subsidiaries to, conduct its operations according to their usual, regular and in the ordinary course in substantially consistent with the same manner as heretofore conducted; ;
(ii) shall use commercially reasonable efforts, and shall cause each of the Company Subsidiaries to use commercially reasonable efforts, to preserve intact their business organizations and goodwill, keep available the services of their respective officers and employees and maintain satisfactory relationships with those persons having business relationships with them;
(iii) shall not, and shall cause each of the Company Subsidiaries not to, amend its Certificate their respective Certificates of Incorporation or Bylaws or comparable governing instruments instruments;
(other than to permit the consummation of the transactions contemplated by this Agreement); (iiiiv) shall promptly notify the Purchaser of any breach give prompt notice to Parent of any representation or warranty made by it contained herein in this Agreement becoming untrue or inaccurate in any Company Material Adverse Effectmaterial respect such that the condition set forth in Section 6.3(a)(ii) would not be satisfied; (iv) provided, however, that no such notification shall promptly deliver affect the representations, warranties, covenants or agreements of the parties or the conditions to the Purchaser true and correct copies obligations of any report, statement or schedule filed with the SEC subsequent to the date of parties under this Agreement; ;
(v) shall not, and shall not permit any of the Company Subsidiaries to, (xA) except pursuant acquire or agree to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreementacquire by merging or consolidating with, or pursuant by acquiring any capital stock of or purchasing a substantial portion of the assets of, or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof, or (B) acquire or agree to acquire assets other than in the Recapitalization issue ordinary course of business or (C) release or relinquish or agree to release or relinquish any shares material contract rights;
(vi) shall not, and shall not permit any of its capital stockthe Company Subsidiaries to, effect any stock split or otherwise change its capitalization as it existed on or issue any shares of its capital stock or securities convertible into or exchangeable or exercisable for shares of its capital stock, except upon exercise of options to purchase shares of Company Common Stock under the date hereofCompany Stock Option Plans;
(vii) shall not, (y) and shall not permit any of the Company Subsidiaries to, grant, confer or award any optionoptions, warrantwarrants, conversion right rights or other right rights, not existing on the date hereof hereof, to acquire any shares of its capital stockstock or other securities of the Company or any of the Company Subsidiaries, other than the issuance of Company Options consistent with past practice;
(viii) shall not, and shall not permit any of the Company Subsidiaries to, take or fail to take any action which would, or would be reasonably likely to, prevent the accounting for the Merger as a pooling of interests in accordance with APB No. 16, the interpretive releases issued pursuant thereto, and the pronouncements of the SEC;
(zix) shall not, and shall not permit any of the Company Subsidiaries to, take or fail to take any actions which would be reasonably likely to prevent the Merger from qualifying as a reorganization within the meaning of Section 368(a) of the Code;
(x) shall not, and shall not permit any of the Company Subsidiaries to, amend in any material respect, except as required by applicable law or in response to changes in applicable law, the terms of any Company Employee Plans, including, without limitation, any employment, severance or similar agreements or arrangements in existence on the date hereof, or adopt any A1-14new employee benefit plans, programs or arrangements or any employment, severance or similar agreements or arrangements, or grant any award thereunder (except as permitted by clause (vii) above or, in the case of awards not involving the acquisition of securities, in the ordinary course of business consistent with past practice), or grant any salary increases to any employee of the Company or any of the Company Subsidiaries except in the ordinary course of -26- 27 business consistent with past practice except that (A) the Company may hire employees in the ordinary course of business consistent with past practice and (B) this subsection (x) shall not preclude Company from making payments under Company Employee Plans;
(xi) shall not, and shall not permit any of the Company Subsidiaries to, except in the ordinary course of business consistent with past practice, (x) incur, create, assume or otherwise become liable for borrowed money or assume, guarantee, endorse or otherwise become responsible or liable for the obligations of any other individual, corporation or other entity or (y) make any loans or advances to any other person;
(xii) shall not, and shall not permit any of the Company Subsidiaries to, (x) make, revoke or change any material election with respect to Taxes unless required by applicable law or (y) settle or compromise any material Tax liability; and
(xiii) shall not, and shall not permit any of the Company Subsidiaries to, agree, in writing or otherwise, to take any of the foregoing actions.
(b) Prior to the Effective Time, except as set forth in the Purchaser Parent Disclosure Letter Schedule or as contemplated by any other provision of this Agreement, unless the Company and the Special Committee have has consented in writing theretothereto (which consent shall not be unreasonably withheld), the Purchaser: Parent:
(i) shall not, and shall cause each of Parent Subsidiaries not to, amend their respective Certificates of Incorporation or Bylaws or comparable governing instruments;
(ii) shall give prompt notice to the Company of any representation or warranty made by it contained in this Agreement becoming untrue or inaccurate in any material respect such that the condition set forth in Section 6.2(a)(ii) would not be satisfied; provided, however, that no such notification shall affect the representations, warranties, covenants or agreements of the parties or the conditions to the obligations of the parties under this Agreement;
(iii) shall not, and shall not permit any of Parent Subsidiaries to, effect any stock split or otherwise change its capitalization or issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split securities convertible into or exchangeable or exercisable for shares of its capital stock; (ii) shall promptly notify the Company , except upon exercise of any breach options to purchase shares of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and Parent Common Stock under Parent Stock Option Plans;
(iv) shall not, and shall not declarepermit any of Parent Subsidiaries to, set aside take or pay fail to take any dividend action which would, or make would be reasonably likely to, prevent the accounting for the Merger as a pooling of interests in accordance with APB No. 16, the interpretive releases issued pursuant thereto, and the pronouncements of the SEC;
(v) shall not, and shall not permit any other distribution of Parent Subsidiaries to, take or payment with respect fail to take any shares actions which would be reasonably likely to prevent the Merger from qualifying as a reorganization within the meaning of its capital stock Section 368(a) of the Code; and
(vi) shall not, and shall not permit any of Parent Subsidiaries to, agree, in writing or other ownership interests (other than regular quarterly cash dividends not otherwise, to exceed $0.05 per share)take any of the foregoing actions.
Appears in 1 contract
Sources: Merger Agreement (Cephalon Inc)
Interim Operations. (a) Prior to the Effective Time, and to allow West Pac and Frontier to coordinate their respective operations between the date hereof and the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this AgreementAgreement or by the Frontier Disclosure Schedule, unless the Purchaser West Pac has consented in writing thereto, the Company: Frontier:
(i) shall, and shall cause each of its Significant Subsidiaries to, Shall conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; ;
(ii) shall Shall use its reasonable efforts to preserve intact its business organizations and goodwill, keep available the services of its respective officers and employees and maintain satisfactory relationships with those persons having business relationships with it;
(iii) Shall not amend its Certificate Articles of Incorporation or Bylaws or comparable governing instruments instruments;
(other than to permit the consummation of the transactions contemplated by this Agreement); (iiiiv) shall Shall promptly notify the Purchaser West Pac of any material emergency or other material change in its condition (financial or otherwise), business, properties, assets, liabilities, prospects or the normal course of its business or of its properties, any material litigation or material governmental complaints, investigations or hearings (or communications indicating that the same may be contemplated), or the breach of any representation or warranty contained herein or any Company Material Adverse Effect; herein;
(ivv) shall Shall promptly deliver to the Purchaser West Pac true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; ;
(vvi) shall Shall not (xA) except pursuant to (I) the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement; (II) the issuance of options or warrants in the ordinary course of business consistent with past practices; or (III) the issuance of Frontier Common Stock in connection with additional equity investments in Frontier permitted under the provisions of this Section 5(a), or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, ; (yB) grant, confer increase any compensation or award enter into or amend any option, warrant, conversion right or other right not existing on the date hereof to acquire employment agreement with any shares of its capital stockpresent or future officers, directors or employees, except for normal increases consistent with past practice (provided, however, that no such increase shall exceed 5% per annum) and the payment of cash bonuses to officers pursuant to and consistent with existing plans or programs; (C) grant any severance or termination package to any employee or consultant other than in the ordinary course of business consistent with past practices; or (zD) adopt any A1-14new employee benefit plan (including any stock option, stock benefit or stock purchase plan) or amend any existing employee benefit plan in any material respect, except for changes which are less favorable to participants in such plans;
(bvii) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: Shall not (iA) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests interests; or (B) directly or indirectly, redeem, purchase or otherwise acquire any shares of its capital stock, or make any commitments for any such action;
(viii) Except in connection with agreements, obligations or undertakings in effect on the date hereof and disclosed in the Frontier Disclosure Schedule or otherwise permitted hereunder, shall not enter into any material transaction, or agree to enter into any material transaction, outside the ordinary course of business, including, without limitation, any transaction involving a merger, consolidation, joint venture, partial or complete liquidation or dissolution, reorganization, recapitalization, restructuring or a purchase, sale, lease or other disposition of a substantial portion of assets or capital stock, or enter into any additional aircraft lease; provided, however, that the foregoing shall not prohibit Frontier from issuing and selling up to an aggregate of $10,000,000 of shares of Frontier Common Stock, or any securities convertible or otherwise exchangeable into shares of Frontier Common Stock at an issue price, or with respect to convertible or exchangeable securities, a conversion or exchange price, that shall not exceed a thirty percent (30%) discount to the market value of such shares of Frontier Common Stock as of the date of issuance, so long as, (A) the issuance of such shares by Frontier does not contain any provisions impairing West Pac's ability to issue additional securities or incur additional indebtedness before or after the Effective Time; (B) any shares issued by Frontier are not senior to the Series B Preferred or the Series C Preferred after the consummation of the Merger; (C) the issuance of such shares by Frontier shall not impair the ability of either party to consummate the Merger; and (D) in the case of securities convertible or otherwise exchangeable into shares of Frontier Common Stock, appropriate provision is made in the governing documents relating to such securities to give effect to the Merger, including adjustments to the conversion or exchange price consistent with the adjustments for Frontier Options pursuant to Section 1.5 of this Agreement;
(ix) Shall not incur any indebtedness for borrowed money or guarantee any such indebtedness or issue or sell any debt securities or warrants or rights to acquire any debt securities of others other than in the ordinary course of its business consistent with past practices, but in no event in an amount exceeding $1,000,000 in the aggregate (other than normal expenditures for the purchase of raw materials or other supplies); provided, however, that Frontier may incur up to an aggregate of $10,000,000 of such indebtedness on commercially reasonable terms with the prior written approval of West Pac, which approval shall not be unreasonably withheld;
(x) Shall not make any loans, advances or capital contributions to, or investments in, any other Person, except loans, advances or capital contributions to, or investments in, any of its Subsidiaries or made in the ordinary course of business consistent with past practices;
(xi) Except in connection with agreements, obligations or undertakings in effect on the date hereof and disclosed in the Frontier Disclosure Schedule or otherwise permitted hereunder, shall not make or commit to make any capital expenditures in excess of $500,000 in the aggregate;
(xii) Except in connection with agreements, obligations or undertakings in effect on the date hereof and disclosed in the Frontier Disclosure Schedule or otherwise permitted hereunder, shall not apply any of its assets to the direct or indirect payment, discharge, satisfaction or reduction of any amount payable directly or indirectly to or for the benefit of any affiliate of Frontier or enter into any transaction with any affiliate of Frontier;
(xiii) Shall not alter the manner of keeping its books, accounts or records, or change in any manner the accounting practices therein reflected;
(xiv) Shall not grant or make any mortgage or pledge or subject itself or any of its material properties or assets to any lien, charge or encumbrance of any kind, except (A) statutory liens for taxes not yet due, (B) liens of carriers, warehousemen, mechanics and materialmen incurred in the ordinary course of business for sums not yet due; and (C) liens incurred or deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance and other types of social security;
(xv) Shall maintain insurance on its tangible assets and its businesses in such amounts and against such risks and losses as are currently in effect; and
(xvi) Shall use commercially reasonable efforts, which shall not require the payment of money or other consideration, to terminate, on or before the Effective Time, that certain Marketing and Code Sharing Agreement, dated as of January 20, 1997 between Frontier and Exec Express II (d/b/a Aspen Mountain Air) and Peak International.
(b) Prior to the Effective Time, and to allow West Pac and Frontier to coordinate their respective operations between the date hereof and the Effective Time, except as contemplated by any other provision of this Agreement or by the West Pac Disclosure Schedule, unless Frontier has consented in writing thereto, West Pac:
(i) Shall conduct its operations according to their usual, regular quarterly and ordinary course in substantially the same manner as heretofore conducted;
(ii) Shall use its reasonable efforts to preserve intact its business organizations and goodwill, keep available the services of its respective officers and employees and maintain satisfactory relationships with those persons having business relationships with it;
(iii) Shall not amend its Restated Certificate of Incorporation or By-Laws, except for amendments to the Restated Certificate of Incorporation of West Pac necessary in order to (A) increase the number of authorized shares of West Pac Common Stock to 40,000,000; or (B) designate the rights of any series or class of preferred stock of West Pac in connection with the issuance of securities by West Pac in connection with additional equity investments in West Pac or additional financing transactions involving West Pac permitted under the terms of this Section 5.2(b);
(iv) Shall promptly notify Frontier of any material emergency or other material change in its condition (financial or otherwise), business, properties, assets, liabilities, prospects or the normal course of its business or of its properties, any material litigation or material governmental complaints, investigations or hearings (or communications indicating that the same may be contemplated), or the breach of any representation or warranty contained herein;
(v) Shall promptly deliver to Frontier true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement;
(vi) Shall not (A) except pursuant to (I) the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement; (II) the issuance of options or warrants in the ordinary course of business consistent with past practices; or (III) the issuance of securities in connection with additional equity investments in West Pac or additional financing transactions involving West Pac permitted under the provisions of this Section 5(b), including, without limitation, the issuance of warrants in connection with aircraft lease transactions, issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof; (B) increase any compensation or enter into or amend any employment agreement with any of its present or future officers, directors or employees, except for normal increases consistent with past practice (provided, however, that no such increase shall exceed 5% per annum) and the payment of cash dividends bonuses to officers pursuant to and consistent with existing plans or programs; (C) grant any severance or termination package to any employee or consultant other than in the ordinary course of business consistent with past practices; provided, however, that West Pac may enter into severance arrangements with any Person who currently has an employment agreement with West Pac; or (D) adopt any new employee benefit plan (including any stock option, stock benefit or stock purchase plan) or amend any existing employee benefit plan in any material respect, except for changes which are less favorable to participants in such plans;
(vii) Shall not (A) declare, set aside or pay any dividend or make any other distribution or payment with respect to exceed any shares of its capital stock or other ownership interests, other than regularly scheduled dividend payments on shares of Series B Preferred Stock; or (B) directly or indirectly, redeem, purchase or otherwise acquire any shares of its capital stock, or make any commitments for any such action, other than the redemption of shares of Series B Preferred Stock in accordance with their terms;
(viii) Except in connection with agreements, obligations or undertakings in effect on the date hereof and disclosed in the West Pac Disclosure Schedule or otherwise permitted hereunder, shall not enter into any material transaction, or agree to enter into any material transaction, outside the ordinary course of business, including, without limitation, any transaction involving a merger, consolidation, joint venture, partial or complete liquidation or dissolution, reorganization, recapitalization, restructuring or a purchase, sale, lease or other disposition of a substantial portion of assets or capital stock or enter into any additional aircraft leases; provided, however, that the foregoing shall not prohibit West Pac to (A) enter into any additional aircraft leases for up to an additional seven (7) aircraft; (B) issue and sell up to an aggregate of $0.05 10,000,000 of shares of West Pac Common Stock, or any securities convertible or otherwise exchangeable into shares of West Pac Common Stock ("Tranche A") for a per shareshare issue price, or with respect to convertible --------- or exchangeable securities, a per share conversion or exchange price of not less than five dollars ($5.00) per share (the "Tranche A Issue Price")., provided, --------------------- however, that West Pac may issue and sell all or any portion of Tranche A at less than the Tranche A Issue Price if the Exchange Ratio is adjusted upward as follows:
Appears in 1 contract
Interim Operations. Each of Omnicom and Publicis covenants and agrees as to itself and its Subsidiaries that, after the date hereof and until the earlier of the Omnicom Effective Time or the termination of this Agreement in accordance with its terms, unless Omnicom (in the case of any action proposed to be taken by Publicis or any Subsidiary of Publicis) or Publicis (in the case of any action proposed to be taken by Omnicom or any Subsidiary of Omnicom) shall otherwise approve in writing (which approval shall not be unreasonably withheld, conditioned or delayed by the party from whom it is requested, with an understanding that (x) all requests for such approval shall be directed to the Chief Executive Officer of the party from whom approval is requested, or such Person as may be designated by such Chief Executive Officer, with a copy to the General Counsel of such party and (y) a failure of such Chief Executive Officer (or such designee) to respond within ten Business Days shall be deemed to constitute consent of such party to such requested approval), and except as otherwise expressly contemplated by this Agreement (including with respect to the Omnicom Transaction Dividend and the Publicis Transaction Dividend) or, in the case of Publicis, except as otherwise set forth in Section 5.1 of the Publicis Disclosure Letter or, in the case of Omnicom, except as otherwise set forth in Section 5.1 of the Omnicom Disclosure Letter:
(a) Prior to the Effective Time, except as set forth business of it and its Subsidiaries shall be conducted in the Company Disclosure Letter or ordinary and usual course consistent with past practice and it and its Subsidiaries shall use their respective commercially reasonable efforts to preserve intact its business organization and maintain its existing relations and goodwill with all Governmental Entities (including applicable Regulatory Authorities) and Self-Regulatory Organizations, clients, customers, suppliers, distributors, creditors, lessors, employees and shareholders, as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: applicable;
(b) (i) shall, and it shall cause each of not amend or propose to amend its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedOrganizational Documents; (ii) neither Omnicom nor Publicis, as applicable, shall split, combine or reclassify its outstanding shares of capital stock or other equity interests; (iii) it shall not amend declare, set aside or pay any type of dividend or other distribution, whether payable in cash, stock or property, in respect of any capital stock or other equity interests, as appropriate, other than (x) as required to pay the Omnicom Transaction Dividend or the Publicis Transaction Dividend, (y) regular quarterly dividends payable by Omnicom or regular annual dividends payable by Publicis (in each case in accordance with the terms and conditions of Section 5.13(c)) and (z) dividends payable by its Certificate direct or indirect Subsidiaries to it or another of Incorporation its direct or Bylaws indirect Subsidiaries in the ordinary and usual course of business (including in connection with acquisitions entered into after the date of this Agreement as permitted by Section 5.1(f)) and consistent with past practice or comparable governing instruments otherwise pursuant to Contracts in existence as of the date hereof; or (iv) except (w) for the acquisition by such party of shares of its capital stock or other equity interests in connection with the surrender of such shares by holders of Omnicom Stock Awards or Publicis Stock Awards, as applicable, in order to pay the exercise price of such Stock Awards in accordance with the terms of such Stock Awards as in effect on the date hereof, (x) for the withholding or disposition of shares of capital stock or other equity interests to satisfy withholding Tax obligations with respect to Omnicom Stock Awards or Publicis Stock Awards, as applicable, granted pursuant to the Omnicom Stock Plans and the Publicis Stock Plans, as applicable, in accordance with the terms of such Stock Awards as in effect on the date hereof, (y) in accordance with, and only to the extent in furtherance of, Section 5.8 (it being agreed that any actions taken pursuant to this clause (y) shall be effected in a commercially reasonable manner, including as to the purchase or redemption price paid, and to the extent practicable, after consultation with the other party), or (z) as required pursuant to and in accordance with the terms of the Omnicom Convertible Notes, Publicis Convertible Notes or Publicis Warrants, as applicable, in each case for this clause (z) outstanding prior to the date hereof, it shall not repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or other equity interests, as applicable, or any securities convertible into or exchangeable or exercisable for any shares of its capital stock or other equity interests, as applicable;
(c) neither it nor any of its Subsidiaries shall (i) except (x) in connection with internal reorganizations entered into in the ordinary and usual course of business solely among such party’s Subsidiaries which will not adversely affect the Intended Tax Treatment or (y) with respect to the issuance or sale of shares of, or securities convertible into or exchangeable or exercisable for, or rights of any kind to acquire, capital stock or other equity interests of, such party’s Subsidiaries (and for the avoidance of doubt not of such party), in the ordinary and usual course of business (including in connection with acquisitions entered into after the date of this Agreement as permitted by Section 5.1(f)) and consistent with past practice or otherwise pursuant to Contracts in existence as of the date hereof which, in each case, will not adversely affect the Intended Tax Treatment, issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock or other equity interests, or any bonds, debentures, notes or other obligations the holders of which have the right to vote (or convertible into or exercisable for securities having the right to vote) with its shareholders on any matter or any other property or assets, other than shares of Omnicom Common Stock or Publicis Shares (as applicable) issuable or transferable pursuant to (A) Publicis Warrants outstanding prior to the date hereof, (B) Publicis Convertible Notes outstanding prior to the date hereof, (C) the Omnicom ESPP or (D) Omnicom Stock Awards or Publicis Stock Awards outstanding on or awarded prior to the date hereof or made by Omnicom or Publicis, as applicable, after the date hereof in the ordinary and usual course of business and consistent with past practice or otherwise in accordance with Section 5.1(d); provided, that, any such Omnicom Stock Awards or Publicis Stock Awards issued after the date hereof do not include any benefits that vest, accelerate or result in any payment or funding in connection with any of the transactions contemplated by this Agreement (other than to permit accelerated vesting as a result of a termination of employment or service upon or following the consummation of the transactions contemplated by this Agreement); (ii) except (w) in connection with refinancings of existing indebtedness for borrowed money upon market terms and conditions, (x) for drawdowns of credit facilities outstanding as of the date hereof (or refinancings of such credit facilities permitted under clause (w)) in the ordinary and usual course of business and consistent with past practice, (y) to the extent necessary in order to pay the Omnicom Transaction Dividend or the Publicis Transaction Dividend or (z) in the ordinary and usual course of business and consistent with past practice, incur any indebtedness for borrowed money (including any guarantee of such indebtedness) or issue any debt securities; or (iii) shall promptly notify make or authorize or commit to any capital expenditures, other than in the Purchaser ordinary and usual course of business and consistent with past practice;
(d) except (x) as required by applicable Law or the terms of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true Benefit Plan existing and correct copies of any report, statement or schedule filed with the SEC subsequent to in effect on the date of this Agreement, (y) as approved by the compensation committee of the Omnicom Board or the Publicis Board, as applicable (or, if such approval is not necessary or desirable to take the applicable action, approved by the Chief Executive Officer of Omnicom (in the case of actions to be taken by Omnicom or its Subsidiaries) or the Chief Executive Officer of Publicis (in the case of actions to be taken by Publicis or its Subsidiaries)) and, with respect to the Persons listed on Schedule IV, after advising the Chief Executive Officer of the other party of the terms and conditions thereof, or (z) in the ordinary and usual course of business and consistent with past practice, in the case of clauses (y) and (z) in a manner which will not adversely affect the Intended Tax Treatment; (vi) shall not (x) except pursuant to the exercise of optionsterminate, warrantsestablish, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreementadopt, enter into, or pursuant to materially amend any Benefit Plan, as the Recapitalization issue case may be, or any shares of its capital stock, other arrangement that would be an Omnicom Benefit Plan or a Publicis Benefit Plan if in effect any stock split or otherwise change its capitalization as it existed on the date hereof, (yii) grantincrease the salary, confer or award any optionwage, warrant, conversion right bonus or other right not existing on compensation of any employees or fringe benefits of any director, manager, officer or employee or enter into any contract, agreement, commitment or arrangement to do any of the date hereof to acquire any shares foregoing; provided, that, none of its capital stock, the foregoing actions in clauses (i) or (zii) adopt shall include any A1-14
(b) Prior to compensation or benefits that vest, accelerate or result in any payment or funding in connection with any of the Effective Time, except as set forth in the Purchaser Disclosure Letter or as transactions contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver enter into any contract, agreement, commitment or arrangement providing for the payment to any director, manager, officer or employee of such party or the Company true and correct copies funding of compensation or benefits in connection with, contingent upon, or the terms of which are materially altered in connection with, any reportof the transactions contemplated by this Agreement either alone or, statement except as provided below, in conjunction with any other event or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declareprovide, set aside or pay any dividend or make any other distribution or payment with respect to any shares stock option, restricted stock, restricted stock unit or other equity-related award, that the vesting of any such stock option, restricted stock, restricted stock unit or other equity-related award or any Benefit Plan shall accelerate or otherwise be affected by or result in any payment or funding in connection with any of the transactions contemplated by this Agreement (other than, in the case of clauses (i) through (iv) above, accelerated vesting as a result of a termination of employment or service upon or following the consummation of the transactions contemplated by this Agreement);
(e) neither it nor any of its Subsidiaries shall lease, license, transfer, exchange or swap, mortgage (including securitizations), or otherwise dispose of (whether by way of merger, consolidation, sale of stock or assets, or otherwise) any material portion of its assets, including the capital stock or other ownership equity interests of its Subsidiaries, except for (i) dispositions of assets that, individually or in the aggregate with all other such dispositions, have fair market value of less than €300,000,000, or (ii) transactions between it and any of its direct or indirect Subsidiaries or transactions between such Subsidiaries;
(f) except for acquisitions (x) entered into on an arm’s length basis, (y) the expected gross expenditures and commitments (including the amount of any indebtedness assumed) of which do not exceed, in the aggregate, €300,000,000 and (z) which are not reasonably likely, individually or in the aggregate, to prevent or materially delay the satisfaction of the conditions set forth in Section 6.1(e), neither it nor any of its Subsidiaries shall acquire or agree to acquire (whether by merger, consolidation, purchase or otherwise) any Person or assets;
(g) except in the ordinary and usual course of business consistent with past practice, neither it nor any of its Subsidiaries shall (i) settle or compromise any material claims or litigation if such settlement or compromise would involve, individually or together with all such other settlements or compromises, the payment of money by such party or its Subsidiaries in excess of $10,000,000 over the available insurance coverage at the time of such settlement or would involve any admission of material wrongdoing or any material conduct requirement or restriction by such party or its Subsidiaries or (ii) except as permitted pursuant to Section 5.1(c)(ii) or Section 5.1(c)(iii), or Section 5.1(d), modify, amend or terminate in any material respect any of its Material Contracts or waive, release or assign any material rights or claims thereunder in excess of $25,000,000 individually or in the aggregate;
(h) except to the extent otherwise required by Law or in the ordinary and usual course of business consistent with past practice, neither it nor any of its Subsidiaries shall make or change any material Tax election, adopt or change any material method of Tax accounting, file any material amended Tax Return, make a request for a Tax ruling (other than regular quarterly cash dividends the Tax ruling request (demande d’agrément) with the French Ministry of Budget contemplated in Section 5.8(h) or any additional ruling request from the French Ministry of Budget having the purpose of obtaining the Publicis Intended French Tax Treatment or except as otherwise provided in this Agreement or any schedule to this Agreement) or enter into a closing agreement or advance pricing agreement in respect of a material amount of Taxes or settle or compromise any material audit, assessment, Tax claim or proceeding relating to Taxes, surrender any material right to claim a refund or offset of any Taxes, or change the classification of Omnicom or Publicis, as applicable, or any of their Subsidiaries for United States Tax purposes;
(i) neither it nor any of its Subsidiaries shall permit any change in its financial accounting principles, policies or practices, except to the extent that any such changes in financial accounting principles, policies or practices shall be required by changes in GAAP (in the case of Omnicom) or IFRS (in the case of Publicis);
(j) neither it nor any of its Subsidiaries shall enter into any Contract that grants “most favored nation” status to any counterparty or any “non-compete” or similar Contract that, in any case, would materially restrict the business of the Holdco Group following the Omnicom Effective Time;
(k) except as permitted pursuant to Section 5.1(d), neither it nor any of its Subsidiaries shall enter into any Contract between itself, on the one hand, and any of its employees, officers, directors or affiliates, or any of their respective affiliates, on the other hand, if such Contract (x) is not entered into on an arm’s length basis or (y) involves payments to exceed or from such party or its Subsidiaries in excess of $0.05 per share50,000,000;
(l) subject to Section 5.2, neither it nor any of its Subsidiaries shall take any action that would reasonably be expected to prevent or materially impair or delay the consummation of the Mergers or any of the other transactions contemplated by this Agreement (including the satisfaction of the conditions set forth in Article VI); and
(m) neither it nor any of its Subsidiaries shall authorize or enter into an agreement, arrangement or understanding to do any of the foregoing set forth in Sections 5.1(a) through (l) if Omnicom or Publicis, as applicable, would be prohibited by the terms of Sections 5.1(a) through (l) from doing the foregoing.
Appears in 1 contract
Sources: Business Combination Agreement (Omnicom Group Inc.)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, from the date of this Agreement until the Effective Time (unless Parent shall otherwise approve in writing, such approval not to be unreasonably withheld, delayed or conditioned and except as otherwise expressly contemplated by this Agreement and except as required by applicable Laws), the business of it and its Subsidiaries shall be conducted in the ordinary course of business consistent with past practice and it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain its and their existing relations and goodwill with Governmental Entities, customers, suppliers, employees and business associates. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (A) as otherwise contemplated or required by this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, delayed or conditioned in the case of clauses (v), (ix) and (xi) below), (C) as required by applicable Laws or any Governmental Entity or (D) as set forth in Section 4.1(a) of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing theretoLetter, the Company: Company will not, and will not permit its Subsidiaries, to:
(i) shall, and shall cause each of adopt any amendments to its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; charter or by-laws or other applicable governing instruments;
(ii) shall not amend merge or consolidate the Company or any of its Certificate Subsidiaries with any other Person, sell or restructure, reorganize or completely or partially liquidate the Company or any of Incorporation its Subsidiaries or Bylaws directly or comparable governing instruments indirectly sell, lease, license, sell and leaseback, abandon, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, in whole or in part, any of its material properties, assets or rights or any interest therein, except for any such transactions solely among Subsidiaries of the Company;
(iii) acquire assets outside of the ordinary course of business from any other Person, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement and disclosed to Parent;
(iv) issue, sell, pledge, dispose of, grant, transfer or encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer or encumbrance of, any shares of capital stock of the Company or any of its Subsidiaries (other than to permit (A) the consummation issuance of Shares upon the exercise of Company Options and the settlement of Restricted Shares and Restricted Stock Units (and dividend equivalents thereon, if applicable) outstanding on the date of this Agreement in accordance with their terms) or (B) the issuance of shares of capital stock by a Subsidiary of the transactions contemplated by this AgreementCompany to the Company or another Subsidiary of the Company); (iii) shall promptly notify the Purchaser , or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any breach kind to acquire any shares of such capital stock or such convertible, exchangeable or exercisable securities (including the grant or award of additional Company Options, Restricted Shares or Restricted Stock Units);
(v) make any loans, advances or capital contributions to or investments in any Person (other than the Company or any direct or indirect Subsidiary of the Company);
(vi) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect Subsidiary of the Company to the Company or to any other direct or indirect Subsidiary of the Company);
(vii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock (other than the acquisition of any representation Shares tendered by current or warranty contained herein former employees or directors in order to pay Taxes in connection with the exercise of Company Options or the settlement of Restricted Shares or Restricted Stock Units);
(viii) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person (other than a Subsidiary of the Company), or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for indebtedness for borrowed money incurred in the ordinary and usual course of business (including for the avoidance of doubt borrowings and issuances of letters of credit under the Company’s revolving credit facility and the financing of insurance premiums);
(ix) make or authorize any capital expenditure in excess of $250,000 in the aggregate;
(x) make any material changes with respect to accounting policies or procedures, except as required by changes in GAAP or a Governmental Entity;
(xi) settle any litigation or other proceedings before a Governmental Entity unless the settlement solely consists of a cash payment by the Company Material Adverse Effect; or any of its Subsidiaries not in excess of $100,000;
(ivA) shall promptly deliver other than in the ordinary course of business consistent with past practices, make, change or revoke any material Tax election, (B) other than in the ordinary course of business consistent with past practices, file or amend any Tax Return, (C) adopt or change a method of accounting in respect of Taxes, (D) consent to any extension or waiver of the limitations period applicable to a Tax Return, (E) surrender any right to request a material refund of Taxes or (F) settle or otherwise agree to a resolution of any material claim or assessment relating to Taxes;
(xiii) except for transactions among the Company and its Subsidiaries, transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets or businesses of the Company or its Subsidiaries, including capital stock of any of its Subsidiaries, in each case which is material to the Purchaser true Company and correct copies its Subsidiaries taken as a whole, other than equipment, inventory, supplies and other assets in the ordinary course of any report, statement or schedule filed with the SEC subsequent business and other than pursuant to Contracts in effect prior to the date of this Agreement; ;
(v) shall not (xxiv) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than required pursuant to any Purchaser Stock Plans) or Contracts in effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent prior to the date of this Agreement; , or any Benefit Plans in effect prior to the date of this Agreement or replacement Benefit Plans entered into after the date of this Agreement and prior to the Effective Time in the ordinary course of business, or as otherwise required by applicable Laws, (ivA) shall not declaregrant or provide any severance or termination payments or benefits to any director, set aside officer or pay other employee of the Company or any dividend of its Subsidiaries, except in the ordinary course of business or consistent with past practice or pursuant to existing Contracts, (B) increase the compensation or make any other distribution or payment with respect new equity awards to any shares director, officer or other employee of the Company or any of its capital stock Subsidiaries, except in the ordinary course of business or other ownership interests consistent with past practice, or (C) establish, adopt, terminate or materially amend any Benefit Plan, other than regular quarterly cash dividends changes that are made in the ordinary course of business or consistent with past practice that do not materially increase the costs to exceed $0.05 per share)the Company of any such Benefit Plan; or
(xv) agree, authorize or commit to do any of the foregoing.
(b) Parent shall not knowingly take or permit any of its Subsidiaries to take any action that could reasonably be likely to prevent or delay the consummation of the Merger.
Appears in 1 contract
Interim Operations. (ai) Prior The Company shall not knowingly take or permit any of its Subsidiaries to take any action or refrain from taking any action the result of which would be reasonably and foreseeably likely to prevent the consummation of the Merger by the Termination Date, except as expressly and specifically permitted by Section 6.2. The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time, unless Parent shall otherwise approve in writing (such approval not to be unreasonably withheld or delayed), and except as otherwise expressly contemplated by this Agreement or as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of the present employees and agents of the Company and its Subsidiaries. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly required by this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld or delayed) or (C) as set forth in Section 6.1(i) of the Company Disclosure Letter, the Company will not and will not permit its Subsidiaries to:
(a) adopt or propose any change in its certificate of incorporation or by-laws or other applicable governing instruments or amend any term of the Shares;
(b) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among wholly-owned Subsidiaries of the Company that are not obligors or guarantors of third-party indebtedness, or adopt a plan of liquidation;
(c) acquire assets outside of the ordinary course of business from any other Person with a value or purchase price in excess of $100,000,000 in the aggregate, other than acquisitions pursuant to Contracts to the extent in effect immediately prior to the execution of this Agreement and as otherwise set forth in Section 6.1(i)(c) of the Company Disclosure Letter, and other than capital expenditures within the Company’s capital expenditure budget as set forth in Section 6.1(i)(l) of the Company Disclosure Letter;
(d) (i) enter into any material line of business in any geographic area other than the current lines of business of the Company or any of its Subsidiaries, and in the geographic areas where they are currently conducted, as of the date hereof or (ii) engage in the conduct of any business in any state which would require the receipt or transfer of a Communications License or foreign country that would require the receipt or transfer of a Company License, in each case other than as expressly permitted by Section 6.1(i)(d) of the Company Disclosure Letter and other than as would not prevent or delay consummation of the Merger;
(e) file for any Company License outside of the ordinary course of business, other than in connection with any acquisition permitted under clause (c) hereof and other than as contemplated by any would not prevent or delay consummation of the Merger;
(f) other provision than as set forth in Section 6.1(i)(f) of this Agreement, unless the Purchaser has consented in writing thereto, Company Disclosure Letter and other than the issuance of shares pursuant to Company Stock Plans or pursuant to the Company: (i) shall’s dividend reinvestment program, and shall cause each issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation issuance of shares by a wholly owned Subsidiary of the transactions contemplated by this AgreementCompany to the Company or another wholly owned Subsidiary); (iii) shall promptly notify the Purchaser , or securities convertible or exchangeable into or exercisable for any shares of any breach of any representation or warranty contained herein such capital stock, or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreementrights, or pursuant to the Recapitalization issue any shares of its capital stockstock appreciation rights, effect any stock split or otherwise change its capitalization as it existed on the date hereofredemption rights, (y) grantrepurchase rights, confer or award any optionagreements, warrantarrangements, conversion right calls, commitments or other right not existing on the date hereof rights of any kind to acquire any shares of its such capital stockstock or such convertible or exchangeable securities;
(g) other than in connection with existing receivables facilities and securitizations and renewals thereof in the ordinary course of business, or (z) adopt in connection with the refinancing of the Company’s indebtedness under its existing credit facility, create or incur any A1-14Lien material to the Company or any of its Subsidiaries on any assets of the Company or any of its Subsidiaries having a value in excess of $50,000,000;
(bh) Prior make any loans, advances or capital contributions to or investments in any Person (other than the Effective Time, except as set forth Company or any direct or indirect wholly-owned Subsidiary of the Company) in excess of $25,000,000 in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: aggregate;
(i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make distribution (whether in cash, stock or property or any combination thereof) on (i) any shares of Company Common Stock other distribution than pursuant to Section 6.18 of this Agreement or the Company’s regular quarterly dividend of $.2375 per share in cash per quarter at record and payment dates consistent with respect past practices, provided that the Company shall designate the record dates for the Company’s quarterly dividends to coincide with the record dates for Parent’s quarterly dividends set forth on Section 6.1(i) of the Parent Disclosure Letter, beginning with the record date on July 10, 2005, or (ii) any shares of capital stock of any Subsidiary (other than wholly-owned Subsidiaries and pro rata dividends payable to holders of interests in non wholly-owned Subsidiaries);
(j) reclassify, split, combine, subdivide or repurchase, redeem or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock stock;
(k) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other ownership interests rights to acquire any debt security of the Company or any of its Subsidiaries, except for (other than regular quarterly cash dividends i) indebtedness for borrowed money incurred in the ordinary course of business not to exceed $0.05 per share100,000,000 in the aggregate, (ii) indebtedness for borrowed money in replacement of existing indebtedness for borrowed money on customary commercial terms, (iii) guarantees by the Company of indebtedness of wholly-owned Subsidiaries of the Company or guarantees by Subsidiaries of indebtedness of the Company, or (iv) interest rate swaps on customary commercial terms consistent with past practice and not to exceed $100,000,000 of notional debt in the aggregate in addition to notional debt currently under swap or similar arrangements;
(l) except as set forth in Section 6.1(i)(l) of the Company Disclosure Letter, make or authorize any capital expenditure;
(m) other than in the ordinary course of business, enter into any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement (other than as permitted by Section 6.1(i)(d), (e) or (k));
(n) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP or by applicable Law or except as the Company, based upon the advice of its independent auditors after consultation with Parent, determines in good faith is advisable to conform to best accounting practices;
(o) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity for an amount to be paid by the Company or any of its Subsidiaries in excess of $50,000,000 or which would be reasonably likely to have any adverse impact on the operations of the Company or any of its Subsidiaries; provided that with respect to any Federal income tax audit of the Company and its consolidated Subsidiaries, such audit may be settled without regard to the foregoing $50,000,000 limitation; and provided, further, that with respect to such Federal audit, the Company shall consult with Parent at least 30 business days prior to the issuance of a Revenue Agent Report or an agreement with respect to a final settlement in appeals, although the final determination of such matters shall be in the sole discretion of the Company; and provided, further, that any amount of Taxes for which the Company reasonably believes that another Person will indemnify the Company pursuant to such Person’s obligations under the tax sharing agreements listed in Section 6.1(i)(q) of the Company Disclosure Letter shall not be considered as an amount paid in settlement of a litigation or other proceeding for purposes of this Section 6.1(i)(o);
(p) other than in the ordinary course of business, (i) amend or modify in any material respect, or terminate or waive any material right or benefit under, any Material Contract (other than as permitted by Section 6.1(i)(d), (e) or (k)), or (ii) cancel, modify or waive any debts or claims held by it or waive any rights having in each case a value in excess of $25,000,000;
(q) except as required by Law or by any currently effective tax sharing agreement listed in Section 6.1(i)(q) of the Company Disclosure Letter, make any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any method therefor that is inconsistent with elections made, positions taken or methods used in preparing or filing similar Tax Returns in prior periods. Anything in this Section 6.1(q) to the contrary notwithstanding, with respect to methods of accounting and elections referred to on Section 6.1(q) of the Company Disclosure Letter, the Company shall consult with Parent, although the final determination of the positions taken or the elections made shall be in the sole discretion of the Company;
(r) sell, lease, license or otherwise dispose of any assets of the Company or its Subsidiaries except (i) in the ordinary course of business or obsolete assets or (ii) sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $50,000,000 in respect of any one asset and not in excess of $100,000,000 in the aggregate other than (x) as set forth in Section 6.1(i)(r) of the Company Disclosure Letter and (y) any dispositions of assets to the extent used as consideration for acquisitions that are permitted pursuant to Section 6.1(i)(c);
(s) except as required pursuant to existing written, binding agreements in effect prior to the date of this Agreement or as otherwise required by applicable Law, (i) enter into any commitment to provide any severance or termination benefits to (or amend any existing arrangement with) any director, officer or employee of the Company or any of its Subsidiaries, other than for severance or termination benefits to employees (other than Section 16 Officers) in the ordinary course of business consistent with past practice and pursuant to the terms of plans, programs or arrangements in effect prior to the date of this Agreement and disclosed on Section 5.1(h) of the Company Disclosure Letter, (ii) increase the benefits payable under any existing severance or termination benefit policy or employment agreement (other than as required to be increased pursuant to the existing terms of any such policy or agreement or as a result of ordinary pay raises or promotions), (iii) enter into any employment severance, change in control, termination, deferred compensation or other similar agreement (or amend any such existing agreement) with any director, officer or employee of the Company or any of its Subsidiaries other than pursuant to the terms of any Compensation or Benefit Plan in effect on the date hereof, (iv) establish, adopt, amend or terminate any Compensation and Benefit Plan, except for technical amendments in the ordinary course of business consistent with past practice, provided that such amendments do not materially increase the cost of such arrangements to the Company, (v) increase the compensation, bonus or other benefits of, make any new awards under any Compensation and Benefit Plan to, or pay any bonus to any director, officer, employee, consultant or independent contractor of the Company or any of its Subsidiaries, except for increases, new awards or payments in the ordinary course of business consistent with past practice for employees who are not among the Company’s Section 16 Officers, (vi) take any action to fund or in any other way secure the payment of compensation or benefits under any Compensation and Benefit Plan, except as required pursuant to the terms thereof, (vii) take any action to accelerate the vesting or payment of any compensation or benefits under any Compensation and Benefit Plans, to the extent not already required in any such Compensation and Benefit Plan, (viii) other than in the ordinary course of business consistent with past practice, materially change any actuarial or other assumptions used to calculate funding obligations with respect to any Compensation and Benefit Plan or change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, (ix) amend the terms of any outstanding equity-based award, (x) provide for accelerated vesting, removal of restrictions or exercisability of any stock based or stock related awards (including stock options, stock appreciation rights, performance units and restricted stock units) upon a change in control occurring on or prior to the Effective Time for any grants made after the date of this Agreement, (xi) exercise any discretion to cash out awards pursuant to the Company’s 1997 Long Term Incentive Program or (xii) enter into any new collective bargaining agreements (or amendments to existing collective bargaining agreements); provided, however, that the prohibitions contained in the foregoing clauses (i) and (v) shall not apply in connection with newly hired or newly promoted employees, in each case to the extent consistent with past practice;
(t) fail to initiate appropriate steps to renew any material Company Licenses held by the Company or any of its Subsidiaries that are scheduled to terminate prior to or within 60 days after the Effective Time or to prosecute any pending applications for any material Company License; or (u) agree or commit to do any of the foregoing.
(ii) The Company will provide Parent with a schedule setting forth a true and complete list as of the date of this Agreement of (A) within five (5) days of the date of this Agreement, all Licenses issued or granted to the Company or any of its Subsidiaries by the FCC (“FCC Licenses”), all Licenses issued or granted to the Company or any of its Subsidiaries by State Commissions regulating telecommunications businesses or services (“State Licenses”) and all Licenses issued or granted to the Company or any of its subsidiaries by foreign Governmental Entities regulating telecommunications businesses or services or the use of radio spectrum (“Foreign Licenses”) that are identified on Section 6.1(ii)(A) of the Company Disclosure Letter; (B) within thirty (30) days, all Foreign Licenses other than those referenced in clause (A) above, all Licenses issued or granted to the Company or any of its Subsidiaries by any local government regulating telecommunications businesses or services or authorizing the Company or any of its Subsidiaries to place facilities within the boundary of such local government (“Local Licenses”), and all Licenses administered by the (v) U.S. State Department, Office of Defense Trade Controls Licensing; (w) U.S. Commerce Department, Bureau of Industry and Security; (x) U.S. Treasury Department, Office of Foreign Assets Controls; or (y) equivalent licensing requirements in any country in which the Company and its Affiliates are doing business (the FCC Licenses, State Licenses, Foreign Licenses and Local Licenses, together with all other Licenses of the Company and its Subsidiaries, the “Company Licenses”); (C) within thirty (30) days, all pending applications for Licenses that would be Company Licenses if issued
Appears in 1 contract
Sources: Merger Agreement (At&t Corp)
Interim Operations. (a) Except as required by applicable Law or as expressly provided by this Agreement, the Company covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time, the business of it and its Subsidiaries shall be conducted in all material respects in the ordinary and usual course and it and its Subsidiaries shall use their respective commercially reasonable efforts to preserve the material components of their business organizations intact and maintain existing relations and goodwill with Governmental Entities, material customers, material suppliers, licensors, licensees, distributors, creditors and lessors, key employees and independent contractors, and material service providers, agents and business associates and keep available the services of its and its Subsidiaries’ present officers and key employees; provided, however, that the Company and its Subsidiaries shall be under no obligation to and shall not, without Parent’s prior written consent, put in place any new retention programs or include additional personnel in any existing retention programs. Without limiting the generality of the immediately preceding sentence, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly required by this Agreement, (B) with the prior written consent of Parent or (C) as set forth in Section 6.1 of the Company Disclosure Schedule, the Company will not and will not permit its Subsidiaries to:
(i) adopt or propose any change or amendment (whether by merger, consolidation or otherwise) to its certificate of incorporation or bylaws or other applicable governing instruments of the Company and its Subsidiaries;
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions solely among wholly owned Subsidiaries of the Company not in violation of any instrument binding on the Company or any of its Subsidiaries and that would not reasonably be expected to result in a material increase in the net Tax liability of the Company and its Subsidiaries, taken as a whole;
(iii) acquire, directly or indirectly, whether by purchase, merger, consolidation or acquisition of stock or assets or otherwise, any assets, securities, properties, interests, or businesses or make any investment (whether by purchase of stock or securities, contributions to capital, loans to, or property transfers), in each case, other than (A) acquisitions of raw materials, supplies, equipment, inventory, third party Software and capital in the ordinary course of business consistent with past practice (it being understood and agreed that the acquisition of all or substantially all of the assets of any Person is not in the ordinary course of business), or (B) acquisitions with a value or purchase price (including the value of assumed liabilities) not in excess of $100,000 in any transaction or related series of transactions or $300,000 in the aggregate, or as required by the terms of Contracts as in effect as of the date of this Agreement that are listed in Section 6.1(a)(iii) of the Company Disclosure Schedule;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any (A) shares of capital stock of the Company or any of its Subsidiaries (other than (1) the issuance, sale, pledge, disposition, grant, transfer, lease, license, guaranty or encumbrance of shares by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary or (2) the issuance or transfer of Shares pursuant to awards outstanding as of the date of this Agreement under, and as required by the terms of the Stock Plans as in effect as of the date of this Agreement), (B) securities convertible into or exercisable, exchangeable or redeemable for any shares of such capital stock, any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible, exercisable, exchangeable or redeemable securities, or (C) any Voting Debt;
(v) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than the Company or any direct or indirect wholly owned Subsidiary of the Company) in excess of $100,000 in any transaction or series of related transactions or $200,000 in the aggregate;
(vi) amend, supplement, replace, refinance, terminate or otherwise modify that certain Amended and Restated Credit Agreement dated as of December 6, 2012, by and among the Company, Bank of America, N.A., as administrative agent, and the lenders named therein (as amended on June 26, 2013 and July 3, 2014 and as such agreement may be further amended, amended and restated, supplemented, extended, refinanced, renewed, replaced or otherwise modified from time to time);
(vii) except with respect to the regular quarterly dividend of $0.13 per share payable on October 15, 2014, declare, authorize, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any Subsidiary of the Company to the Company or to a wholly owned Subsidiary of the Company) or enter into any Contract with respect to the voting of its capital stock;
(viii) adjust, reclassify, split, combine or subdivide, redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(ix) incur, alter, amend or modify any indebtedness or guarantee indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for the incurrence of indebtedness for borrowed money incurred in the ordinary course of business consistent with past practice not to exceed $200,000 in the aggregate;
(x) make or authorize any capital expenditures materially in excess of the amount reflected in the Company’s capital expenditure budget attached to Section 6.1(a)(x) of the Company Disclosure Schedule;
(xi) make any material changes with respect to accounting policies or procedures, except as required by changes in applicable GAAP;
(xii) subject to Section 6.11, release, assign, compromise, discharge, waive, settle or satisfy any Action (including any Action relating to this Agreement, the Offer or the Merger) or other rights, claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise) for an amount not covered by insurance in excess of $100,000 individually or $200,000 in the aggregate or providing for any relief other than monetary relief (except for confidentiality, non-disparagement, releases, agreements not to ▇▇▇ and other similar provisions in a settlement agreement);
(xiii) amend or modify, in any material respect, or terminate any Material Contract, material lease for Leased Real Property or material Company Permit or enter into any Contract that would have been a Material Contract had it been entered into prior to the execution of this Agreement, in each case other than in the ordinary course of business;
(xiv) other than in the ordinary course of business or to the extent required by law, make any material Tax election, amend any Tax Return with respect to a material amount of Taxes, settle or finally resolve any controversy with respect to a material amount of Taxes or change any method of Tax accounting;
(xv) (A) with regard to Intellectual Property, transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any material Intellectual Property, other than non-exclusive licenses granted in the ordinary course of business; and (B) with regard to other assets, transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon, create or incur any Lien (other than Permitted Encumbrances) on or allow to lapse or expire or otherwise dispose of any material assets, licenses, operations, rights, product lines, businesses or interests therein of the Company or its Subsidiaries, except, with respect to the foregoing clause (B), (x) in connection with sales of Company products or dispositions of inventory in the ordinary course of business (y) sales or other dispositions of obsolete assets or (z) sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $100,000 in any transaction or series of related transactions or $300,000 in the aggregate (inclusive of any sales or dispositions made pursuant to clauses (x) or (y) of this paragraph);
(xvi) terminate any executive officers or hire any new employees unless such hiring is in the ordinary course of business consistent with past practice;
(xvii) adopt, enter into, amend, terminate or extend any Collective Bargaining Agreement;
(xviii) except as required pursuant to existing written, binding agreements in effect prior to the date of this Agreement, or as otherwise required by applicable Law, (A) grant or provide any severance or termination payments or benefits to any director, officer or, other than in the ordinary course of business, employees (who are not officers) of the Company or any of its Subsidiaries, (B) increase the compensation, bonus or pension, welfare, severance, change-in-control or other benefits of, pay any bonus to, or make any new equity awards to any director, officer or, other than in the ordinary course of business consistent with past practice, non-officer employee of the Company or any of its Subsidiaries other than, in the case of non-officer employees, base salary increases or spot or other bonuses awarded in the ordinary course of business (which spot or other bonuses shall not exceed $20,000 in the aggregate), (C) establish, adopt, amend or terminate any Company Benefit Plan (except as required by Law) or amend the terms of any outstanding equity-based awards, (D) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any Company Benefit Plan, to the extent not already provided in any such Company Benefit Plan, (E) materially change any actuarial or other assumptions used to calculate funding obligations with respect to any Company Benefit Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, or (F) forgive any loans to directors, officers or key employees of the Company or any of its Subsidiaries;
(xix) unless required by applicable Law, reclassify any independent contractor as an employee of the Company or any of its Subsidiaries;
(xx) fail to use commercially reasonable efforts to renew or maintain the Insurance Policies or comparable replacement policies, other than in the ordinary course of business consistent with past practice;
(xxi) enter into any new line of business;
(xxii) adopt, enter into or effect any plan of complete or partial liquidation, dissolution, reorganization or restructuring;
(xxiii) take any action that would, or would be reasonably likely to, individually or in the aggregate, prevent, materially delay or materially impede the consummation of the Offer, the Merger or the other transactions contemplated by this Agreement; or
(xxiv) agree, authorize, propose, commit or announce an intention to do any of the foregoing.
(b) Nothing contained herein shall give to Parent or Purchaser, directly or indirectly, rights to control or direct the Company’s operations prior to the Effective Time in violation of applicable Law. Prior to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision shall exercise, consistent with the terms and conditions hereof, complete control and supervision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, its operations and shall cause each not be required to obtain consent of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as Parent if it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)reasonably believes that doing so would violate applicable Law.
Appears in 1 contract
Sources: Merger Agreement (Einstein Noah Restaurant Group Inc)
Interim Operations. (a) Prior to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: :
(i) shallShall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; ;
(ii) Shall use its reasonable efforts, and shall cause each of its Subsidiaries to use their reasonable efforts, to preserve intact their respective business organizations and goodwill, keep available the services of their respective officers and employees and maintain satisfactory relationships with those persons having business relationships with them;
(iii) Shall not amend its Certificate Articles of Incorporation or Bylaws or comparable governing instruments instruments;
(other than to permit the consummation of the transactions contemplated by this Agreement); (iiiiv) shall Shall promptly notify the Purchaser of any material breach of any representation or warranty contained herein or any Company Material Adverse Effect; Effect with respect to the Company;
(ivv) shall Shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; ;
(vA) shall not (x) Shall not, except pursuant to (i) the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to and (ii) the Recapitalization Company Rights Agreement, issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereofhereof and (B) shall not, and shall not permit any of its Subsidiaries to, (yx) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stockstock (except as contemplated by the Company Rights Agreement and as identified in the Company Disclosure Letter) or grant, confer or award any bonuses or other forms of cash incentives, except as is consistent with past practice, to any officer, director or key employee, (y) increase any compensation under any employment agreement with any present or future officers, directors or employees, except for normal increases consistent with past practice, grant any severance or termination pay to, or enter into any employment or severance agreement with any officer or director or amend any such agreement in any material respect other than severance arrangements which are consistent with past practice with respect to employees terminated by the Company or such Subsidiary, or (z) except as may be required by law, adopt any A1-14new employee benefit plan (including any stock option, stock benefit or stock purchase plan) or amend any existing employee benefit plan in any material respect;
(bvii) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: Shall not (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests or (other than regular quarterly cash dividends not to exceed $0.05 per share).ii) directly or indirectly redeem, purchase or otherwise
Appears in 1 contract
Interim Operations. (a) Prior ▇▇▇▇▇▇ covenants and agrees as to itself and its Subsidiaries that, after the date hereof and until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time (unless VeriFone shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement) and except as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of its and its Subsidiaries’ present employees and agents. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, except (A) as otherwise expressly required by this Agreement, (B) as VeriFone may approve in writing or (C) as set forth in Section 6.1 of the Company ▇▇▇▇▇▇ Disclosure Letter or as contemplated by any other provision of this AgreementLetter, unless the Purchaser has consented in writing thereto, the Company: ▇▇▇▇▇▇ will not and will not permit its Subsidiaries to:
(i) shalladopt or propose any change in its articles of association or other applicable governing instruments, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course except in substantially the same manner as heretofore conducted; accordance with Section 6.18(a) hereof;
(ii) shall not amend merge or consolidate itself or any of its Certificate of Incorporation Subsidiaries with any other Person, except for any such transactions among its wholly-owned Subsidiaries, or Bylaws restructure, reorganize or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) shall promptly notify acquire assets outside of the Purchaser ordinary course of business from any breach other Person with a value or purchase price in the aggregate in excess of $2 million in any representation transaction or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver series of related transactions, other than acquisitions pursuant to the Purchaser true and correct copies Contracts in effect as of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights Agreement and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser ▇▇▇▇▇▇ Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and Letter;
(iv) shall not declareissue, set aside sell, pledge, dispose of, grant, transfer, encumber, or pay any dividend authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or make any other distribution or payment with respect to encumbrance of, any shares of its capital stock or other ownership interests of any its Subsidiaries (other than regular quarterly cash the issuance of shares by a wholly-owned Subsidiary to it or another of its wholly-owned Subsidiaries), or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities, except for the options that are planned to be granted under the ▇▇▇▇▇▇ 2006 Share Incentive Plan as set forth in Section 5.1(b)(i) of the ▇▇▇▇▇▇ Disclosure Letter;
(v) create or incur any Lien material to it or any of its Subsidiaries on any of its assets or any of its Subsidiaries;
(vi) make any loans, advances or capital contributions to or investments in any Person (other than between itself and any of its direct or indirect wholly-owned Subsidiaries);
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for the Special Cash Dividend or dividends or other distributions by any direct or indirect wholly-owned Subsidiary to ▇▇▇▇▇▇ or to any wholly-owned Subsidiary of ▇▇▇▇▇▇) or enter into any agreement with respect to the voting of its capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(ix) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any of its debt securities or of any of its Subsidiaries, except for (A) indebtedness for borrowed money incurred in the ordinary course of business consistent with past practices (x) not to exceed $0.05 per share10 million in the aggregate or (y) in replacement of existing indebtedness for borrowed money on terms substantially consistent with or more beneficial than the indebtedness being replaced, or (B) guarantees incurred in compliance with this Section 6.1 by it of indebtedness of its wholly-owned Subsidiaries or (C) interest rate swaps on customary commercial terms consistent with past practice and in compliance with its risk management policies in effect on the date of this Agreement and not to exceed $10 million of notional debt in the aggregate;
(x) except as set forth in the capital budgets set forth in Section 6.1(a)(x) of the ▇▇▇▇▇▇ Disclosure Letter and consistent therewith, make or authorize any capital expenditure in excess of $5 million in the aggregate;
(xi) make any changes with respect to accounting policies or procedures, except as required by changes in applicable generally accepted accounting principles;
(xii) other than the Israeli Tax Assessment (as defined 5.1(n) of the ▇▇▇▇▇▇ Disclosure Letter) settle any litigation or other proceedings before a Governmental Entity other than a settlement reimbursable from insurance or calling solely for a cash payment in an amount less than $5 million and including a full release of ▇▇▇▇▇▇ and its affiliates, as applicable;
(xiii) except in connection with the filing with the ITA of the Stock Option Plan (November 2004), make any material Tax election or make any application with any Governmental Entity or, except as set forth in Section 6.15, seek any tax ruling from a Governmental Entity, if there is a risk that such ruling may result in any terms, restrictions, liabilities or obligations being imposed on ▇▇▇▇▇▇ (or any ▇▇▇▇▇▇ Subsidiary) or its shareholders (including VeriFone);
(xiv) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any of its assets, product lines or businesses or of its Subsidiaries, including capital stock of any of its Subsidiaries and sales of obsolete assets and except for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $5 million in the aggregate, other than pursuant to Contracts in effect as of the date of this Agreement;
(xv) except as required pursuant to Contracts in effect as of the date of this Agreement and set forth in Section 5.1(h)(i) of the ▇▇▇▇▇▇ Disclosure Letter, or as otherwise required by applicable Law, (i) grant or provide any severance or termination payments or benefits to any of its director, officer or employee or of any of its Subsidiaries, except in the ordinary course of business consistent with past practice, (ii) increase the compensation, bonus or pension, welfare, severance or other benefits of, pay any bonus to, or make any new equity awards to any of its director, officer or employee or of any of its Subsidiaries, except in the ordinary course of business consistent with past practice, (iii) establish, adopt, amend or terminate any of its benefit plans or amend the terms of any outstanding equity-based awards, (iv) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any of its benefit plans, to the extent not already provided in any such benefit plans, (v) change any actuarial or other assumptions used to calculate funding obligations with respect to any benefit plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP; or (vi) forgive any loans to any of its or of any of its Subsidiaries’ directors, officers or employees;
(xvi) take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Merger set forth in Article VII not being satisfied;
(xvii) take any action that would reasonably be expected to result in a material increase in Tax liability (or a corresponding loss of Tax attributes) other than in the ordinary course of business; or
(xviii) agree, authorize or commit to do any of the foregoing.
(b) ▇▇▇▇▇▇ shall, prior to making any written or oral communications to any of its or of any of its Subsidiaries’ directors, officers or employees pertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement, provide VeriFone with a copy of the intended communication and provide VeriFone a reasonable period of time to review and comment on the communication, and the parties hereto shall cooperate in providing any such mutually agreeable communication.
(c) VeriFone covenants and agrees as to itself and its Significant Subsidiaries that, after the date hereof and prior to the Effective Time (unless ▇▇▇▇▇▇ shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement) and except as required by applicable Laws, VeriFone will not:
(i) adopt or propose any change in its certificate of incorporation;
(ii) merge or consolidate itself or any of its Significant Subsidiaries with any other Person, except for any such transactions among its wholly-owned Subsidiaries, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends paid by any direct or indirect wholly-owned Subsidiary to it or to any other direct or indirect wholly-owned Subsidiary);
(iv) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(v) take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Merger set forth in Article VII not being satisfied; or
(vi) agree, authorize or commit to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) Prior to the Effective Time, except Except as set forth in Section 6.1 of the Company Disclosure Letter Letter, the Company covenants and agrees as to itself and its Subsidiaries and undertakes as to itself and its Subsidiaries to use commercially reasonable efforts in relation to its Joint Ventures as though for the purpose of the remainder of this Article VI its Joint Ventures were Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, which shall not be unreasonably withheld or delayed, and except as otherwise expressly contemplated by any other provision of this Agreement):
(a) its and its Subsidiaries' businesses shall be conducted in the ordinary and usual course (it being understood and agreed that nothing contained herein shall permit the Company to enter into or engage in (through acquisition, unless product extension or otherwise) the Purchaser has consented business of selling any products or services materially different from existing products or services of the Company and its Subsidiaries, to enter into or engage in writing theretonew lines of business, to utilize new distribution methods, expand into new geographic territories outside of the Company: United States, or to exit any current business of the Company or its Subsidiaries, without Parent's prior written approval);
(b) to the extent consistent with (a) above it and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, reinsurers, distributors, creditors, lessors, employees and business associates;
(c) it shall not (i) shallissue, and shall cause each sell, pledge, dispose of or encumber any capital stock owned by it in any of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedSubsidiaries; (ii) shall not amend its Certificate of Incorporation Charter or Bylaws by-laws or comparable governing instruments (other than to permit amend, modify or terminate the consummation of the transactions Rights Agreement except as contemplated by this AgreementSection 5.1(o)(ii); (iii) shall promptly notify the Purchaser split, combine or reclassify its outstanding shares of any breach of any representation or warranty contained herein or any Company Material Adverse Effectcapital stock; (iv) shall promptly deliver to the Purchaser true and correct copies of any reportauthorize, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend payable in cash, stock or make property in respect of any capital stock other distribution than dividends from its direct or indirect wholly-owned Subsidiaries and other than regular quarterly dividends paid by the Company on its Common Shares not in excess of $.09 per share, with usual record and payment dates and in accordance with respect the Company's past dividend policy; or (v) repurchase, redeem or otherwise acquire, except in connection with any of the Company Stock Plans, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its stock or any securities convertible into or exchangeable or exercisable for any shares of its stock;
(d) neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other ownership interests property or assets (other than Shares issuable pursuant to options outstanding on the date hereof under any of the Company Stock Plans); (ii) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; (iii) make or authorize or commit for any capital expenditures, including entering into capital lease obligations, other than in amounts not exceeding $1 million in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity, including by way of assumption reinsurance, in excess of $100,000 individually or $1 million in the aggregate (other than in connection with ordinary course investment and reinsurance activities); (iv) enter into, amend or terminate any material Contract or (v) permit any insurance policy naming it as a beneficiary or loss-payable payee to be canceled or terminated except in the ordinary and usual course of business;
(e) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any employee benefit or incentive plan or employment or other agreement (including the Compensation and Benefit Plans) or hire or terminate the employment of key employees, or increase the salary, wage, bonus or other compensation of any employees except increases occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases);
(f) neither it nor any of its Subsidiaries shall pay, discharge, settle or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge, settlement or satisfaction of claims, liabilities or obligations legally due and payable and arising in the ordinary and usual course of business and such other claims, liabilities or obligations as shall not exceed $1 million in the aggregate and other than regular quarterly cash dividends semi-annual payments paid by MMI Capital Trust I on its 7 5/8% Series B Capital Trust Securities (the "Trust Securities") pursuant to the Indenture, dated December 23, 1997, between The Chase Manhattan Bank and the Company, pursuant to which the Trust Securities were issued;
(g) neither it nor any of its Subsidiaries shall make, change or revoke any Tax election, settle or compromise any material Tax liability arising in any audit, change its method of accounting if such change would have a material impact on Taxes, enter into any closing or other agreement with respect to a material amount of Taxes, file a request for refund of a material amount of Taxes (but not including the prosecution of any refund claim pending on the date hereof), or file an amended Tax Return if such Tax Return is materially different from the original return to which it relates, except, in each case, (i) in the ordinary course of business and consistent with the Company's past practice in respect of the Tax at issue in the jurisdiction in question or (ii) with the consent of Parent, such consent not to exceed be unreasonably withheld;
(h) neither it nor any of its Subsidiaries shall enter into any agreement containing any provision or covenant limiting in any material respect the ability of the Company or any Subsidiary or Affiliate to (A) sell any products or services of or to any other Person, (B) engage in any line of business or (C) compete with or to obtain products or services from any Person or limiting the ability of any Person to provide products or services to the Company or any of its Subsidiaries or Affiliates;
(i) neither it nor any of its Subsidiaries shall enter into any new quota share or other reinsurance transaction (A) which does not contain standard cancellation and termination provisions, (B) which, except in the ordinary course of business, materially increases or reduces the Company Insurance Subsidiaries' consolidated ratio of net written premiums to gross written premiums or (C) pursuant to which $0.05 per share)1 million or more in gross written premiums are ceded by the Company Insurance Subsidiaries to any Person other than the Company or any of its Subsidiaries;
(j) neither it nor any of its Subsidiaries shall take any action or omit to take any action that would cause any of its representations and warranties herein to become untrue in any material respect;
(k) neither it nor any of the Company Insurance Subsidiaries will alter or amend in any material respect their existing underwriting, claim handling, loss control, investment, actuarial, financial reporting or accounting practices, guidelines or policies or in any material assumption underlying an actuarial practice or policy, except as may be required by GAAP or SAP; and
(l) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Sources: Merger Agreement (Mmi Companies Inc)
Interim Operations. (a) Prior From the date of this Agreement to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of required pursuant to this Agreement, unless the Purchaser Intercardia has consented in writing thereto, the Company: Transcell shall:
(i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their its usual, regular and ordinary course in substantially the same manner as heretofore conducted; of business consistent with past practice;
(ii) use its reasonable efforts to preserve intact its business organizations and goodwill, to maintain in effect all existing qualifications, licenses, permits, approvals and other authorizations, to keep available the services of their officers and employees and to maintain satisfactory relationships with suppliers and all other persons having business relationships with them except where the failure to do so would not have a Material Adverse Effect;
(iii) deliver, within fifteen (15) business days after the end of each accounting month, monthly financial accounts prepared internally by Transcell's management, in the same format as heretofore furnished to Intercardia, for Transcell for and as of the end of each such month; and
(iv) promptly notify Intercardia of any Litigation instituted or threatened against Transcell;
(b) From the date of this Agreement to the Effective Time, unless Intercardia has consented in writing thereto, Transcell shall not not:
(i) amend its Certificate of Incorporation or Bylaws Bylaws;
(ii) issue, sell, pledge or comparable governing instruments (other than to permit the consummation otherwise dispose of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stockAuthorized Capital Stock (other than issuances of Authorized Capital Stock in respect of any exercise of Transcell Options or Transcell Warrants or any conversion of Class B Common Stock, Series A Preferred Stock or Series B Preferred Stock outstanding on the date hereof), or any securities convertible into or exchangeable for any such shares, or any rights, warrants or options to acquire or with respect to any such shares of Authorized Capital Stock, or convertible or exchangeable securities; or accelerate any right to convert or exchange or acquire any securities of Transcell for any such shares;
(iii) effect any stock split split, reverse stock split, stock dividend, subdivision, reclassification or similar transaction, or otherwise change its capitalization as it existed exists on the date hereof;
(iv) other than pursuant to this Agreement, (y) grant, confer confer, award or award amend any option, warrant, conversion right convertible security or other right not existing on the date hereof to acquire any shares of its capital stock, Authorized Capital Stock or (z) adopt take any A1-14action to cause to be exercisable any otherwise unexercisable option under any stock option plan;
(bv) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its Outstanding Capital Stock;
(vi) directly or indirectly redeem, purchase or otherwise acquire any shares of its Outstanding Capital Stock;
(vii) sell, lease, assign, transfer or otherwise dispose of (by merger or otherwise) any of its property, business or assets (including, without limitation, any Intellectual Property) except in the ordinary course of business;
(viii) settle or compromise any pending or threatened Litigation without Intercardia's consent (which consent will not be unreasonably withheld or delayed);
(ix) make any loan, extension of credit or capital stock contribution to, or purchase to acquire (by merger or otherwise) any stock, bonds, notes, debentures or other ownership interests securities of, or any assets constituting a business unit of, or make any other investment in, any person, firm or entity, except (v) loans, extensions of credit, capital contributions, purchases, acquisitions or investments that are, individually and in the aggregate, of DE MINIMIS value, (w) extensions of trade credit and endorsements of negotiable instruments and other negotiable documents in the ordinary course of business (x) investments in cash and cash equivalents, (y) investments in wholly owned subsidiaries;
(x) incur, assume or create any indebtedness for borrowed money or the deferred purchase price for property or services or pursuant to any capital lease or other financing, except indebtedness owed to Interneuron or incurred in the ordinary course of business for equipment financing or working capital purposes pursuant to Transcell's existing credit facilities; or amend in a manner materially adverse to Transcell any of Transcell's existing credit facilities;
(xi) assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person except for obligations in the ordinary course of business consistent with the past practice of Transcell;
(xii) make any material tax election (unless required by law or unless consistent with prior practice), settle or compromise any material income tax liability or amend any tax return;
(xiii) waive or amend any term or condition of any confidentiality or "standstill" agreement to which Transcell is a party and which relates to a business combination with Transcell or the purchase of shares or assets of Transcell;
(xiv) grant or amend any share-related or performance awards;
(xv) except with respect to agreements which are terminable at will by Transcell without any material penalty to Transcell, enter into or amend any legally binding employment, severance, consulting or salary continuation agreements with any officers, directors or employees or grant any increases in compensation or benefits to employees other than regular quarterly cash dividends not increases to exceed $0.05 per shareofficers and employees in the ordinary course of business consistent with the past practice of Transcell;
(xvi) adopt, amend or terminate any employee benefit plan or arrangement (except as expressly contemplated by this Agreement);
(xvii) change any accounting principles or practices used by Transcell;
(xviii) waive, relinquish, release or terminate any material right or claim, including any such right or claim under any Material Contract or permit any rights of material value to use any Intellectual Property to lapse or be forfeited; or
(xix) agree in writing or otherwise to take any of the foregoing actions.
Appears in 1 contract
Sources: Merger Agreement (Intercardia Inc)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, from and after the execution of this Agreement and prior to the Effective Time (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld, conditioned or delayed, and except as otherwise expressly disclosed in Section 6.1(a) of the Company Disclosure Letter), the business of the Company and its Subsidiaries shall be conducted in the ordinary course of business consistent with past practice and each of the Company and its Subsidiaries shall, subject to compliance with the specific matters set forth below, use reasonable best efforts to preserve its business organization intact and maintain the existing relations and goodwill with Governmental Entities, customers, suppliers, content providers, distributors, licensors, creditors, lessors, employees and business associates and keep available the services of the Company and its Subsidiaries’ present employees and agents. Without limiting the generality of, and in furtherance of, the foregoing, the Company covenants and agrees as to itself and its Subsidiaries that, from and after the date of this Agreement and prior to the Effective Time, except (A) as set forth Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (B) as expressly disclosed in Section 6.1(a) or (d) of the Company Disclosure Letter or (C) as contemplated by any other provision of this expressly provided for in the Employee Matters Agreement, unless the Purchaser has consented in writing thereto, the Company: Company shall not and will not permit its Subsidiaries to:
(i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (iiA) shall not amend its Certificate certificate of Incorporation incorporation or Bylaws bylaws (or comparable governing instruments documents), (other than to permit the consummation of the transactions contemplated by this Agreement); (iiiB) shall promptly notify the Purchaser of any breach of any representation split, combine, subdivide or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any reclassify its outstanding shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (yC) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make distribution payable in cash, stock or property (or any other distribution combination thereof) in respect of any shares of its capital stock (except for any dividends or payment distributions paid by Sky Brasil Servicios Ltda. or a direct or indirect wholly owned Subsidiary of the Company to its stockholders or unitholders on a pro rata basis in the ordinary course of business consistent with past practice), (D) enter into any agreement with respect to the voting of its capital stock, or (E) purchase, repurchase, redeem or otherwise acquire any shares of its capital stock or any securities convertible or exchangeable into or exercisable for any shares of its capital stock;
(ii) merge or consolidate with any other ownership interests Person, except for any such transactions among wholly owned Subsidiaries of the Company, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or business;
(iii) knowingly take or omit to take any action if such action or failure to act would be reasonably likely to prevent or impede the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code;
(iv) (A) establish, adopt, amend or terminate any Company Plan or amend the terms of any outstanding equity-based awards, (B) grant or provide any severance or termination payments or benefits to any director, officer, employee or other service provider of the Company or any of its Subsidiaries, except to comply with applicable Law or as expressly required by the provisions of the Company Plans as in effect on the date hereof or the provisions of this Agreement, (C) increase the compensation, bonus or pension, welfare, severance or other benefits of or pay any bonus to any director, officer or employee of the Company or any of its Subsidiaries, (D) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any Company Plan (including any equity-based awards), except to the extent expressly required by any such Company Plan or provided in this Agreement, (E) change any actuarial or other assumptions used to calculate funding obligations with respect to any Company Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP or to comply with applicable Law, or (F) forgive any loans to directors, officers or employees of the Company or any of its Subsidiaries;
(v) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for (A) indebtedness for borrowed money incurred in the ordinary course of business consistent with past practice not to exceed $25,000,000 in the aggregate on terms substantially consistent with or more beneficial to the Company and its Subsidiaries, taken as a whole, than existing indebtedness for borrowed money, (B) indebtedness for borrowed money in replacement of existing indebtedness for borrowed money which has matured or is scheduled to mature within the twelve month period following such incurrence of indebtedness at the then prevailing market rates and on terms substantially consistent with or more beneficial to the Company and its Subsidiaries, taken as a whole, than the indebtedness being replaced or (C) guarantees incurred in compliance with this Section 6.1 by the Company and its Subsidiaries of indebtedness of its wholly owned Subsidiaries;
(vi) make or commit to any capital expenditures other than in the ordinary course of business consistent with past practice and in the aggregate in any event not in excess of (A) in 2014, 110% of the aggregate amounts reflected in the Company’s capital expenditure budget set forth in Section 6.1(a)(vi)(A) of the Company Disclosure Letter (the “2014 CapEx Budget”) and (B) in 2015, the sum of (1) the remainder (if a positive number) of (x) 100% of the 2014 CapEx Budget minus (y) the actual amount the Company made or committed to pursuant to the preceding clause (A) plus (2) 110% of the Company’s 2015 capital expenditure budget set forth in Section 6.1(a)(vi)(B) of the Company Disclosure Letter; provided that the Company’s timing of such capital expenditures in 2015 shall be consistent with past practice.
(vii) other than transfers among and between wholly owned Subsidiaries of the Company, transfer, lease, license, sell, assign, let lapse, abandon, cancel, mortgage, pledge, place a Lien (other than Permitted Liens) upon or otherwise dispose of any of their respective properties or assets (including capital stock of any of its Subsidiaries) with a fair market value in excess of $50,000,000 individually or $100,000,000 in the aggregate (except with respect to Intellectual Property that is material to the respective businesses of the Company or its Subsidiaries, which shall not be included in this exception) or that are otherwise material other than ordinary course sales of customer premises equipment, or, with respect to Intellectual Property, non-exclusive license grants, in each case, made in the ordinary course of business consistent with past practice;
(viii) issue, deliver, sell, grant, transfer, or encumber, or authorize the issuance, delivery, sale, grant, transfer on encumbrance of, any shares of its capital stock or any securities convertible or exchangeable into or exercisable for, or any options, warrants or other rights to acquire, any such shares except any Shares issued pursuant to Company Options, Company SARs, Company Restricted Stock Units, Company Performance Stock Units and Company Awards outstanding on the date of this Agreement expressly required by the existing terms or such awards and the Company Stock Plans;
(ix) other than acquisitions of inventory or assets in the ordinary course of business consistent with past practice and making or committing to any capital expenditures in compliance with Section 6.1(a)(vi), spend in excess of $50,000,000 individually or $200,000,000 in the aggregate to acquire any business or to acquire assets or other property, whether by merger, consolidation, purchase of property or assets or otherwise (valuing any non-cash consideration at its fair market value as of the date of the agreement for such acquisition); provided that neither the Company nor any of its Subsidiaries shall make any acquisition that would, or would reasonably be likely to prevent, delay or impair the Company’s ability to consummate the transactions contemplated by this Agreement;
(x) make any material change with respect to its accounting policies or procedures, except as required by changes in GAAP or by applicable Law;
(xi) except as required by applicable Law, (A) make any Tax election that is material to the Company and its Subsidiaries, taken as a whole, or take any position that is material to the Company and its Subsidiaries, taken as a whole, on any material Tax Return filed on or after the date of this Agreement; that is inconsistent with elections made or positions taken in preparing or filing similar Tax Returns in prior periods, (B) change any method of Tax accounting, which change is material to the Company and its Subsidiaries, taken as a whole, (C) amend any Tax Return with respect to an amount of Taxes that is material to the Company and its Subsidiaries, taken as a whole, or (D) settle or resolve any Tax controversy that is material to the Company and its Subsidiaries, taken as a whole;
(xii) (A) (1) enter into any new line of business other than any line of business that is reasonably ancillary to and a reasonably foreseeable extension of any line of business as of the date of this Agreement, or (2) start to conduct a line of business of the Company or any of its Subsidiaries in any geographic area where it is not conducted as of the date of this Agreement, other than starting to conduct a line of business of the Company or any of its Subsidiaries in geographic areas that are reasonable extensions to geographic areas where such business line is conducted as of the date of this Agreement (provided that in the case of each of clauses (1) and (2), such entry or expansion would not require the receipt or transfer of any License that would constitute a Communications License if issued or granted prior to the date hereof and would not reasonably be expected to prevent, delay (other than in a de minimis respect) or impair the ability of the Company, Parent and Merger Sub to complete the Merger on a timely basis) or (B) except as currently conducted, engage in the conduct of any business in any state which would require the receipt or transfer of a Communications License or License that would constitute a Communications License if issued or granted prior to the date hereof or in any foreign country that would require the receipt of a material License;
(xiii) file or apply for any License outside of the ordinary course of business consistent with past practice;
(xiv) other than in the ordinary course of business consistent with past practice in an aggregate amount not to exceed $100,000,000, make any loans, advances or capital contributions to, or investments in, any Person (other than loans, advances or capital contributions to the Company or any direct or indirect wholly owned Subsidiary of the Company or to Sky Brasil Servicios Ltda.);
(xv) enter into any Contract pursuant to which the Company or any of its Subsidiaries agrees to provide any wireless, wireline or Internet services to any Person (other than Parent or its Subsidiaries) as an agent or reseller if such Contract is not terminable by the Company or one of its Subsidiaries on 60 days’ or less notice without penalty;
(xvi) other than in the ordinary course of business, (a) amend or modify in any material respect or terminate (excluding terminations upon expiration of the term thereof in accordance with the terms thereof) any Material Contract or waive, release or assign any material rights, claims or benefits under any Material Contract and (b) enter into any Contract that would have been a Material Contract had it been entered into prior to the date of this Agreement unless it is on terms substantially consistent with, or on terms more favorable to the Company and/or its Subsidiaries (and to Parent and its Subsidiaries following the Closing) than, either a Contract it is replacing or a form of such Material Contract made available to Parent prior to the date hereof;
(xvii) settle any action, suit, case, litigation, claim, hearing, arbitration, investigation or other proceedings before or threatened to be brought before a Governmental Entity;
(xviii) assign, transfer, forfeit, cancel, fail to renew, or fail to extend or defend any Communications License that is material to the Company and its Subsidiaries;
(xix) enter into any collective bargaining agreement, unless required by applicable Law;
(xx) enter into any Contract that obligates or purports to obligate any existing or future non-controlled Affiliate of the Company (including any parent entity) to grant licenses to any Intellectual Property; or
(xxi) agree, resolve or commit to do any of the foregoing.
(b) Parent covenants and agrees, from and after the execution of this Agreement and prior to the Effective Time (unless the Company shall otherwise approve in writing, which approval will not be unreasonably withheld, conditioned or delayed and except as otherwise expressly contemplated by this Agreement or expressly disclosed in Section 6.1(b) of the Parent Disclosure Letter):
(i) Parent shall not (A) amend Parent’s certificate of incorporation or bylaws in any manner that would prohibit or hinder, impede or delay in any material respect the Merger or the consummation of the other transactions contemplated hereby or have a material and adverse impact on the value of the Parent Common Stock; provided that any amendment to its certificate of incorporation to increase the authorized number of shares of any class or series of the capital stock of Parent shall in no way be restricted by the foregoing, or (B) declare, set aside or pay any dividend or distribution payable in cash, stock or property in respect of any capital stock, other than regular quarterly cash dividends on the Parent Common Stock as described on Section 6.1(b)(i) of the Parent Disclosure Letter and other than dividends or distributions with a record date after the Effective Time;
(ii) Parent shall not, and shall not permit any of its Subsidiaries to, acquire another business that, at the time such action is taken, to exceed $0.05 per sharethe Knowledge of Parent, would be likely to prevent the Closing;
(iii) Parent shall not knowingly take or omit to take any action if such action or failure to act would be reasonably likely to prevent or impede the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code; or
(iv) Parent shall not agree, resolve, or commit to do any of the foregoing.
(c) (i) Officers of the Company shall, prior to the Effective Time, execute and deliver to each of S▇▇▇▇▇▇▇ & C▇▇▇▇▇▇▇ LLP and Weil, Gotshal & M▇▇▇▇▇ LLP a certificate substantially in the form of Section 6.1(c)(i) of the Company Disclosure Letter (with such changes as are necessary, in the opinion of such counsel, to reflect any change in applicable Law, regulation or official interpretation thereof occurring between the date hereof and the Closing Date).
Appears in 1 contract
Sources: Merger Agreement (Directv)
Interim Operations. 6.1.1 From and after the date hereof and prior to the earlier of the Closing or the date, if any, on which this Agreement is terminated pursuant to Section 8.1 (the “Termination Date”), and except (1) as required by applicable Laws, (2) with the consent in writing of Parent (which consent shall not be unreasonably withheld, conditioned or delayed), (3) as required or expressly contemplated by another provision of this Agreement, or (4) as set forth on Schedule 6.1.1, the Company covenants and agrees that (a) the business of the Company and its Subsidiaries shall be conducted in the ordinary course of business consistent with past practice and (b) the Company and its Subsidiaries shall use their commercially reasonable efforts, in a manner consistent with their ordinary course of business consistent with past practice, to maintain and preserve intact their present business organizations, assets, rights, properties, and relationships and goodwill with their respective employees, customers, clients, suppliers, channel partners and other material business relations.
6.1.2 From and after the date hereof and prior to the earlier of the Closing or the Termination Date, and except (1) as required by applicable Laws, (2) with the consent in writing of Parent (which consent shall not be unreasonably withheld, conditioned or delayed), (3) as required or expressly contemplated by another provision of this Agreement, or (4) as set forth on Schedule 6.1.2, the Company covenants and agrees that the Company shall not, and shall cause its Subsidiaries not to:
(a) adopt or authorize any amendments to its certificate of formation, limited liability company agreement, operating agreement, certificate of incorporation or bylaws or other organizational or governing documents;
(b) declare, authorize, set aside or pay any dividends on, or make any distributions with respect to, its outstanding Equity Interests, other than dividends or distributions paid by a Subsidiary of the Company to the Company or another Subsidiary of the Company;
(c) purchase, redeem, or otherwise acquire, or offer to purchase, redeem, or otherwise acquire, its outstanding Equity Interests, other than purchases, redemptions, or other acquisitions in connection with the departure of any employee of or other service provider to the Company or its Subsidiaries to the extent permitted by and in accordance with the terms of the Company Operating Agreement, the Equity Incentive Plan and/or all award agreements thereunder and other agreements related thereto in effect as of the date hereof;
(d) issue, grant, sell, transfer, subject to a Lien, or otherwise dispose of, or authorize or propose the issuance, grant, sale, transfer, encumbrance or other disposition of, any of its Equity Interests, other than issuances, grants, sales, transfers, encumbrances, or dispositions (i) to the Company or a Subsidiary of the Company, (ii) pursuant to the terms of any Options outstanding as of the date hereof, or (iii) in connection with the Rollover Transaction;
(e) grant, sell, transfer, subject to a Lien, license, abandon, allow to expire or lapse or otherwise dispose of any material assets, rights or properties of the Company or its Subsidiaries, other than non-exclusive licenses in the ordinary course of business;
(f) make any material change to any Privacy Policies, except as required by applicable Law (as determined by the Company as reasonably advised by counsel), or make any material adverse change to the security of the IT Assets;
(g) split, combine, subdivide, adjust or reclassify or subject to any Lien (other than Permitted Liens) any Equity Interests of the Company and its Subsidiaries;
(h) adopt a plan or agreement of complete or partial liquidation, dissolution, or merger, consolidation, restructuring, recapitalization or other reorganization or divest or reorganize any material business line;
(i) adopt, terminate, or materially amend or modify any Company Plan or any plan, program, arrangement, practice or agreement that would be a Company Plan if it were in effect on the date hereof;
(j) except as required by the terms of a Company Plan in effect as of the date hereof (i) increase the compensation (including base salary, commissions, bonus, and other forms of cash compensation) of any current or former employee, director or individual independent contractor of the Company or any of its Subsidiaries, other than increases for employees with a base salary of less than $125,000 made in the ordinary course of business consistent with past practice, (ii) grant any rights to severance or termination pay to any current or former employee, director or independent contractor of the Company or any of its Subsidiaries, other than grants to employees with a base salary of less than $125,000 made in the ordinary course of business consistent with past practice, (iii) increase the coverage or benefits available under any Company Plan, except for increases in a manner that does not materially increase the obligations of Parent and its Affiliates (including the Company after the Closing Date), (iv) establish, adopt, enter into, amend or terminate any Company Plan or any plan, agreement, program, policy or other arrangement that would be a Company Plan if it were in existence as of the date hereof, (v) hire or terminate (other than for cause or performance) the employment of any employee with a base salary of more than $125,000, (vi) take any action to accelerate the vesting, funding or payment of any benefit or payment to any current or former employee, director or independent contractor of the Company or any of its Subsidiaries or (vii) make or forgive any loans to any current or former employee, director or independent contractor of the Company or any of its Subsidiaries;
(k) incur or modify any amount of Debt set forth in clauses (a), (b), (c), (e) or (f) of such definition, other than (i) draws or repayments pursuant to the Company’s or its Subsidiaries’ existing revolving credit facilities, (ii) repayments of Debt under the Company’s or its Subsidiaries’ existing term facilities, and (iii) Debt solely among the Company and/or its Subsidiaries;
(l) (i) terminate, materially amend or waive any material rights under any Material Contract or (ii) enter into any new contract that would have been a Material Contract if it had been in place as of the date hereof;
(m) commence any Action or compromise, settle or come to an arrangement regarding any pending or threatened Action (i) involving an amount greater than $200,000 individually or $500,000 in the aggregate, or (ii) that imposes material restrictions on the business, properties, rights or assets of the Company or any of its Subsidiaries;
(n) make, change or revoke any Tax election, change any accounting period or method with respect to Taxes, file any amended Tax Return, enter into any closing agreement with respect to any Tax, settle or compromise any proceeding with respect to any Tax claim or assessment relating to the Company or its Subsidiaries, surrender any right to claim a refund of Taxes, request any ruling with respect to Taxes, or consent to any extension or waiver of the limitation period applicable to any Taxes of the Company or its Subsidiaries;
(o) recognize any Labor Union as the representative of any of the employees of the Company or any of the Subsidiaries, or enter into any new or amended Collective Bargaining Agreement as required by applicable Law; and
(p) agree or commit to take any of the foregoing actions.
6.1.3 Nothing in this Agreement shall give Parent or Merger Sub, directly or indirectly, the right to control or direct the operations of the Company or any of its Subsidiaries prior to the Effective Time. Prior to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision shall exercise, consistent with the provisions of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, complete control and shall cause each of supervision over its Significant Subsidiaries to, conduct and its operations according to their usual, regular Subsidiaries’ respective businesses.
6.1.4 From and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on after the date hereof and disclosed pursuant to this Agreement, or pursuant prior to the Recapitalization issue any shares earlier of its capital stockthe Closing or the Termination Date, effect any stock split or otherwise change its capitalization as each of Parent and Merger Sub covenants and agrees that it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue take or agree to take any shares of its capital stock at less than fair market value action (other than pursuant to including entering into any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment agreement with respect to any shares acquisition (by merger, consolidation, acquisition of its capital stock or assets, or otherwise) of any corporation, partnership, or other ownership interests (other than regular quarterly cash dividends not business organization or Person or any property or assets of any Person) which could reasonably be expected to exceed $0.05 per share)prevent or materially impair or materially delay the ability of Parent or Merger Sub to consummate the transactions contemplated hereby.
Appears in 1 contract
Sources: Merger Agreement (Certara, Inc.)
Interim Operations. (a) Prior During the period from the date of this Agreement to the earlier of the Effective TimeTime and the date, except if any, on which this Agreement is terminated pursuant to Section 6.1, except
(i) as set forth in required by Law, (ii) with the Company Disclosure Letter prior written consent of Newco, which consent shall not be unreasonably withheld, delayed or conditioned or (iii) as contemplated or permitted by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries to, conduct carry on its operations according to their usual, regular and business in the ordinary course and preserve intact its business organization and listing exchange status, keep available the services of its current officers and employees, maintain in substantially effect all material licenses and permits required to carry on their respective businesses, maintain in effect any exemptive orders or exemptive relief which they have received from the same manner SEC and which are currently in effect, and preserve their material business relationships and maintain generally its business relationships with its lenders and others having business relationships with it; provided, however, that no action by the Company or any of its Subsidiaries with respect to matters addressed specifically by any provision of this Section 4.1 shall be deemed a breach of this sentence unless such action would constitute a breach of such specific provision.
(b) Without limiting the generality of the foregoing, during the period from the date of this Agreement to the earlier of the Effective Time and the date, if any, on which this Agreement is terminated pursuant to Section 6.1, except (i) as heretofore conducted; may be required by Law, (ii) with the prior written consent of Newco, which consent shall not be unreasonably withheld, delayed or conditioned, or (iii) as required, contemplated or permitted by this Agreement, the Company shall not, and shall not permit any of its Subsidiaries to:
(A) issue, deliver, sell, dispose of, pledge or otherwise encumber, amend the terms of, or authorize or propose the issuance, sale, disposition or pledge or other encumbrance of (1) any shares of capital stock of any class or any other ownership interest of the Company or any of its Certificate Subsidiaries, or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for any shares of Incorporation capital stock or Bylaws any other ownership interest of the Company or comparable governing instruments any of its Subsidiaries, or any rights, warrants, options, calls, commitments or any other agreements of any character to purchase or acquire any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for, any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries, or (2) any other securities of the Company or any of its Subsidiaries in respect of, in lieu of, or in substitution for, Company Common Stock outstanding on the date hereof;
(B) redeem, purchase or otherwise acquire, or propose to redeem, purchase or otherwise acquire, any outstanding Company Common Stock;
(C) split, combine, subdivide or reclassify any Company Common Stock or, except as provided in Section 4.14, declare, set aside for payment or pay any dividend (whether in cash, stock or property, or any combination thereof) in respect of any Company Common Stock or otherwise make any payments to stockholders in their capacity as such;
(D) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries, other than the Transactions;
(E) enter into any new line of business;
(F) other than in the ordinary course of business and consistent with past practices, redeem, repurchase, prepay, defease, incur or otherwise acquire or amend or modify the terms of any indebtedness for borrowed money, enter into any “keep well” or other agreement to maintain any financial statement condition of another Person or pledge any of the Company’s assets or enter into any arrangement which would have the economic effect of any of the foregoing, in each case, in addition to that incurred as of the date of this Agreement or guarantee any such indebtedness;
(G) make any investment, investment contract or loan (other than any unfunded commitments existing as of the date hereof) either by sale or purchase of stock or securities or otherwise, contributions to permit capital, property transfers, or purchase of any property or assets of any other individual, Person or other entity (other than a Subsidiary), sell, dispose of, transfer, lease, amend, modify, grant waivers with respect to or discontinue any investment, investment contract or loan; or acquire, sell, lease or dispose of any non-investment assets that, in the consummation aggregate, are material to the Company and its Subsidiaries, taken as a whole, to any Person other than a wholly-owned Subsidiary;
(H) except as provided for in this Agreement, grant any increase in, take any action to accelerate the vesting or payment or fund or in any other way secure the payment of, the compensation and benefits of any of the Company’s directors, officers, consultants or employees, enter into any employment or severance agreement with any such director, officer, consultant or employee, or adopt, terminate or materially amend any Company Benefit Plan;
(I) make any material change in any of the financial accounting principles, practices or methods used by the Company unless required by GAAP or applicable Law;
(J) change its fiscal year;
(K) amend any material Tax Return of the Company, make, revoke or amend any material Tax election of the Company, adopt or change any Tax accounting principles, methods or policies other than as required by applicable Law, change any Tax accounting period, enter into any closing agreement as described in Section 7121 of the Code (or any corresponding or similar agreement under applicable state, local or foreign tax Law) affecting any material Tax liability or refund, or settle or compromise any material Tax liability or refund of the Company;
(L) directly or indirectly take any action, or knowingly fail to take any action, which action or failure to act is reasonably likely to cause the Company to fail to qualify or not be subject to tax as a RIC; provided, however, that on or before the Effective Time, the Company shall (if not adequately provided for by the Special Dividend contemplated by Section 4.14) take such actions as are necessary to ensure that (i) the Company would not be subject to the tax imposed under Section 4982(a) of the Code if the Effective Time were the end of the calendar year, (ii) the Company satisfies the requirements Section 852(a) of the Code for its last federal income tax year, and (iii) the Company is not subject to tax under Section 852(b)(1) or 852(b)(3)(A) of the Code in its last federal income tax year.
(M) make or incur any obligation to make any capital expenditures;
(N) enter into or draw down from any contract, agreement, commitment or arrangement whereby the obligation or liability imposed on the Company or any of its Subsidiaries under such contract, agreement, commitment or arrangement would exceed $50,000, or whereby such contract, agreement, commitment or arrangement would otherwise constitute a Company Material Contract, or amend any contract, agreement, commitment or arrangements in existence on the date hereof that, after giving effect to such amendment, would impose an obligation or liability on the Company or any of its Subsidiaries under such contract, agreement, commitment or arrangement in excess of $50,000 or constitute a Company Material Contract;
(O) except as otherwise provided in this Agreement, enter into, terminate, cancel, renew or agree to any material amendment of, change in or waiver under any Company Material Contract;
(P) commence or settle any material claim, suit, action or proceeding (other than in connection with or with respect to this Agreement or any of the Transactions);
(Q) amend the certificate of incorporation or bylaws of the Company or similar governing documents of any of its Subsidiaries; or
(R) enter into any contract, agreement, commitment or arrangement to do any of the foregoing.
(c) During the period from the date of this Agreement to the earlier of the Effective Time and the date, if any, on which this Agreement is terminated pursuant to Section 6.1, Newco shall not (i) incur any liabilities or obligations (other than in connection with its formation, its initial capitalization and the Transactions contemplated in this Agreement and the transactions contemplated by this the Subscription Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside declare or pay any dividend or make any other distribution or payment (iii) take any action that could impair its ability to pay and perform its obligations under Section 6.2 upon a termination of this Agreement. Newco will procure that, during the period from the date of this Agreement to the earlier of the Effective Time and the date on which this Agreement is terminated pursuant to Section 6.1, except (i) as required by Law or, (ii) with respect the prior written consent of the Company, which consent shall not be unreasonably withheld, delayed or conditioned, MAST and the Funds will manage the MAST Portfolio Assets in the ordinary course consistent with past practice and, without limiting the generality of the foregoing, none of MAST or the Funds will subject any of the MAST Portfolio Assets to any shares Encumbrance that would prohibit the transfer of its capital stock or other ownership interests (other than regular quarterly cash dividends not such asset to exceed $0.05 per share).Newco under the Subscription Agreement. For the avoidance of doubt, the Funds will provide the Company prompt notice in the event that
Appears in 1 contract
Sources: Merger Agreement
Interim Operations. (a) Prior Each of the Company and Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the other party shall otherwise expressly approve in writing, and except as otherwise expressly contemplated by this Agreement) and except as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve their business organizations intact and maintain existing relations and goodwill with Governmental Entities and Self-Regulatory Organizations, customers, suppliers, distributors, creditors, lessors, key employees and business associates and keep available the services of its and its Subsidiaries’ present employees and agents. During the period from the date of this Agreement through the Effective Time, each of the Company and Parent shall take all actions necessary to qualify as a REIT. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (A) as otherwise expressly required by this Agreement, (B) as the other party may approve in writing or (C) as set forth in Section 6.1 of the Company Disclosure Letter or Parent Disclosure Letter, as contemplated applicable, neither the Company nor Parent will, nor will it permit its Subsidiaries to:
(i) adopt or propose any change in its declaration of trust or bylaws or other applicable governing instruments;
(ii) merge or consolidate itself or any of its Subsidiaries with any other Person, except for any such transactions among its wholly owned Subsidiaries, or restructure, reorganize or completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iii) acquire any business or Person by merger or consolidation, purchase or lease assets, or by any other provision manner, in a single or series of related transactions or acquire assets outside the ordinary course of business from any other Person with a value or purchase price in the aggregate in excess of $1 million in any single or series of related transactions;
(iv) issue, sell, pledge, dispose of, grant, transfer or encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, or encumbrance of, any shares of beneficial interest or capital stock in itself or any of its Subsidiaries (other than the issuance of shares by its wholly-owned Subsidiary to it or another of its wholly-owned Subsidiaries and other than Parent Common Shares upon the exercise of Parent Options and Parent Phantom Shares outstanding on the date of this Agreement and in accordance with the existing terms thereof), or securities convertible or exchangeable into or exercisable for any such shares of beneficial interest or capital stock, or any options, warrants or other rights of any kind to acquire any such shares of beneficial interest or capital stock or such convertible or exchangeable securities, in all cases relating to its Subsidiaries outside the ordinary course of business;
(v) create or incur any Lien material to it or any of its Subsidiaries on any of its assets or any of its Subsidiaries outside the ordinary course of business in excess of $50 million;
(vi) make any loans, advances or capital contributions to or investments in any Person (other than between itself and any of its direct or indirect wholly-owned Subsidiaries) in excess of $100 million;
(vii) subject to Section 6.1(b) hereof, declare, set aside, make or pay any dividend or other distribution, payable in cash, shares of beneficial interest or capital stock, property or otherwise, with respect to any of its shares of beneficial interest or capital stock (except for dividends paid by any direct or indirect wholly-owned Subsidiary to it or to any other direct or indirect wholly-owned Subsidiary) or enter into any agreement with respect to the voting of its shares of beneficial interest or capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its shares of beneficial interest or securities convertible or exchangeable into or exercisable for any of its shares of beneficial interest;
(ix) incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any of its debt securities or of any of its Subsidiaries, except for indebtedness for borrowed money incurred in the ordinary course of business (A) not to exceed $100 million, (B) in replacement of existing indebtedness for borrowed money, (C) guarantees incurred in compliance with this Section 6.1 by it of indebtedness of its wholly-owned Subsidiaries not to exceed $250 million or (D) interest rate swaps on customary commercial terms consistent with past practice and in compliance with its risk management policies in effect on the date of this Agreement and not to exceed $750 million of notional debt in the aggregate at any one time;
(x) make or authorize any capital expenditure in excess of $2 million in the aggregate during any 12-month period;
(xi) other than in the ordinary course of business, enter into any of the following (each, a “Material Contract”):
(A) any lease of real or personal property providing for annual rentals of $1 million or more;
(B) any Contract that is reasonably likely to require either (x) annual payments to or from it and its Subsidiaries of more than $1 million or (y) aggregate payments to or from it and its Subsidiaries of more than $5 million;
(C) any partnership, joint venture or other similar agreement or arrangement relating to the formation, creation, operation, management or control of any partnership or joint venture material to it or any of its Subsidiaries or in which it owns more than a 15% voting or economic interest, or any interest valued at more than $5 million without regard to percentage voting or economic interest;
(D) any Contract required to be filed as an exhibit to the Company’s Form S-11 or the Parent’s Form 10-K, as applicable;
(E) any non-competition Contract or other Contract that (I) purports to limit in any material respect either the type of business in which it or its Subsidiaries (or, with respect to the Company, after the Effective Time, Parent or its Subsidiaries) may engage or the manner or locations in which any of them may so engage in any business, (II) could require the disposition of any material assets or lines of business of it or its Subsidiaries or, with respect to the Company, after the Effective Time, Parent or its Subsidiaries, (III) grants “most favored nation” status that, following the Merger, would apply to Parent and its Subsidiaries, including the Company and its Subsidiaries or (IV) prohibits or limits its or any of its Subsidiaries’ rights to make, sell or distribute any products or services, or use, transfer, license, distribute or enforce any of their respective intellectual property rights;
(F) any Contract to which it or any of its Subsidiaries is a party containing a standstill or similar agreement pursuant to which the party has agreed not to acquire assets or securities of the other party or any of its Affiliates;
(G) any Contract between it or any of its Subsidiaries and any trustee or officer of it or any Person beneficially owning five percent or more of its outstanding shares;
(H) any Contract providing for indemnification by it or any of its Subsidiaries of any Person, except for any such Contract that is (x) not material to it or any of its Subsidiaries and (y) entered into in the ordinary course of business;
(I) any Contract that contains a put, call or similar right pursuant to which it or any of its Subsidiaries could be required to purchase or sell, as applicable, any equity interests of any Person or assets that have a fair market value or purchase price of more than $5 million; and
(J) any other Contract or group of related Contracts that, if terminated or subject to a default by any party thereto, would, individually or in the aggregate, reasonably be expected to result in a Company Material Adverse Effect or Parent Material Adverse Effect, as applicable;
(xii) make any changes with respect to accounting methods, policies or procedures, including any change in any method of accounting for Tax purposes, except as required by GAAP or applicable Laws;
(xiii) settle any litigation or other similar proceedings before a Governmental Entity or Self-Regulatory Organization or otherwise for an amount in excess of $3 million or any obligation or liability of it in excess of such amount or that would impose any material restriction on its business or create precedents for claims that are reasonably likely to have a material adverse effect on it and its Subsidiaries, taken as a whole;
(xiv) other than in the ordinary course of business, amend, modify or terminate any Material Contract, or cancel, modify or waive any debts or claims held by it or any of its Subsidiaries;
(xv) make any material Tax election unless such election is (i) required by Law, (ii) necessary to preserve its (A) qualification as a REIT or (B) status of any of its Subsidiaries as a partnership for federal income tax purposes, or as a qualified REIT subsidiary within the meaning of Section 856(i) of the Code, or as a taxable REIT subsidiary within the meaning of Section 856(l) of the Code, as the case may be or (iii) consistent with elections historically made by it;
(xvi) take any action, or fail to take any action, which can reasonably be expected to cause (i) it to fail to qualify as a REIT, or (ii) any of its Subsidiaries to cease to be treated as a partnership for federal income tax purposes, as a qualified REIT subsidiary within the meaning of Section 856(i) of the Code, or as a taxable REIT subsidiary within the meaning of Section 856(l) of the Code, as the case may be;
(xvii) other than in the ordinary course of business, and with respect to Contracts in effect as of the date of this Agreement, unless transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any of its material assets, product lines or businesses or of its Subsidiaries, including shares of beneficial interest or capital stock in any of its Subsidiaries;
(xviii) except as required pursuant to Contracts in effect as of the Purchaser has consented in writing theretodate of this Agreement or as otherwise required by applicable Law, the Company: (i) shall, and shall cause each grant or provide any severance or termination payments or benefits to any of its Significant Subsidiaries totrustee, conduct officer or employee or of any of its operations according to their usualSubsidiaries, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) increase the compensation, bonus or pension, welfare, severance or other benefits of, pay any bonus to, or make any new equity awards to any of its trustee, officer or employee or of any of its Subsidiaries, (iii) establish, adopt, amend or terminate any of its benefit plans or amend the terms of any outstanding equity-based awards, (iv) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any of its benefit plans, to the extent not already provided in any such benefit plans, (v) materially change any actuarial or other assumptions used to calculate funding obligations with respect to any benefit plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP; or (vi) forgive any loans to any of its or of any of its Subsidiaries’ trustees, officers or employees;
(xix) take any action or omit to take any action that is reasonably likely to result in any of the conditions to the Merger set forth in Article VII not being satisfied; or
(xx) agree, authorize or commit to do any of the foregoing.
(b) Notwithstanding anything to the contrary in this Agreement, prior to the Closing Date, Parent may declare and pay regular quarterly dividends to holders of Parent Common Shares in accordance with its regular dividend payment schedule, which dividend for the second quarter of 2006 shall not amend exceed $0.64 per share and which dividend for the third quarter of 2006 shall not exceed $0.65 per share. All such dividends shall meet the requirements of Code Section 561. If the Closing shall not have occurred prior to the record date of Parent’s third quarter dividend, the Company may declare and pay a quarterly dividend of not more than $0.35, such dividend to be payable to holders of record on the same record date as Parent’s third quarter dividend. Neither party shall declare a fourth quarter dividend until after either the Closing or the termination of this Agreement.
(c) Notwithstanding anything to the contrary in this Agreement, prior to the Closing Date, Parent may declare and pay regular quarterly dividends to the holders of the Parent Preferred Shares.
(d) Prior to making any written or oral communications to any of its Certificate or of Incorporation any of its Subsidiaries’ trustees, officers or Bylaws employees pertaining to compensation or comparable governing instruments (other than to permit the consummation of benefit matters that are affected by the transactions contemplated by this Agreement); (iii) , each party shall promptly notify provide the Purchaser other party with a copy of any breach the intended communication. The other party shall have a reasonable period of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver time to the Purchaser true review and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing comment on the date hereof communication, and disclosed the parties hereto shall cooperate in providing any such mutually agreeable communication.
(e) Neither Parent nor any Affiliate of Parent shall purchase or otherwise acquire any beneficial interest or other security of the Company other than pursuant to this Agreement, or pursuant to Agreement at the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization Effective Time.
(f) As promptly as it existed on practicable following the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on Parent shall file with the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior Department the Merger Sub Articles Supplementary and the Company shall file with the Department the Company Articles Supplementary. At least 15 days prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: Merger Sub shall issue (i) shall not issue any 120 shares of its capital stock at less than fair market value (other than pursuant Merger Sub Preferred Stock to any Purchaser Stock Plans) or effect any stock split of its capital stock; 120 separate persons and (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any 600 shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not Merger Sub Preferred Stock to exceed Parent, in each case, at a price equal to $0.05 1,000 per share).
Appears in 1 contract
Interim Operations. (a) Prior to the Effective Time, except as set forth in the The Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, from and after the execution and delivery of this Agreement and prior to the Closing (unless Purchaser shall otherwise approve in writing (such approval not to be unreasonably conditioned, withheld or delayed)), and except as otherwise expressly required or permitted by this Agreement or as required by applicable Law or requested by a Governmental Authority, conduct its operations according business in all material respects in the Ordinary Course of Business and, to the extent consistent therewith, shall use and cause each of its Subsidiaries to use their usualrespective commercially reasonable efforts to maintain its and its Subsidiaries’ relations and goodwill with key Governmental Authorities, regular customers, suppliers, licensors, licensees, distributors, creditors, lessors, employees, agents and ordinary course business associates. Without limiting the generality of and in substantially furtherance of the same manner foregoing sentence, from the execution and delivery of this Agreement until the Closing, except as heretofore conducted; otherwise expressly required or permitted by this Agreement, required by applicable Law or requested by a Governmental Authority, as approved in writing by Purchaser (such approval not to be unreasonably conditioned, withheld or delayed) or set forth in the corresponding subsection of Section 5.7(a) of the Company Disclosure Letter, neither the Company nor any of its Subsidiaries shall, directly or indirectly:
(i) adopt or propose any change in its Organizational Documents;
(ii) shall not amend change the number of directorships that constitute the Company Board as of the date of this Agreement or present a slate of directors to the Company Shareholders for election that is greater than or fewer than the number of directors that constitute the Company Board as of the date of this Agreement;
(iii) merge or consolidate the Company or any of its Certificate Subsidiaries with any other Person, except for any such transactions solely among Wholly Owned Subsidiaries of Incorporation the Company, or Bylaws restructure, reorganize or comparable governing instruments completely or partially liquidate or otherwise enter into any agreements or arrangements imposing material changes or restrictions on its assets, operations or businesses;
(iv) (A) acquire assets outside of the Ordinary Course of Business from any other Person with a fair market value (reasonably determined by the Company) or purchase price in excess of, or (B) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than to or from the Company and any of its Wholly Owned Subsidiaries) in excess of $5,000,000 in any individual transaction or series of related transactions or $25,000,000 in the aggregate (it being understood that such aggregate limitation shall apply to all transactions contemplated by either clause (A) or (B)), in each case, including any amounts or value reasonably expected to be paid in connection with a future earn-out, purchase price adjustment, release of “holdback” or similar contingent payment obligation, or that would reasonably be expected to prevent or materially impair the ability of the Company to consummate the transactions contemplated by this Agreement prior to the Outside Date, other than acquisitions of inventory or other goods in the Ordinary Course of Business pursuant to the terms of a Contract binding on the Company or any of its Subsidiaries in effect as of the date of this Agreement or entered into following the date of this Agreement in accordance with the terms of this Section 5.7;
(v) issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, Encumber, or otherwise enter into any Contract or other agreement, understanding or arrangement with respect to the voting of, any shares in the capital of the Company (including the Common Shares) or of any of its Subsidiaries, securities convertible or exchangeable into or exercisable for any such shares, or any options, warrants or other rights of any kind to acquire any such shares or such convertible or exchangeable securities (other than the (A) issuance of shares by a Wholly Owned Subsidiary of the Company to the Company or another Wholly Owned Subsidiary of the Company, (B) issuance of Common Shares in respect of Company Options outstanding as of the date of this Agreement or granted pursuant to clause (C), in each case, in accordance with their terms and, as applicable, the Stock Plans in effect on the date of this Agreement, (C) grant of up to 250,000 Company Options to employees (other than Executives) in the Ordinary Course of Business under the Stock Plans in effect as of the date of this Agreement (provided, however, that such Company Options shall not include any provisions regarding accelerated vesting in connection with a “change of control” (as defined in the applicable Stock Plan) or upon a termination of employment and the applicable award agreement shall clarify that any such provisions in the applicable Stock Plan do not apply to such Company Options), or (D) issuance of Common Shares pursuant to the terms and conditions of the Existing Warrants);
(vi) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its share capital or securities convertible or exchangeable into or exercisable for any shares of its share capital (including, with respect to the Company, for the avoidance of doubt, the Common Shares), other than the withholding of Common Shares to satisfy the payment of the exercise price or withholding Tax obligations upon the exercise of Company Options outstanding as of the date of this Agreement or granted in accordance with Section 5.7(a)(v), in each case, in accordance with their terms and, as applicable, the Stock Plans as in effect on the date of this Agreement;
(vii) incur any Indebtedness (including the issuance of any debt securities, warrants or other rights to acquire any debt security), except for
(A) Indebtedness for borrowed money incurred in the Ordinary Course of Business not to exceed $1,000,000 individually and $5,000,000 in the aggregate or to fund expenditures expressly permitted by Section 5.7(a)(iv),
(B) Indebtedness in replacement of existing Indebtedness for borrowed money on terms substantially consistent with or more favorable to the Company than the Indebtedness being replaced or (C) guarantees of Indebtedness of its Wholly Owned Subsidiaries otherwise incurred in compliance with this Section 5.7(a); provided that any Indebtedness that is extinguished in full prior to, or concurrently with, the Closing shall not be deemed to be a breach of this provision;
(viii) except as consistent with or reasonably related to, and not in excess of ten percent of the aggregate amounts of, with respect to the fiscal year ending December 31, 2018, the expenditures made in respect of the Company’s and its Subsidiaries’ operations during any one full month prior to the date of this Agreement for such fiscal year or the Company Budget (as applicable) or to the extent reasonably necessary to avoid a material business interruption as a result of any act of God, war, terrorism, earthquake, fire, hurricane, storm, flood, civil disturbance, explosion, partial or entire failure of utilities or information technology systems, or any other similar cause not reasonably within the control of the Company or its Subsidiaries, make or authorize any payment of, or accrual or commitment for, capital expenditures;
(ix) amend, supplement or otherwise modify any Company Budget, except for such amendments, supplements or other modifications to any Company Budget that would result in an increase of ten percent or less to the aggregate amounts set forth in any initial version of a Company Budget adopted by the Company Board;
(x) enter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement, other than Contracts with customers or suppliers entered into in the Ordinary Course of Business and, for the avoidance of doubt, any Contracts entered into in connection with an action expressly permitted by any of the Subsections of this Section 5.7(a), including any amendment, supplement or other modification to an existing Contract, which are governed by Section 5.7(a)(xi);
(xi) other than with respect to Material Contracts related to Indebtedness, which shall be governed by Section 5.7(a)(vii), or, for the avoidance of doubt as contemplated by Section 5.8(g), terminate or amend, modify, supplement or waive in a manner that is materially adverse to the Company and its Subsidiaries (taken as a whole), or assign, convey, Encumber or otherwise transfer (including pursuant to the division of a limited liability company), in whole or in part, material rights or interest pursuant to or in any Material Contract, other than (A) expirations of any such Contract in the Ordinary Course of Business, and (B) non-exclusive licenses, covenants not to ▇▇▇, releases, waivers or other rights under Intellectual Property Rights, in each case, granted in the Ordinary Course of Business;
(xii) cancel, modify or waive any debts or claims held by the Company or any of its Subsidiaries having in each case a value in excess of $1,000,000 individually or $5,000,000 in the aggregate;
(xiii) amend any License contemplated by Schedule B6(b) in any material respect, or allow any such License to lapse, expire or terminate (except where the lapse, expiration or termination of any such License is with respect to a License that has become obsolete, redundant or no longer required by applicable Law);
(xiv) amend, modify, terminate, cancel or let lapse a material Insurance Policy, unless simultaneous with such termination, cancellation or lapse, replacement policies underwritten by insurance and reinsurance companies of internationally recognized standing are in full force and effect, in each case, providing coverage equal to or greater than the coverage under the terminated, canceled or lapsed Insurance Policies for substantially similar premiums, as applicable, as in effect as of the date of this Agreement;
(xv) other than with respect to Transaction Litigation, which shall be governed by Section 5.9, settle or compromise any Claim for an amount in excess of $500,000 individually or $2,000,000 in the aggregate during any calendar year, net of any amount covered by insurance, indemnification or existing reserves established in accordance with IFRS or any obligation or liability of it in excess of such amount or on a basis that would result in the imposition of any Order that would materially and adversely restrict the future activity or conduct of the Company or any of its Subsidiaries or a finding or admission of a material violation of Law;
(xvi) make any changes with respect to accounting policies or procedures, except as required by changes in IFRS;
(xvii) make, change or revoke any material Tax election, adopt or change any Tax accounting period, adopt or change any material Tax accounting method, file any amended Tax Return, enter into any closing agreement with respect to Taxes, settle or compromise any material Tax claim, audit, assessment, dispute or other proceeding, surrender any right to claim a refund of a material amount of Taxes, request any ruling from any Governmental Authority with respect to Taxes, agree to an extension or waiver of the statute of limitations with respect to material Taxes or take any action with respect to Taxes which would be reasonably expected to result in a material increase in the Tax obligation or liability of the Company or its Subsidiaries, or, in respect of any taxable period (or portion thereof) ending after the Closing Date, the Tax obligation or liability of Purchaser, Parent or any of their respective Subsidiaries;
(xviii) transfer, sell, divest or otherwise dispose of or transfer, or permit or suffer to exist the creation of any Encumbrance upon, any properties or assets (tangible or intangible, including any Intellectual Property Rights), product lines or businesses material to the Company and its Subsidiaries (taken as a whole), including the share capital of any of its Subsidiaries, other than (A) in the Ordinary Course of Business, (B) sales of obsolete assets, (C) with respect to assets with a fair market value (reasonably determined by the Company) not in excess of $1,000,000 individually or $5,000,000 in the aggregate or (D) pursuant to the terms of any Contract that is in effect as of the date of this Agreement and a copy of which has been made available to Purchaser prior to the date of this Agreement;
(xix) cancel, abandon or otherwise allow to lapse or expire any Intellectual Property Rights that are owned by the Company or any of its Subsidiaries and are material to the businesses of the Company and its Subsidiaries as currently conducted, except, solely with respect to Intellectual Property Rights that have reached their date of final expiration or are otherwise not material to the businesses of the Company and its Subsidiaries, in the Ordinary Course of Business;
(xx) except as required pursuant to the terms of any Employee Plan in effect as of the date of this Agreement or as otherwise required by applicable Law, (A) increase the compensation or benefits payable to any director, employee or individual independent contractor of the Company or its Subsidiaries, (B) become a party to, establish, adopt, amend or otherwise modify or commence participation in any Employee Plan, other than amendments to Employee Plans that are health and welfare plans in the Ordinary Course of Business, (C) pay or award, or commit to pay or award, any bonuses or incentive compensation, (D) enter into any employment or severance agreement (excluding offer letters that provide for no severance entitlements in excess of those required by applicable Law) with any director, officer, employee or individual independent contractor, other than the entry into a severance agreement in the Ordinary Course of Business upon the termination of employment of an employee who is not an Executive, (E) enter into any change in control or retention agreement with any director, officer, employee or individual independent contractor, (F) establish, adopt, enter into, amend or terminate any collective bargaining agreement, (G) take any action to accelerate the vesting or lapsing of restrictions or payment, or fund or in any other way secure the payment, of compensation or benefits under any Employee Plan, (H) terminate the employment or service of any employee or individual independent contractor who is an Executive, other than for cause, or (I) hire any employee or individual independent contractor at the Executive level;
(xxi) engage in the production, cultivation, marketing, distribution or sale of Cannabis or any products derived from or intended to be used in connection with Cannabis or services intended to relate to Cannabis in the United States to the extent such activities remain prohibited under applicable Law; or
(xxii) agree, authorize or commit to do any of the foregoing.
(b) Purchaser and Parent (i) shall not, and shall cause its Subsidiaries not to, take or fail to take any actions that would, individually or in the aggregate, reasonably be expected to prevent or materially impair the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true Agreement and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify comply with and satisfy the Company of any breach of any representation Parent Exclusivity Obligations.
(c) Nothing set forth in this Agreement shall give Purchaser or warranty contained herein Parent, directly or indirectly, the right to control or direct the Company’s or its Subsidiaries’ operations prior to the Closing or give the Company, directly or indirectly, the right to control or direct Purchaser’s, Parent’s or any Purchaser Material Adverse Effect; (iii) shall promptly deliver of their respective Subsidiaries’ operations prior to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Closing.
Appears in 1 contract
Interim Operations. NYSE and Archipelago each covenants and agrees as to itself and its Subsidiaries (including, in the case of Archipelago, PCX Holdings and its Subsidiaries after the acquisition of PCX Holdings is consummated) that, after the date hereof and until the earlier of the Effective Time or the termination of this Agreement in accordance with its terms (unless NYSE (in the case of Archipelago) or Archipelago (in the case of NYSE) shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement or, in the case of Archipelago, except as otherwise set forth in Schedule 7.1 of the Archipelago Disclosure Letter or, in the case of NYSE, except as otherwise set forth in Schedule 7.1 of the NYSE Disclosure Letter):
(a) Prior in the case of NYSE and Archipelago, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practice and, to the Effective Timeextent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with all Governmental Entities (including the SEC), providers of order flow, customers, suppliers, distributors, creditors, lessors, Employees, business associates, Members and shareholders, as appropriate;
(b) (i) in the case of NYSE and Archipelago, it shall not issue, sell, pledge, dispose of or encumber any membership interests or capital stock, as appropriate, owned by it in any of its Subsidiaries; (ii) in the case of Archipelago, except as set forth in the Company Disclosure Letter or as contemplated by any other provision Article III of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) it shall not amend its Certificate certificate of Incorporation incorporation, constitution or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)bylaws, as applicable; (iii) in the case of NYSE and Archipelago, it shall promptly notify the Purchaser not split, combine or reclassify its outstanding membership interests or shares of any breach of any representation or warranty contained herein or any Company Material Adverse Effectcapital stock, as appropriate; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreementcase of NYSE and Archipelago, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) it shall not declare, set aside or pay any type of dividend, whether payable in cash, stock or property, in respect of any membership interests or capital stock, as appropriate, other than (A) any cash dividend permitted under Section 7.16, (B) in the case of NYSE, dividends payable by direct or indirect wholly owned Subsidiaries of NYSE to NYSE or other direct or indirect wholly owned Subsidiaries of NYSE and (C) in the case of Archipelago, dividends payable by direct or indirect wholly owned Subsidiaries of Archipelago to Archipelago or other direct or indirect wholly owned Subsidiaries of Archipelago; or (v) in the case of NYSE and Archipelago, it shall not repurchase, redeem or otherwise acquire (except, in the case of Archipelago, in connection with the Archipelago Stock Plans and the acquisition of PCX Holdings on the terms set forth on Section 7.1 of the Archipelago Disclosure Letter), or permit any of its Subsidiaries to purchase or otherwise acquire, any membership interests or shares of its capital stock, as applicable, or any securities convertible into or exchangeable or exercisable for any membership interests or shares of its capital stock, as applicable;
(c) neither it nor any of its Subsidiaries shall (i) in the case of NYSE and Archipelago, issue, sell, pledge, dispose of or encumber any membership interests or shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock of any class, as appropriate, or any bonds, debentures, notes or other obligations the holders of which have the right to vote (or convertible into or exercisable for securities having the right to vote) with Members of NYSE or stockholders of Archipelago, as the case may be, on any matter, or, in the case of Archipelago, any other property or assets other than Archipelago Shares issuable pursuant to stock-based awards outstanding on or awarded prior to the date hereof under the Archipelago Stock Plans (other than the issuance of any Archipelago Shares pursuant to the acquisition of PCX Holdings on the terms set forth in the PCX Merger Agreement and otherwise on Section 7.1 of the Archipelago Disclosure Letter and pursuant to Section 7.1(d)(ii)(B)); (ii) in the case of Archipelago, other than in the ordinary and usual course of business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other material property or assets (including membership interests or capital stock of any of its Subsidiaries); (iii) in the case of NYSE (unless NYSE shall have consulted with Archipelago prior to taking such action) and in the case of Archipelago, incur or modify any indebtedness or other liability (including any guarantee of such material indebtedness or other liability) in an amount in excess of $20,000,000 individually or $40,000,000 in the aggregate; (iv) in the case of NYSE (unless NYSE shall have consulted with Archipelago prior to taking such action) and in the case of Archipelago, make or authorize or commit for any capital expenditures, except (A) in cases of clause (iv), as provided in the Business Plan for each of NYSE and Archipelago, respectively, that has been provided to the other prior to the date of this Agreement (provided that each of NYSE and Archipelago shall be permitted to make or authorize or commit for any capital expenditures in an amount that is between 90% and 110% of the amounts set forth in such Party's respective Business Plan) or (B) in the case of clause (i), for such amounts in cash or Archipelago Shares, securities convertible into or exchangeable or exercisable for, or option, warrants, calls, commitments or rights of any kind to acquire Archipelago Shares, or Archipelago shall issue pursuant to the PCX Transaction on the terms set forth in the PCX Merger Agreement and otherwise on Section 7.1 of the Archipelago Disclosure Letter; or (v) other than the acquisition of PCX Holdings on the terms set forth in the PCX Merger Agreement and otherwise on Section 7.1 of the Archipelago Disclosure Letter, in the case of Archipelago, enter into or consummate any acquisitions or other types of non-ordinary-course transactions;
(d) in the case of Archipelago, neither it nor any of its Subsidiaries shall (i) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Archipelago Benefit Plan, as the case may be, or any other distribution arrangement that would be an Archipelago Benefit Plan if in effect on the date hereof other than offer letters provided to newly-hired employees (other than offer letters to executive officers of Archipelago and its Subsidiaries or to employees whose base salary is in excess of $300,000); provided that such offer letters do not include any compensation or benefits that vest, accelerate or otherwise are affected by or result in any payment or funding upon the occurrence of any of the transactions contemplated by this Agreement, or (ii) increase the salary, wage, bonus or other compensation of any employees or fringe benefits of any director, officer or employee or enter into any contract, agreement, commitment or arrangement to do any of the foregoing, except (A) increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and related increases of annual base salaries not to exceed 4% in the aggregate or 6% for any individual officer or employee) and (B) new grants of up to 1,000,000 restricted stock units which shall be granted in amounts and on terms and conditions in the ordinary course of business consistent with past practice prior to the Determination Date or (iii) enter into or renew any contract, agreement, commitment or arrangement (other than a renewal occurring in accordance with the terms thereof) providing for the payment to any director, officer or employee of such party of compensation or benefits contingent, or the terms of which are materially altered, upon the occurrence of any of the transactions contemplated by this Agreement or (iv) provide, with respect to the grant of any stock option, restricted stock, restricted stock unit or other equity-related award (or with respect to any shares outstanding equity-related award) that the vesting of any such stock option, restricted stock, restricted stock unit or other equity-related award or any Archipelago Benefit Plan shall accelerate or otherwise be affected by or result in any payment or funding upon the occurrence of any of the transactions contemplated by this Agreement (except the restricted stock units granted pursuant to clause (ii)(B) of this Section 7.1(d) may include a double trigger vesting provision which are the same as previously granted awards);
(e) except in the ordinary and usual course of business consistent with past practice, in the case of NYSE (unless NYSE shall have consulted with Archipelago prior to taking such action) and in the case of Archipelago, neither it nor any of its capital stock Subsidiaries shall settle or other ownership interests compromise any material claims or litigation and, in the case of Archipelago, neither it nor any of its Subsidiaries shall modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) in the case of Archipelago, neither it nor any of its Subsidiaries shall make or change any material Tax election (other than regular quarterly cash dividends (i) routine elections made on the first corporate income tax return of Archipelago or (ii) elections consistent with elections in effect for Archipelago immediately prior to its conversion from a limited liability company to a corporation), change any material method of Tax accounting, file any materially amended Tax Return, or settle or compromise any material audit or proceeding relating to Taxes (provided, however, that NYSE shall be deemed to have consented to any such Tax election if NYSE has not indicated an objection to making such Tax election within five business days after NYSE's receipt of written notice stating Archipelago's intent to make such election); or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business;
(g) in the case of NYSE (unless NYSE shall have consulted with Archipelago prior to taking such action) and in the case of Archipelago, neither it nor any of its Subsidiaries shall permit any change in its credit practices or accounting principles, policies or practice (including any of its practices with respect to accounts receivable or accounts payable), except to the extent that any such changes in accounting principles, policies or practices shall be required by changes in GAAP;
(h) in case of Archipelago, it shall not make any amendment, waiver or modification to the Agreement and Plan of Merger, dated January 3, 2005 (the "PCX Merger Agreement"), among PCX Holdings, Inc. ("PCX Holdings"), Archipelago and New Apple Acquisitions Corporation, or any transactions contemplated thereby (the "PCX Transaction"), or any other agreement relating to or in connection with the PCX Transaction;
(i) in the case of NYSE and Archipelago, neither it nor any of its Subsidiaries shall enter into any "non-compete" or similar Contract that would materially restrict the business of Holdco or any of its Subsidiaries following the Effective Time;
(j) except as permitted pursuant to Section 7.1(d), in the case of Archipelago, neither it nor any of its Subsidiaries shall enter into any Contract between itself, on the one hand, or any of its affiliates, employees, officers or directors, on the other hand;
(k) in the case of Archipelago, neither it nor any of its Subsidiaries will file with the SEC any application to change any of its rules or regulations unless it shall simultaneously provide a written copy of such application to NYSE; and
(l) in the case of NYSE and Archipelago, neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing set forth in Sections 7.1(a) - (k) if NYSE or Archipelago, as applicable, would be prohibited by the terms of Sections 7.1(a) - (k) from doing the foregoing. Notwithstanding anything to the contrary in this Agreement, NYSE shall have the right to agree to and to consummate any acquisitions of another Person, including by agreeing to issue equity interests in Holdco to such Person; provided that such issuance shall not exceed $0.05 per share)a number of Holdco Common Stock equal to 25% of the outstanding NYSE Membership Interests, on an as-converted basis using the NYSE Exchange Ratio. Any issuance of NYSE Membership Interests in connection with the foregoing shall cause a pro rata adjustment to each of the NYSE Exchange Ratio and the Archipelago Exchange Ratio.
Appears in 1 contract
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective TimeTime (unless Parent shall otherwise approve in writing and except as otherwise expressly contemplated by this Agreement), the business of the Company and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, the Company and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates. Without limiting the generality of the foregoing, from the date hereof to the Effective Time except as set forth in the Company Disclosure Letter or Schedule (unless Parent shall otherwise approve in writing and except as otherwise expressly contemplated by any other provision of this Agreement, unless ):
(a) the Purchaser has consented in writing thereto, the Company: (i) shallCompany shall not, and shall cause each its Subsidiaries not to enter into, terminate, or materially extend or modify any material Contract; provided, further, that neither the Company nor any of its Significant Subsidiaries toshall enter into (i) any time charters or bareboat charters having a term of more than sixty days but equal to or less than 12 months without first consulting with Parent or (ii) any time charters or bareboat charters having a term of more than 12 months, conduct consecutive voyage arrangements or pooling arrangements, in each case in this clause (ii), without the prior express written consent of Parent, such consent not to be unreasonably withheld;
(b) the Company shall not (i) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedSubsidiaries; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)Organizational Documents; (iii) shall promptly notify the Purchaser split, combine or reclassify its outstanding shares of any breach of any representation or warranty contained herein or any Company Material Adverse Effectcapital stock; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend payable in cash, stock or make property in respect of any capital stock other distribution than dividends from its direct or payment with respect indirect wholly-owned Subsidiaries; or (v) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(c) neither the Company nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other ownership interests property or assets; (ii) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries) or incur or modify any material indebtedness or other liability; (iii) make or authorize or commit for any capital expenditures in amounts greater than $100,000 individually and $1,000,000 in the aggregate, other than regular quarterly cash dividends not such capital expenditures made pursuant to exceed $0.05 per share)new building contracts, drydocking arrangements or Vessel upgrading arrangements, in each case, existing on the date of this Agreement and explicitly disclosed in the Company's 1999 budget delivered to Parent on March 26, 1999; or (iv) by any means, make any acquisition of, or investment in, assets or stock of any other Person or entity;
(d) neither the Company nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees;
(e) neither the Company nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither the Company nor any of its Subsidiaries shall make any Tax election or otherwise alter any Tax or accounting practice or procedure, or permit any insurance policy naming it as a beneficiary or loss-payable payee to be canceled or terminated;
(g) neither the Company nor any of its Subsidiaries shall take any action or omit to take any action that would cause any of its representations and warranties herein to become untrue in any material respect; and
(h) neither the Company nor any of its Subsidiaries shall authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) Prior to From the date of this Agreement and until the Effective TimeTime or the earlier termination of this Agreement in accordance with its terms, except (w) as set forth in Section 6.1(a) of the Company Disclosure Letter Letter, (x) as otherwise expressly contemplated or as contemplated permitted by any other provision of this Agreement, unless (y) to the Purchaser has extent consented to in writing theretoby Parent (which consent shall not be unreasonably withheld, delayed or conditioned) or (z) as required by applicable Law or by a Governmental Entity, the Company: (i) Company shall use reasonable best efforts to cause the business of it and its Subsidiaries to be conducted in the ordinary course of business and, to the extent consistent therewith, it shall, and shall cause each its Subsidiaries, to use their respective reasonable best efforts to preserve their business organizations intact and maintain satisfactory relationships with Governmental Entities, customers, vendors, Suppliers, lessors, distributors and employees. Notwithstanding the generality of the foregoing, and subject to the exceptions set forth in clauses (w), (x), (y) and (z) of the immediately preceding sentence, the Company shall not and shall not permit its Subsidiaries to:
(i) amend the certificate of incorporation, bylaws or comparable governing documents of the Company or any of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; Subsidiaries;
(ii) shall not amend its Certificate acquire (by merger, consolidation, acquisition of Incorporation stock or Bylaws assets or comparable governing instruments otherwise) assets outside of the ordinary course of business consistent with past practice from any other Person (other than to permit the consummation Company or any direct or indirect wholly owned Subsidiary of the transactions contemplated by this Agreement); (iiiCompany) shall promptly notify with a value or purchase price in the Purchaser aggregate in excess of $300,000 in any breach transaction or series of any representation related transactions, other than acquisitions of merchandise for sale in the Company’s stores or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver acquisitions pursuant to the Purchaser true and correct copies Contracts in effect as of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; ;
(iii) merge or consolidate with any other Person or restructure, reorganize or completely or partially liquidate the Company or any of its Subsidiaries;
(iv) enter into any new line of business material to the Company and its Subsidiaries, taken as a whole;
(v) shall not issue, sell, pledge, dispose of, grant, transfer or encumber any shares of capital stock or equity interests or securities convertible, exchangeable or exercisable therefor (xcollectively, “Equity Interests”) of the Company or any of its Subsidiaries (including any Company Stock Options), except issuances or dispositions of (A) Shares pursuant to Company Stock Options, or Company RSUs, Company DSUs or Company PSUs outstanding on the date of this Agreement under the Company Plans or (B) any capital stock of any of the Company’s Subsidiaries to the Company or any other of its direct or indirect wholly-owned Subsidiaries;
(vi) split, combine, subdivide or reclassify any of the Equity Interests;
(vii) declare, set aside, establish a record date for, or pay any dividends on or make any other distributions (whether payable in cash, stock, property or a combination thereof) in respect of any of the capital stock, other than any dividends from any wholly owned Subsidiary of the Company to the Company or to another wholly owned Subsidiary of the Company;
(viii) repurchase, redeem or otherwise acquire any of the Equity Interests, except for redemptions, purchases or acquisitions pursuant to the exercise or settlement of optionsCompany Stock Options, warrantsemployee severance, conversion rights retention, termination, change of control and other contractual rights existing on the date hereof of this Agreement on the terms in effect on the date of this Agreement; provided that the Company shall not undertake any market purchases of Equity Interests.
(ix) incur or modify in any material respect the terms of any Indebtedness (other than with respect to clauses (d) or (e) of the definition of Indebtedness to the extent not otherwise included in clauses (a), (b), (c), (f) or (g)) or assume, guarantee or endorse, or otherwise become responsible for, the obligations of any Person for Indebtedness (in each case, for the avoidance of doubt, excluding trade payables, immaterial capital lease obligations incurred in the ordinary course of business, or obligations issued or assumed as consideration for services or property, including inventory), except for (A) Indebtedness incurred under the Credit Agreement, dated April 5, 2013, among the Company, as lead borrower, the borrowers named therein, the guarantors signatory thereto and disclosed Bank of America, N.A. as administrative agent, collateral agent, swing line lender and letter of credit issuer, and the other lender parties thereto (the “Revolving Credit Facility”) and (B) letters of credit issued pursuant to the Revolving Credit Facility in the ordinary course of business in an aggregate amount outstanding for clause (A) and (B) at any time of less than $5,000,000;
(x) grant or incur any Lien material to the Company and its Subsidiaries taken as a whole, other than Liens incurred in the ordinary course of business consistent with past practice, Liens that may be incurred or granted pursuant to or in accordance with the terms of any Indebtedness in effect as of the date hereof to the extent, in connection with any Indebtedness permitted pursuant to Section 6.1(a)(ix) or pursuant to licenses or sublicenses of Intellectual Property granted in the ordinary course of business;
(xi) except as (x) required pursuant to Company Plans in effect prior to the date of this Agreement that have been disclosed in Section 5.1(i)(i) of the Company Disclosure Letter, (y) set forth in Section 6.1(a)(xi) of the Company Disclosure Letter or (z) otherwise required by this Agreement, (A) loan or pursuant advance any money or grant to any Employee of the Recapitalization issue Company or any shares of its capital stockSubsidiaries, effect except in the case of employees who are not executive officers of the Company wage advances in the ordinary course of business consistent with past practice, (B) provide any stock split severance, retention or otherwise change termination payments or benefits to any Employee of the Company or any of its capitalization as it existed Subsidiaries, except in the case of employees who are not executive officers of the Company in the ordinary course of business consistent with past practice, (C) increase or modify the compensation, bonus or pensions or welfare benefits of any Employee of the Company or any of its Subsidiaries, except in the case of employees who are not executive officers of the Company merit increases or promotions in the ordinary course of business consistent with past practice, (D) establish, adopt, terminate or amend any Company Plan, accelerate the timing of payments under or increase the amount of funding of any Company Plan or amend the terms of any outstanding equity-based awards, (E) enter into any offer letter, employment, consulting or other service agreement or arrangement with any individual who would be an Employee if such individual were employed on the date hereof, except that the Company shall be permitted to hire Employees who are not executive officers of the Company, (x) to replace terminated employees, provided that the total compensation opportunities for such individual shall be no greater in any material respect than that of the terminated employee such individual is intended to replace or (y) grantto hire employees with annual compensation and benefits of less than $100,000 or (F) use discretion to waive, confer accelerate or award otherwise amend or establish any option, warrant, conversion right vesting or other performance conditions applicable to any incentive awards or make any new incentive awards to any Employee of the Company or any of its Subsidiaries;
(xii) make or change any material Tax election, file any material amended Tax Return, settle or compromise any material Tax liability, enter into any closing agreement with respect to any material Tax or surrender any right not existing to claim a material Tax refund, or change the Company’s or any Subsidiary of the Company’s method of accounting for Tax purposes;
(xiii) except as required by GAAP, make any material changes to accounting policies or principles;
(xiv) other than as described in Section 6.1(a)(xiv) of the Company Disclosure Letter or as permitted in accordance with Section 6.1(a)(xi), make any loans, advances or capital contributions to, or investments in, any Person, other than to or in the Company or to or in any wholly-owned Subsidiary of the Company;
(xv) other than (A) in the ordinary course of business or (B) as otherwise expressly permitted by this Section 6.1, (1) enter into any Contract that would have been a Company Material Contract pursuant to subsections (B) through (O) of Section 5.1(r)(i) had it been entered into prior to the date of this Agreement or (2) terminate, renew, amend or waive any material rights under any Company Material Contract excluding any termination upon expiration of a term in accordance with the terms of such Company Material Contract; provided in each case that the Company and its Subsidiaries shall be permitted to renew or replace any Company Material Contract which has terminated in accordance with its terms with one or more Contracts on substantially similar terms with the same counterparty;
(xvi) other than stockholder litigation (which is governed by Section 6.4), compromise, settle or agree to settle any claims (A) involving amounts in excess of $150,000 individually or $500,000 in the aggregate or (B) that would impose any material non-monetary obligations on the date hereof to acquire Company or its Subsidiaries that would continue after the Effective Time;
(xvii) transfer, sell, lease, license, pledge, surrender, encumber, divest, cancel, abandon, let lapse, assign or otherwise dispose of any shares material assets, rights, product lines or businesses of the Company and its Subsidiaries taken as a whole, including capital stock of any of its capital stockSubsidiaries, or any material Intellectual Property other than (zA) adopt as may be permitted pursuant to Section 6.1(a)(xv), (B) inventory, supplies and other assets in the ordinary course of business consistent with past practice, (C) pursuant to Contracts in effect prior to the date of this Agreement as set forth in Section 6.1(a)(xvii) of the Company Disclosure Schedule, (D) pursuant to transactions solely among the Company and/or any A1of its Subsidiaries, (E) pursuant to non-14exclusive licenses or sublicenses of Intellectual Property granted in the ordinary course of business consistent with past practice or (F) the abandonment or lapse of Intellectual Property not material to the conduct of the business of the Company and its Subsidiaries;
(xviii) except for the expenditures contemplated by and consistent with the annual capital budgets set forth in Section 6.1(a)(xviii) of the Company Disclosure Letter, make or authorize any capital expenditures in excess of $250,000 in the aggregate;
(xix) fail to maintain in full force and effect any Company Insurance Policies in a form and amount consistent with past practice; or
(xx) agree, authorize or commit to do any of the foregoing.
(b) Nothing contained in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the right to control or direct the Company’s or its Subsidiaries’ operations prior to the Effective Time, and nothing contained in this Agreement is intended to give the Company, directly or indirectly, the right to control or direct Parent’s or its Subsidiaries’ operations. Prior to the Effective Time, except as set forth in each of Parent and the Purchaser Disclosure Letter or as contemplated by Company shall exercise, consistent with the terms and conditions of this Agreement, unless the Company complete control and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of supervision over its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of and its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Subsidiaries’ respective operations.
Appears in 1 contract
Sources: Merger Agreement (Rue21, Inc.)
Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement or the Stock Option Agreement or set forth in Section 6.1 of the Company Disclosure Schedule):
(a) Prior its and its Subsidiaries's businesses shall be conducted in the ordinary and usual course (it being understood and agreed that nothing contained herein shall permit the Company to enter into or engage in (through acquisition, product extension or otherwise) the business of selling any products or services materially different from existing products or services of the Company and its Subsidiaries or to enter into or engage in new lines of business without Parent's prior written approval);
(b) to the Effective Timeextent consistent with (a) above it and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreementsuppliers, unless the Purchaser has consented in writing theretoreinsurers, the Company: distributors, creditors, lessors, employees and business associates;
(c) it shall not (i) shallissue, and shall cause each sell, pledge, dispose of or encumber any capital stock owned by it in any of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedSubsidiaries; (ii) shall not amend its Certificate of Incorporation charter or Bylaws by-laws or comparable governing instruments (other than to permit amend, modify or terminate the consummation of the transactions contemplated by this Rights Agreement or New Rights Agreement); (iii) shall promptly notify the Purchaser split, combine or reclassify its outstanding shares of any breach of any representation or warranty contained herein or any Company Material Adverse Effectcapital stock; (iv) shall promptly deliver to the Purchaser true and correct copies of any reportauthorize, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend payable in cash, stock or make property in respect of any capital stock other distribution than dividends from its direct or payment indirect wholly-owned Subsidiaries and other than regular quarterly dividends paid by the Company on its Common Shares not in excess of $0.11 per share and regular quarterly dividends paid by the Company on its Preferred Shares in accordance with respect the Company's Articles of Incorporation; or (v) repurchase, redeem or otherwise acquire, except in connection with any of the Company Stock Plans, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its stock or any securities convertible into or exchangeable or exercisable for any shares of its stock;
(d) neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any other ownership interests property or assets (other than regular quarterly cash dividends Shares issuable pursuant to options outstanding on the date hereof under any of the Company Stock Plans or upon conversion of the Preferred Shares or Convertible Notes); (ii) other than in the ordinary and usual course of business, transfer, lease, license,
(e) neither it nor any of its Subsidiaries shall terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Compensation and Benefit Plans, other than awards made in the normal course under the Management Incentive Plan in respect of 1997 performance and grants of up to 20,000 restricted Common Shares to be made in January 1998 under the year 2000 Tenure Award Program, or increase the salary, wage, bonus or other compensation of any employees except increases occurring in the ordinary and usual course of business (which shall include normal periodic performance reviews and related compensation and benefit increases);
(f) neither it nor any of its Subsidiaries shall pay, discharge, settle or satisfy any claims, liabilities or obligations (absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction of claims, liabilities or obligations legally due and payable and arising in the ordinary and usual course of business, claims arising under the terms of products, contracts or policies issued by the Company Insurance Subsidiaries in the ordinary and usual course of business and such other claims, liabilities or obligations as shall not to exceed $0.05 per share)5 million in the aggregate;
(g) neither it nor any of its Subsidiaries shall make or change any Tax election, settle any material audit, file any amended tax returns or permit any insurance policy naming it as a beneficiary or loss-payable payee to be canceled or terminated except in the ordinary and usual course of business;
(h) neither it nor any of its Subsidiaries shall enter into any agreement containing any provision or covenant limiting in any material respect the ability of the Company or any Subsidiary or affiliate to (A) sell any products or services of or to any other person, (B) engage in any line of business or (C) compete with or to obtain products or services from any person or limiting the ability of any person to provide products or services to the Company or any of its Subsidiaries or affiliates;
(i) neither it nor any of its Subsidiaries shall enter into any new quota share or other reinsurance transaction (A) which does not contain standard cancellation and termination provisions, (B) which, except in the ordinary course of business,
(j) neither it nor any of the Company Insurance Subsidiaries will alter or amend in any material respect their existing investment guidelines or policies;
(k) neither it nor any of its Subsidiaries shall take any action or omit to take any action that would cause any of its representations and warranties herein to become untrue in any material respect; and
(l) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Sources: Agreement and Plan of Merger (American Bankers Insurance Group Inc)
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, from and after the execution of this Agreement and prior to the First Effective Time (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld, conditioned or delayed, and except as (1) required by applicable Law, (2) expressly required by this Agreement or (3) otherwise expressly disclosed in Section 6.1(a) of the Company Disclosure Letter), the Company shall use its reasonable best efforts to conduct its business and the business of its Subsidiaries in the ordinary course of business consistent with past practice and each of the Company and its Subsidiaries shall, subject to compliance with the specific matters set forth below, use reasonable best efforts to preserve its business organization intact and maintain the existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, licensors, creditors, lessors, employees and business associates and others having material business dealings with it (including material content providers, studios, authors, producers, directors, actors, performers, guilds, announcers and advertisers) and keep available the services of the Company and its Subsidiaries’ present employees and agents. Without limiting the generality of, and in furtherance of, the foregoing, the Company covenants and agrees as to itself and its Subsidiaries that, from and after the date of this Agreement and prior to the First Effective Time, except (A) as set forth required by applicable Law, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (C) as expressly disclosed in Section 6.1(a) of the Company Disclosure Letter or (D) as contemplated by any other provision of expressly provided for in this Agreement, unless the Purchaser has consented in writing thereto, the Company: Company shall not and will not permit any of its Subsidiaries to:
(i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (iiA) shall not amend its Certificate certificate of Incorporation incorporation or Bylaws bylaws (or comparable governing instruments documents) (other than amendments to permit the consummation governing documents of any wholly owned Subsidiary of the Company that would not prevent, materially delay or materially impair the Initial Merger or the other transactions contemplated by this Agreement); , (iiiB) shall promptly notify the Purchaser of any breach of any representation split, combine, subdivide or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any reclassify its outstanding shares of its capital stock, effect stock (except for any stock split or otherwise change its capitalization as it existed on such transaction by a wholly owned Subsidiary of the date hereofCompany which remains a wholly owned Subsidiary after consummation of such transaction), (yC) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make distribution payable in cash, stock or property (or any combination thereof) in respect of any shares of its capital stock (except for (I) any dividends or distributions paid by a direct or indirect wholly owned Subsidiary of the Company to another direct or indirect wholly owned Subsidiary of the Company or to the Company or (II) other distribution or payment than normal quarterly cash dividends on the Company’s Common Stock as described in Section 6.1(a)(i)(C) of the Company Disclosure Letter), (D) enter into any agreement with respect to the voting of its capital stock, or (E) ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, redeem or otherwise acquire any shares of its capital stock or other ownership interests any securities convertible or exchangeable into or exercisable for any shares of its capital stock (other than regular quarterly cash dividends (1) pursuant to the cashless exercise of Company Options or the forfeiture of, or withholding of Taxes with respect to, Company Options, Company Restricted Stock Units or Company Performance Stock Units in connection with any Taxable event related to such awards, in each case in accordance with past practice and with the terms of the applicable Company Stock Plan as in effect on the date of this Agreement (or as modified after the date of this Agreement in accordance with the terms of this Agreement) or (2) purchases, repurchases, redemptions or other acquisitions of securities of any wholly owned Subsidiary of the Company by the Company or any other wholly owned Subsidiary of the Company);
(ii) merge or consolidate with any other Person, or restructure, reorganize or completely or partially liquidate (other than mergers among, or the restructuring, reorganization or liquidation of any wholly owned Subsidiaries of the Company that would not prevent, materially delay or materially impair the Initial Merger or the other transactions contemplated by this Agreement);
(iii) knowingly take or omit to take any action if such action or failure to act would be reasonably likely to prevent or impede the Mergers from qualifying for the Intended Tax Treatment;
(iv) except as expressly disclosed in Section 6.1(a) of the Company Disclosure Letter, increase or change the compensation or benefits payable to any employee of the Company or any of its Subsidiaries (including through changes in actuarial or other assumptions, loan forgiveness or otherwise) other than in the ordinary course of business, provided that, notwithstanding the foregoing, the Company shall not and will not permit its Subsidiaries to, other than as required by the terms of any Company Plan or CBA, in each case as in effect on the date hereof (or as modified after the date of this Agreement in accordance with the terms of this Agreement), (a) grant any new equity-based awards, or amend or modify the terms of any such outstanding awards, under any Company Plan, (b) grant any transaction or retention bonuses, (c) increase the compensation or benefits payable to any Senior Executive (other than, solely in the case of benefits pursuant to a generally applicable amendment to a Company Plan covering other Company Employees who are not Senior Executives, which amendment is permitted by this Agreement), (d) pay annual bonuses, other than for completed periods based on actual performance through the end of the applicable performance period as determined in the ordinary course of business pursuant to the applicable Company Plan, (e) increase the severance terms applicable to any employee of the Company or any of its Subsidiaries or (f) make any change to any Company Pension Plan or any Company Plan that is an “employee welfare benefit plan” (within the meaning of Section 3(1) of ERISA) that would materially increase the costs to the Company or any of its Subsidiaries in respect of such Company Plan;
(v) incur any Indebtedness or issue any warrants or other rights to acquire any Indebtedness, except (A) in the ordinary course of business consistent with past practice in a principal amount not to exceed $0.05 250,000,000 in the aggregate at any time outstanding and on prevailing market terms or on terms substantially consistent with or more beneficial to the Company and its Subsidiaries, taken as a whole, than existing Indebtedness, (B) in replacement of existing Indebtedness which has matured or is scheduled to mature, in each case after the date of this Agreement, within the twelve month period following such incurrence of Indebtedness on then prevailing market terms or on terms substantially consistent with or more beneficial to the Company and its Subsidiaries, taken as a whole, than the Indebtedness being replaced, (C) inter-company Indebtedness among the Company and its wholly owned Subsidiaries, (D) commercial paper issued in the ordinary course of business, (E) (i) to the extent not drawn upon and payments are not triggered thereby, letters of credit, bank guarantees, security or performance bonds or similar credit support instruments and (ii) overdraft facilities or cash management programs, in each case issued, made or entered into in the ordinary course of business and (F) hedging in compliance with the hedging strategy of the Company as of the date of this Agreement in the ordinary course of business consistent with past practice and not for speculative purposes; provided that the Company and its Subsidiaries shall use commercially reasonable efforts to mitigate any material increase in their respective aggregate exposure to currency risk;
(vi) make or commit to any capital expenditures other than (A) in connection with the repair or replacement of facilities, properties or assets destroyed or damaged due to casualty or accident (if covered by insurance or the portion of which is not covered by insurance is less than $100,000,000) or (B) in the ordinary course of business consistent with past practice and in the aggregate not in excess of 120% of the amounts reflected in the Company’s capital expenditure budget for each of 2016 and 2017 and 2018 set forth in Section 6.1(a)(vi) of the Company Disclosure Letter;
(vii) transfer, lease, license, sell, assign, let lapse, abandon, cancel, mortgage, pledge, place a Lien upon or otherwise dispose of any Intellectual Property; provided that this clause (vii) shall not restrict (A) ordinary course licenses, sales, letting lapse, abandonment, cancellations and Liens that are licenses in each case of Intellectual Property, (B) the granting of any licenses of Intellectual Property other than in the ordinary course of business with a term of three years or less where the aggregate payments under such license do not exceed $250,000,000 per sharelicense and (C) sales of Intellectual Property with a fair market value less than $50,000,000 individually if the transaction is not in the ordinary course or $100,000,000 individually in any event (other than transactions among the Company and its wholly owned Subsidiaries).;
(viii) transfer, lease, license, sell, assign, let lapse, abandon, cancel, mortgage, pledge, place a Lien upon or otherwise dispose of any properties or assets (including capital stock of any of its Subsidiaries but not including any Intellectual Property, which is governed by Section 6.1(a)(vii)) with a fair market value in excess of $50,000,000 individually if the transaction is not in the ordinary course or $100,000,000 individually in any event (other than transactions among the Company and its wholly owned Subsidiaries);
(ix) issue, deliver, sell, grant, transfer, or encumber, or authorize the issuance, delivery, sale, grant, transfer or encumbrance of, any shares of its capital stock or any securities convertible or exchangeable into or exercisable for, or any options, warrants or other rights to acquire, any such shares, except (A) for any Shares issued pursuant to Company Options, Company Restricted Stock Units and Company Performance Stock Units outstanding on the date of this Agreement in accordance with the existing terms of such awards and the Company Stock Plans, (B) for any profit participation rights relating to programs granted in the ordinary course of business consistent with past practice or (C) by wholly owned Subsidiaries to the Company or to any other wholly owned Subsidiary of the Company;
Appears in 1 contract
Sources: Merger Agreement (Time Warner Inc.)
Interim Operations. (a) Prior During the period from the date of this Agreement to the earlier of the Effective TimeTime and the date, except if any, on which this Agreement is terminated pursuant to Section 6.1, except
(i) as set forth in required by Law, (ii) with the Company Disclosure Letter prior written consent of Newco, which consent shall not be unreasonably withheld, delayed or conditioned or (iii) as contemplated or permitted by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) Company shall, and shall cause each of its Significant Subsidiaries to, conduct carry on its operations according to their usual, regular and business in the ordinary course and preserve intact its business organization and listing exchange status, keep available the services of its current officers and employees, maintain in substantially effect all material licenses and permits required to carry on their respective businesses, maintain in effect any exemptive orders or exemptive relief which they have received from the same manner SEC and which are currently in effect, and preserve their material business relationships and maintain generally its business relationships with its lenders and others having business relationships with it; provided, however, that no action by the Company or any of its Subsidiaries with respect to matters addressed specifically by any provision of this Section 4.1 shall be deemed a breach of this sentence unless such action would constitute a breach of such specific provision.
(b) Without limiting the generality of the foregoing, during the period from the date of this Agreement to the earlier of the Effective Time and the date, if any, on which this Agreement is terminated pursuant to Section 6.1, except (i) as heretofore conducted; may be required by Law, (ii) with the prior written consent of Newco, which consent shall not be unreasonably withheld, delayed or conditioned, or (iii) as required, contemplated or permitted by this Agreement, the Company shall not, and shall not permit any of its Subsidiaries to:
(A) issue, deliver, sell, dispose of, pledge or otherwise encumber, amend the terms of, or authorize or propose the issuance, sale, disposition or pledge or other encumbrance of (1) any shares of capital stock of any class or any other ownership interest of the Company or any of its Certificate Subsidiaries, or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for any shares of Incorporation capital stock or Bylaws any other ownership interest of the Company or comparable governing instruments any of its Subsidiaries, or any rights, warrants, options, calls, commitments or any other agreements of any character to purchase or acquire any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries or any securities or rights convertible into, exchangeable for, or evidencing the right to subscribe for, any shares of capital stock or any other ownership interest of the Company or any of its Subsidiaries, or (2) any other securities of the Company or any of its Subsidiaries in respect of, in lieu of, or in substitution for, Company Common Stock outstanding on the date hereof;
(B) redeem, purchase or otherwise acquire, or propose to redeem, purchase or otherwise acquire, any outstanding Company Common Stock;
(C) split, combine, subdivide or reclassify any Company Common Stock or, except as provided in Section 4.14, declare, set aside for payment or pay any dividend (whether in cash, stock or property, or any combination thereof) in respect of any Company Common Stock or otherwise make any payments to stockholders in their capacity as such;
(D) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries, other than the Transactions;
(E) enter into any new line of business;
(F) other than in the ordinary course of business and consistent with past practices, redeem, repurchase, prepay, defease, incur or otherwise acquire or amend or modify the terms of any indebtedness for borrowed money, enter into any "keep well" or other agreement to maintain any financial statement condition of another Person or pledge any of the Company's assets or enter into any arrangement which would have the economic effect of any of the foregoing, in each case, in addition to that incurred as of the date of this Agreement or guarantee any such indebtedness;
(G) make any investment, investment contract or loan (other than any unfunded commitments existing as of the date hereof) either by sale or purchase of stock or securities or otherwise, contributions to permit capital, property transfers, or purchase of any property or assets of any other individual, Person or other entity (other than a Subsidiary), sell, dispose of, transfer, lease, amend, modify, grant waivers with respect to or discontinue any investment, investment contract or loan; or acquire, sell, lease or dispose of any non-investment assets that, in the consummation aggregate, are material to the Company and its Subsidiaries, taken as a whole, to any Person other than a wholly-owned Subsidiary;
(H) except as provided for in this Agreement, grant any increase in, take any action to accelerate the vesting or payment or fund or in any other way secure the payment of, the compensation and benefits of any of the Company's directors, officers, consultants or employees, enter into any employment or severance agreement with any such director, officer, consultant or employee, or adopt, terminate or materially amend any Company Benefit Plan;
(I) make any material change in any of the financial accounting principles, practices or methods used by the Company unless required by GAAP or applicable Law;
(J) change its fiscal year;
(K) amend any material Tax Return of the Company, make, revoke or amend any material Tax election of the Company, adopt or change any Tax accounting principles, methods or policies other than as required by applicable Law, change any Tax accounting period, enter into any closing agreement as described in Section 7121 of the Code (or any corresponding or similar agreement under applicable state, local or foreign tax Law) affecting any material Tax liability or refund, or settle or compromise any material Tax liability or refund of the Company;
(L) directly or indirectly take any action, or knowingly fail to take any action, which action or failure to act is reasonably likely to cause the Company to fail to qualify or not be subject to tax as a RIC; provided, however, that on or before the Effective Time, the Company shall (if not adequately provided for by the Special Dividend contemplated by Section 4.14) take such actions as are necessary to ensure that (i) the Company would not be subject to the tax imposed under Section 4982(a) of the Code if the Effective Time were the end of the calendar year, (ii) the Company satisfies the requirements Section 852(a) of the Code for its last federal income tax year, and (iii) the Company is not subject to tax under Section 852(b)(1) or 852(b)(3)(A) of the Code in its last federal income tax year.
(M) make or incur any obligation to make any capital expenditures;
(N) enter into or draw down from any contract, agreement, commitment or arrangement whereby the obligation or liability imposed on the Company or any of its Subsidiaries under such contract, agreement, commitment or arrangement would exceed $50,000, or whereby such contract, agreement, commitment or arrangement would otherwise constitute a Company Material Contract, or amend any contract, agreement, commitment or arrangements in existence on the date hereof that, after giving effect to such amendment, would impose an obligation or liability on the Company or any of its Subsidiaries under such contract, agreement, commitment or arrangement in excess of $50,000 or constitute a Company Material Contract;
(O) except as otherwise provided in this Agreement, enter into, terminate, cancel, renew or agree to any material amendment of, change in or waiver under any Company Material Contract;
(P) commence or settle any material claim, suit, action or proceeding (other than in connection with or with respect to this Agreement or any of the Transactions);
(Q) amend the certificate of incorporation or bylaws of the Company or similar governing documents of any of its Subsidiaries; or
(R) enter into any contract, agreement, commitment or arrangement to do any of the foregoing.
(c) During the period from the date of this Agreement to the earlier of the Effective Time and the date, if any, on which this Agreement is terminated pursuant to Section 6.1, Newco shall not (i) incur any liabilities or obligations (other than in connection with its formation, its initial capitalization and the Transactions contemplated in this Agreement and the transactions contemplated by this the Subscription Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside declare or pay any dividend or make any other distribution or payment (iii) take any action that could impair its ability to pay and perform its obligations under Section 6.2 upon a termination of this Agreement. Newco will procure that, during the period from the date of this Agreement to the earlier of the Effective Time and the date on which this Agreement is terminated pursuant to Section 6.1, except (i) as required by Law or, (ii) with the prior written consent of the Company, which consent shall not be unreasonably withheld, delayed or conditioned, MAST and the Funds will manage the MAST Portfolio Assets in the ordinary course consistent with past practice and, without limiting the generality of the foregoing, none of MAST or the Funds will subject any of the MAST Portfolio Assets to any Encumbrance that would prohibit the transfer of such asset to Newco under the Subscription Agreement. For the avoidance of doubt, the Funds will provide the Company prompt notice in the event that any of them (A) agree to any modification of or waiver or forbearance under any MAST Portfolio Loan Document, or waive or fail to enforce any material right under any MAST Portfolio Loan Document or (B) consent to any release of collateral relating to any MAST Portfolio Asset. Newco will procure that, during the period from the Measurement Date to the earlier of the Effective Time and the date, if any, on which this Agreement is terminated pursuant to Section 6.1, neither MAST nor any of the Funds will execute any trade with respect to any shares MAST Portfolio Asset except (i) as may be required by Law, (ii) with the prior written consent of its capital stock the Company, which consent shall not be unreasonably withheld, delayed or other ownership interests conditioned, or (other than regular quarterly cash dividends not to exceed $0.05 per share)iii) as required by this Agreement.
Appears in 1 contract
Interim Operations. From the date hereof until the Closing Date, the Seller Companies shall conduct the Wholesale Business (aincluding the businesses associated with the Customer Sandwich Leases and the Facilities, and the assets used in providing and services to be provided under the Transition Services Agreement and the 3PL Agreement) Prior to the Effective Time, except as set forth substantially in the Company Disclosure Letter or manner as contemplated by any other provision conducted on the date of this Agreement. Without limiting the generality of the foregoing, unless and except as otherwise expressly contemplated by this Agreement or with the Purchaser has consented in writing theretoprior written consent of Purchaser, from the date hereof until the Closing Date (or until the Employee Closing, with respect to subsection (k) below), the Company: (iSeller Companies shall:
a) shalluse, preserve and shall maintain the Acquired Assets on a basis consistent with practices as of the date of this Agreement and all applicable laws and not cause each material damage to or destruction or loss of its Significant Subsidiaries to, conduct its operations according any of the Acquired Assets;
b) continue to their usual, regular maintain the insurance covering the Acquired Assets in effect as of the date of this Agreement;
c) pay all debts and obligations incurred by the Seller Companies in the operation of the Wholesale Business and the Acquired Assets in the ordinary course of business consistent with practices as of the date of this Agreement;
d) comply with all terms and conditions of the Assumed Contracts and Customer Agreements and not commit any act or omit to do any act which may cause a material breach by the Seller Companies of any of the Assumed Contracts or the Customer Agreements (and the Seller Companies shall provide Purchaser prompt notice of any such breach declared by a counterparty to such agreements);
e) maintain its books, accounts and records with respect to such Acquired Assets and the Wholesale Business in substantially the same usual manner and on a basis consistent with past practices;
f) not create, assume or permit to exist any Lien, other than Permitted Liens, on any Acquired Asset, except in the ordinary course of business consistent with practices as heretofore conducted; (iiof the date of this Agreement;
g) shall not amend its Certificate or terminate any Assumed Contract or Customer Agreement, except in the ordinary course of Incorporation business consistent with practices as of the date of this Agreement (provided, that, the Seller Company shall consult with Purchaser in advance of any such amendment or Bylaws termination);
h) not undertake any plan of complete or comparable governing instruments (partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other than to permit the consummation of reorganization that is inconsistent with the transactions contemplated by this Agreement); (iii;
i) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreementtake, or pursuant agree to or commit to take, any action that would or is reasonably likely to result in any of the Recapitalization issue any shares Conditions of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as Closing set forth in ARTICLE VII not being satisfied, or that would materially impair the ability of Purchaser Disclosure Letter or as a Seller Company to consummate the transactions contemplated by this Agreement, unless the Company and the Special Committee have consented Agreement in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed accordance with the SEC subsequent terms hereof or materially delay such consummation;
j) maintain the operations of the Seller Companies to enable them to satisfy their obligations under the date of this Agreement; Transition Services Agreement (and (ivall other Related Agreements) shall after the Closing;
k) not declaregrant any raises or other concessions to Wholesale Employees, set aside or pay any dividend or make any organizational changes or other distribution or payment material personnel decisions with respect to any shares Wholesale Employees, such as hiring, terminating or laying off any Wholesale Employee;
l) not take any action or omit to take any action whereby any Intellectual Property included in the Acquired Assets may lapse, become abandoned, dedicated to the public, or unenforceable;
m) operate the Wholesale Business (including the businesses associated with the Customer Sandwich Leases and the Facilities, and the assets used in providing and services to be provided under the Transition Services Agreement and the 3PL Agreement) in the ordinary course consistent with past practices and use commercially reasonable efforts to preserve intact its goodwill, keep available the services of its capital stock employees, and preserve the goodwill and business relationships with its suppliers, Wholesale Customers and others having business relationships with it;
n) comply with all terms and conditions of the Customer Sandwich Leases in all material respects, and not commit any act or other ownership interests omit to do any act, which may cause a material breach of any of the Customer Sandwich Leases (other than regular quarterly cash dividends and the Seller Companies shall provide Purchaser prompt notice of any such breach declared by a counterparty to such agreements); and
o) not enter into any contract or agreement, or take any action or omit to exceed $0.05 per share)take any action, that is inconsistent with any of the foregoing.
Appears in 1 contract
Interim Operations. (a) Prior Except as set forth in the corresponding section of the Company Disclosure Schedule (including the capital expenditure, spending and other budgets contained therein) or otherwise as expressly provided hereby, subject to applicable law, the Company covenants and agrees as to itself and its Subsidiaries that, from the date of this Agreement until the Effective Time, the business of it and its Subsidiaries shall be conducted only in the ordinary course of business consistent with past practice and, to the extent consistent therewith, it and its Subsidiaries shall use their respective reasonable commercial efforts to preserve its business organization intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates and keep available the services of the present employees and agents of the Company and its Subsidiaries. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, the Company will not and will not permit its Subsidiaries to (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed):
(i) adopt or propose any change in its articles of incorporation or by-laws (or similar governing documents);
(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among wholly-owned Subsidiaries of the Company that are not obligors or guarantors of third party indebtedness;
(iii) except as set forth in Section 7.1(a)(iii) of the Company Disclosure Letter or as contemplated by Schedule, acquire assets from any other provision Person with a value or purchase price in the aggregate in excess of $250,000 other than acquisitions pursuant to Contracts to the extent in effect immediately prior to the execution of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments Agreement (other than to permit the consummation any such Contract that is a Significant Contract but is not listed on Section 5.11 of the transactions contemplated by this Agreement); (iiiCompany Disclosure Schedule or a true and correct copy of which was not previously made available to Parent prior to the date hereof) shall promptly notify and the Purchaser purchase of any breach materials, supplies or services for the manufacture, delivery or sale of any representation or warranty contained herein or any Company Material Adverse Effect; the Company’s products in the ordinary course of business;
(iv) shall promptly deliver other than pursuant to Contracts to the Purchaser true and correct copies extent in effect as of any report, statement or schedule filed with the SEC subsequent immediately prior to the date execution of this Agreement; Agreement and set forth in Section 7.1 (va)(iv) shall not (x) except pursuant to of the Company Disclosure Schedule, and other than the issuance of shares of Common Stock upon the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed outstanding Company Options outstanding on the date hereof, (y) disclosed pursuant to Section 5.2 and in accordance with their terms, issue, sell, pledge, dispose of, grant, confer transfer, lease, license, guarantee, encumber, or award authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any optionshares of stock of the Company or any of its Subsidiaries (other than the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary), warrantor securities convertible or exchangeable or exercisable for any shares of such stock, conversion right or any options, warrants or other right not existing on the date hereof rights of any kind to acquire any shares of its capital stock, such stock or (z) adopt any A1-14such convertible or exchangeable securities;
(bv) Prior grant any Lien on assets of the Company or any of its Subsidiaries in excess of $50,000 or outside the ordinary course of business consistent with past practice;
(vi) other than pursuant to Contracts to the Effective Time, except extent in effect as of immediately prior to the execution of this Agreement and set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless Section 7.1(a)(vi) of the Company Disclosure Schedule, make any loan, advance or capital contribution to or investment in any Person in excess of $50,000 in the aggregate;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its Stock (except for dividends or other distributions by any direct or indirect wholly-owned Subsidiary of the Company to the Company) or to any other direct or indirect wholly-owned Subsidiary of the Company or enter into any agreement with respect to the voting of its stock, except for dividends declared in January, 2006 at a rate per share no greater than the amount of each of the quarterly dividends which the Company has paid for the immediate past four (4) quarters and which have not been paid as of the Special Committee have consented in writing theretodate hereof;
(viii) reclassify, the Purchaser: (i) shall not issue combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock at less than fair market value except the acceptance of shares of Common Stock as payment of the exercise price of stock options or for withholding taxes incurred in connection with the exercise of Company Options in accordance with past practice and the terms of the applicable award and the acceptance of Class B Common Stock in exchange for Common Stock;
(ix) waive any stock repurchase rights; accelerate, amend or change the period of exercisability of options granted under any employee, consultant, director or other stock plans; or authorize cash payments in exchange for any options granted under any of such plans (other than pursuant to cashless exercise provisions in effect on the date hereof);
(x) incur any Purchaser Stock Plans) indebtedness for borrowed money which, together with existing indebtedness and capital leases exceeds $27.5 million, or effect guarantee such indebtedness of another Person, issue or sell any stock split securities or warrants or other rights to acquire any security of the Company or any of its capital stock; (ii) shall promptly notify Subsidiaries, except for the issuance of Common Stock upon the exercise of Company Options or the exchange of Class B Common Stock, except, in the case of each of the foregoing, arrangements by and between any direct or indirect wholly-owned Subsidiary of the Company and the Company or any other direct or indirect wholly-owned Subsidiary of the Company;
(xi) make or authorize any capital expenditure which individually exceeds $100,000 or in the aggregate exceeds $300,000, except as disclosed in Section 7.1(a)(xi) of the Company Disclosure Schedule, or any operating expenditure other than in the ordinary course of business and consistent with the operating budgets disclosed in Section 7.1(a)(xi) of the Company Disclosure Schedule;
(xii) other than as otherwise permitted by this Agreement, enter into any Contract that would have been a Significant Contract had it been entered into prior to the execution of this Agreement except with respect to the sale of the Company’s products in the ordinary course of business, purchases for the manufacture or sale of the Company’s products in the ordinary course of business or other contracts in the ordinary course of business consistent with past practice;
(xiii) amend or modify in any material respect, or terminate or waive any material right or benefit under, any Significant Contract;
(xiv) except as required by GAAP or applicable Law (as to which the Company will give prompt written notice to the Parent), make any change in financial accounting methods, principles or practices;
(xv) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity for an amount in excess of $100,000 or which would be reasonably likely to have an adverse impact of $100,000 on the net income of the Company or any of its Subsidiaries or on any current or future litigation or other proceeding of the Company or any of its Subsidiaries;
(xvi) pay, discharge, settle or satisfy any liabilities or obligations of any breach nature in excess of $100,000, other than any payment, discharge, settlement or satisfaction (A) required by applicable Law, (B) in the ordinary course of business or (C) in accordance with their terms, of liabilities or obligations recognized or disclosed in the most recent financial statements (or the notes thereto) of the Company included in the Company Reports;
(xvii) waive the benefits of, agree to modify in any manner, terminate, release any person from, or knowingly fail to use reasonable efforts to enforce, the confidentiality or nondisclosure provisions of any representation or warranty contained herein Significant Contract to which the Company or any Purchaser Material Adverse Effect; of its Subsidiaries is a party or of which the Company or any of its Subsidiaries is a named third party beneficiary;
(iiixviii) shall promptly deliver cancel or fail to use commercially reasonable efforts to renew, with reasonable substitutes, any insurance policy naming the Company or any of its Subsidiaries as a beneficiary or loss payee;
(xix) except as disclosed in Section 7.1(a)(xix) of the Company Disclosure Schedule, sell, lease, license, or otherwise dispose of any assets of the Company or its Subsidiaries except for ordinary course sales of products or services provided in the ordinary course of business consistent with past practice or obsolete assets, and except for sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $100,000 in the aggregate, other than pursuant to Contracts in effect prior to the execution of this Agreement (other than any such Contract that is a Significant Contract but is not listed on Section 5.11 of the Company Disclosure Schedule or a true and correct copies copy of any report, statement or schedule filed with the SEC subsequent which was not previously made available to Parent prior to the date hereof);
(xx) except as required pursuant to existing written, binding agreements or Benefit Plans in effect prior to the execution of this AgreementAgreement and set forth in Sections 5.13 or 7.1(a)(xx) of the Company Disclosure Schedule, or as otherwise required by Law or with respect to new hires below the officer level (except with respect to clause (6) below, which will be applicable to all new hires), (1) enter into any new employment or compensatory agreements with any officer, employee or director of the Company or any of its Subsidiaries (including entering into any bonus, severance, change of control, termination, reduction-in- force or consulting agreement or other employee benefits arrangement or agreement pursuant to which such person has the right to any form of compensation from the Company or any of its Subsidiaries); and (iv) shall not declareexcept, set aside or pay any dividend or make any other distribution or payment with respect to any shares new officer that will replace a former officer, entering into a new employment or company agreement in which the overall compensatory package of such officer is no more favorable (in terms of compensation, severance, duration and other matters) than the former officer whom the new officer will replace; (2) promote any employee, other than promotions on terms that are no more favorable (in terms of compensation, severance, duration and other matters) than the terms upon which any employee previously serving in the applicable capacity was entitled; or (3) increase the compensation or employee benefits of any officer, employee, consultant, or director of the Company or any of its capital stock Subsidiaries, except with respect to employees only, for increases in the ordinary course of business consistent with past practice (including timing of increases); or (4) hire any officer or director, except in connection with the replacement of an officer whose employment has terminated, provided the overall compensatory package of such officer is no more favorable (in terms of compensation, severance, duration and other ownership interests matters) than the terminated officer; or (5) adopt or amend any Benefit Plan in any respect that would increase the cost of such Benefit Plan to the Company, or accelerate vesting or payment under, any Benefit Plan; or (6) agree or commit to provide severance benefits to any newly hired officer, employee or director of the Company or any of its Subsidiaries other than as required by Benefit Plans set forth on Section 5.13 of the Company Disclosure Schedules;
(xxi) engage in the conduct of any new line of business (other than regular quarterly any new product or service offerings reflected on the capital expenditure, spending and other budgets);
(xxii) manage working capital other than in the ordinary course of business consistent with past practice, including extending the payment of accounts payable and/or accelerating the collection of accounts receivable, which has an adverse impact of $1 million or more on cash dividends not flow; or
(xxiii) agree, resolve or commit to exceed $0.05 per share)do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) Prior From the date of this Agreement to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of required pursuant to this Agreement, unless the Purchaser Intercardia has consented in writing thereto, the Company: Transcell shall:
(i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their its usual, regular and ordinary course in substantially the same manner as heretofore conducted; of business consistent with past practice;
(ii) use its reasonable efforts to preserve intact its business organizations and goodwill, to maintain in effect all existing qualifications, licenses, permits, approvals and other authorizations, to keep available the services of their officers and employees and to maintain satisfactory relationships with suppliers and all other persons having business relationships with them except where the failure to do so would not have a Material Adverse Effect;
(iii) deliver, within fifteen (15) business days after the end of each accounting month, monthly financial accounts prepared internally by Transcell's management, in the same format as heretofore furnished to Intercardia, for Transcell for and as of the end of each such month; and
(iv) promptly notify Intercardia of any Litigation instituted or threatened against Transcell;
(b) From the date of this Agreement to the Effective Time, unless Intercardia has consented in writing thereto, Transcell shall not not:
(i) amend its Certificate of Incorporation or Bylaws Bylaws;
(ii) issue, sell, pledge or comparable governing instruments (other than to permit the consummation otherwise dispose of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stockAuthorized Capital Stock (other than issuances of Authorized Capital Stock in respect of any exercise of Transcell Options or Transcell Warrants or any conversion of Class B Common Stock, Series A Preferred Stock or Series B Preferred Stock outstanding on the date hereof), or any securities convertible into or exchangeable for any such shares, or any rights, warrants or options to acquire or with respect to any such shares of Authorized Capital Stock, or convertible or exchangeable securities; or accelerate any right to convert or exchange or acquire any securities of Transcell for any such shares;
(iii) effect any stock split split, reverse stock split, stock dividend, subdivision, reclassification or similar transaction, or otherwise change its capitalization as it existed exists on the date hereof;
(iv) other than pursuant to this Agreement, (y) grant, confer confer, award or award amend any option, warrant, conversion right convertible security or other right not existing on the date hereof to acquire any shares of its capital stock, Authorized Capital Stock or (z) adopt take any A1-14action to cause to be exercisable any otherwise unexercisable option under any stock option plan;
(bv) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its Outstanding Capital Stock;
(vi) directly or indirectly redeem, purchase or otherwise acquire any shares of its Outstanding Capital Stock;
(vii) sell, lease, assign, transfer or otherwise dispose of (by merger or otherwise) any of its property, business or assets (including, without limitation, any Intellectual Property) except in the ordinary course of business;
(viii) settle or compromise any pending or threatened Litigation without Intercardia's consent (which consent will not be unreasonably withheld or delayed);
(ix) make any loan, extension of credit or capital stock contribution to, or purchase to acquire (by merger or otherwise) any stock, bonds, notes, debentures or other ownership interests securities of, or any assets constituting a business unit of, or make any other investment in, any person, firm or entity, except (v) loans, extensions of credit, capital contributions, purchases, acquisitions or investments that are, individually and in the aggregate, of de minimis value, (w) extensions of trade credit and endorsements of negotiable instruments and other negotiable documents in the ordinary course of business (x) investments in cash and cash equivalents, (y) investments in wholly owned subsidiaries;
(x) incur, assume or create any indebtedness for borrowed money or the deferred purchase price for property or services or pursuant to any capital lease or other financing, except indebtedness owed to Interneuron or incurred in the ordinary course of business for equipment financing or working capital purposes pursuant to Transcell's existing credit facilities; or amend in a manner materially adverse to Transcell any of Transcell's existing credit facilities;
(xi) assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other person except for obligations in the ordinary course of business consistent with the past practice of Transcell;
(xii) make any material tax election (unless required by law or unless consistent with prior practice), settle or compromise any material income tax liability or amend any tax return;
(xiii) waive or amend any term or condition of any confidentiality or "standstill" agreement to which Transcell is a party and which relates to a business combination with Transcell or the purchase of shares or assets of Transcell;
(xiv) grant or amend any share-related or performance awards;
(xv) except with respect to agreements which are terminable at will by Transcell without any material penalty to Transcell, enter into or amend any legally binding employment, severance, consulting or salary continuation agreements with any officers, directors or employees or grant any increases in compensation or benefits to employees other than regular quarterly cash dividends not increases to exceed $0.05 per shareofficers and employees in the ordinary course of business consistent with the past practice of Transcell;
(xvi) adopt, amend or terminate any employee benefit plan or arrangement (except as expressly contemplated by this Agreement);
(xvii) change any accounting principles or practices used by Transcell;
(xviii) waive, relinquish, release or terminate any material right or claim, including any such right or claim under any Material Contract or permit any rights of material value to use any Intellectual Property to lapse or be forfeited; or
(xix) agree in writing or otherwise to take any of the foregoing actions.
Appears in 1 contract
Interim Operations. (a) Prior to the Effective Time, except as set forth in the The Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, from the period commencing on the delivery and execution of this Agreement until the earlier of the Effective Time and the termination of this Agreement pursuant to Article XI (the “Interim Period”), unless (I) Authentic shall otherwise approve in writing, which approval shall not be unreasonably withheld, conditioned or delayed, (II) expressly required by this Agreement, including the Pre-Closing Restructuring Plan, or applicable Law, or otherwise expressly permitted by this Section 8.1, or (III) as set forth in Section 8.1(a) of the Company Disclosure Schedule (the exceptions set forth in the foregoing clauses (I) – (III), the “Interim Covenant Exceptions”), use commercially reasonable efforts to (x) conduct its operations according business in the Ordinary Course of Business and in compliance with applicable Laws, (y) maintain and preserve intact in all material respects the business of the Company and its Subsidiaries, the relations and goodwill with customers, suppliers, licensors, licensees, distributors, creditors, lessors, employees, consultants, agents and business associates and (z) keep available, in all material respects, the services of the employees and consultants of the Company and its Subsidiaries (but excluding for these purposes the Rolling Stockholders) and all other Persons with which it has business relations that are material to their usualthe Company and its Subsidiaries (taken as a whole). At all times during the Interim Period, regular except pursuant to any Interim Covenant Exception, the Company shall not (and ordinary course shall cause its Subsidiaries not to):
(i) adopt any change in substantially the same manner as heretofore conducted; its Organizational Documents, other than immaterial amendments to applicable organizational documents of its Subsidiaries that would not reasonably be expected to be adverse to Authentic or Parent;
(ii) shall (A) merge or consolidate with any other Person, or restructure, reorganize or completely or partially liquidate, in each case except for any such transactions solely between or among the Company and its Wholly Owned Subsidiaries or (B) enter into a material new line of business;
(iii) acquire, directly or indirectly by merger, consolidation, acquisition of stock or assets or otherwise, any business, Person, properties or assets from any other Person with a fair market value or purchase price in excess of $5 million in the aggregate, in each case, including any amounts or value reasonably expected to be paid in connection with a future earn-out, purchase price adjustment, release of “holdback” or similar contingent payment obligation, or that would reasonably be expected to prevent, materially delay or materially impair the ability of the Company to consummate the transactions contemplated by this Agreement, other than acquisitions of inventory or assets, goods or properties or in connection with the development of stores in the Ordinary Course of Business;
(iv) transfer, sell, lease, sublease, license, pledge, mortgage, assign, divest, cancel or otherwise dispose of, or incur, permit or suffer to exist the creation of any Encumbrance, in each case, other than Permitted Encumbrances, upon, any properties or assets (tangible or intangible, but other than Intellectual Property which is addressed in Section 8.1(a)(xviii)), product lines or businesses of the Company or any of its Subsidiaries, including capital stock or other equity interests of any of its Subsidiaries, except in connection with (A) sales, leases or other dispositions of inventory (including on consignment) in the Ordinary Course of Business, (B) sales or other dispositions of store locations as contemplated by the Restructuring, (C) sales, leases, or other dispositions of store locations or other assets and rights (including transfers between or among the Company and its Subsidiaries) that are not amend material to the Company and its Certificate Subsidiaries, taken as a whole and are not reasonably expected to adversely impact or delay the Phase I Restructuring or the Pre-Closing Restructuring and (D) the termination or settlement of Incorporation Convertible Hedge Call Options and Convertible Hedge Warrants in the Ordinary Course of Business and in compliance with Section 8.17.
(v) issue, sell, deliver, pledge, dispose of, grant, transfer or Bylaws agree or comparable governing instruments commit to issue, sell, deliver, pledge, dispose of, grant or transfer any shares of capital stock of the Company (including, for the avoidance of doubt, Shares) or capital stock or other equity or equity-based interests of any of its Subsidiaries, securities convertible or exchangeable into or exercisable for any such shares of capital stock or other equity interests, or any options, warrants or other rights of any kind to acquire any such shares of capital stock, other equity interests or such convertible or exchangeable securities (other than (A) the Voting Agreement, (B) the issuance of shares of such capital stock, other equity securities or convertible or exchangeable securities (1) in respect of Company Equity Awards outstanding as of the date of this Agreement as required in accordance with their terms and, as applicable, the Stock Plans and (2) in respect of the Convertible Notes, Convertible Hedge Call Options and Convertible Hedge Warrants in the Ordinary Course of Business and in accordance with their terms), and (C) Encumbrances under Existing Indebtedness;
(vi) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than to permit or from the Company and any of its Subsidiaries) in excess of $2.5 million individually or $5 million in the aggregate, except for (A) to the extent permitted by applicable Law, reasonable and documented advances to directors, officers and other employees for travel and other business-related expenses, in each case, in the Ordinary Course of Business, (B) loans, advances or capital contributions to, or investments in, Wholly Owned Subsidiaries of the Company that are not reasonably expected to adversely impact or delay the Phase I Restructuring or the Pre-Closing Restructuring, or (C) advances pursuant to any advancement obligations under the Company’s or its Subsidiaries’ Organizational Documents or under any Contract existing on the date of this Agreement;
(vii) declare, set aside, establish a record date for, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock or other equity interests (including with respect to the Company, for the avoidance of doubt, Shares), except (A) for dividends or other distributions paid by any Subsidiary to the Company or to any other Subsidiary of the Company that are not reasonably expected to adversely impact or delay the Phase I Restructuring or the Pre-Closing Restructuring and (B) the Company’s regular quarterly dividends that are payable to the holders of Shares following the date of this Agreement until the Closing, payable in cash in an amount not to exceed $0.225 per Share per quarter (which is the current “Dividend Threshold” (as defined in the Convertible Notes Indenture) of the Convertible Notes);
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, or offer to do any of the foregoing with respect to, any of its capital stock, other equity interests or securities convertible or exchangeable into or exercisable for any shares of its capital stock or other equity interests (including with respect to the Company, for the avoidance of doubt, Shares), except for (A) in connection with the forfeiture or cancellation of such interest and (B) in connection with the exercise, vesting or settlement of any Company Equity Awards that are outstanding as of the date of this Agreement;
(ix) incur, assume, repurchase or prepay or guarantee or endorse or otherwise become responsible for any Indebtedness for borrowed money (including the issuance of any debt securities, warrants or other rights to acquire any debt security), except for (A) trade payables incurred in the Ordinary Course of Business, (B) pursuant to Existing Indebtedness (including, for the avoidance of doubt, using available cash of the Company or its Subsidiaries to repay any amounts under Existing Indebtedness prior to the Effective Time), (C) any refinancing, extension, renewal or replacement of any outstanding Indebtedness of the Company, in the case of this subclause (C), that does not increase the aggregate commitments of Indebtedness thereunder, or (D) the incurrence of Indebtedness for borrowed money in the Ordinary Course of Business, not to exceed $10 million in the aggregate in the case of this subclause (D);
(x) make or authorize any payment of, or accrual or commitment for, capital expenditures, in excess of $10 million, except to the extent set forth in the line items of the Company’s capital budget set forth in Section 8.1(a)(x) of the Company Disclosure Schedule;
(xi) enter into any Contract that would have been a Material Contract of the types described in clauses (viii) (solely with respect to any such Contract that impacts any Company IPCo Assets), (ix), (x) (solely with respect to any such Contract that impacts any Company IPCo Assets) or (xi) (but solely to the extent such Contract would limit Authentic’s or its Affiliates’ freedom of action with respect to, or its or their ability to retain or freely operate, one or more of the businesses, licenses, rights, product lines, or assets of Authentic or any of its Affiliates, in each case following the Closing) of Section 5.11(a) had it been entered into prior to this Agreement;
(xii) terminate, fail to renew or amend, let lapse or otherwise modify or waive or assign, convey, encumber (other than with a Permitted Encumbrance) or otherwise transfer, in whole or in part, rights or interest pursuant to or in, any Material Contract, other than (A) expirations or non-renewals of any such Material Contract, (B) amendments or modifications providing for the extension of any such Material Contract (other than any such Material Contract described in clauses (iv) – (v) of Section 5.11(a)), in each case of clauses (A) and (B), in the Ordinary Course of Business and in accordance with the terms of such Material Contract, (C) as contemplated by the Restructuring, (D) terminations of any such Material Contract due to a material breach of such Material Contract by the counterparty thereto, or (E) in a manner that would not be material and adverse to the Company and its Subsidiaries, taken as a whole;
(xiii) cancel, modify or waive any debts or claims held by or owed to the Company or any of its Subsidiaries having in each case a value in excess of $1 million individually or $2 million in the aggregate;
(xiv) except as would not be material to the Company and its Subsidiaries, taken as a whole, adversely amend or modify, or terminate, cancel or let lapse any insurance policy of the Company and its Subsidiaries that is in effect as of the date hereof, unless simultaneously with such termination, cancellation or lapse replacement coverage equal to or greater than the existing coverage is in full force and effect with no gap in coverage;
(xv) other than (A) with respect to Transaction Litigation (which shall be governed by the terms of Section 8.14) or (B) with respect to any Proceeding with respect to which an insurer or other third party (but neither the Company nor any of its Subsidiaries) has the right to control the decision to compromise or settle such Proceeding (except to the extent that delaying, conditioning or withholding such consent would not be unreasonable), or the Company or its Subsidiary is contractually obligated not to unreasonably delay, condition or withhold its consent to such third party’s decision to compromise or settle such Proceeding, settle, pay, discharge or compromise any Proceeding for an amount in excess of $2 million individually or $5 million in the aggregate during any calendar year, in each case, net of any reasonably expected insurance recovery and excluding amounts reflected and reserved against in the financial statements included or incorporated by reference into the most-recent Company Report, or on a basis that would result in the imposition of any Order that would restrict in any material respect the future activity or conduct of the Company or any of its Subsidiaries or a finding or admission of a violation of Law, or which would reasonably be expected to prevent, materially delay or materially impair the consummation of the transactions contemplated by this Agreement;
(xvi) make any material changes with respect to financial accounting policies or procedures, except to the extent required by GAAP or Law (or any interpretation thereof, including pursuant to standards, guidelines and interpretations of the Financial Accounting Standards Board or any similar organization); ;
(iiixvii) shall promptly notify (A) make (inconsistent with past practice), change or revoke any material Tax election or change any material Tax accounting method, (B) file any material amended Tax Return, (C) file any Tax Return in a matter materially inconsistent with the Purchaser most recent past practices of the Company or applicable Subsidiary, (D) enter into, cancel or modify any closing agreement with respect to a material amount of Taxes, (E) settle or otherwise compromise any Tax claim, audit, assessment or dispute with respect to a material amount of Taxes, in the case of this clause (E), for an amount materially in excess of the amount reserved for Taxes on the financial statements of the Company, (F) surrender any right to claim a refund with respect to a material amount of Taxes, (G) request any material ruling with respect to Taxes, (H) agree to an extension or waiver of the statute of limitations with respect to any material Taxes (in each case, other than in connection with extensions of time to file Tax Returns that are automatic or automatically granted or otherwise constitute ordinary course extensions) or (I) enter into any material Tax indemnification, sharing, allocation or similar agreement or arrangement (other than customary provisions under any commercial, leasing, financing, employment or other agreement entered into in the ordinary course of business no principal purpose of which relates to Taxes);
(xviii) transfer, sell, lease, sublease, license, sublicense, assign, convey or otherwise dispose of, pledge, encumber, grant a covenant not to sue or other right under, abandon, dedicate to the public, cancel or allow to lapse or expire any Company Intellectual Property, other than (A) abandonments, cancellation, lapses or expiration of Company Intellectual Property that is no longer used in and is not material to the business of the Company or any of its Subsidiaries’ respective businesses, individually or collectively, or at the expiration of the applicable non-renewable statutory period, (B) non-exclusive licenses granted to vendors to manufacture product in the Ordinary Course of Business or (C) licenses or sublicenses between or among the Company and its Subsidiaries in the Ordinary Course of Business, provided, that any such licenses or sublicenses (i) are on substantially the same terms as other such licenses or sublicenses made available to Authentic and (ii) do not adversely affect the rights of Company Swiss IPCo or Company US IPCo, as applicable, in or to the Company IPCo Assets following and in connection with the Phase I Restructuring or the Pre-Closing Restructuring;
(xix) except as required by applicable Law or pursuant to the terms of any breach Company Benefit Plan in effect as of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (yA) grantmaterially increase in any manner the cash compensation or consulting fees, confer bonus opportunity, severance or award termination pay of any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective TimeCompany Employee, except as set forth for (1) in respect of those Company Employees who are not Section 16 Officers, increases in annual salary, wage rate or consulting fees in the Purchaser Disclosure Letter Ordinary Course of Business (provided, that any such increase does not exceed 20% for any such Company Employee with an annual salary in excess of $300,000), and any consequent incentives and in severance or as contemplated by this Agreementtermination pay, unless the and (2) in respect of all Company and the Special Committee have consented in writing theretoEmployees, the Purchaser: payment of cash bonuses and any incentives for completed periods based on actual performance in the Ordinary Course of Business (i) shall not issue but excluding any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).discretio
Appears in 1 contract
Sources: Merger Agreement (Guess Inc)
Interim Operations. The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (aunless Parent shall otherwise approve in writing, such approval not to be unreasonably withheld, conditioned or delayed, and except as otherwise expressly required or permitted hereunder) Prior and except as required by applicable Law, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practice and the Company shall use reasonable efforts to preserve intact its business organization, preserve its assets, rights and properties in good repair and condition, keep available the services of its current officers, employees and consultants and preserve its goodwill and its relationships with customers, suppliers, licensors, licensees, distributors and others having business dealings with it. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (i) as Parent may approve in writing, such approval not to be unreasonably withheld; (ii) as is expressly required or permitted by this Agreement; (iii) as is required by applicable Law or by any Governmental Entity; or (iv) as set forth in Section 6.1 of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing theretoSchedule, the Company: Company will not and will not permit its Subsidiaries to:
(a) adopt or propose any change in its certificate of incorporation or bylaws or other applicable governing instruments;
(b) directly or indirectly acquire or agree to acquire (i) shallby merging or consolidating with, and shall cause each purchasing a substantial equity interest in or a substantial portion of its Significant Subsidiaries tothe assets of, conduct its operations according making an investment in or loan or capital contribution to their usual(other than as permitted under Section 6.1(d)) or in any other manner, regular and ordinary course in substantially the same manner as heretofore conducted; any corporation, partnership, association or other business organization or division thereof or (ii) shall not amend any assets that are otherwise material to the Company and its Certificate Subsidiaries, other than inventory acquired in the ordinary course of Incorporation business consistent with past practice;
(c) issue, sell, dispose of, grant, transfer or Bylaws subject to any Lien, or comparable governing instruments authorize the issuance, sale, disposition, grant or transfer of or Lien on, any shares of capital stock of the Company or any of its Subsidiaries (other than to permit (i) the consummation issuance or grant of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to Shares upon the exercise of optionsCompany Options that are outstanding, warrantsand in accordance with their terms, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares as of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, or (yii) grant, confer or award any option, warrant, conversion right the issuance of capital stock or other right not existing on equity interests by a wholly owned Subsidiary of the date hereof Company to the Company or another wholly owned Subsidiary), or securities convertible or exchangeable into or exercisable for any such capital stock or other equity interests, or any options, warrants or other rights of any kind to acquire any shares of its such capital stock, stock or (z) adopt any A1-14such convertible or exchangeable securities;
(bd) Prior make any loans, advances or capital contributions to the Effective Time, except as set forth or investments in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value Person (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; direct or indirect wholly owned domestic Subsidiary of the Company) in excess of $100,000 in the aggregate (iiiother than advances to employees for expenses in the ordinary course of business);
(e) shall promptly deliver to invest any cash of the Company true and correct copies or its Subsidiaries that is not needed to pay current operating expenses in anything other than obligations of any reportor guaranteed by the United States of America or state or local municipal bonds or commercial paper obligations rated A1 or P1 or better by ▇▇▇▇▇’▇ Investors Service, statement Inc. or schedule filed with the SEC subsequent to the date of this Agreement; and Standard & Poors Corporation, respectively;
(ivf) shall not declare, set aside or pay any dividend dividends on, or make any other distribution distributions (whether in cash, stock or payment with property) in respect of, any of its capital stock or other equity interests, except for dividends by a wholly owned Subsidiary of the Company to its parent;
(g) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock or other ownership interests (other than regular the acquisition of any such capital stock or other securities tendered by current or former employees or directors in connection with the exercise of Company Options);
(h) incur, create, assume or otherwise become liable for, or repay or prepay, any indebtedness for borrowed money, any obligations under conditional or installment sale Contracts or other retention Contracts relating to purchased property, any capital lease obligations (except as permitted under Section 6.1(i)) or any guarantee of any such indebtedness of any other Person, issue or sell any debt securities, options, warrants, calls or other rights to acquire any debt securities of the Company or any of its Subsidiaries, guarantee any debt securities of any other Person, enter into any “keepwell” or other agreement to maintain any financial statement condition of any other Person or enter into any arrangement having the economic effect of any of the foregoing (collectively, “Indebtedness”), or amend, modify or refinance any Indebtedness; provided, that the Company may incur indebtedness for borrowed money under credit facilities, lines of credit and other debt or borrowing arrangements reflected in the Company Reports incurred to cover payments, in the first quarter of the Company’s fiscal year ended December 31, 2009, of (x) quarterly tax payments for the Company and its Subsidiaries, (y) annual cash dividends incentives to employees of the Company and its Subsidiaries, and (z) earn-out payments to ▇▇▇▇▇▇▇ ▇▇▇▇ pursuant to the terms of that certain Stock Purchase Agreement, dated as of January 30, 2007, by and among the Company, Project Planning, Incorporated, and ▇▇▇▇▇▇▇ ▇▇▇▇;
(i) incur or commit to incur any capital expenditure or authorization or commitment with respect thereto that in the aggregate are in excess of $500,000;
(i) pay, discharge, settle or satisfy any claims, liabilities or obligations (whether absolute, accrued, asserted or unasserted, contingent or otherwise), other than the payment, discharge or satisfaction in the ordinary course of business consistent with past practice or as required by their terms as in effect on the date of this Agreement of claims, liabilities or obligations reflected or reserved against in the most recent audited financial statements (or the notes thereto) of the Company included in the Company Reports (for amounts not in excess of such reserves) or incurred since the date of such financial statements in the ordinary course of business consistent with past practice, (ii) cancel any material indebtedness or (iii) waive, release, grant or transfer any right of material value; provided, that the Company and any Subsidiary may pay, discharge, settle or satisfy, in accordance with its terms, any liability or obligation incurred by the Company or such Subsidiary after the date hereof in accordance with the terms of this Agreement;
(k) except with respect to exceed entry into and modification, amendment, termination, cancellation or extension of customer contracts in the ordinary course of business consistent with past practice, (i) modify, amend, terminate, cancel or extend any Material Contract or (ii) enter into any Contract that if in effect on the date hereof would be a Material Contract;
(l) change its financial or tax accounting methods, principles or practices, except insofar as may have been required by a change in GAAP or applicable Law, or revalue any of its material assets;
(m) commence any Action (other than an Action as a result of an Action commenced against the Company or any of its Subsidiaries), or compromise, settle or agree to settle any Action (including any Action relating to this Agreement or the transactions contemplated hereby) other than compromises, settlements or agreements in the ordinary course of business consistent with past practice that involve only the payment of money damages not in excess of $0.05 per share250,000 individually or $500,000 in the aggregate, in any case without the imposition of any equitable relief on, or the admission of wrongdoing by, the Company;
(n) make or change any Tax election or Tax accounting method, amend any Tax Return, or settle or compromise any material Tax liability;
(o) change its fiscal year;
(p) transfer, sell, lease, exclusively license, surrender, divest, cancel, abandon or otherwise dispose of, or subject to any Lien, any assets, product lines or businesses of the Company or its Subsidiaries which are material to the Company and its Subsidiaries taken as a whole, other than sales of inventory, supplies and other assets in the ordinary course of business and other than pursuant to Contracts in effect on the date of this Agreement that have been disclosed to Parent or filed or furnished in or with the Company Reports;
(q) except as expressly required by this Agreement, required pursuant to the Benefit Plans or the Stock Plans in effect on the date of this Agreement, as otherwise required by applicable Law (including to cause any compensation to comply with, or be exempt from, Section 409A of the Code and the Department of Treasury regulations and other interpretative guidance issued thereunder), (i) grant or provide any severance or termination payments or benefits to any officer, employee, independent contractor or consultant of the Company or any of its Subsidiaries other than payments or benefits to non-officer employees, independent contractors, or consultants in the ordinary course of business consistent with past practices, (ii) increase the compensation, perquisites or benefits payable to any director, officer, employee, independent contractor, or consultant of the Company or any of its Subsidiaries, other than increases in compensation, perquisites, or benefits payable to non-officer employees, independent contractors, or consultants in the ordinary course of business consistent with past practice, (iii) grant any equity or equity-based awards that may be settled in Shares or any other equity securities of the Company or any of its Subsidiaries or the value of which is linked directly or indirectly, in whole or in part, to the price or value of any Shares or other equity securities of the Company or any of its Subsidiaries, (iv) accelerate the vesting or payment of compensation payable or benefits provided or to become payable or provided to any current or former director, officer, employee, independent contractor or consultant, (v) change the terms of any outstanding Company Option, or (vi) terminate or materially amend any existing, or adopt any new, Benefit Plan (other than (I) changes that may be necessary to comply with applicable Law that do not materially increase the costs of any such Benefit Plans or acceleration of Company Options or Company RSUs contemplated by Section 4.3 of this Agreement and (II) termination, at the sole discretion of the Company, of the 1995 Nonqualified Stock Option Plan of Space Applications Corporation);
(r) adopt or enter into a plan of complete or partial liquidation, dissolution, restructuring, capitalization or other reorganization;
(s) fail to keep in force insurance policies or replacement or revised provisions regarding insurance coverage with respect to the assets, operations and activities of the Company and its Subsidiaries as currently in effect;
(t) renew or enter into any non-compete, exclusivity, non-solicitation or similar agreement that would restrict or limit, in any material respect, the operations of the Company or any of its Subsidiaries;
(u) waive any material benefits of, or agree to modify in any adverse respect, or fail to enforce, or consent to any matter with respect to which its consent is required under, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is a party, except as contemplated by the provisions of Sections 6.2 and 6.3;
(v) enter into any new line of business outside of its existing business;
(w) enter into any new lease or amend the terms of any existing lease of real property that would require payments over the remaining term of such lease in excess of $300,000;
(x) take any action (or omit to take any action) if such action (or omission) would reasonably be expected to result in any of the conditions to the Merger set forth in Article VII not being satisfied; or
(y) except as provided in Section 6.2 and Section 6.3, agree, authorize or commit to do any of the foregoing. Nothing contained in this Agreement (including, without limitation, this Section 6.1) is intended to give Parent, directly or indirectly, the right to control or direct the Company’s or any of its Subsidiaries’ operations prior to the Effective Time, and nothing contained in this Agreement is intended to give the Company, directly or indirectly, the right to control or direct Parent’s or any of its Subsidiaries’ operations. Prior to the Effective Time, each of Parent, Merger Sub and the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations.
Appears in 1 contract
Sources: Merger Agreement (Sm&A)
Interim Operations. (a) Prior Each of the Company and EFIH covenants and agrees as to itself and each of its Subsidiaries (other than the Oncor Entities) that, except (i) as otherwise specifically permitted or required by the provisions of this Agreement and the Plan of Reorganization, (ii) as Parent may approve in writing (such approval, not to be unreasonably withheld, delayed or conditioned), (iii) as is required by any applicable Law or any Governmental Entity; provided that, to the extent legally permissible, the Company or EFIH shall provide prompt written notice to Parent of any such requirement, (iv) as set forth in Section 6.1(a) of the Company Disclosure Letter, or (v) as required by the Bankruptcy Court in the Chapter 11 Cases without any of the E-Side Debtors having requested or applied (or having requested that any of their respective Affiliates make such request or application) for the Bankruptcy Court to impose such requirement (and with the Company and EFIH, to the extent requested by Parent prior to such imposition, having used commercially reasonable efforts to challenge such imposition before the Bankruptcy Court), in each case after the date hereof and prior to the earlier of the Termination Date (as defined below) and the Effective Time, except as set forth in each of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) and EFIH shall, and shall cause each of its Significant their respective Subsidiaries (other than the Oncor Entities) to, conduct its operations according business and the Chapter 11 Cases in accordance with the Bankruptcy Code and the orders of the Bankruptcy Court and use its reasonable best efforts to preserve its business organizations intact, and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, employees and business associates. Notwithstanding the foregoing, from the date of this Agreement until the earlier of the Termination Date and the Effective Time, except (A) as otherwise specifically permitted or required by the provisions of this Agreement and the Plan of Reorganization, (B) as Parent may approve in writing (such approval, not to be unreasonably withheld, delayed or conditioned), (C) as is required by any applicable Law or any Governmental Entity, (D) as set forth in Section 6.1(a) of the Company Disclosure Letter, or (E) as required by the Bankruptcy Court in the Chapter 11 Cases without any of the E-Side Debtors having requested or applied (or having requested that any of their usualrespective Affiliates make such request or application) for the Bankruptcy Court to impose such requirement (and with the Company and EFIH, regular to the extent requested by Parent prior to such imposition, having used commercially reasonable efforts to challenge such imposition before the Bankruptcy Court), each of the Company and ordinary course EFIH will not and will not permit any of its respective Subsidiaries (other than the Oncor Entities) to:
(i) adopt any change in substantially the same manner as heretofore conducted; its certificate of incorporation, bylaws, limited liability company agreement or other applicable governing instruments;
(ii) merge or consolidate with any other Person;
(iii) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization other than the Plan of Reorganization;
(iv) make any acquisition of any assets or Person for a purchase price individually or in the aggregate in excess of $10,000,000;
(v) issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of any shares of its capital stock or other equity interests; other than (A) the issuance of shares of EFH Common Stock upon the settlement of awards currently outstanding under the Company Stock Plans (and dividend equivalents thereon, if applicable), (B) the issuance of equity interests by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary of the Company, or (C) pursuant to permitted borrowings under the DIP Facility or the modification, replacement, refunding, renewal, extension or refinancing of the DIP Facility or the modification, replacement, refunding, renewal, extension or refinancing thereof (provided that any modification, replacement, refunding, renewal, extension or refinancing shall not amend its Certificate be for an amount greater than the then current outstanding principal amount thereof except by an amount equal to the unpaid accrued interest and premium thereon plus the reasonable amounts paid in respect of Incorporation fees and expenses incurred in connection with such modification, replacement, refunding, renewal, extension or Bylaws refinancing), or, securities convertible or comparable governing instruments exchangeable into or exercisable for any shares of such capital stock or other equity interests, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or other equity interests or such convertible or exchangeable securities;
(vi) make any loans, advances or capital contributions to, or investments in, any Person (other than in or to the Company or any direct or indirect wholly owned Subsidiary of the Company) individually or in the aggregate in excess of $10,000,000;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock or other equity interests (except for dividends paid by any direct or indirect wholly owned Subsidiary to the Company or to any other direct or indirect wholly owned Subsidiary of the Company) or enter into any agreement with respect to the voting of its capital stock or other equity interests or take any action that would result in the Company or any of its Subsidiaries becoming subject to any restriction not in existence on the date hereof with respect to the payment of distributions or dividends;
(viii) reclassify, split, combine or subdivide, directly or indirectly, any of its capital stock, equity interests or securities convertible or exchangeable into or exercisable for any shares of its capital stock or equity interests;
(ix) repurchase, redeem or otherwise acquire, or offer to repurchase, redeem or otherwise acquire, any of its capital stock or equity interests or any securities of convertible into or exchangeable or exercisable for capital stock or equity interests, or any warrants, calls, options or other rights to acquire any such capital stock, securities or interests;
(x) repurchase, redeem, defease, cancel, prepay, forgive, issue, sell, incur or otherwise acquire any indebtedness for borrowed money or any debt securities or rights to acquire debt securities, of the Company or any of its Subsidiaries other than pursuant to the Plan of Reorganization, or assume, guarantee or otherwise become responsible for such indebtedness of another Person (other than a wholly owned Subsidiary of the Company), except for indebtedness for borrowed money (A) incurred or repaid under the DIP Facility or the modification, replacement, refunding, renewal, extension, repayment or refinancing (subject to clause (v) above) thereof, in each case, to the extent approved by the Bankruptcy Court in the Chapter 11 Cases, or (B) incurred by drawing under outstanding letters of credit;
(xi) (A) grant to any Employee or any member of the board of directors (or similar governing body) or consultant any increase in compensation or benefits other than increases in the ordinary course of business, (B) grant to any Employee or any member of the board of directors (or similar governing body) or consultant any increase in change in control, severance or termination pay, (C) amend in any material respect or terminate any Assumed Plan or related agreement thereunder or establish, adopt, enter into any plan or related agreement that would be a Benefit Plan if in existence on the date hereof or with respect to any actions taken to terminate and wind-down any Discharged Plan or as otherwise required under the terms of this Agreement, (D) take any action to accelerate the time of vesting, funding or payment of any compensation or benefits under any Assumed Plan or EFH Retirement Plan or related agreement thereunder (or any plan or related agreement that would be an Assumed Plan if in existence on the date hereof); provided that with respect to the Discharged Plans, such actions may be taken that are in furtherance of the confirmation of a plan of reorganization or the termination and wind-down of such Discharged Plans, (E) grant any new awards, or amend any outstanding awards, under any Assumed Plan or related agreement thereunder (or any plan or related agreement that would be an Assumed Plan if in existence on the date hereof), or (F) enter into or amend any collective bargaining agreement or other agreement with a labor union, works council or similar organization, except in the case of the foregoing clauses (A) through (F) for actions required pursuant to the terms of any Benefit Plan, or required in accordance with the terms and conditions of this Agreement or applicable Law; provided, however, that following the date of this Agreement and notwithstanding anything to the contrary herein, the Company and EFIH may, and may permit any of their respective Subsidiaries to, hire any individual or engage any individual, as an interim employee through a third party staffing agency or as an independent contractor or consultant, with such engagements to end in all instances prior to the Effective Time, to the extent reasonably necessary for the Company’s operations, and may, notwithstanding anything contained in this Agreement to the contrary, provide compensation and benefits that, for all such persons as a group, (i) does not exceed $15,000,000 in the aggregate in any annual period and (ii) does not impose any liability on the reorganized Company and its Subsidiaries following the Closing;
(xii) make or authorize any capital expenditure in an amount in excess of $1,000,000, in the aggregate, during any 12 month period;
(xiii) make any material changes with respect to its financial accounting methods, principles, policies, practices or procedures, except as required by Law or by changes in GAAP;
(xiv) make (excluding any elections made (a) in the ordinary course of business or (b) under Section 168(k) of the Code) or change any material Tax election, change any material method of Tax accounting, settle or compromise any material Tax liability, claim or assessment or agree to an extension or waiver of the limitation period to any material Tax claim or assessment, grant any power of attorney with respect to material Taxes, enter into any closing agreement with respect to any material Tax or refund, amend any material Tax Return, or surrender any right to claim a material Tax Refund of the Company or any of its Subsidiaries, in each case, other than with respect to any such actions agreed to in connection with any audit or other Tax proceedings disclosed in Section 6.1(a)(xiv) of the Company Disclosure Letter; provided, however, that the full details of any such actions shall be disclosed to Parent if such actions would result in the inclusion of any material item of income in, or the exclusion of any material item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date which taxable income was realized (and reflects economic income arising) prior to the Closing Date;
(xv) waive, release, assign, settle or compromise any pending or threatened claim, action, suit or proceeding against the Company or any of its Subsidiaries other than settlements or compromises (A) that would result in the payment by the Company and its Subsidiaries of less than $10,000,000 in the aggregate, and (B) that do not entail the acceptance or imposition of any material restrictions on the business or operations of the Company or its Subsidiaries;
(xvi) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets, product lines or businesses of the Company or its Subsidiaries with a fair market value in excess of $10,000,000 in the aggregate for all such actions, other than (A) sales of obsolete goods or equipment, or (B) cancellation of, abandonment of, allowing to lapse or expire, or the licensing or sublicensing of, material Intellectual Property, in each of (A) and (B), in the ordinary course of business consistent with past practice or in accordance with the Bankruptcy Code or the orders of the Bankruptcy Court; provided, however, that in no event shall the Company or any of its Subsidiaries (other than the Oncor Entities) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any capital stock or other equity interests of any of their respective Subsidiaries other than in connection with the modification, replacement, refunding, renewal, extension or refinancing (subject to clause (v) above) of the DIP Facility;
(xvii) except as permitted by clause (v)(C) above, enter into, terminate (other than at the end of a term), renew or materially extend or amend any Company Material Contract or Contract that, if in effect on the date hereof, would be a Company Material Contract; or waive any material default under, or release, settle or compromise any material claim against the Company or any of its Subsidiaries or liability or obligation owing to the Company or any of its Subsidiaries, under any Company Material Contract or Contract that, if in effect on the date hereof, would be a Company Material Contract, other than pursuant to the Plan of Reorganization;
(xviii) enter into any Contract that contains a change of control or similar provision that would require a payment to any Person counterparty thereto in connection with the consummation of the transactions contemplated by this Agreement)Agreement that would not otherwise be due;
(xix) fail to maintain in full force and effect material insurance policies covering the Company and its Subsidiaries (other than the Oncor Entities) and their respective properties, assets and businesses in a form and amount consistent with past practice; or
(iiixx) shall promptly notify agree, authorize or commit to do any of the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14foregoing.
(b) Prior Notwithstanding anything in Section 6.1(a) to the Effective Timecontrary, except the Company and its Subsidiaries may take commercially reasonable actions consistent with prudent industry practices that would otherwise be prohibited pursuant to Section 6.1(a) in order to prevent the occurrence of, or mitigate the existence of, an emergency situation involving endangerment of life, human health, safety or the Environment or the protection of equipment or other assets; provided, however, that the Company shall provide Parent with notice of such emergency situation and any such action taken by the Company or any of its Subsidiaries (other than the Oncor Entities) as set forth soon as reasonably practicable after obtaining Knowledge thereof.
(c) Except for actions required, or specifically permitted, under the terms of this Agreement or the Plan of Reorganization or as required by the Bankruptcy Code or the Bankruptcy Court in the Purchaser Disclosure Letter Chapter 11 Cases without any of the Debtors having requested or as contemplated applied (or having requested that any of their respective Affiliates make such request or application) for the Bankruptcy Court to impose such requirement (and with the Company and EFIH, to the extent requested by Parent prior to such imposition, having used commercially reasonable efforts to challenge such imposition before the Bankruptcy Court), and subject to Section 6.20, none of Parent, Merger Sub, the Company or EFIH shall intentionally take (or fail to take if required by this Agreement, unless the Company and the Special Committee have consented in writing theretoPlan of Reorganization, any Governmental Entity, the Purchaser: (iBankruptcy Court, applicable Law or contractual obligation) shall not issue or permit any shares of its capital stock at less than fair market value Subsidiaries to take (other than pursuant or fail to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of take if required by this Agreement; and , the Plan of Reorganization, any Governmental Entity, the Bankruptcy Court, applicable Law or contractual obligation) any action that if taken (ivor failed to be taken) shall not declarewould reasonably be expected to prevent or impair in any material respect the consummation of the Closing Date Transactions.
(d) Nothing contained in this Agreement is intended to give Parent, set aside directly or pay any dividend indirectly, the right to control or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).direct the
Appears in 1 contract
Sources: Merger Agreement (Sempra Energy)
Interim Operations. NYSE Group and Euronext each covenants and agrees as to itself and its Subsidiaries that, after the date hereof and until the earlier of the Effective Time or the termination of this Agreement in accordance with its terms, unless NYSE Group (in the case of Euronext) or Euronext (in the case of NYSE Group) shall otherwise approve in writing, and except as otherwise expressly contemplated by this Agreement or, in the case of Euronext, except as otherwise set forth in Schedule 7.1 of the Euronext Disclosure Letter or, in the case of NYSE Group, except as otherwise set forth in Schedule 7.1 of the NYSE Group Disclosure Letter:
(a) Prior the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practice and, to the Effective Timeextent consistent therewith, it and its Subsidiaries shall use their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with all Governmental Entities (including the SEC and the European Regulators and other Euronext stock market regulators), providers of order flow, customers, suppliers, distributors, creditors, lessors, Employees and stockholders, as appropriate;
(b) (i) it shall not issue, sell, pledge, dispose of or encumber any capital stock, as appropriate, owned by it in any of its Subsidiaries; (ii) except as set forth in the Company Disclosure Letter or as contemplated by any other provision Article IV of this AgreementAgreement and except as required to pay the Special Euronext Distribution, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) it shall not amend its Certificate certificate of Incorporation incorporation, articles of association or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement)bylaws, as applicable; (iii) it shall promptly notify the Purchaser not split, combine or reclassify its outstanding shares of any breach of any representation or warranty contained herein or any Company Material Adverse Effectcapital stock; (iv) shall promptly deliver to except for the Purchaser true and correct copies payment of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing theretoEuronext Distribution, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) it shall not declare, set aside or pay any dividend type of dividend, whether payable in cash, stock or make property, in respect of any capital stock, as appropriate, other distribution than dividends payable by its direct or payment with respect indirect wholly owned Subsidiaries to it or another of its direct or indirectly wholly owned Subsidiaries; or (v) it shall not repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any interests or shares of its capital stock, as applicable, or any securities convertible into or exchangeable or exercisable for any shares of its capital stock, as applicable;
(c) neither it nor any of its Subsidiaries shall (i) except for the issuance of Euronext Stock Options and Euronext Stock-Based Awards authorized at the annual general meeting of Euronext on May 23, 2006, issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, capital stock of any class, as appropriate, or any bonds, debentures, notes or other ownership interests obligations the holders of which have the right to vote (or convertible into or exercisable for securities having the right to vote) with its stockholders on any matter or any other property or assets other than shares of NYSE Group Common Stock or Euronext Shares (or Euronext Paris ordinary shares, as the case may be) issuable pursuant to stock-based awards outstanding on or awarded prior to the date hereof under the NYSE Group Stock Plans or Euronext Stock Plans; (ii) other than in the ordinary and usual course of business, transfer, lease, license, guarantee, acquire, sell, mortgage, pledge, dispose of or encumber any other material property or assets (including capital stock of any of its Subsidiaries); (iii) incur any indebtedness for borrowed money (including any guarantee of such indebtedness); or (iv) make or authorize or commit for any capital expenditures, except as provided in the business plan for each of NYSE Group and Euronext, respectively, that has been provided to the other prior to the date of this Agreement (provided that each of NYSE Group and Euronext shall be permitted to make or authorize or commit for any capital expenditures in an amount that is between 90% and 110% of the amounts set forth in such party’s respective business plan);
(d) neither it nor any of its Subsidiaries shall (i) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Benefit Plan, as the case may be, or any other arrangement that would be a NYSE Group Benefit Plan or a Euronext Benefit Plan if in effect on the date hereof other than offer letters provided to newly-hired employees (but excluding offer letters to executive officers of it and its Subsidiaries or to employees whose target compensation is in excess of $700,000); provided that such offer letters do not include any compensation or benefits that vest, accelerate or otherwise are affected by or result in any payment or funding in connection with any of the transactions contemplated by this Agreement (including without limitation upon signing, closing, shareholder approval of or any other event closely associated with the Offer, the Merger or the Post-Closing Reorganization) either alone or in conjunction with any other event, or (ii) except for the issuance of Euronext Stock Options and Euronext Stock-Based Awards authorized at the annual general meeting of Euronext on May 23, 2006 and increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and related increases of annual base salaries not to exceed 7% in the aggregate), increase the salary, wage, bonus or other compensation of any employees or fringe benefits of any director, officer or employee or enter into any contract, agreement, commitment or arrangement to do any of the foregoing or (iii) enter into or renew any contract, agreement, commitment or arrangement (other than regular quarterly cash dividends not a renewal occurring in accordance with the terms thereof) providing for the payment to exceed $0.05 per shareany director, officer or employee of such party of compensation or benefits contingent, or the terms of which are materially altered, in connection with any of the transactions contemplated by this Agreement (including without limitation upon signing, closing, shareholder approval of or any other event closely associated with the Offer, the Merger or the Post-Closing Reorganization) either alone or in conjunction with any other event or (iv) provide, with respect to the grant of any stock option, restricted stock, restricted stock unit or other equity-related award (or with respect to any outstanding equity-related award) that the vesting of any such stock option, restricted stock, restricted stock unit or other equity-related award or any Benefit Plan shall accelerate or otherwise be affected by or result in any payment or funding in connection with any of the transactions contemplated by this Agreement (including without limitation upon signing, closing, shareholder approval of or any other event closely associated with the Offer, the Merger or the Post-Closing Reorganization) either alone or in conjunction with any other event;
(e) except in the ordinary and usual course of business consistent with past practice, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation, and neither it nor any of its Subsidiaries shall modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(f) neither it nor any of its Subsidiaries shall make or change any material Tax election, change any material method of Tax accounting, file any materially amended Tax Return, or settle or compromise any material audit or proceeding relating to Taxes; or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of business;
(g) neither it nor any of its Subsidiaries shall permit any change in its credit practices or financial accounting principles, policies or practice (including any of its practices with respect to accounts receivable or accounts payable), except to the extent that any such changes in financial accounting principles, policies or practices shall be required by changes in GAAP (in the case of NYSE Group) or IFRS (in the case of Euronext);
(h) neither it nor any of its Subsidiaries shall enter into any “non-compete” or similar Contract that would materially restrict the business of Holdco or any of its Subsidiaries following the Effective Time;
(i) except as permitted pursuant to Section 7.1(d), neither it nor any of its Subsidiaries shall enter into any Contract between itself, on the one hand, and any of its affiliates, employees, officers or directors, on the other hand; and
(j) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing set forth in Sections 7.1(a) - (i) if NYSE Group or Euronext, as applicable, would be prohibited by the terms of Sections 7.1(a) - (i) from doing the foregoing.
Appears in 1 contract
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, after the date of this Agreement and prior to the Effective Time, except (1) as required by applicable Laws, Governmental Entities or Educational Agencies, (2) as otherwise expressly required by this Agreement (which, for the avoidance of doubt, shall be deemed to include Section 6.12), (3) as set forth in Sections 6.1(a) or 6.1(b) of the Company Disclosure Letter or as contemplated permitted by and consistent with Section 6.2 of this Agreement (4) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), the Company and its Subsidiaries shall use their respective commercially reasonable efforts to conduct the business and operations of it and its Subsidiaries in the ordinary course and, to the extent consistent therewith, it and its Subsidiaries shall use their respective commercially reasonable efforts to (i) preserve intact their respective material assets, including real and personal property, and present business organizations, (ii) maintain all of their material Licenses, (iii) keep available the services of the directors of the Company Board and the executive officers and key employees of the Company and its Subsidiaries, (iv) maintain good relations with, and the goodwill of, their respective students, suppliers, creditors, lessors, employees, business associates, (v) incur or spend capital expenditures in accordance with the Company’s program of capital expenditures and (vi) manage its working capital (including the timing of collection of accounts receivable and of the payment of accounts payable and the management of inventory) in the ordinary course of business.
(b) Without limiting the generality of, and in furtherance of, the foregoing, from the date of this Agreement until the Effective Time, except (1) as required by applicable Laws, Governmental Entities and Educational Agencies, (2) as otherwise expressly required by this Agreement, (3) as set forth in Section 6.1(b) of the Company Disclosure Letter or, if applicable, Section 6.2 of this Agreement or (4) as Parent may approve in advance in writing (such approval not to be unreasonably withheld, conditioned or delayed in the case of Sections 6.1(b)(vi), 6.1(b)(x), 6.1(b)(xiii), 6.1(b)(xv), 6.1(b)(xvi), 6.1(b)(xvii), 6.1(b)(xix), 6.1(b)(xx)-(xxiv) and to the extent applicable to the foregoing subsections, Section 6.1(b)(xxv)), the Company will not and will cause its Subsidiaries not to:
(i) adopt any change in its articles of incorporation or by-laws or other applicable governing instruments (whether by merger, consolidation or otherwise);
(ii) directly or indirectly (A) acquire (whether by merger, consolidation or acquisition of stock or assets or otherwise) equity interests in any corporation, partnership or other business organization or division thereof or, other than in the ordinary course of business, any assets from any other provision Person or (B) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose (whether by merger, consolidation or sale of stock or assets or otherwise) of any material property, assets, licenses, operations, rights, product lines, businesses or interests therein of the Company or any of its Subsidiaries, including capital stock of any of its Subsidiaries, with a value or purchase price in excess of $5,000,000 in the aggregate, except (1) in connection with services provided in the ordinary course of business, (2) non-exclusive licenses granted in the ordinary course of business, (3) cancellations, abandonments and lapses of rights in Intellectual Property made in the Company’s reasonable business judgment and in the ordinary course of business, (4) sales of obsolete assets that are no longer useful in the conduct of the business of the Company or any of its Subsidiaries and with a fair market value not in excess of $5,000,000 in the aggregate and (5) any such transfer among the Company or any of its wholly-owned Subsidiaries;
(iii) issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock, ownership interests or other securities of the Company or any of its Subsidiaries (other than the issuance of Shares in respect of Company Equity Awards outstanding as of the date of this Agreement, unless in accordance with their terms and (as applicable) the Purchaser has consented Stock Plan as in writing theretoeffect on the date of this Agreement), or securities convertible into or exchangeable or exercisable for any shares of such capital stock, ownership interests or other securities, or any options, warrants, other Company Equity Awards or other rights of any kind to acquire any shares of such capital stock, ownership interests or other securities or such convertible or exchangeable securities, or amend, modify or supplement any terms of any such options, warrants or other rights;
(iv) mortgage, pledge, hypothecate, grant any security interest in or otherwise create or incur any Lien not created or incurred in the Company: (i) shallordinary course of business, and shall cause each other than Permitted Liens, on any properties or assets of the Company or any of its Significant Subsidiaries tohaving a value in excess of $5,000,000 in the aggregate;
(v) make, conduct its operations according forgive or cancel any loans, advances, guarantees or capital contributions to their usual, regular and ordinary course or investments in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments any Person (other than any loans, advances, guarantees or capital contributions to permit the consummation or investments in a wholly-owned Subsidiary of the transactions contemplated Company) in excess of $5,000,000 in the aggregate;
(vi) make any change in financial accounting methods, principles or practices (including procedures with respect to the payment of accounts payable and collection of accounts receivable) (or change an annual accounting period) or systems of internal accounting controls, except insofar as may be required by this Agreement); a change in GAAP, any rule or regulation promulgated by any Governmental Entity or Educational Agency or any other applicable Law after the date hereof;
(iiivii) shall promptly notify declare, set aside, make or pay any dividend or other distribution, whether payable in cash, stock, property or otherwise, with respect to any of the Purchaser capital stock of the Company or any of its Subsidiaries or enter into any agreement with respect to the voting or registration of its capital stock;
(viii) reclassify, split, combine, subdivide or amend the terms of, or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible into or exchangeable or exercisable for any shares of its capital stock (other than (A) the acquisition of any breach Shares tendered by current or former employees in order to pay the exercise price of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies Options outstanding as of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (vB) shall not the withholding of Shares to satisfy withholding Tax obligations in respect of Company Equity Awards outstanding as of the date of this Agreement); or (C) the acquisition of any Shares as required by any Company Joint Venture Agreement disclosed to Parent prior to the date hereof in accordance with their terms and, as applicable, the Stock Plan as in effect on the date of this Agreement;
(ix) except for this Agreement and the Merger, adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization involving the Company or any of its Subsidiaries;
(x) incur any capital expenditures or any Liabilities in respect thereof, other than (A) those budgeted by the Company’s program of capital expenditures and (B) any unbudgeted capital expenditures that do not exceed $500,000 individually or $4,000,000 in the aggregate;
(xi) create, assume, or otherwise become liable for, incur, prepay, refinance or modify in any material respect the terms of, any indebtedness for borrowed money or assume or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, in an aggregate amount in excess of $5,000,000, except for indebtedness for borrowed money pursuant to the exercise terms of optionsthe Credit Agreement or the Company Loan Agreements;
(xii) enter into, warrantsamend or modify any Interested Party Transactions;
(xiii) enter into (A) any Lease which requires annual payments from the Company or any of its Subsidiaries in excess of $5,000,000, conversion or (B) any Contract that would have been a Material Contract pursuant to Sections 5.1(m)(i)(A), 5.1(m)(i)(B), 5.1(m)(i)(C), 5.1(m)(i)(D), 5.1(m)(i)(E), 5.1(m)(i)(F), 5.1(m)(i)(G), 5.1(m)(i)(I), 5.1(m)(i)(J), 5.1(m)(i)(K) and 5.1(m)(i)(M) had it been entered into prior to this Agreement or, other than in the ordinary course of business, terminate, cancel, transfer, assign, license, encumber, amend waive any rights of or modify in any material respect adversely, to the Company or any of its Subsidiaries, any such Lease or Material Contract;
(xiv) enter into any new line of business outside of the post-secondary or proprietary education industry;
(xv) terminate or fail to maintain in full force and other contractual rights existing on effect, replace or renew until the Effective Time substantially the same material insurance policies (or equivalent levels of insurance coverage) with respect to the assets, operations and activities of the Company and its Subsidiaries as are in effect as of the date hereof and disclosed pursuant to of this Agreement;
(xvi) settle or compromise (A) any Proceeding against the Company or any of its Subsidiaries that requires payments by the Company or any of its Subsidiaries in excess of $5,000,000 in the aggregate or grants injunctive or equitable relief against the Company or any of its Subsidiaries or involves the admission of any wrongdoing by the Company or any of its Subsidiaries, other than to the extent such settlements of Proceedings are disclosed, reflected or reserved against in the Company Reports or (B) any shareholder litigation or dispute against the Company or any of its officers or directors that relates to the Merger and the Transactions;
(xvii) except as required pursuant to the Recapitalization issue terms of any shares Company Plan in effect as of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, or as otherwise required by applicable Law, (yA) grantgrant or provide any severance or termination payments or benefits to any current or former director, confer officer, employee or award independent contractor of the Company or any optionof its Subsidiaries, warrant(B) increase the compensation or benefits payable to any current or former director, conversion right officer, employee or independent contractor of the Company or any of its Subsidiaries, except for employees who are designated as Grade 16 and below, increases of no more than 2% in the ordinary course of business, (C) establish, adopt, amend, renew, announce or terminate (or commit to do any of the preceding in respect of) any Company Plan except for (1) amendments to Company Plans made in the ordinary course of business that do not materially increase the expense of maintaining such plan and (2) establishing or adopting Company Plans in the ordinary course of business in connection with the Company’s annual or open enrollment procedures, (D) amend the terms of any outstanding Company Equity Awards, (E) take any action to accelerate the vesting or payment, or fund or in any other way secure the payment, of compensation or benefits under any Company Plan or any Company Equity Award, to the extent not already provided in any such Company Plan or as provided in this Agreement, (F) materially change any actuarial or other right not existing assumptions used to calculate funding obligations with respect to any Company Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP, (G) forgive or grant any loans to directors, officers or employees of the Company or any of its Subsidiaries, (H) hire any employee or independent contractor, other than employees or independent contractors hired in the ordinary course of business and where such person is (1) designated as Grade 16 or below or (2) designated as Grade 19 or below and hired to fill a position open as of the date hereof or to acquire replace an employee or independent contractor of the Company or any shares of its capital stockSubsidiaries whose employment or engagement is terminated in the ordinary course of business (by reason of involuntary termination, voluntary resignation or otherwise) prior to the Closing, or (zI) adopt adopt, enter into, amend or terminate any A1-14collective bargaining agreement or other similar arrangement relating to Unions or other organized employees;
(bxviii) take any action that would result in any of the conditions to the Merger and the Transactions set forth in Article VII not being satisfied or that would reasonably be expected to prevent, materially delay or materially impair the ability of the Company to consummate the Merger and the Transactions;
(xix) fail to prepare and timely file all Tax Returns required to be filed on or before the Closing Date in a manner consistent with past practice, except as otherwise required by a change in applicable Law;
(xx) make or revoke any material election with regard to Taxes or file any material amended Tax Returns;
(xxi) make any change in any Tax accounting methods, except as may be appropriate to conform to changes in Tax Laws, any rule or regulation promulgated by any Governmental Entity or Educational Agency or GAAP;
(xxii) (A) fail to promptly notify Parent of any federal, state, local or foreign income or franchise and any other Proceeding pending or threatened in writing against or with respect to the Company or any of its Subsidiaries in respect of any Tax matter or Proceeding involving a material amount of Tax, (B) fail to provide Parent with information reasonably requested by Parent in writing with respect to the commencement, nature and status of any such Tax matter or Proceeding, or (C) settle or compromise any such Tax matter or Proceeding;
(xxiii) fail to terminate all Contracts relating to the sharing, allocation or indemnification of Taxes between the Company or any of its Subsidiaries, on the one hand, and any of their respective former Affiliates, on the other hand (excluding any commercial Contract that may include Tax allocation or sharing provisions, but the primary purpose of which is unrelated to Taxes) such that there are no further Liabilities thereunder;
(xxiv) fail to take commercially reasonable steps to protect data security or fail to reasonably proceed with data security improvements that have been planned and approved as of the date of this Agreement or fail to conduct customary data security audits, in each case in compliance in all material respects with all internal policies and applicable Laws; or
(xxv) agree, authorize or commit to do any of the foregoing; provided, however, that, without limiting any of Parent’s, Merger Sub’s or the Company’s rights or obligations under this Agreement (including this Section 6.1), nothing contained in this Agreement shall give Parent or Merger Sub, directly or indirectly, any right to control or direct the operations of the Company and its Subsidiaries prior to the Effective Time. Prior to the Effective Time, except as set forth in each of the Purchaser Disclosure Letter or as contemplated by Company and Parent shall exercise, subject to the other terms and conditions of this Agreement, unless the Company control and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true supervision over their respective businesses and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)operations.
Appears in 1 contract
Interim Operations. (a) Prior Each of the Company and EFIH covenants and agrees as to itself and each of its Subsidiaries (other than the Oncor Entities) that, except (i) as otherwise specifically permitted or required by the provisions of this Agreement and the Plan of Reorganization, (ii) as Parent may approve in writing (such approval, not to be unreasonably withheld, delayed or conditioned), (iii) as is required by any applicable Law or any Governmental Entity; provided that, to the extent legally permissible, the Company or EFIH shall provide prompt written notice to Parent of any such requirement; (iv) as set forth in Section 6.1(a) of the Company Disclosure Letter, or (v) as required by the Bankruptcy Court in the Chapter 11 Cases without any of the E-Side Debtors having requested or applied (or having requested that any of their respective Affiliates make such request or application) for the Bankruptcy Court to impose such requirement (and with the Company and EFIH, to the extent requested by Parent prior to such imposition, having used commercially reasonable efforts to challenge such imposition before the Bankruptcy Court), in each case after the date hereof and prior to the earlier of the Termination Date (as defined below) and the Effective Time, except as set forth in each of the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) and EFIH shall, and shall cause each of its Significant their respective Subsidiaries (other than the Oncor Entities) to, conduct its operations according business and the Chapter 11 Cases in accordance with the Bankruptcy Code and the orders of the Bankruptcy Court and use its reasonable best efforts to preserve its business organizations intact, and maintain existing relations and goodwill with Governmental Entities, customers, suppliers, employees and business associates. Notwithstanding the foregoing, from the date of this Agreement until the earlier of the Termination Date and the Effective Time, except (A) as otherwise specifically permitted or required by the provisions of this Agreement and the Plan of Reorganization, (B) as Parent may approve in writing (such approval, not to be unreasonably withheld, delayed or conditioned), (C) as is required by any applicable Law or any Governmental Entity, (D) as set forth in Section 6.1(a) of the Company Disclosure Letter or (E) as required by the Bankruptcy Court in the Chapter 11 Cases without any of the E-Side Debtors having requested or applied (or having requested that any of their usualrespective Affiliates make such request or application) for the Bankruptcy Court to impose such requirement (and with the Company and EFIH, regular to the extent requested by Parent prior to such imposition, having used commercially reasonable efforts to challenge such imposition before the Bankruptcy Court), each of the Company and ordinary course EFIH will not and will not permit any of its respective Subsidiaries (other than the Oncor Entities) to:
(i) adopt any change in substantially the same manner as heretofore conducted; its certificate of incorporation, bylaws, limited liability company agreement or other applicable governing instruments;
(ii) merge or consolidate with any other Person;
(iii) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization other than the Plan of Reorganization;
(iv) make any acquisition of any assets or Person for a purchase price individually or in the aggregate in excess of $10,000,000;
(v) issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of any shares of its capital stock or other equity interests; other than (A) the issuance of shares of EFH Common Stock upon the settlement of awards under the Company Stock Plans (and dividend equivalents thereon, if applicable), (B) the issuance of equity interests by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary of the Company, or (C) pursuant to permitted borrowings under the DIP Facility or the modification, replacement, refunding, renewal, extension or refinancing of the DIP Facility or the modification, replacement, refunding, renewal, extension or refinancing thereof (provided that any modification, replacement, refunding, renewal, extension or refinancing shall not amend its Certificate be for an amount greater than the then current outstanding principal amount thereof except by an amount equal to the unpaid accrued interest and premium thereon plus the reasonable amounts paid in respect of Incorporation fees and expenses incurred in connection with such modification, replacement, refunding, renewal, extension or Bylaws refinancing), or, securities convertible or comparable governing instruments exchangeable into or exercisable for any shares of such capital stock or other equity interests, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or other equity interests or such convertible or exchangeable securities;
(vi) make any loans, advances or capital contributions to, or investments in, any Person (other than in or to the Company or any direct or indirect wholly owned Subsidiary of the Company) individually or in the aggregate in excess of $10,000,000;
(vii) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock or other equity interests (except for dividends paid by any direct or indirect wholly owned Subsidiary to the Company or to any other direct or indirect wholly owned Subsidiary of the Company) or enter into any agreement with respect to the voting of its capital stock or other equity interests or take any action that would result in the Company or any of its Subsidiaries becoming subject to any restriction not in existence on the date hereof with respect to the payment of distributions or dividends;
(viii) reclassify, split, combine or subdivide, directly or indirectly, any of its capital stock, equity interests or securities convertible or exchangeable into or exercisable for any shares of its capital stock or equity interests;
(ix) repurchase, redeem or otherwise acquire, or offer to repurchase, redeem or otherwise acquire, any of its capital stock or equity interests or any securities of convertible into or exchangeable or exercisable for capital stock or equity interests, or any warrants, calls, options or other rights to acquire any such capital stock, securities or interests;
(x) repurchase, redeem, defease, cancel, prepay, forgive, issue, sell, incur or otherwise acquire any indebtedness for borrowed money or any debt securities or rights to acquire debt securities, of the Company or any of its Subsidiaries other than pursuant to the Plan of Reorganization, or assume, guarantee or otherwise become responsible for such indebtedness of another Person (other than a wholly owned Subsidiary of the Company), except for indebtedness for borrowed money (A) incurred or repaid under the DIP Facility or the modification, replacement, refunding, renewal, extension, repayment or refinancing (subject to clause (v) above) thereof, in each case, to the extent approved by the Bankruptcy Court in the Chapter 11 Cases, or (B) incurred by drawing under outstanding letters of credit;
(xi) (A) grant to any Employee or any member of the board of directors (or similar governing body) or consultant any increase in compensation or benefits other than increases in the ordinary course of business, (B) grant to any Employee or any member of the board of directors (or similar governing body) or consultant any increase in change in control, severance or termination pay, (C) amend in any material respect or terminate any Assumed Plan or related agreement thereunder or establish, adopt, enter into any plan or related agreement that would be a Benefit Plan if in existence on the date hereof or with respect to any actions taken to terminate and wind-down any Discharged Plan or as otherwise required under the terms of this Agreement, (D) take any action to accelerate the time of vesting, funding or payment of any compensation or benefits under any Assumed Plan or EFH Retirement Plan or related agreement thereunder (or any plan or related agreement that would be an Assumed Plan if in existence on the date hereof); provided that with respect to the Discharged Plans, such actions may be taken that are in furtherance of the confirmation of a plan of reorganization or the termination and wind-down of such Discharged Plans, (E) grant any new awards, or any outstanding awards, under any Assumed Plan or related agreement thereunder (or any plan or related agreement that would be an Assumed Plan if in existence on the date hereof), or (F) enter into or amend any collective bargaining agreement or other agreement with a labor union, works council or similar organization, except in the case of the foregoing clauses (A) through (F) for actions required pursuant to the terms of any Benefit Plan, or in accordance with the terms and conditions of this Agreement or applicable Law; provided, however, that following the date of this Agreement and notwithstanding anything to the contrary herein, the Company and EFIH may, and may permit any of their respective Subsidiaries to, hire any individual or engage any individual, as an interim employee through a third party staffing agency or as an independent contractor or consultant, with such engagements to end in all instances prior to the Effective Time, to the extent reasonably necessary for the Company’s operations, and may, notwithstanding anything contained in this Agreement to the contrary, provide compensation and benefits that, for all such persons as a group, (i) does not exceed $15,000,000 in the aggregate in any annual period and (ii) does not impose any liability on the reorganized Company and its Subsidiaries following the Closing;
(xii) make or authorize any capital expenditure in an amount in excess of $1,000,000, in the aggregate, during any 12 month period;
(xiii) make any material changes with respect to its financial accounting methods, principles, policies, practices or procedures, except as required by Law or by changes in GAAP;
(xiv) make (excluding any elections made (a) in the ordinary course of business or (b) under Section 168(k) of the Code) or change any material Tax election, change any material method of Tax accounting, settle or compromise any material Tax liability, claim or assessment or agree to an extension or waiver of the limitation period to any material Tax claim or assessment, grant any power of attorney with respect to material Taxes, enter into any closing agreement with respect to any material Tax or refund, amend any material Tax Return, or surrender any right to claim a material Tax Refund of the Company or any of its Subsidiaries, in each case, other than with respect to any such actions agreed to in connection with any audit or other Tax proceedings disclosed in Section 6.1(a)(xiv) of the Company Disclosure Letter; provided, however, that the full details of any such actions shall be disclosed to Parent if such actions would result in the inclusion of any material item of income in, or the exclusion of any material item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date which taxable income was realized (and reflects economic income arising) prior to the Closing Date;
(xv) waive, release, assign, settle or compromise any pending or threatened claim, action, suit or proceeding against the Company or any of its Subsidiaries other than settlements or compromises (A) that would result in the payment by the Company and its Subsidiaries of less than $10,000,000 in the aggregate, and (B) that do not entail the acceptance or imposition of any material restrictions on the business or operations of the Company or its Subsidiaries;
(xvi) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets, product lines or businesses of the Company or its Subsidiaries with a fair market value in excess of $10,000,000 in the aggregate for all such actions, other than (A) sales of obsolete goods or equipment, or (B) cancellation of, abandonment of, allowing to lapse or expire, or the licensing or sublicensing of, material Intellectual Property, in each of (A) and (B), in the ordinary course of business consistent with past practice or in accordance with the Bankruptcy Code or the orders of the Bankruptcy Court; provided, however, that in no event shall the Company or any of its Subsidiaries (other than the Oncor Entities) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any capital stock or other equity interests of any of their respective Subsidiaries other than in connection with the modification, replacement, refunding, renewal, extension or refinancing (subject to clause (v) above) of the DIP Facility;
(xvii) except as permitted by clause (v)(C) above, enter into, terminate (other than at the end of a term), renew or materially extend or amend any Company Material Contract or Contract that, if in effect on the date hereof, would be a Company Material Contract; or waive any material default under, or release, settle or compromise any material claim against the Company or any of its Subsidiaries or liability or obligation owing to the Company or any of its Subsidiaries, under any Company Material Contract or Contract that, if in effect on the date hereof, would be a Company Material Contract, other than pursuant to the Plan of Reorganization;
(xviii) enter into any Contract that contains a change of control or similar provision that would require a payment to any Person counterparty thereto in connection with the consummation of the transactions contemplated by this Agreement)Agreement that would not otherwise be due;
(xix) fail to maintain in full force and effect material insurance policies covering the Company and its Subsidiaries (other than the Oncor Entities) and their respective properties, assets and businesses in a form and amount consistent with past practice; or
(iiixx) shall promptly notify agree, authorize or commit to do any of the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14foregoing.
(b) Prior Notwithstanding anything in Section 6.1(a) to the Effective Timecontrary, except the Company and its Subsidiaries may take commercially reasonable actions consistent with prudent industry practices that would otherwise be prohibited pursuant to Section 6.1(a) in order to prevent the occurrence of, or mitigate the existence of, an emergency situation involving endangerment of life, human health, safety or the Environment or the protection of equipment or other assets; provided, however, that the Company shall provide Parent with notice of such emergency situation and any such action taken by the Company or any of its Subsidiaries (other than the Oncor Entities) as set forth soon as reasonably practicable after obtaining Knowledge thereof.
(c) Except for actions required, or specifically permitted, under the terms of this Agreement or the Plan of Reorganization or as required by the Bankruptcy Code or the Bankruptcy Court in the Purchaser Disclosure Letter Chapter 11 Cases without any of the Debtors having requested or as contemplated applied (or having requested that any of their respective Affiliates make such request or application) for the Bankruptcy Court to impose such requirement (and with the Company and EFIH, to the extent requested by Parent prior to such imposition, having used commercially reasonable efforts to challenge such imposition before the Bankruptcy Court), and subject to Sections 6.19 and 6.20, none of Parent, Merger Subs, the Company or EFIH shall intentionally take (or fail to take if required by this Agreement, unless the Company and the Special Committee have consented in writing theretoPlan of Reorganization, any Governmental Entity, the Purchaser: (iBankruptcy Court, applicable Law or contractual obligation) shall not issue or permit any shares of its capital stock at less than fair market value Subsidiaries to take (other than pursuant or fail to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of take if required by this Agreement; and , the Plan of Reorganization, any Governmental Entity, the Bankruptcy Court, applicable Law or contractual obligation) any action that if taken (ivor failed to be taken) shall not declarewould reasonably be expected to prevent or impair in any material respect the consummation of the Closing Date Transactions or the Minority Interest Acquisition.
(d) Nothing contained in this Agreement is intended to give Parent, set aside directly or pay any dividend indirectly, the right to control or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).d
Appears in 1 contract
Interim Operations. (a) Prior Except as otherwise expressly contemplated by this Agreement, the Company covenants and agrees as to itself and its Subsidiaries that from and after the date of this Agreement and prior to the Effective Time, except as set forth the business of the Company and its Subsidiaries shall be conducted in all material respects in the Company Disclosure Letter or as contemplated by any other provision of this Agreementordinary and usual course and, unless to the Purchaser has consented in writing theretoextent consistent therewith, the Company: (i) shall, Company shall and shall cause each of its Significant Subsidiaries toto use reasonable best efforts to preserve its business organization intact in all material respects and to maintain in all material respects the Company’s existing relations and goodwill with customers, conduct suppliers, regulators, agents, resellers, creditors, lessors, employees and business associates. In addition, the Company covenants and agrees as to itself and its operations according to their usualSubsidiaries that, regular from and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to after the date of this Agreement; Agreement and prior to the Effective Time (vunless Parent shall otherwise approve in writing (which approval shall not be unreasonably withheld, delayed or conditioned), and except as otherwise expressly contemplated by this Agreement or disclosed in Section 6.1(a) of the Company Disclosure Letter):
(i) it shall not (xA) except pursuant to the exercise amend its certificate of optionsincorporation or by-laws or comparable governing instruments; (B) split, warrantscombine, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, subdivide or pursuant to the Recapitalization issue any reclassify its outstanding shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (iiC) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or distribution payable in cash, stock or property in respect of any capital stock, other than
(I) dividends and distributions by a wholly owned Subsidiary to its parent Person and (II) cash dividends on the Series F Preferred required under the Company’s certificate of incorporation; or (D) other than the redemption of Series F Preferred contemplated by Section 6.17, purchase, redeem or otherwise acquire any of its or its Subsidiaries’ shares of capital stock or any securities convertible or exchangeable into or exercisable for any such shares of capital stock;
(ii) it shall not merge or consolidate with any other Person, except for any such transactions among wholly owned Subsidiaries of the Company, or adopt a plan of liquidation;
(iii) it shall not (A) establish, adopt, amend in any material respect or terminate any Company Compensation and Benefit Plan or amend the terms of any outstanding equity-based awards, except (I) to comply with applicable Law, including the requirements of Section 409A of the Code, and (II) if the transactions contemplated by this Agreement are not consummated prior to December 31, 2007, subject to prior consultation with Parent, the Company shall be entitled to establish a 2008 cash bonus plan having terms reasonably comparable in all material respects to the terms of the Company’s 2007 bonus plan; (B) grant or provide any severance or termination payments or benefits to any director, officer or employee of the Company or any of its Subsidiaries, except to comply with applicable Law or the provisions of the Company Compensation and Benefit Plans as in effect on the date hereof or the provisions of this Agreement; (C) increase the compensation, bonus or pension, welfare, severance or other benefits of, pay any bonus to, or make any new equity awards to any director, officer or employee of the Company or any of its Subsidiaries, except for (I) the payment of bonuses in accordance with Company Compensation and Benefit Plans existing as of the date hereof, (II) the payment of cash bonuses established pursuant to clause (iii)(A)(II) of this Section 6.1(a), (III) increases in base salary in the ordinary course of business consistent with past practice for current, promoted or newly hired employees who are not officers and (IV) increases in base salary related to normal periodic performance reviews, including the annual performance reviews in March 2008 if the Closing has not occurred by that time; (D) take any action to accelerate the vesting or payment, or fund or in any other distribution way secure the payment, of compensation or payment benefits under any Company Compensation and Benefit Plan, except to the extent already provided in any such Company Compensation and Benefit Plan or provided in this Agreement; (E) change any actuarial or other assumptions used to calculate funding obligations with respect to any Company Compensation and Benefit Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP or to comply with applicable Law, including the requirements of Section 409A of the Code; or (F) forgive any loans to directors, officers or employees of the Company or any of its Subsidiaries;
(iv) it shall not incur any indebtedness for borrowed money or guarantee such indebtedness of another Person, or issue or sell any debt securities or warrants or other rights to acquire any debt security of the Company or any of its Subsidiaries, except for (A) indebtedness for borrowed money incurred in the ordinary course of business (including, subject to Section 6.13, in connection with the upcoming auction of 700 MHz spectrum ) consistent with the terms of the Company’s existing indebtedness for borrowed money not to exceed $195 million in the aggregate; (B) indebtedness for borrowed money to fund the redemption of Series F Preferred contemplated by Section 6.17 consistent with the terms of the Company’s existing indebtedness for borrowed money; (C) indebtedness for borrowed money in replacement of existing indebtedness for borrowed money or permitted to be incurred under this clause (iv) consistent with the terms of the Company’s existing indebtedness for borrowed money; (D) guarantees by the Company of indebtedness of its wholly-owned Subsidiaries; and (E) indebtedness for borrowed money used to make the capital expenditures permitted under clause (v) of this Section 6.1(a);
(v) it shall not make or commit to any capital expenditures, other than in the ordinary course of business and in any event (A) with respect to the period through December 31, 2007, not in excess of 103% of the aggregate amount contemplated by the Company’s capital expenditure budget for the year 2007, a copy of which capital expenditure budget for the year 2007 is attached to the Company Disclosure Letter, reduced for all amounts spent or committed to prior to the date of this Agreement, provided that the timing of all expenditures under such budget shall be substantially consistent with the timing contemplated in such budget, and (B) with respect to the year 2008, not in excess of $165 million in the aggregate and not more than $50 million in any fiscal quarter;
(vi) it shall not transfer, lease, license, sell, mortgage, pledge, place a Lien upon or otherwise dispose of any of their respective property or assets (including capital stock of any of its Subsidiaries), except for (A) transfers, leases, licenses, sales, or other dispositions of inventory and equipment in the ordinary course of business consistent with past practice (B) leases or licenses of spectrum in the ordinary course of business consistent with past practice, (C) dispositions or sales of their respective properties or assets in the ordinary course of business consistent with past practice with a fair market value not to exceed $15 million individually or $35 million in the aggregate and (D) Liens, mortgages and pledges on properties or assets to secure any indebtedness for borrowed money permitted by clause (iv) of this Section 6.1(a);
(vii) it shall not issue, deliver, sell, or place a Lien upon shares of its capital stock or any securities convertible into, or any rights, warrants or options to acquire, any such shares, except (A) any shares of Class A Common Stock issued pursuant to Company Options and other ownership interests awards outstanding on the date of this Agreement under the Company Stock Plans; (B) shares of Class A Common Stock issued upon conversion of (x) the Company’s 1.50% Senior Convertible Debentures due 2025 or (y) the Series F Preferred; and (C) Liens on the capital stock of its Subsidiaries to secure any indebtedness for borrowed money permitted by clause (iv) of this Section 6.1(a);
(viii) subject to Section 6.13, it shall not acquire any business, whether by merger, consolidation, purchase of property or assets or otherwise;
(ix) it shall not make any change with respect to accounting policies or procedures, except as required by changes in GAAP or by Law;
(x) except as required by Law, it shall not (A) make any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any material accounting method therefor that is inconsistent with elections made, positions taken or accounting methods used in preparing or filing similar Tax Returns in prior periods or (B) settle or resolve any material Tax controversy;
(xi) it shall not (A) enter into any line of business in any geographic area other than the current lines of business of the Company and its Subsidiaries and products and services reasonably ancillary thereto, including any current line of business and products and services reasonably ancillary thereto in any geographic area for which the Company or any of its Subsidiaries currently holds a FCC License authorizing the conduct of such business, product or service in such geographic area, or (B) except as currently conducted, engage in the conduct of any business in any state which would require the receipt or transfer of a Communications License or any other license issued by any Governmental Entity authorizing operation or provision of any communication services or foreign country that would require the receipt or transfer of, or application for, a Company License to the extent such license would be reasonably expected to prevent or materially delay the consummation of the transactions contemplated herein;
(xii) subject to Section 6.13, it shall not file for any Company License (A) outside of the ordinary course of business or (B) the receipt of which would reasonably be expected to prevent, impair or delay consummation of the Merger;
(xiii) subject to Section 6.13 and other than investments in marketable securities in the ordinary course of business consistent with past practice, it shall not make any loans, advances or capital contributions to or investments in any Person (other than regular quarterly cash dividends the Company or any direct or indirect wholly owned Subsidiary of the Company);
(xiv) subject to Section 6.13, it shall not enter into (A) any non-competition Contract or other Contract that (I) purports to exceed limit in any material respect either the type of business in which the Company or its Subsidiaries (or, after the Effective Time, Parent or its Subsidiaries) may engage or the manner or locations in which any of them may so engage in any business or (II) could require the disposition of any material assets or line of business of the Company or its Subsidiaries or, after the Effective Time, Parent or its Subsidiaries, (B) any Contract requiring the Company or its Subsidiaries to deal exclusively with a Person or related group of Persons, (C) any other Contract or series of related Contracts with respect to which the Company would be required to file a Current Report on Form 8-K pursuant to Item 1.01 thereof or that is reasonably likely to provide for payments to the Company and its Subsidiaries, or by the Company and its Subsidiaries, in excess of $0.05 per share)1 million in any twelve-month period or (D) that would or would be reasonably likely to prevent, delay or impair the Company’s ability to consummate the transactions contemplated by this Agreement;
(xv) it shall not settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity for an amount to be paid by the Company or any of its Subsidiaries in excess of $500,000 (exclusive of any amounts paid by or under any insurance policy maintained by the Company or its Subsidiaries) or which would be reasonably likely to have any adverse impact on the operations of the Company or any of its Subsidiaries as a result of a non-monetary settlement;
(xvi) it shall not change (other than pursuant to software updates, upgrades and patches) any of the material technology used in its respective businesses;
(xvii) it shall not assign, transfer, cancel, fail to renew or fail to extend any FCC License or material State License, except for cancellations or modifications of FCC Licenses for microwave facilities in the ordinary course of business consistent with past practice, or cancellations or modifications of FCC Licenses for microwave facilities in connection with negotiated relocation agreements in accordance with Sections 27.1111, et seq. and Sections 101.69, et seq. of the FCC Rules, provided that such actions would not, individually or in the aggregate, reasonably be expected to prevent or materially delay the consummation of the transactions contemplated hereby;
(xviii) it shall not enter into any collective bargaining agreement; and
(xix) it shall not authorize or enter into any agreement to do any of the foregoing.
(b) Prior to making any written communications to the directors, officers or employees of the Company or any of its Subsidiaries pertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement, the Company shall provide Parent with a copy of the intended communication, Parent shall have a reasonable opportunity to review and comment on the communication, and Parent and the Company shall cooperate in providing any such mutually agreeable communication.
Appears in 1 contract
Interim Operations. (a) Prior The Company covenants and agrees as to itself and its Subsidiaries that, from and after the execution of this Agreement and prior to the First Effective Time (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld, conditioned or delayed, and except as (1) required by applicable Law, (2) expressly required by this Agreement or (3) otherwise expressly disclosed in Section 6.1(a) of the Company Disclosure Letter), the Company shall use its reasonable best efforts to conduct its business and the business of its Subsidiaries in the ordinary course of business consistent with past practice and each of the Company and its Subsidiaries shall, subject to compliance with the specific matters set forth below, use reasonable best efforts to preserve its business organization intact and maintain the existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, licensors, creditors, lessors, employees and business associates and others having material business dealings with it (including material content providers, studios, authors, producers, directors, actors, performers, guilds, announcers and advertisers) and keep available the services of the Company and its Subsidiaries’ present employees and agents. Without limiting the generality of, and in furtherance of, the foregoing, the Company covenants and agrees as to itself and its Subsidiaries that, from and after the date of this Agreement and prior to the First Effective Time, except (A) as set forth required by applicable Law, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), (C) as expressly disclosed in Section 6.1(a) of the Company Disclosure Letter or (D) as contemplated by any other provision of expressly provided for in this Agreement, unless the Purchaser has consented in writing thereto, the Company: Company shall not and will not permit any of its Subsidiaries to:
(i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (iiA) shall not amend its Certificate certificate of Incorporation incorporation or Bylaws bylaws (or comparable governing instruments documents) (other than amendments to permit the consummation governing documents of any wholly owned Subsidiary of the Company that would not prevent, materially delay or materially impair the Initial Merger or the other transactions contemplated by this Agreement); , (iiiB) shall promptly notify the Purchaser of any breach of any representation split, combine, subdivide or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any reclassify its outstanding shares of its capital stock, effect stock (except for any stock split or otherwise change its capitalization as it existed on such transaction by a wholly owned Subsidiary of the date hereofCompany which remains a wholly owned Subsidiary after consummation of such transaction), (yC) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make distribution payable in cash, stock or property (or any combination thereof) in respect of any shares of its capital stock (except for (I) any dividends or distributions paid by a direct or indirect wholly owned Subsidiary of the Company to another direct or indirect wholly owned Subsidiary of the Company or to the Company or (II) other distribution or payment than normal quarterly cash dividends on the Company’s Common Stock as described in Section 6.1(a)(i)(C) of the Company Disclosure Letter), (D) enter into any agreement with respect to the voting of its capital stock, or (E) -▇▇- ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, redeem or otherwise acquire any shares of its capital stock or other ownership interests any securities convertible or exchangeable into or exercisable for any shares of its capital stock (other than regular quarterly cash dividends (1) pursuant to the cashless exercise of Company Options or the forfeiture of, or withholding of Taxes with respect to, Company Options, Company Restricted Stock Units or Company Performance Stock Units in connection with any Taxable event related to such awards, in each case in accordance with past practice and with the terms of the applicable Company Stock Plan as in effect on the date of this Agreement (or as modified after the date of this Agreement in accordance with the terms of this Agreement) or (2) purchases, repurchases, redemptions or other acquisitions of securities of any wholly owned Subsidiary of the Company by the Company or any other wholly owned Subsidiary of the Company);
(ii) merge or consolidate with any other Person, or restructure, reorganize or completely or partially liquidate (other than mergers among, or the restructuring, reorganization or liquidation of any wholly owned Subsidiaries of the Company that would not prevent, materially delay or materially impair the Initial Merger or the other transactions contemplated by this Agreement);
(iii) knowingly take or omit to take any action if such action or failure to act would be reasonably likely to prevent or impede the Mergers from qualifying for the Intended Tax Treatment;
(iv) except as expressly disclosed in Section 6.1(a) of the Company Disclosure Letter, increase or change the compensation or benefits payable to any employee of the Company or any of its Subsidiaries (including through changes in actuarial or other assumptions, loan forgiveness or otherwise) other than in the ordinary course of business, provided that, notwithstanding the foregoing, the Company shall not and will not permit its Subsidiaries to, other than as required by the terms of any Company Plan or CBA, in each case as in effect on the date hereof (or as modified after the date of this Agreement in accordance with the terms of this Agreement), (a) grant any new equity-based awards, or amend or modify the terms of any such outstanding awards, under any Company Plan, (b) grant any transaction or retention bonuses, (c) increase the compensation or benefits payable to any Senior Executive (other than, solely in the case of benefits pursuant to a generally applicable amendment to a Company Plan covering other Company Employees who are not Senior Executives, which amendment is permitted by this Agreement), (d) pay annual bonuses, other than for completed periods based on actual performance through the end of the applicable performance period as determined in the ordinary course of business pursuant to the applicable Company Plan, (e) increase the severance terms applicable to any employee of the Company or any of its Subsidiaries or (f) make any change to any Company Pension Plan or any Company Plan that is an “employee welfare benefit plan” (within the meaning of Section 3(1) of ERISA) that would materially increase the costs to the Company or any of its Subsidiaries in respect of such Company Plan;
(v) incur any Indebtedness or issue any warrants or other rights to acquire any Indebtedness, except (A) in the ordinary course of business consistent with past practice in a principal amount not to exceed $0.05 250,000,000 in the aggregate at any time outstanding and on prevailing market terms or on terms substantially consistent with or more beneficial to the Company and its Subsidiaries, taken as a whole, than existing Indebtedness, (B) in replacement of existing Indebtedness which has matured or is scheduled to mature, in each case after the date of this Agreement, within the twelve month period following such incurrence of Indebtedness on then prevailing market terms or on terms substantially consistent with or more beneficial to the Company and its Subsidiaries, taken as a whole, than the Indebtedness being replaced, (C) inter-company Indebtedness among the Company and its wholly owned Subsidiaries, (D) commercial paper issued in the ordinary course of business, (E) (i) to the extent not drawn upon and payments are not triggered thereby, letters of credit, bank guarantees, security or performance bonds or similar credit support instruments and (ii) overdraft facilities or cash management programs, in each case issued, made or entered into in the ordinary course of business and (F) hedging in compliance with the hedging strategy of the Company as of the date of this Agreement in the ordinary course of business consistent with past practice and not for speculative purposes; provided that the Company and its Subsidiaries shall use commercially reasonable efforts to mitigate any material increase in their respective aggregate exposure to currency risk;
(vi) make or commit to any capital expenditures other than (A) in connection with the repair or replacement of facilities, properties or assets destroyed or damaged due to casualty or accident (if covered by insurance or the portion of which is not covered by insurance is less than $100,000,000) or (B) in the ordinary course of business consistent with past practice and in the aggregate not in excess of 120% of the amounts reflected in the Company’s capital expenditure budget for each of 2016 and 2017 and 2018 set forth in Section 6.1(a)(vi) of the Company Disclosure Letter;
(vii) transfer, lease, license, sell, assign, let lapse, abandon, cancel, mortgage, pledge, place a Lien upon or otherwise dispose of any Intellectual Property; provided that this clause (vii) shall not restrict (A) ordinary course licenses, sales, letting lapse, abandonment, cancellations and Liens that are licenses in each case of Intellectual Property, (B) the granting of any licenses of Intellectual Property other than in the ordinary course of business with a term of three years or less where the aggregate payments under such license do not exceed $250,000,000 per sharelicense and (C) sales of Intellectual Property with a fair market value less than $50,000,000 individually if the transaction is not in the ordinary course or $100,000,000 individually in any event (other than transactions among the Company and its wholly owned Subsidiaries).;
(viii) transfer, lease, license, sell, assign, let lapse, abandon, cancel, mortgage, pledge, place a Lien upon or otherwise dispose of any properties or assets (including capital stock of any of its Subsidiaries but not including any Intellectual Property, which is governed by Section 6.1(a)(vii)) with a fair market value in excess of $50,000,000 individually if the transaction is not in the ordinary course or $100,000,000 individually in any event (other than transactions among the Company and its wholly owned Subsidiaries);
(ix) issue, deliver, sell, grant, transfer, or encumber, or authorize the issuance, delivery, sale, grant, transfer or encumbrance of, any shares of its capital stock or any securities convertible or exchangeable into or exercisable for, or any options, warrants or other rights to acquire, any such shares, except (A) for any Shares issued pursuant to Company Options, Company Restricted Stock Units and Company Performance Stock Units outstanding on the date of this Agreement in accordance with the existing terms of such awards and the Company Stock Plans, (B) for any profit participation rights relating to programs granted in the ordinary course of business consistent with past practice or (C) by wholly owned Subsidiaries to the Company or to any other wholly owned Subsidiary of the Company;
Appears in 1 contract
Sources: Merger Agreement
Interim Operations. (a) Prior Except as otherwise (i) expressly permitted or required by this Agreement, (ii) required by applicable Law or the rules or regulations of NASDAQ, (iii) expressly approved in writing by Parent (such approval not to be unreasonably withheld, delayed or conditioned) or (iv) expressly set forth in Section 6.1(a) of the Company Disclosure Schedule, from the date of this Agreement until the Effective Time, the Company will, and will cause its Subsidiaries to, use its and their reasonable efforts to conduct their businesses in all material respects in the ordinary course of business consistent with past practice and, to the extent consistent therewith, the Company shall, and shall cause its Subsidiaries to, use its and their reasonable efforts to preserve their business organizations substantially intact (including the service of key employees) and to maintain existing relations in all material respects with key customers, suppliers and other Persons with whom the Company and its Subsidiaries have significant relationships.
(b) Except as otherwise (w) expressly permitted or required by this Agreement, (x) required by applicable Law or the rules or regulations of NASDAQ, (y) approved in writing by Parent (such approval not to be unreasonably withheld, delayed or conditioned) or (z) set forth in Section 6.1(b) of the Company Disclosure Schedule, from the date of this Agreement until the Effective Time, the Company will not, and will cause its Subsidiaries not to:
(i) (x) adopt or submit to stockholder approval any change in the certificate of incorporation or bylaws of the Company or (y) adopt any change in the comparable organizational document of any Subsidiary of the Company;
(ii) (x) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transaction between or among any of its wholly owned Subsidiaries that would not impose, individually or in the aggregate, any changes or restrictions on its assets, operations or business or on the assets, operations and businesses of the Company and its Subsidiaries taken as a whole that would be adverse to Parent or any of its Subsidiaries or (y) restructure, reorganize or completely or partially liquidate or otherwise enter into any agreement or arrangement imposing, individually or in the aggregate, any changes or restrictions on the assets, operations or business or on the assets, operations and businesses of the Company or any of its Subsidiaries that would be adverse to Parent or any of its Subsidiaries;
(iii) acquire (by merger, consolidation, acquisition of stock or assets or otherwise), directly or indirectly, any assets, securities, properties, interests or businesses, other than (A) acquisitions of inventory, supplies, raw materials, equipment and similar assets in the ordinary course of business consistent with past practice, (B) acquisitions pursuant to Contracts in effect on the date of this Agreement which have been disclosed in unredacted form to Parent prior to the date hereof, (C) in accordance with the Company’s capital and research and development expenditure budget made available to Parent prior to the date of this Agreement and set forth in the Company Disclosure Letter Schedule (the “Company Budget”), or (D) any other acquisitions for consideration that are not in excess of $5,000,000 in the aggregate; provided, that such aggregate cap shall be deemed to be increased to $10,000,000 effective upon the First Outside Date Extension;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or Lien against, or otherwise enter into any Contract or understanding with respect to the voting of, any shares of capital stock of the Company or any of its Subsidiaries, or securities convertible or exchangeable into or exercisable for any shares of such capital stock, or any options, warrants, restricted shares, restricted share units, performance share units, stock appreciation rights, phantom stock or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities, in each case, other than (A) any such transaction solely among the Company and its wholly owned Subsidiaries or among the Company’s wholly owned Subsidiaries that would not be adverse to Parent or any of its Subsidiaries, (B) any issuance, sale, grant or transfer of Shares pursuant to the exercise or settlement of Company Options, Company RSU Awards, Company PSU Awards or Company DSU Awards outstanding as contemplated of the date of this Agreement or granted after the date of this Agreement in accordance with Section 6.1(b)(xv) below, or (C) the issuance of Shares for the Final Offering in accordance with the terms of the ESPP;
(v) make any loans, advances or capital contributions to, or investments in, any Person (other than (A) to the Company or any of its wholly owned Subsidiaries or (B) extensions of refunds, credit terms, rebates or other allowances to customers or vendors in the ordinary course of business consistent with past practice);
(vi) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for dividends or other distributions paid by any wholly owned Subsidiary of the Company to the Company or to any other provision wholly owned Subsidiary of the Company);
(vii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock (except for (A) any such transaction by a wholly owned Subsidiary of the Company that would not be adverse to Parent or any of its Subsidiaries and (B) acquisitions of Shares in satisfaction of withholding obligations in respect of Company Options, Company RSU Awards or Company PSU Awards or payment of the exercise price in respect of Company Options, in each case, outstanding as of the date of this Agreement pursuant to its terms or granted thereafter not in violation of this Agreement);
(viii) create, unless incur, assume, guarantee, endorse, suffer to exist or otherwise be liable with respect to any indebtedness for borrowed money, issue or sell any debt securities or warrants or other rights to acquire any debt security of the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each Company or any of its Significant Subsidiaries toSubsidiaries, conduct except (A) guarantees of indebtedness of the Company or any of its operations according to their usualwholly owned Subsidiaries, regular and (B) intercompany indebtedness between or among the Company and/or any of its wholly owned Subsidiaries, (C) in connection with the financing of accounts payable in the ordinary course of business consistent with past practice, (D) indebtedness for borrowed money incurred in substantially the same manner ordinary course of business in accordance with Contracts (x) in effect prior to the date hereof, including the Existing Credit Agreement, that have been disclosed in unredacted form to Parent prior to the date hereof or (y) entered into after the date hereof as heretofore conductedset forth in Section 6.1(b)(viii) of the Company Disclosure Schedule and (E) other indebtedness for borrowed money in an amount not to exceed $7,500,000 in the aggregate; provided, that such aggregate cap shall be deemed to be increased to $15,000,000 effective upon the First Outside Date Extension;
(iiix) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than in accordance with the Company Budget, (1) incur or commit to permit any capital or research and development expenditure, that, in the consummation aggregate, exceeds the amount of the transactions capital or research and development expenditures contemplated by this Agreement)the Company Budget, except the Company may make capital or research and development expenditures of less than $1,000,000 individually or $2,000,000 in the aggregate; provided, that such aggregate cap shall be deemed to be increased to $4,000,000 effective upon the First Outside Date Extension, or (iii2) shall promptly notify fail to incur or commit to any capital or research and development expenditures in the Purchaser amounts and on the time frames set forth in the Company Budget in all material respects;
(x) except as set forth on Section 6.1(b)(x) of the Company Disclosure Schedule, enter into, amend or modify in any breach of material respect or terminate any representation or warranty contained herein Material Contract or any Company Contract that would have been a Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent Contract had it been entered into prior to the date of this Agreement; , or otherwise waive, release or assign (vother than assignments between or among the Company and/or any of its wholly owned Subsidiaries) any material rights, claims or benefits of the Company or any of its Subsidiaries thereunder, other than the expiration of any such Contract in accordance with its terms;
(xi) make any material changes with respect to financial accounting policies or procedures, except as required by Law, proposed Law or by U.S. GAAP or statutory or regulatory accounting rules or interpretations with respect thereto or by any Governmental Authority or quasi-governmental authority (including the Financial Accounting Standards Board or any similar organization);
(xii) settle any action, suit, claim, hearing, arbitration, investigation or other proceedings (other than any audit or other proceeding in respect of Taxes, which shall be governed solely by Section 6.1(b)(xiii) of the Agreement), for an amount in excess of $1,500,000 individually or $3,000,000 in the aggregate or any obligation or liability of it in excess of such amount or on a basis that would result in the imposition of any writ, judgment, decree, settlement, award, injunction or similar order of any Governmental Authority that would restrict the future activity or conduct of Parent, the Company or any of their respective Subsidiaries or a finding or admission of a violation of Law or violation of the rights of any Person other than with respect to monetary settlements only, settlements or compromises of any action, suit, claim, hearing, arbitration, investigation or other proceedings to the extent reflected or reserved against in the balance sheet (or the notes thereto) of the Company included in the Company Reports filed prior to the date of this Agreement for an amount not in excess of the amount so reflected or reserved;
(A) make (other than consistent with past practice) or change any material Tax election, (B) change any entity classification for federal income tax purposes of any Subsidiary, (C) create an entity outside of the United States that is (x) except pursuant to a direct Subsidiary of the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, Company or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, domestic Subsidiaries and (y) granttreated as a “disregarded entity” or partnership for U.S. federal income tax purposes, confer (D) knowingly create a permanent establishment outside of the Company or award any optionSubsidiary’s place of incorporation or formation, warrant, conversion right (E) file any amended income Tax Return or other right not existing on the date hereof to acquire any shares of its capital stockmaterial amended Tax Return, or (zF) adopt or change any A1-14
material accounting method for Taxes, (bG) Prior settle or compromise any material Tax claim, other than with respect to settlements or compromises of any Tax claim for an amount that does not exceed the Effective Timeamount disclosed, except as set forth reflected or reserved in accordance with U.S. GAAP in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule Reports filed with the SEC subsequent prior to the date of this Agreement; , (H) surrender any material claim for a refund of Taxes, (I) enter into any closing agreement relating to a material amount of Taxes, (J) file any income Tax Return or other material Tax Return that is materially inconsistent with past practice, (K) other than in the ordinary course of business, consent to any extension or waiver of the limitation period applicable to any material Tax claim or assessment or (L) transfer (including any controlled transaction or controlled transfer as described in Treasury Regulation Section 1.482-7 related to a cost sharing arrangement), sell, assign, pledge, convey, or otherwise dispose of, for legal or Tax purposes, any Intellectual Property Rights currently owned by the Company or any of its Subsidiaries out of the United States including through any such transaction that is intended to or could reasonably be expected to be considered as a transfer (including any controlled transaction or controlled transfer as described in Treasury Regulation Section 1.482-7 related to a cost sharing arrangement), sale, assignment, pledge, conveyance or disposition for U.S. federal income Tax purposes;
(xiv) (1) transfer, sell, lease, license, divest, pledge, cancel or otherwise dispose of, abandon or permit to lapse, or permit or suffer to exist the creation of any Lien upon, any assets of the Company or any of its Subsidiaries (including any Intellectual Property Rights or Technology), including capital stock of any of its Subsidiaries, except (A) for sales of Company Products to customers in the ordinary course of business consistent with past practice, (B) for sales of obsolete tangible assets, (C) for sales, leases, licenses or other dispositions of tangible assets having a value not in excess of $1,250,000 individually or $2,500,000 in the aggregate (provided, that such aggregate cap shall be deemed to be increased to $5,000,000 effective upon the First Outside Date Extension), (D) pursuant to Contracts or written commitments existing as of the date hereof, in each case, which have been disclosed in unredacted form to Parent prior to the date hereof, (E) for non-exclusive licenses of Intellectual Property Rights to customers, vendors or service providers of the Company or its Subsidiaries in the ordinary course of business consistent with past practice, and (ivF) shall for sales of tangible inventory or used tangible equipment in the ordinary course of business consistent with past practice, (2) abandon or permit to lapse any Trademarks included in the Owned Intellectual Property, or (3) disclose any Trade Secret of the Company or any of its Subsidiaries, except in the ordinary course of business consistent with past practice and pursuant to a written confidentiality agreement;
(xv) except as required by any Benefit Plan in effect as of the date of this Agreement and set forth on Section 5.1(h)(i) of the Company Disclosure Schedule or adopted or entered into in accordance with this Agreement, (A) terminate, adopt, establish, enter into, amend or renew (or communicate any intention to take such action) any Benefit Plan, other than amendments that do not declareincrease benefits or result in increased administrative costs; (B) increase in any manner the compensation, set aside benefits, severance or termination pay of any of the current or former directors, executive officers or employees or consultants who are natural persons of the Company or its Subsidiaries, other than in the ordinary course of business consistent with past practice as contemplated under Section 6.1(b)(xv) of the Company Disclosure Schedule; (C) pay any dividend bonus or make incentive compensation under any Benefit Plan, other distribution than payments based on actual performance for completed performance periods in the ordinary course of business as contemplated under Section 6.1(b)(xv) of the Company Disclosure Schedule; (D) accelerate the vesting of or payment lapsing of restrictions, or amend the vesting requirements, with respect to any shares of its capital stock equity-based compensation or other ownership interests long-term incentive compensation under any Benefit Plan; (E) grant any new severance, change in control, retention benefit or any other award that could be triggered by the transactions contemplated by this Agreement (whether accompanied by a termination of employment or not) (other than regular quarterly pursuant to arrangements entered into with newly hired and promoted employees in the ordinary course of business consistent with past practice as contemplated under Section 6.1(b)(xv) of the Company Disclosure Schedule) or amend the terms of outstanding awards under any Benefit Plan; (F) grant any Company Options; (G) grant any Company RSU Awards, Company PSU Awards, Company DSU Awards or other equity-based awards other than in the ordinary course of business as contemplated under Section 6.1(b)(xv) of the Company Disclosure Schedule; (H) take any action to accelerate the payment of, or to fund or secure the payment of, any amounts under any Benefit Plan; (I) hire any (1) executive officer, (2) employee or consultant who is a natural person with target total annual cash dividends not to exceed compensation opportunities at or above $0.05 per share).350,000 or (3) employee or consultant who is a natural person who, in either case, re
Appears in 1 contract
Sources: Merger Agreement (Irobot Corp)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time, unless Parent shall otherwise consent (such consent not to be unreasonably withheld or delayed), and except as otherwise expressly contemplated by this Agreement (including that the Company and its Subsidiaries will not be required to act in a manner inconsistent with any representation, warranty, agreement, covenant, condition or other provision of this Agreement) or required by applicable Laws, the business of the Company and its Subsidiaries shall be conducted, in all material respects, in the ordinary course consistent with past practice, and the Company and its Subsidiaries, at their expense, shall use their respective reasonable best efforts to preserve their business organizations intact, maintain satisfactory relations and goodwill with Governmental Entities, customers, suppliers, lenders, employees and distributors and other Persons with whom they have material business relations and keep available the services of their key officers and employees. Without limiting the generality of the foregoing, from the date of this Agreement until the Effective Time, except (x) as otherwise contemplated or specifically permitted by this Agreement, (y) as Parent may consent (such consent not to be unreasonably withheld or delayed) or (z) as set forth in Section 6.1(a) of the Company Disclosure Letter, the Company will not and will not permit any of its Subsidiaries to:
(i) amend its Organizational Documents;
(ii) (a) authorize for issuance, issue or sell, pledge, dispose of or subject to any Lien or agree or commit to any of the foregoing in respect of, any shares of beneficial interest or shares of any class of capital stock or other equity interest of the Company or any Subsidiary or any options, warrants, convertible securities or other rights of any kind to acquire any such shares or any other equity interest, of the Company or any Subsidiary, other than the issuance of Shares upon exercise of Company Options, or the settlement of RSUs or Company Awards outstanding on the date of this Agreement and except as permitted under Section 6.1(a)(vii); (b) repurchase, redeem or otherwise acquire any securities or equity equivalents except in the ordinary course of business in connection with (i) the cashless exercise of Company Options in accordance with the Stock Plans, (ii) the lapse of restrictions on Restricted Shares, or the settlement of RSUs or Company Awards, in each case, in order to satisfy withholding or exercise price obligations in accordance with the Stock Plans or Director Deferral Program, or (iii) the cancellation of the Company Options, Restricted Shares, RSUs and Company Awards pursuant to Section 4.3; (c) adjust, redeem, reclassify, combine, split, or subdivide any shares of beneficial interest or shares of any class of capital stock or other equity interest of the Company or any of its Subsidiaries; or (d) declare, set aside, make or pay any dividend or other distribution, payable in cash, shares of beneficial interest, property or otherwise, with respect to any of the shares of beneficial interest or shares of any class of capital stock or other equity interests of the Company or any of its Subsidiaries, except for (i) cash dividends by any direct or indirect wholly-owned Subsidiary only to the Company or any other wholly-owned Subsidiary in the ordinary course of business consistent with past practice, (ii) regular quarterly dividends on the Shares (but not to exceed $0.63 per Share for each regular quarterly dividend) with declaration, record and payment dates reasonably consistent with the Company’s past practice for the comparable quarter, it being agreed that declarations of dividends between the date hereof and the consummation of the Merger will provide that such dividend is not payable if the Merger is consummated prior to the relevant record date, (iii) dividends or distributions required under the applicable Organizational Documents, or (iv) dividends or distributions consistent with past practice with respect to the Subsidiaries that are listed in Section 6.1(a)(ii) of the Company Disclosure Letter;
(iii) acquire or agree to acquire (whether by merger, consolidation, acquisition of equity stock or assets or otherwise) any Person (or division or assets thereof) or any real property from any other Person with a value or purchase price in excess of $10,000,000 individually or $25,000,000 with respect to all such acquisitions in the aggregate, other than (a) acquisitions pursuant to Contracts in effect as of the date of this Agreement as described in Section 6.1(a)(iii) of the Company Disclosure Letter and (b) acquisitions of equity interests otherwise permitted under clause (ix) of this Section 6.1;
(iv) incur any indebtedness or issue any debt securities or assume, guarantee or endorse, or otherwise as an accommodation become responsible for, the obligations of any Person (other than a wholly-owned Subsidiary) for indebtedness, except for: (a) indebtedness for borrowed money incurred under the Company’s existing credit facility or other existing similar lines of credit in the ordinary course of business; (b) indebtedness to finance the costs and expenses incurred in connection with the transactions contemplated hereby; (c) refinancings of indebtedness becoming due and payable in accordance with their terms on terms and in such amounts reasonably acceptable to Parent; and (d) inter-company indebtedness among the Company and its Subsidiaries in the ordinary course of business consistent with past practice;
(v) repurchase, repay, defease or pre-pay any indebtedness, except (a) repayments in the ordinary course of business, (b) payments made in respect of any termination or settlement of any interest rate swap or other similar hedging instrument relating thereto, or (c) prepayments, repayments of mortgage indebtedness secured by one or more Owned Real Properties in accordance with their terms, as such loans become due and payable or payment of indebtedness in accordance with its terms; or (except with respect to any Actions) pay, discharge or satisfy any material claims, liabilities or obligations (absolute, accrued, contingent or otherwise), except in the ordinary course of business consistent with past practice;
(vi) modify, amend, or terminate any Material Contract or enter into any new Contract that, if entered into prior to the date of this Agreement, would have been a Material Contract, in each case other than in the ordinary course of business consistent with past practice;
(vii) except (a) as set forth in Section 6.1(a)(vii) of the Company Disclosure Letter or (b) to the extent required under any Benefit Plan as in effect on the date of this Agreement or as required by applicable Law, (i) increase the compensation (including bonus opportunities) or fringe benefits of any of its directors, executive officers or employees (except in the ordinary course of business consistent with past practice with respect to employees who are not parties to a severance agreement, employment or change-in-control agreement), (ii) grant any severance or termination pay, other than nominal severance to terminated employees, (iii) make any new equity awards to any director, officer or employee, except with respect to new hires in the ordinary course of business, which equity awards shall be treated in the same manner as the regular equity grants permitted to be made pursuant to, and described in, Section 6.1(a)(vii) of the Company Disclosure Letter, (iv) enter into or amend any employment, consulting, change-in-control or severance agreement or arrangement with any of its present or former directors, executive officers, or employees (except in the ordinary course of business consistent with past practice with respect to employees who are not directors, executive officers or parties to a severance agreement, employment or change-in-control agreement), (v) establish, adopt, enter into, freeze or amend in any material respect or terminate any Benefit Plan, take any action to accelerate entitlement to benefits under any Benefit Plan, or make any contribution to any Benefit Plan, other than contributions required by Law, other than in the ordinary course of business consistent with past practice, (vi) pay, accrue or certify performance level achievements at levels in excess of actually achieved performance in respect of any component of an incentive-based award, or take any affirmative action to amend or waive any performance or vesting criteria or accelerate vesting, exercisability, distribution, settlement or funding under any Benefit Plan, except as contemplated by the Benefit Plans as in effect on the date hereof, (vii) take any action with respect to salary, compensation, benefits or other terms and conditions of employment that would result in the holder of a change-in-control or similar agreement having “good reason” to terminate employment and collect severance payments and benefits pursuant to such agreement, (viii) terminate the employment of any holder of a change-in-control or similar agreement other than for “cause” (within the meaning of such agreement); (ix) take any action that would result in any Benefit Plan violating Section 409A of the Code; and (x) execute or amend any collective bargaining agreement or other obligation to any labor organization;
(viii) except as required by the SEC or changes in GAAP which become effective after the date of this Agreement, change in any material respect GAAP financial accounting principles or policies;
(ix) make any loans, advances or capital contributions to, or investments in, any Persons (other than (a) to or in wholly-owned Subsidiaries, (b) as required by any Contract in effect on the date hereof and described in Section 6.1(a)(ix) of the Company Disclosure Letter or (c) amounts up to $15,000,000 in the aggregate);
(x) make, authorize, or enter into any commitment for any capital expenditure (“Capital Expenditures”) other than (a) Capital Expenditures for items and in the amounts (other than immaterial changes) set forth in the Company’s current projections for Capital Expenditures as updated by Company’s management in the ordinary course of business (which projections, as so updated prior to the date of this Agreement, is set forth on Section 6.1(a)(x) of the Company Disclosure Letter), together with up to $5,000,000 of additional Capital Expenditures as deemed appropriate by the Company, or in the Company’s 2009 budget (so long as such budget is generally consistent with the projections for 2008, or as reasonably approved by Parent), and (b) Capital Expenditures in the ordinary course of business and consistent with past practice necessary to repair and/or prevent damage to any of the assets or properties of the Company or any of its Subsidiaries as is necessary in the event of an emergency situation;
(xi) waive, release, assign, settle or compromise any Action for amounts greater than, $1,000,000 individually or $5,000,000 in the aggregate;
(xii) amend any term of any outstanding equity security or equity interest of the Company or any of its Subsidiaries;
(xiii) adopt or enter into a plan of complete or partial liquidation or dissolution or adopt resolutions providing for or authorizing such liquidation or dissolution;
(xiv) fail to use its reasonable best efforts to maintain in full force and effect the existing insurance policies or to replace such insurance policies with comparable insurance policies covering the Company, its Subsidiaries and their respective properties, assets and businesses or substantially equivalent policies;
(xv) except as required by applicable Law, (a) prepare or file any material Tax Return inconsistent with past practice or, on any such Tax Return, take any position, make any election, or adopt any method of accounting that is materially inconsistent with positions taken, elections made or methods of accounting used in preparing or filing similar Tax Returns in prior periods, (b) enter into any settlement or compromise of any material Tax liability, (c) file any material amended Tax Return, (d) change any annual Tax accounting period, (e) enter into any closing agreement relating to any material amount of Taxes or consent to any material claim or audit relating to Taxes, (f) surrender any right to claim any material Tax refund or (g) consent to any extension or waiver of the limitation period applicable to any material Tax claim or assessment relating to the Company or its Subsidiaries;
(xvi) mortgage or pledge, or suffer to exist any Liens on, any Owned Real Property or other real property or interest therein, or any material assets other than (a) sales of properties, and at or above the price, identified in Section 6.1(a)(xvi) of the Company Disclosure Letter, and (b) Permitted Liens;
(xvii) transfer, license, sell, lease or otherwise dispose of any assets (by merger, consolidation, sale of assets or otherwise) with a fair market value in excess of $15,000,000 in the aggregate with respect to all such transfers, licenses, sales, leases or other dispositions, provided that the foregoing shall not prohibit the Company and its Subsidiaries from (a) selling inventory in the ordinary course of business consistent with past practice or (b) transferring, selling, leasing or disposing of any assets pursuant to any Contract that is in effect as of the date hereof;
(xviii) effectuate a “plant closing” or “mass layoff,” as these terms are defined in WARN or similar state or local Laws;
(xix) enter into any material agreement, agreement in principle, letter of intent, memorandum of understanding or similar Contract with respect to any joint venture, strategic partnership or alliance, which in each case, is material to either of the Business Units;
(xx) release or permit the release of any Person from, waive or permit the waiver of any right under, fail to enforce any provision of, or grant any consent or make any election under, any confidentiality, “standstill” or similar agreement to which the Company or any of its Subsidiaries is a party or take any action to exempt any Person other than Merger Sub and its Affiliates from the restrictions on “business combinations” contained in Section 203 of the DGCL or the Company’s certificate of incorporation or bylaws, except, in each case, to the extent the Company Board shall have determined in good faith, after consultation with its outside legal counsel, that failure to take such action would be inconsistent with its fiduciary duties under applicable Law, but in such case only after providing Parent with prior written notice of such determination;
(xxi) knowingly take any action that would, or would reasonably be expected to (a) result in the failure of a condition set forth in Section 7.2(a) or Section 7.2(b), or (b) individually or in the aggregate, prevent, delay or impede in any material respect the consummation of the Merger or the other transactions contemplated by this Agreement; or
(xxii) enter into any agreement or otherwise make a commitment, to do any of the foregoing.
(b) Parent covenants and agrees that, prior to the Effective Time, Parent shall not knowingly take or permit any of its Affiliates to take any action that, individually or in the aggregate, is reasonably likely to (i) result in the failure of a condition set forth in Section 7.3(a), Section 7.3(b) or Section 7.3(c) or (ii) prevent, delay or impede in any material respect the consummation of the Merger or the other transactions contemplated by this Agreement.
(c) The Company and Parent acknowledge that nothing contained in this Agreement is intended to give Parent, directly or indirectly, the right to control or direct the Company’s or its Subsidiaries’ operations prior to the Effective Time, and nothing contained in this Agreement is intended to give the Company, directly or indirectly, the right to control or direct Parent’s or its Subsidiaries’ operations. Prior to the Effective Time, except as set forth in each of Parent and the Company Disclosure Letter or as contemplated by any other provision shall exercise, consistent with the terms and conditions of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, complete control and shall cause each of supervision over its Significant Subsidiaries to, conduct and its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)Subsidiaries’ respective operations.
Appears in 1 contract
Interim Operations. (a) Prior to the Effective TimeSeller covenants and agrees that, except as set forth in the Company Disclosure Letter or (i) as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated as required by this Agreement)Law; (iii) shall promptly notify as disclosed in the Purchaser of any breach of any representation Disclosure Schedule; or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver with the prior written consent of Purchaser, such consent not to be unreasonably withheld, after the date hereof and prior to the Purchaser true Closing Date:
(a) Seller shall use reasonable efforts consistent with Seller's past practices to preserve the Business intact in all material respects and correct copies generally conduct the Business in the ordinary course of the Business consistent with past practice;
(b) Seller shall not sell, lease or dispose of any reportassets or properties included in the Purchased Assets (other than Inventory in the ordinary course of business consistent with past practices);
(c) Seller shall not, statement with respect to the Business, do any act or schedule filed omit to do any act whereby any Transferred Intellectual Property may lapse, become abandoned, dedicated to the public, or unenforceable, or enter into any material commitment, transaction, contract or agreement concerning the Transferred Intellectual Property;
(d) Seller shall not grant any bonus, salary increase, severance or termination pay to, or otherwise increase the compensation or benefits of, any employees of the Business, except obligations pursuant to any existing Plans;
(e) Seller shall not, with respect to the SEC Business, change in any material respect any of the accounting principles, methods or practices used by it (except as required by GAAP);
(f) Seller shall not, with respect to the Business, modify, amend or terminate, or waive, release or assign any material rights or claims with respect to, any Contract;
(g) Seller shall not permit any of the Purchased Assets to become subjected to any Encumbrance other than the Permitted Encumbrances;
(h) Seller shall not, with respect to the Business, enter into any lease or sublease of real property (whether as a lessor, sublessor, lessee or sublessee) other than the Real Property Lease or modify, amend, terminate or fail to exercise any right to renew the Real Property Lease;
(i) Seller shall not, with respect to the Business, commit to make as of a date subsequent to the Closing any capital expenditure which individually is in excess of $100,000, except capital expenditures reasonably required in the event of exigent circumstances or which are funded by insurance or other third parties;
(j) Except for the persons listed on Schedule 4.1(j), with respect to the Business, Seller shall not hire any new employee with an annual base salary in excess of $75,000, promote any employee except in order to fill a position vacated after the date of this Agreement; (v) shall not (x) except , or engage any consultant or independent contractor pursuant to a binding commitment that is non-terminable without the exercise payment of optionsfees in excess of a minimum of $75,000;
(k) Seller shall not, warrantswith respect to the Business, conversion rights and other adopt, enter into, or amend any Plan, except (i) as required pursuant to contractual rights existing on arrangements in effect as of the date hereof and disclosed pursuant to or as required or permitted under this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation as required by applicable law or warranty contained herein or any Purchaser Material Adverse Effect; (iii) as may apply to any employee other than employees or former employees of the Business;
(l) Seller shall promptly deliver not, with respect to the Company true and correct copies Business, change in any material respect any of any reportits co-op advertising policies, statement product return policies, product maintenance policies, service policies, product modification or schedule filed upgrade policies, or personnel policies;
(m) Seller shall not, with the SEC subsequent respect to the date Business, authorize or enter into an agreement to do any of the foregoing. Notwithstanding the provisions of this Agreement; and (iv) Section 4.1, nothing in this Agreement shall not declare, set aside or pay prevent Seller from engaging in any dividend or make any other distribution or payment activity with respect to any shares of its capital stock or other ownership interests (businesses other than regular quarterly cash dividends not to exceed $0.05 per share)the Business.
Appears in 1 contract
Interim Operations. (a) Prior to Between the Effective TimeDate of Execution and the Closing Date, except Seller shall retain full authority and control of the operation of the Business and the Facilities. Except as set forth Purchaser in the Company Disclosure Letter its sole discretion otherwise approves, in advance, in writing, or as contemplated by any other provision of this Agreementotherwise expressly required hereunder, unless the Purchaser has consented in writing thereto, the CompanySeller shall: (i) shall, operate the Business and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular the Facilities in a manner consistent with all Applicable Laws and ordinary course in substantially the same manner as heretofore conductedpast practices (both operational and financial); (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments maintain the Assets in good order and condition (other than normal wear and tear excepted) to permit the consummation of extent required to operate the transactions contemplated by this Agreement)Business and the Facilities consistent with past practices and in full compliance with Applicable Laws; (iii) shall promptly notify comply with all Applicable Laws with respect to the Purchaser Assets and the operation thereof, including, without limitation, all required regulatory standards of any breach of any representation or warranty contained herein or any Company Material Adverse EffectGovernmental Authorities with regulatory jurisdiction over the Business and the Facilities and all Third Party Payor Programs; (iv) shall promptly deliver to timely pay all payments due on or before the Purchaser true Closing Date under, and correct copies of any reportotherwise maintain and comply with, statement or schedule filed with the SEC subsequent to the date of this Agreementall Provider Agreements, Contracts and all Residency Agreements, each without change except as expressly provided herein; (v) except as may be required by Applicable Law, not make any changes or modifications to any Provider Agreements, Contracts or Residency Agreements or incur any further obligations or surrender any rights thereunder, except that Seller may enter into new residency agreements with new Residents and may renew existing Residency Agreements on substantially the same terms and conditions as other Residency Agreements in effect prior to the Date of Execution for the same Facility and otherwise consistent with the specimen residency agreement attached hereto on Schedule 2.7(b), provided in no event shall such new residency agreements provide for any “move in” specials or free rent, fix rental amounts for more than sixty (60) days, provide for a single payment for lifetime services, or be at rates that are lower than the rates reflected in Schedule 4.1(a)(v); (vi) not enter into any contracts, agreements or leases (or any amendment of any of them) which would have had to be disclosed on any schedule hereto had such contracts, agreements or leases been entered into prior to the Date of Execution, unless such contract, agreement or lease (or amendment thereof) has been approved in advance in writing by Purchaser, such approval not to be unreasonably withheld; (vii) keep in full force and effect (and renew as applicable) present insurance policies and Licenses through the Closing Date; (viii) maintain in good standing all Licenses and use commercially reasonable efforts to maintain (and not terminate) all goodwill of Residents, parties to all Contracts and vendors; (ix) not allow the number of Residents at any Facility to exceed the licensed capacity for such Facility; (x) except pursuant for any bonuses which Seller may in its discretion propose to pay at its sole cost and expense to certain management employees in connection with the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreement, or pursuant to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as transaction contemplated by this Agreement, unless not cause or permit any of the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment following with respect to any shares of its capital stock Employees: any new bonus, percentage compensation, service award or other ownership interests like benefit, or any increase in the compensation payable or to become payable by Seller to any Employees; or any change in the method of calculating any presently existing bonus, percentage compensation, service award or other like benefit, granted, made or accrued to or to the credit of any of the Employees, or any increase in any Employee welfare, insurance, pension, retirement or similar payment or arrangement made or agreed to pursuant to existing welfare, pension and retirement Employee Benefit Plans and arrangements, deferred compensation, or other Employee Benefit Plans; and (other than regular quarterly cash dividends xi) except as expressly permitted hereunder, not to exceed $0.05 per share)take any action that would cause any of the changes, events or conditions described in Section 2.21.
Appears in 1 contract
Sources: Asset Purchase Agreement (Griffin-American Healthcare REIT III, Inc.)
Interim Operations. Each of Laguna and Orca covenants and agrees as to itself and its Subsidiaries that, after the date hereof and until the earlier of the Laguna Effective Time or the termination of this Agreement in accordance with its terms, unless Laguna (in the case of any action or omission proposed with respect to Orca or any Subsidiary of Orca) or Orca (in the case of any action or omission with respect to Laguna or any Subsidiary of Laguna) shall otherwise approve in writing (which approval shall not be unreasonably withheld, delayed or conditioned by the party from whom it is requested) and except as required by applicable Law, Self-Regulatory Organization, the Orca Scheme or as expressly contemplated by this Agreement or, in the case of Orca, as otherwise set forth in Section 5.1 of the Orca Disclosure Letter or, in the case of Laguna, as otherwise set forth in Section 5.1 of the Laguna Disclosure Letter:
(a) Prior to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision each of this Agreement, unless the Purchaser has consented in writing thereto, the Company: it and its Subsidiaries shall use its commercially reasonable efforts (i) shallto conduct its business in the ordinary and usual course consistent with past practice and (ii) to preserve intact its business organization and consistent with prior practice maintain its existing relations and goodwill with all Governmental Entities (including applicable Regulatory Authorities) and Self-Regulatory Organizations, clients, customers, suppliers, distributors, creditors, lessors, employees, stockholders and other Persons with which it or Laguna or Orca, as applicable, and its Subsidiaries has material business relations, as applicable;
(i) neither it nor its Subsidiaries shall cause each amend, modify, waive, rescind or otherwise change any provisions of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedOrganizational Documents; (ii) neither Laguna nor Orca, as applicable, shall split, combine or reclassify its outstanding shares of capital stock or other equity interests; (iii) neither it nor its Subsidiaries shall declare, set aside or pay any type of dividend or other distribution, whether payable in cash, stock, property or a combination thereof, in respect of any capital stock or other equity interests, as appropriate, other than dividends payable by direct or indirect wholly owned Subsidiaries of Laguna or Orca, as applicable, to Laguna or Orca, respectively, or another of its direct or indirect wholly owned Subsidiaries in the ordinary and usual course of business (including in connection with acquisitions entered into after the date of this Agreement as permitted by Section 5.1(h)) or to service existing indebtedness for borrowed money; (iv) neither it nor its Subsidiaries shall adopt a plan of merger, consolidation or complete or partial liquidation or resolutions providing for a merger, consolidation or complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization; and (v) except (x) for the acquisition by such party of shares of its capital stock or other equity interests in connection with the surrender of such shares by holders of Laguna Stock Awards or Orca Stock Awards, as applicable, in order to pay the exercise price of such Stock Awards in accordance with the terms of such Stock Awards as in effect on the date of this Agreement and Disclosed to the other party, (y) for the withholding or disposition of shares of capital stock or other equity interests to satisfy withholding Tax obligations with respect to Laguna Stock Awards or Orca Stock Awards, as applicable, granted pursuant to the Laguna Stock Plans and the Orca Stock Plans, as applicable, in accordance with the terms of such Stock Awards as in effect on the date of this Agreement and Disclosed to the other party, neither it nor its Subsidiaries it shall repurchase, redeem or otherwise acquire any shares of any capital stock or other equity interests of Laguna or Orca or their respective Subsidiaries, as applicable, or any securities convertible into or exchangeable or exercisable for any such shares of capital stock or other equity interests, as applicable;
(c) neither it nor any of its Subsidiaries shall (i) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, profits interests, commitments or rights of any kind to acquire, capital stock or other equity interests, or any bonds, debentures, notes or other obligations the holders of which have the right to vote (or convertible into or exercisable for securities having the right to vote) with its stockholders on any matter or any other property or assets, except for (x) Laguna Shares or Orca Shares (as applicable) issuable or transferable pursuant to Laguna Stock Awards or Orca Stock Awards outstanding on or awarded prior to the date hereof or made by Laguna or Orca, as applicable, (y) in amounts not to exceed the maximum amounts set forth respectively, in the case of Orca, on Section 5.1 of the Orca Disclosure Letter or, in the case of Laguna, on Section 5.1 of the Laguna Disclosure Letter, or (z) issuances to Subsidiaries of Laguna or Orca, as applicable, in connection with internal reorganizations entered into in the ordinary and usual course of business solely among the Subsidiaries of Laguna or Orca, as applicable, which will not adversely affect the Intended Tax Treatment; (ii) incur any indebtedness for borrowed money (including any guarantee of indebtedness) or issue any debt securities except for borrowing in amounts not to exceed $25,000,000 in the aggregate (including pursuant to any drawdowns of credit facilities outstanding as of the date hereof); or (iii) make or authorize or commit to any material capital expenditures, other than in the ordinary and usual course of business and consistent with past practice; provided that, to the extent permitted by Law, it shall inform the other party of material capital expenditures not contemplated by such party’s capital budget;
(d) neither it nor any of its Subsidiaries shall (i) terminate, establish, adopt, enter into, or materially amend any Benefit Plan, as the case may be, or any other arrangement that would be a Laguna Benefit Plan or an Orca Benefit Plan if in effect on the date of this Agreement; (ii) materially increase the salary, wage, bonus, fringe benefits or other compensation of any director, manager, officer or employee or enter into any contract, agreement, commitment or arrangement to do any of the foregoing; provided, however, that any compensation or benefits that vest, accelerate or result in any payment or funding in connection with any of the transactions contemplated by this Agreement shall not amend its Certificate be considered a breach of Incorporation the foregoing clauses (i) and (ii); (iii) enter into any contract, agreement, commitment or Bylaws arrangement providing for the payment to any director, manager, officer or comparable governing instruments employee of such party or the funding of compensation or benefits in connection with, contingent upon, or the terms of which are materially altered in connection with, any of the transactions contemplated by this Agreement either alone or, except as provided below, in conjunction with any other event; or (iv) provide, with respect to any stock option, restricted stock, restricted stock unit or other than to permit equity-related award, that the consummation vesting of any such stock option, restricted stock, restricted stock unit or other equity-related award or any Benefit Plan shall accelerate or otherwise be affected by or result in any payment or funding in connection with any of the transactions contemplated by this Agreement, except (x) with respect to the foregoing clauses (i)—(iv); (iii) shall promptly notify , as required by applicable Law or the Purchaser terms of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true Benefit Plan existing and correct copies of any report, statement or schedule filed with the SEC subsequent to in effect on the date of this Agreement; Agreement and Disclosed to the other party or (vy) shall not with respect to the foregoing clause (xii), in the usual course of business consistent with past practice;
(e) except pursuant to in the exercise ordinary course of options, warrants, conversion rights business or as may be required by applicable Law or the terms of any Benefit Plan existing and other contractual rights existing in effect on the date hereof of this Agreement and disclosed pursuant that is set forth, in the case of Orca, in Section 5.1 of the Orca Disclosure Letter or, in the case of Laguna, that is set forth in Section 5.1 of the Laguna Disclosure Letter, neither it nor any of its Subsidiaries shall establish, adopt, enter into, materially amend or terminate any collective bargaining or similar agreement with a labor union or similar organization;
(f) neither it nor any of its Subsidiaries shall lease, license, transfer, exchange or swap, mortgage (including securitizations) pledge, abandon, allow to lapse, or otherwise dispose of (whether by way of merger, consolidation, sale of stock or assets, or otherwise) any portion of its assets, including the capital stock or other equity interests of its Subsidiaries except for (i) dispositions of assets that, individually or in the aggregate with all other such dispositions, have fair market value of less than $25,000,000; (ii) transactions between it and any of its direct or indirect Subsidiaries or transactions between such Subsidiaries; or (iii) activities in the ordinary and usual course of business consistent with past practice;
(g) neither it nor any of its Subsidiaries shall, except in the ordinary and usual course of business and consistent with past practices, sell, lease, license, transfer, exchange or swap, mortgage (including securitizations) pledge, abandon, allow to lapse or otherwise dispose of any Material Intellectual Property of such party or any of its Subsidiaries;
(h) neither it nor any of its Subsidiaries shall acquire or agree to acquire (whether by merger, consolidation, purchase or otherwise) any Person, division or assets (including real property), except for acquisitions: (i) entered into on an arm’s length basis; (ii) the expected gross expenditures and commitments (including the amount of any indebtedness assumed) of which do not exceed, in the aggregate, $25,000,000; and (iii) which are not reasonably likely, individually or in the aggregate, to prevent or materially delay the satisfaction of the conditions set forth in Section 6.1(e);
(i) neither it nor any of its Subsidiaries shall settle or compromise (other than any claims or litigation brought by Laguna against Orca or brought by Orca against Laguna arising out of or relating to this Agreement) any material claims or litigation, if such settlement or pursuant to compromise would involve, individually or together with all such other settlements or compromises, the Recapitalization issue payment of money by such party or its Subsidiaries in excess of $25,000,000 over the available insurance coverage or applicable reserves, if any, at the time of such settlement or would involve any shares admission of material wrongdoing or any material conduct requirement or restriction by such party or its affiliates, except, in each case, in the ordinary and usual course of business consistent with past practice;
(j) neither it nor any of its capital stockSubsidiaries shall modify, effect renew, amend or (excluding expirations in accordance with their terms) terminate in any stock split material respect any of its Material Contracts or otherwise change its capitalization as it existed waive, release or assign any material rights or claims thereunder in excess of $20,000,000 individually or in the aggregate or enter into or amend any Contract that, if existing on the date hereof, would be a Material Contract, except, in each case, in the ordinary and usual course of business consistent with past practice or as permitted pursuant Section 5.1(c)(ii) or 5.1(c)(iii), or 5.1(d);
(yk) grant, confer or award neither it nor any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stockSubsidiaries shall make or change any material Tax election, adopt or change any material method of Tax accounting, file any material amended Tax Return, enter into a closing agreement or advance pricing agreement in respect of a material amount of Taxes, settle or compromise any material audit, assessment, notice, Tax claim or proceeding relating to Taxes, surrender any material right to claim a refund or offset of any Taxes, consent to (or request) any extensions or waiver of the limitation period applicable to any material Tax claim or assessment, or (z) adopt change the classification of Laguna or Orca, as applicable, or any A1-14of their Subsidiaries for U.S. Tax purposes, except, in each case, to the extent otherwise required by Law or in the ordinary course of business consistent with past practice;
(bl) Prior neither it nor any of its Subsidiaries shall permit any material change in its financial accounting principles, policies or practices, except to the Effective Timeextent that any such changes in financial accounting principles, policies or practices shall be required by changes in GAAP or SEC rules and regulations or Regulation S-X of the Exchange Act and, in each case, authoritative interpretations thereof;
(m) neither it nor any of its Subsidiaries shall enter into any Contract that grants “most favored nation” status to any counterparty, except as set forth in the Purchaser Disclosure Letter ordinary and usual course of business consistent with past practice, or as contemplated by this Agreementany “non-compete” or similar Contract that, unless in any case, would materially restrict the Company and business of the Special Committee have consented Topco Group following the Laguna Effective Time with respect to engaging or competing in writing theretoany line of business or in any geographic area;
(n) neither it nor any of its Subsidiaries shall make any material loans, the Purchaseradvances or capital contributions to, or investments in, any other Person (other than any wholly owned Subsidiary), other than: (i) shall not issue any shares routine travel, relocation (of non-executive employees) and business advances in the ordinary course of business to employees of it or its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; Subsidiaries and (ii) trade credit to customers, in either case, made in the ordinary course of business consistent with past practice;
(o) neither it nor any of its Subsidiaries shall promptly notify the Company enter into any material new line of business outside of its existing business segments;
(p) neither it nor any breach of its Subsidiaries shall convene any representation regular or warranty contained herein special meeting (or any Purchaser Material Adverse Effectadjournment or postponement thereof) of the stockholders of it or its Subsidiaries other than (i) the stockholder meetings to adopt this Agreement and approve the Combinations and (ii) regular annual meetings to address matters arising in the ordinary course consistent with past practice other than this Agreement and the Combinations;
(q) neither it nor any of its Subsidiaries shall implement or announce any material plant closing, material reduction in labor force or other material group layoff of employees or service providers other than routine employee terminations for cause or following performance reviews in the ordinary course of business and consistent with past practice;
(r) subject to Section 5.2, neither it nor any of its Subsidiaries shall take any action that would reasonably be expected to prevent or materially impair or delay the consummation of the Combinations or any of the other transactions contemplated by this Agreement (including the satisfaction of the conditions set forth in ARTICLE VI); and
(iiis) neither it nor any of its Subsidiaries shall promptly deliver authorize or enter into an agreement, arrangement or understanding to do any of the foregoing set forth in Section 5.1(a) through (r) if Laguna or Orca, as applicable, would be prohibited by the terms of Section 5.1(a) through (r) from doing the foregoing. Nothing contained in this Agreement shall give (x) Laguna, directly or indirectly, the right to control or direct the operations of Orca or Topco, or (y) Orca or Topco, directly or indirectly, the right to control or direct the operations of Laguna, prior to the Company true and correct copies filing of any report, statement or schedule filed the Orca Scheme Order with the SEC subsequent to Registrar and the date consummation of the Laguna Merger, respectively. Prior thereto, each of Laguna and its Subsidiaries, on the one hand, and Orca and its Subsidiaries (including Topco), on the other hand, shall exercise, consistent with the terms and conditions of this Agreement; , complete unilateral control and supervision over their business operations. Notwithstanding anything to the contrary in this Agreement, any actions or omissions (iva) shall not declarethat are reasonably prudent or reasonably necessary to mitigate the effects of the COVID-19 pandemic and the Effects resulting therefrom, set aside or pay (b) required or prudent to comply with applicable Law, guidelines or best practices of any dividend Governmental Entity or make any other distribution Orders in connection with or payment with respect in response to any shares the COVID-19 pandemic and the Effects resulting therefrom shall, in each case, be considered to have been taken in the “ordinary course of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).bus
Appears in 1 contract
Sources: Business Combination Agreement (Ortho Clinical Diagnostics Holdings PLC)
Interim Operations. (a) Prior Between the date hereof and each Applicable Closing Date, Seller shall operate and carry on the Business not previously transferred to Buyer only in the Effective Timeordinary course and substantially as presently operated. Consistent with the foregoing, Seller shall (i) keep and maintain the Purchased Assets in good operating condition and repair; (ii) use commercially reasonable efforts to preserve the goodwill of the suppliers, contractors, licensors, employees, customers, distributors and others having business relations with the Business; and (iii) other than the reduction of surplus non-pharmaceutical Excluded Inventory that does not eliminate the display of a product or create the appearance of an inventory shortage, maintain the Inventory at levels adequate and not excessive in the present circumstances of the Business and at levels reasonably based on past practices and historical sales of the Business. In furtherance of the foregoing, Seller shall maintain normal operating hours, staffing levels, inventory levels and merchandise mix. Additionally, between the date hereof and each Applicable Closing Date, Seller will take commercially reasonable steps that are consistent with (x) Seller’s past practice in the ordinary course of the Business and (y) regional pharmacy standards to maintain or increase the applicable Current Volume. Buyer shall have the right, at any time before the Final Closing upon reasonable notice and at Buyer’s expense, to audit Seller’s prescription records to determine the then-current average daily prescription counts.
(b) Except as expressly contemplated by this Agreement or except as with the express written approval of Buyer, Seller shall not: (i) take any action that is intended or may reasonably be expected to result in (x) any of the representations and warranties set forth in this Agreement being or becoming untrue in any material respect, (y) any of the Company Disclosure Letter conditions to each Applicable Closing set forth in this Agreement not being satisfied or as contemplated by (z) any other violation of any provision of this Agreement, unless the Purchaser has consented except, in writing theretoeach case, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conductedmay be required by applicable law; (ii) shall not amend its Certificate enter into any lease, agreement, contract or commitment of Incorporation any nature (or Bylaws amendment, supplement or comparable governing instruments (modification of any existing lease, agreement, contract or commitment, other than amendments to permit the consummation of the transactions Operate Real Estate Leases contemplated by this Agreement), oral or written, that would be binding on or adversely impact the Purchased Assets or Buyer after any Applicable Closing, nor make any capital investment or expenditures, primarily related to the ownership or operation of the Operate Location Pharmacies or File-Transfer Locations; (iii) shall promptly notify enter into any contract with respect to, or make any increase in (or commitment to increase) the Purchaser compensation payable to any of any breach of any representation its employees or warranty contained herein agents primarily related to the Operate Location Pharmacies or any Company Material Adverse EffectFile-Transfer Locations; or (iv) shall promptly deliver sell, lease, transfer or otherwise dispose of (including any transfers from Seller to the Purchaser true and correct copies any of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on the date hereof and disclosed pursuant to this Agreementits Affiliates), or pursuant impose or suffer to be imposed any Encumbrance on, any of the Recapitalization issue any shares Purchased Assets, other than inventory and minor amounts of its capital stock, effect any stock split personal property sold or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares disposed of its capital stock, or (z) adopt any A1-14
(b) Prior to the Effective Time, except as set forth for fair value in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless ordinary course of the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company of any breach of any representation or warranty contained herein or any Purchaser Material Adverse Effect; (iii) shall promptly deliver to the Company true and correct copies of any report, statement or schedule filed Business consistent with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution or payment with respect to any shares of its capital stock or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share)past practice.
Appears in 1 contract
Sources: Asset Purchase Agreement (Graymark Healthcare, Inc.)
Interim Operations. (a) Prior to the Effective Time, except as set forth in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless the Purchaser has consented in writing thereto, the Company: (i) shall, and shall cause each of its Significant Subsidiaries to, conduct its operations according to their usual, regular and ordinary course in substantially the same manner as heretofore conducted; (ii) shall not amend its Certificate of Incorporation or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights existing on From the date hereof and disclosed pursuant until the Closing Date, (i) USX and Holdings agree that they will cause Transtar and each of the Transtar Companies to and (ii) Transtar will and will cause each of the Transtar Companies to:
(a) Except as expressly contemplated by, or as required to implement this Agreement, conduct their business and maintain their assets only in the ordinary course and consistent with past practice;
(b) Duly and punctually pay and perform all of its contractual obligations in accordance with the terms thereof;
(c) Not sell, pledge or pursuant assign any capital stock of any Transtar Company nor issue or agree to the Recapitalization issue any shares share of its capital stock, effect any stock split or otherwise change its capitalization ;
(d) Except as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stockexpressly contemplated by, or (z) adopt any A1-14
(b) Prior as required to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by implement this Agreement, unless not amend any of the Company and Constituent Documents of Transtar or any of the Special Committee have consented Transtar Companies;
(e) Not acquire any assets or the securities of any person other than in writing thereto, the Purchaser: ordinary course of business consistent with past practice;
(f) Not dispose of any assets other than (i) shall not issue any shares the sale of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) obsolete equipment and supplies in the ordinary course of business consistent with past practice or effect any stock split of its capital stock; (ii) shall the sale or lease of real property in the ordinary course of business consistent with past practice;
(g) Not make any capital authorizations or expenditures, or enter into any agreements in connection therewith, other than for amounts and items in the form of and contemplated in the 2000 Capital Plan (including the amendment in respect of the Bessemer Car Fleet specified in the Letter dated May 30, 2000 from ▇▇▇▇▇▇ ▇▇▇▇▇▇ to ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇) and which do not exceed $31,434,000 in the aggregate with respect to USX Companies and $16,526,000 in the aggregate with respect to Holdings Companies;
(h) Except as contemplated in the 2000 Business Plan, not enter into any contract or agreement that would (i) constitute a Material Contract or (ii) any contract for a term longer than six months (assuming that all cancellation rights are promptly notify exercised on the Company of Closing Date or as soon thereafter as possible);
(i) Not establish nor amend any breach of employee benefit plan except as contemplated in Article III hereof;
(j) Not grant any representation salary or warranty contained herein wage increase or pay any Purchaser Material Adverse Effect; (iii) shall promptly deliver bonus except for increases granted to the Company true and correct copies of any report, statement or schedule filed employees other than elected officers in accordance with the SEC subsequent existing program or except as explicitly agreed to in writing by USX and Holdings;
(k) Not incur, guarantee or become liable for any indebtedness for money borrowed, except for guarantees (i) made by one of the date Holdings Companies for the benefit of this Agreementanother Holdings Company; and or (ivii) shall not made by one of the USX Companies for the benefit of another USX Company.
(l) Not declare, set aside or aside, pay any dividend or make any other distribution or payment with in respect to of any shares of its capital stock or purchase, redeem, otherwise acquire any of its capital stock or make any capital contributions (except as authorized by Sections 2.2, 2.3 and 2.5 hereof);
(m) Not grant any stock or options under the Management Plans;
(n) Not allow any substantial negotiations by the officers, employees, or agents (if such agents are acting pursuant to the direction of such officers or employees) of Transtar or the Transtar Companies concerning any agreement, understanding, or arrangement concerning the sale, transfer or other ownership interests disposition, either directly or indirectly, of the stock of Transtar or any Transtar Company or substantially all of the assets of Transtar or a Transtar Company.
(o) Not enter into, modify, amend, supplement or terminate any binding agreement or contract with any affiliate of Holdings or USX (other than regular quarterly cash dividends the Transtar Companies), except in the ordinary course of business, consistent with past practice.
(p) Not agree to any material change in any insurance policy, including, but not limited to, any change which would impair Transtar's, or any of the Transtar Companies', rights to exceed $0.05 per share)extend the discovery period for claims made against any claims made insurance policies.
(q) Not authorize or agree with any person nor make any commitment to do any of (c) through (p) above.
Appears in 1 contract
Sources: Reorganization and Exchange Agreement (Transtar Holdings Lp)
Interim Operations. (a) Prior Seller has directed and shall direct the management of Valence to cause the Effective Timebusinesses of Valence and each of the Valence Subsidiaries to be conducted at all times between February 1, except 1998 and the Closing Date as set forth follows:
(i) Except as otherwise provided in the Company Disclosure Letter or as contemplated by any other provision of this Agreement, unless Valence and each of the Purchaser has consented Valence Subsidiaries shall carry on their businesses and continue to operate, maintain and repair their properties, in writing theretothe normal course of business in all material respects and in accordance with their past practices;
(ii) The books and records of Valence and each of the Valence Subsidiaries shall be maintained on a basis consistent with the Valence Financial Statements prepared in accordance with H.K. GAAP in such manner as to present fairly the history of the operations and financial condition of Valence and each of the Valence Subsidiaries;
(iii) Valence and each of the Valence Subsidiaries shall carry such insurance against fire, storm damage and other hazards, consistent with the Company: past practices of Valence and each of the Valence Subsidiaries subject to the availability thereof at costs not materially greater than at present; and
(iv) Seller shall use its best efforts and shall cooperate with Buyer in all respects reasonably requested by Buyer, without making any commitments on behalf of Buyer, to preserve the business organizations of Valence and each of the Valence Subsidiaries intact, to keep available to Valence and each of the Valence Subsidiaries their present employees, to preserve the goodwill of Valence and each of the Valence Subsidiaries, and to fost▇▇ ▇▇▇ promote the operations of Valence and each of the Valence Subsidiaries and their relations with customers, suppliers, contractors, vendors, purchasers, banks, lenders, employees and others having business relationships with Valence and each of the Valence Subsidiaries.
(b) Between February 1, 1998 and the Closing Date, without prior written agreement or authorization of Buyer, and except as otherwise specifically provided in this Agreement and in the Exhibits and Schedules attached hereto, Seller did not take or shall not take any action, or allow any action to be taken with respect to Valence and each of the Valence Subsidiaries, which would cause any material change in the businesses of Valence or any of the Valence Subsidiaries or would result in the inaccuracy or breach of any of the representations and warranties of Seller in Article 2 if such representations and warranties were remade immediately after such action, including without limitation:
(i) shall, and shall cause each of its Significant Subsidiaries incurring or becoming subject to, conduct its operations according or agreeing to their usualincur or become subject to, regular and any liability, indebtedness, claim, obligation or responsibility (fixed, contingent or otherwise) other than those incurred in the ordinary course in substantially the same manner of business, consistent with past practice or as heretofore conducted; (ii) shall not amend its Certificate of Incorporation required by law or Bylaws or comparable governing instruments (other than to permit the consummation of the transactions contemplated by this Agreement); (iii) shall promptly notify the Purchaser of any breach of any representation or warranty contained herein or any Company Material Adverse Effect; (iv) shall promptly deliver to the Purchaser true and correct copies of any report, statement or schedule filed with the SEC subsequent to the date of this Agreement; (v) shall not (x) except pursuant to the exercise of options, warrants, conversion rights and other contractual rights obligations existing on the date hereof and which has been disclosed pursuant in writing to this Agreement, or pursuant Buyer prior to the Recapitalization issue any shares of its capital stock, effect any stock split or otherwise change its capitalization as it existed on the date hereof, (y) grant, confer or award any option, warrant, conversion right or other right not existing on the date hereof to acquire any shares of its capital stock, or (z) adopt any A1-14;
(b) Prior to the Effective Time, except as set forth in the Purchaser Disclosure Letter or as contemplated by this Agreement, unless the Company and the Special Committee have consented in writing thereto, the Purchaser: (i) shall not issue any shares of its capital stock at less than fair market value (other than pursuant to any Purchaser Stock Plans) or effect any stock split of its capital stock; (ii) shall promptly notify the Company discharging or satisfying any lien or encumbrance or payment of any breach liability, indebtedness, claim, obligation or responsibility (fixed, contingent or otherwise) other than current liabilities reflected on the Corporate Balance Sheet and current liabilities incurred since the date of any representation or warranty contained herein or any Purchaser Material Adverse Effect; the Corporate Balance Sheet in the ordinary course of business of Valence and each of the Valence Subsidiaries, consistent with past practice;
(iii) shall promptly deliver to the Company true and correct copies of mortgaging, pledging or assuming any reportlien, statement charge or schedule filed with the SEC subsequent to the date of this Agreement; and (iv) shall not declare, set aside or pay any dividend or make any other distribution encumbrances or payment with the agreement so to do, in respect to any shares of its capital stock the assets, tangible or other ownership interests (other than regular quarterly cash dividends not to exceed $0.05 per share).intangible, of Valence and each of the Valence Subsidiaries;
Appears in 1 contract