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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter): (i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates; (ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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; (iii) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person; (iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000; (v) except in the ordinary and usual course of business, neither it 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; (vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP; (vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and (viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing. (b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter): (i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates; (ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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; (iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person; (iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000; (v) except in the ordinary and usual course of business, neither it 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; (vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP; (vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and (viii) 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: Combination Agreement (Donnelley R R & Sons Co), Combination Agreement (Moore Wallace Inc)
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 date on which Purchaser's nominees comprise a majority of the Board of Directors of the Company (unless Parent Praxair shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact and maintain its existing relations rela- tions and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of sell or encumber pledge any capital stock owned by it in any of its Subsidiaries; (B) amend the Company Charter or its Organizational Documentsby-laws or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock Shares or Preferred Shares other than regular quarterly or semi- annual cash dividends from its direct not in excess of $0.12 per Share and regular quarterly or indirect wholly owned Subsidiariessemi-annual cash dividends on the Preferred Shares; or (E) 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 stockstock except in connection with the ordinary course of operations of the CBI Salaried Employee Stock Ownership Plan (1987);
(iii) neither it nor any of its Subsidiaries shall except as disclosed in Section 7.1(a) of the Company Disclosure Letter (A) issue, sell, pledge, dispose of or encumber encumber, or authorize or propose the issuance, sale, pledge, disposition or encumbrance of, 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 Company Voting Debt or any other property or assets (other than Company Common Shares issuable pursuant to options outstanding on the date hereof under the Company Option Plans)Stock Plan or upon conversion of Convertible Preferred Shares; (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000busi- ness, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of any other property or assets or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yC) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring make any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Teamcommitments for, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materialsexisting capital expenditures required to be made pursuant to existing capital projects, supplies and other inventory items acquired as set forth in Section 7.1(a)(iii) of the ordinary and usual course of business consistent with past practiceCompany Disclosure Letter, which have been previously authorized or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other PersonPerson or entity;
(iv) except as disclosed in Section 7.1(a) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by or increase the salary, wage, bonus or other compensation of any Laws or the terms of applicable collective bargaining agreements, (B) employees other than increases in compensation in the ordinary and usual course of business business, in each case, consistent with past practice practices with regard to frequency and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000amount;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any the ordinary and usual course of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectbusiness; and
(viiivii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Px Acquisition Corp), Merger Agreement (Px Acquisition Corp)
Interim Operations. Each of Grace and Fresenius AG (afor itself and on behalf of Fresenius AG) The Company covenants and agrees as to itself and its Subsidiaries subsidiaries that, from and after the date hereof and prior to until the Effective Time (unless Parent Time, except insofar as the other parties shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement, the Contribution Agreement, the Distribution Agreement or its Disclosure Letter (provided that, as used herein, all references to Grace (and/or its Affiliates) shall be deemed to refer to Grace and its Affiliates which conduct the corresponding subsection of NMC Business, consistent with Section 3.1(a) of the Company Disclosure Letter9.8 hereof, except as otherwise specifically provided):
(ia) To the extent reasonably practicable, taking into account any operational matters that may arise that are primarily attributable to the pendency of the Reorganization, the business of it and its Subsidiaries shall subsidiaries will be conducted only in the ordinary and usual course consistent with past practice and existing business plans previously disclosed to the other parties and, to the extent consistent therewith, it and each of its Subsidiaries shall subsidiaries will use its respective all reasonable best efforts to preserve its their business organization intact and maintain its their existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;.
(iib) it shall It will not (Ai) issue, sell, pledge, dispose of sell or encumber pledge or agree to sell or pledge any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than subsidiaries or, in the case of Fresenius AG, any direct FWD Business Subsidiary; (ii) amend its Certificate of Incorporation or indirect, wholly owned Subsidiary, By-laws (or similar organizational document); (iii) split, combine or reclassify its any outstanding shares of capital stock; or (Div) declare, set aside or pay any dividend payable in cash, stock or property in with respect of to any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;.
(iiic) neither it Neither Grace, Fresenius USA, nor any of its Subsidiaries shall (A) their respective subsidiaries or, Fresenius AG, solely with respect to any FWD Business Subsidiary, will issue, sell, pledge, dispose of or encumber encumber, or authorize or propose the issuance, sale, pledge, disposition or encumbrance of, any shares of, or securities convertible into or exchangeable or exercisable for, or options, puts, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any Company Voting Debt (other than Company Common Shares common shares issuable under pursuant to options, warrants and other convertible securities outstanding on the Company Option Plans); (B) other than products sold to customers date hereof and disclosed in its Disclosure Letter, and employee stock options granted after the date hereof in the ordinary and usual course of business business.
(without limitation as d) None of Grace, Fresenius USA or Fresenius AG, with respect to dollar amountthe FWD Business, will (i) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, pledge or dispose of or encumber any other property or assets (including capital stock of encumber any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) property or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business business; (ii) authorize or make capital expenditures; (iii) make any acquisition of, or investment in, assets, stock or other securities of any other person or entity other than its wholly owned subsidiaries or (iv) make any divestiture.
(e) Except as required by agreements or arrangements disclosed in its SEC Documents or its Disclosure Letter, neither it nor any of its subsidiaries or, in the case of Fresenius AG, any FWD Business Subsidiary, will grant any severance or termination pay to, or enter into, extend or amend any employment, consulting, severance or other compensation agreement with, any director, officer or other of its employees, except to other employees in the ordinary course in a manner consistent with past practice practice, which would bind Newco (or its subsidiary) after the Reorganization.
(f) Except as may be required to satisfy contractual obligations existing as of the date hereof (and disclosed to the other parties hereto) and the Company’s compensation budget with respect to employees at an annual compensation level requirements of less than $150,000applicable law, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) and except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise subsidiaries or, in the case of Fresenius AG, any material claims or litigation or modifyFWD Business Subsidiary, will establish, adopt, enter into, make, amend or terminate make any elections under any collective bargaining, bonus, profit sharing, thrift, compensation, stock option, restricted stock, pension, retirement, employee stock ownership, deferred compensation, employment, termination, severance or other plan, agreement, trust, fund, policy or arrangement for the benefit of any directors, officers or employees which would affect Newco (or its material Contracts or waivesubsidiary), release or assign any material rights or claims;except in a manner consistent with past practice.
(vig) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or It will not implement or adopt any change in its accounting principles principles, practices or material accounting practicesmethods, in all cases other than as may be required by applicable Law German GAAP, in the case of Fresenius AG, or by Canadian US GAAP;, in the case of Grace and Fresenius USA, other than as may be necessary or advisable in connection with the Distribution.
(viih) neither Neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries subsidiaries will authorize or enter into an agreement to do take any of the foregoingactions referred to in paragraphs (a) through (g) above.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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: Agreement and Plan of Reorganization (Grace W R & Co /Ny/), Agreement and Plan of Reorganization (Fresenius Aktiengesellschaft)
Interim Operations. Except as set forth on Schedule 5.08, since the Interim Financial Statement Date:
(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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of Business has been conducted by the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associatespast practices;
(iib) it shall there has not (A) issueoccurred any change, sell, pledge, dispose of event or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquirecircumstance that has had, or permit any of its Subsidiaries could reasonably be expected to purchase or otherwise acquirehave, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stocka Material Adverse Effect;
(iiic) neither it nor the Company has not:
(i) paid, discharged or satisfied any of its Subsidiaries shall claims, liabilities or obligations (A) issueabsolute, sellaccrued, pledgecontingent or otherwise), 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) payment, discharge or otherwise satisfaction in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice of liabilities and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise obligations incurred in the ordinary and usual course of business and not in an aggregate consistent with past practice;
(ii) borrowed any amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber incurred or become subject to any other liabilities (absolute or contingent), other than trade payables in the ordinary course of business, except as set forth on Schedule 5.08(c)(ii);
(iii) declared or made any payment or distribution of cash or other property to Seller or assets purchased or redeemed, or made any agreements to purchase or redeem, any of its equity securities;
(including iv) issued, delivered, sold, pledged or encumbered, or authorized, proposed or agreed to the issuance, delivery, sale, pledge or encumbrance of, any shares of capital stock or bonds or any other security (or any right to acquire such capital stock or other security, including options) of the Company or any of its Subsidiaries); , or any right, options or warrants with respect thereto;
(Cv) incur effected any recapitalization, reclassification or modify like change in the capitalization of the Company or any indebtedness of its Subsidiaries, or declared or paid dividends on, or made other than distributions in respect of, any of its capital stock, or issued or authorized the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, or repurchased, redeemed or otherwise acquired, or modified or amended, any shares of capital stock of the Company or any of its Subsidiaries or any other securities thereof or any rights, warrants or options to acquire any such shares or other securities;
(vi) canceled any debts owing to the Company or waived any claims or rights;
(vii) sold, transferred, or otherwise disposed of, any of the Assets;
(viii) disposed of, failed to take reasonable steps to protect, or permitted to lapse, any rights for the use of, any Intellectual Property, or disposed of, failed to take reasonable steps to protect, or disclosed to any Person any Proprietary Information or Confidential Information;
(ix) made any change in any its methods of accounting or accounting practices;
(x) commercial paperwritten off as uncollectible any notes or accounts receivable, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(ivxi) neither it nor made any capital expenditures or capital expenditure commitments in excess of $10,000 individually or $25,000 in the aggregate, except as set forth on Schedule 5.08(c)(xi);
(xii) entered into any transaction or series of related transactions providing for payments by or to the Company in excess of $25,000 in the aggregate, whether or not in the ordinary course of business;
(xiii) made any change in the manner in which products or services have been developed or marketed;
(xiv) had any labor dispute or received notice of any grievance with respect thereto;
(xv) loaned or advanced any amount to, or made any payments to or received any payments from, or sold, transferred or leased any of its Subsidiaries shall assets to, any Affiliate, except in the ordinary course of business;
(xvi) discharged or satisfied any Encumbrance or paid any obligation or liability (absolute or contingent), other than current liabilities paid in the ordinary course of business consistent with past practices;
(xvii) made any change in the cash management or working capital management of the Company other than in the ordinary course of business;
(xviii) (A) terminateterminated, establishcanceled or requested any material change in, or agreed to any material change in, any Subsisting Contract, or (B) entered into any contract which would constitute a Subsisting Contract as defined herein, other than in the ordinary course of business consistent with past practices, in either case, other than as set forth on Schedule 5.08(c)(xviii);
(xix) adopted, agreed to adopt, enter into, make or made any announcement regarding the adoption of (A) any new grants pension, retirement or awards underother employee benefit plan, amend program or otherwise modifypolicy or (B) any amendment to any existing plan, policy or program;
(xx) increased the compensation, bonuses or benefits of any Parent Compensation and Benefit Plans employee, officer, director, or consultant of the Company or any of its Subsidiaries, other than annual increases in the ordinary course of business consistent with past practices at the regularly scheduled times, other than as set forth on Schedule 5.08(c)(xx);
(xxi) amended or modified any of the organizational documents of the Company;
(xxii) made any material election with respect to Taxes or made any change in any such election;
(xxiii) made any change in its methods of accounting in effect at November 30, 2005, except as required by changes in GAAP as agreed to by the Company's independent public accountants or as required by applicable law;
(xxiv) made any Laws charitable contributions or the terms of applicable collective bargaining agreementspledges, (B) other than as set forth on Schedule 5.08(c)(xxiv);
(xxv) settled any Legal Proceeding to which the Company is or was a party, other than as set forth on Schedule 5.08(c)(xxv); or
(xxvi) suffered or agreed to take any of the actions set forth in this subparagraph (c);
(d) the Business has been conducted by the Company only in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000practices;
(ve) except in the ordinary Company has taken no steps to seek protection pursuant to any bankruptcy law, Seller has no reason to believe that any creditors of the Company intend to initiate involuntary bankruptcy proceedings against the Company, and usual course Seller has no knowledge of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit fact which would reasonably lead a creditor to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectdo so; and
(viiif) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any none of the foregoingAssets has suffered any damage, destruction or casualty loss (as a result of fire, explosion or otherwise), whether or not covered by insurance.
Appears in 2 contracts
Sources: Stock Purchase Agreement (Elec Communications Corp), Stock Purchase Agreement (Elec Communications Corp)
Interim Operations. Except as otherwise expressly contemplated by this Agreement, as required by applicable Law, as set forth in Section 5.1 of the Company Disclosure Schedule, or as agreed to in writing by Purchaser (which agreement shall not be unreasonably withheld, delayed or conditioned), the Company, the Stockholder, and the Asset Sellers covenant and agree that, prior to the Closing:
(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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the business of it and its Subsidiaries Business shall be conducted in the ordinary and usual course and, to the extent of business consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associatespast practice;
(iib) it The Company and the Asset Sellers shall use commercially reasonable efforts to keep intact the rights, properties and assets, and vendor, supplier, customer, franchisee and other business relationships of the Business;
(c) The Company shall not (Ai) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect other equity interests of any the Company (including securities convertible into, or rights or options to acquire, capital stock or other than dividends from its direct or indirect wholly owned Subsidiaries; or equity interests of the Company), (Eii) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, acquire any shares of its capital stock or any other equity interests of the Company (including securities convertible into into, or exchangeable rights or exercisable for any shares options to acquire, capital stock or other equity interests of the Company), or (iii) amend or otherwise change its capital stockcertificate of incorporation or bylaws;
(iiid) neither it nor any of its Subsidiaries The Company shall (A) issuenot acquire, sellincluding by merging or consolidating with, pledge, dispose of or encumber any shares purchasing the assets or capital stock or other equity interests of, or securities convertible into in any other manner, any business or exchangeable any corporation, partnership, association or exercisable forother business organization or division thereof, or optionsmake any capital expenditures or commitments in an amount in excess of $25,000 in the aggregate, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any Company Voting Debt (other than pursuant to existing agreements;
(e) The Company Common Shares issuable under the shall not hire any employees;
(f) The Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and shall not in an aggregate amount of more than $5,000,000, transfersell, lease, license, guarantee, sell, mortgage, pledge, subject to any Lien (other than a Permitted Lien) or otherwise encumber or dispose of or encumber any other property or assets (including capital stock of through any sale-leaseback or similar transaction) any of its Subsidiaries); (C) incur properties or modify assets, and no Asset Seller shall take any indebtedness such action with respect to any of the Purchased Assets, other than (xi) indebtedness pursuant to existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries agreements, or (yii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice;
(g) The Company shall not (i) make or forgive any loans, advances or capital contributions to, or investments in, any Person, other than trade accounts receivable incurred in the ordinary course of business consistent with past practice, by any means(ii) assume, make any acquisitions ofguarantee or otherwise become liable or responsible (whether directly, contingently or investments in stock of (otherwise) for the Indebtedness or other interest in) or assets obligations of any other Person, or (iii) enter into any “keep well” or other agreement to maintain any financial statement condition of another Person;
(ivh) neither it nor The Company shall not adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization;
(i) None of the Company or any of its Subsidiaries Asset Seller shall (A) terminate, establish, adopt, enter into, make any new grants or awards undermaterially amend, amend modify or otherwise modifysupplement, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) Material Contract other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000practice;
(vj) except in None of the ordinary and usual course of businessCompany or any Asset Seller (to the extent constituting Purchased Assets) shall waive, neither it nor release, grant, assign or transfer 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;
(vik) neither it nor any Each of the Company and the Asset Sellers shall (i) comply in all material respects with its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent obligations under the Material Contracts as such obligations become due, (ii) use commercially reasonable efforts to maintain insurance covering risks of the Business of such types and in such amounts as are consistent with its past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than and (iii) use commercially reasonable efforts not to permit any insurance policy naming the Company as may beneficiary or loss payable payee to be canceled or terminated;
(l) None of the Company or any Asset Seller (to the extent relevant to the Purchased Assets or Assumed Liabilities) shall (i) change any accounting policies, practices or procedures (including Tax accounting policies, practices and procedures), except as required by applicable Law or by Canadian GAAP;
, (viiii) neither it nor any of revalue its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue assets in any material respect; and
respect (viii) neither it nor including writing down or writing off any of its Subsidiaries will authorize notes or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it accounts receivable in any of its Subsidiaries; (B) except as provided in Section 3.19material manner), amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsGAAP, (Biii) other than in the ordinary and usual course make or change any Tax election or make or change any method of business consistent with past practice and Parent’s compensation budget accounting with respect to employees at an annual compensation level of less than $150,000Taxes, increase in each case that would adversely affect the compensation of any employee or (C) Company following the Closing, except as approved required by the Transition Teamapplicable Law, hire any employee at an annual compensation level expected to be more than $100,000;
(viv) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modifyTax liability that would adversely affect the Company following the Closing, amend or terminate (v) file any of its material Contracts or waiveamended Tax Return, release or assign any material rights or claims;
(vi) neither it nor enter into any Tax allocation, sharing, indemnity or closing agreement, (vii) agree to an extension or waiver of its Subsidiaries shall make a statute of limitations applicable to any Tax liability, (viii) fail to pay any material Tax election as such Tax becomes due and payable (including any estimated Tax), or (ix) prepare and file any material income Tax Return in a manner inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectpractice; and
(viiim) neither it nor None of the Company, the Stockholder or any of its Subsidiaries will authorize Asset Seller shall agree or enter into an agreement commit to do take any of the foregoingforegoing actions prohibited by this Section 5.1. Notwithstanding anything to the contrary set forth in this Agreement, the parties hereto acknowledge and agree that neither Purchaser nor its Affiliates have the right to control or direct the Company’s or any Asset Seller’s operations prior to the Closing. Prior to the Closing, each of the Company and each Asset Seller shall exercise, consistent with the terms of this Agreement, complete control and supervision over its operations.
Appears in 2 contracts
Sources: Purchase Agreement, Purchase Agreement (Red Lion Hotels CORP)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after From the date hereof of this Agreement and prior to until the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and the earlier termination of this Agreement, except as (w) otherwise expressly contemplated by this Agreement, (x) required by applicable Laws (y) set forth in this Agreement or the corresponding subsection of Section 3.1(a) 6.1 of the Company Disclosure Letter):
Letter or (iz) consented to in writing by Parent (which consent will not be unreasonably withheld, conditioned or delayed), the business of it Company will, and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and will cause each of its Subsidiaries shall to, conduct its business in the ordinary course of business consistent with past practice and in compliance with all applicable Laws, and will, and will cause each of its Subsidiaries to, use its respective reasonable best efforts to preserve intact its present business organization intact organization, maintain in effect all of its Permits, keep available the services of its directors, officers and employees and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditorslenders, lessorspartners, employees suppliers and others having material business associatesassociations with it or its Subsidiaries. Without limiting the generality of the foregoing and subject to the exceptions set forth in the foregoing clauses (w), (x), (y) and (z), from the date of this Agreement until the Effective Time, the Company will not and will not permit its Subsidiaries to do any of the following:
(i) adopt or propose any change in its articles of incorporation or bylaws or such other similar applicable governing instruments;
(ii) it shall not merge or consolidate the Company or any of its Subsidiaries with any other Person, or restructure, reorganize or completely or partially liquidate;
(Aiii) other than capital expenditures covered by clause (x) below, acquire assets (whether by merger, tender offer, consolidation, purchase of property or otherwise) outside of the ordinary course of business from any other Person with a value or purchase price in the aggregate in excess of $10,000,000 in any transaction or series of related transactions;
(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 including Shares and/or Class B Shares (other than 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 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 issuance of Shares pursuant to awards or rights outstanding as of the date of this Agreement in accordance with the terms of the Stock Plans, or as may be granted in accordance with, or otherwise in compliance with, the terms of this Agreement;
(v) create or incur any material Lien on any of the assets including any material Owned Intellectual Property, other than Permitted Liens;
(vi) make any loans, advances or capital contributions to, guarantees of or encumber investments in any Person (other than (1) between or among the Company and/or one or more direct or indirect wholly owned Subsidiary of the Company or (2) advances made in the ordinary course of business consistent with past practice to employees of the Company and its Subsidiaries for reimbursement of routine travel or business expenses in accordance with the terms of the applicable policy in effect on the date of this Agreement);
(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 wholly owned Subsidiary to the Company or to any other wholly owned Subsidiary or any dividends required to be paid under any credit facility filed as an exhibit in the Company Reports filed with the SEC since June 28, 2014); provided, that the Company may make, declare and pay one regular quarterly cash dividend in each quarter of the fiscal year with a record date consistent with the record date for each quarterly period for the fiscal year ended June 27, 2015; provided, further, that such dividend per share shall not exceed (A) $0.39 per quarter for dividends with respect to fiscal year 2017 and (B) $0.41 per quarter for dividends with respect to fiscal year 2018;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or securities convertible or exchangeable into or exercisable for any shares of capital stock of the Company or any of its Subsidiaries;
(ix) 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, except for Indebtedness (A) that is to be paid off in full and without penalty at or prior to the Effective Time and (i) incurred in the ordinary course of business consistent with past practice pursuant to existing Contracts, or (ii) incurred to replace, renew, extend, refinance or refund any existing Indebtedness of the Company or any of its Subsidiaries, (B) incurred as intercompany Indebtedness solely among the Company and its direct or indirect wholly owned Subsidiaries or among the Company’s wholly owned Subsidiaries or (C) Indebtedness not to exceed $10,000,000 in aggregate principal amount outstanding at any time incurred by the Company or any of its Subsidiaries that is to be paid off in full and without penalty at or prior to the Effective Time other than in accordance with clauses (A) through (B);
(x) make or authorize any capital expenditures or series of related capital expenditures that are not in the ordinary course of business consistent with past practice;
(xi) (A) except as required by Law (including the legal obligation under the National Labor Relations Act or similar national and provincial Canadian laws to bargain in good faith to reach a labor contract with a labor organization that has been certified as the bargaining agent for the designated employee group) enter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement or (B) amend or modify in a material manner or terminate any Material Contract, or cancel, modify in a material manner or waive any debts, rights, or claims thereunder (other than as permitted pursuant to Section 6.1(a)(ix));
(xii) make any changes with respect to accounting policies or procedures, except as required by changes in applicable GAAP;
(xiii) (A) waive, release, settle or compromise any pending Action against the Company or any of its Subsidiaries other than settlements or compromises of any Action (1) in which the amount paid by or on behalf of the Company or any of its Subsidiaries in settlement or compromise does not exceed $1,000,000 individually or $3,000,000 in the aggregate and (2) that would not impose any material restrictions on the business or operations of the Company or its Subsidiaries or (B) commence, join or appeal in any Action, other than in the ordinary course of business;
(xiv) (A) make or change any material Tax election, (B) change the Company’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;
(xv) fail to use commercially reasonable efforts to maintain in full force and effect the Insurance Policies covering the Company and its Subsidiaries and their respective properties, assets and businesses in a form and amount consistent with past practice;
(xvi) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any material assets (including any material Owned Intellectual Property), licenses, operations, product lines, businesses or interests of the Company or its Subsidiaries, including capital stock of any of its Subsidiaries, in each case except (1) in the ordinary course of business consistent with past practice, (2) for sales of obsolete assets or (3) for transactions involving a de minimis amount of assets in the aggregate;
(xvii) except as required pursuant to existing written Benefit Plans in effect prior to the date of this Agreement or as otherwise required by applicable Law and except as contemplated by this Agreement, (A) pay, grant or provide any severance or termination payments or benefits to any director, officer, contractor or employee of the Company or any of its Subsidiaries; (B) amend its Organizational Documents; (C) increase the compensation, bonus or pension, welfare, severance or other than in the case of any direct or indirectbenefits of, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cashbonus, stock incentive or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquireretention payments to, or permit make any equity awards to any director, officer, contractor or employee 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 (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness , except for increases in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired base salary in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to for employees at an annual compensation level of less than $150,000, increase the compensation of any employee or who are not officers; (C) except as approved by the Transition Teamestablish, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modifyadopt, amend or terminate any Benefit Plan or amend the terms of its material Contracts any outstanding equity-based awards; (D) take any action to accelerate the vesting or waivepayment, release or assign fund or in any other way secure the payment, of compensation or benefits under any Benefit Plan; (E) change in any material rights respect any actuarial or claims;
(vi) neither it nor other assumptions used to calculate funding obligations with respect to any of its Subsidiaries shall make any material Tax election Benefit Plan or file any material income Tax Return inconsistent with past practice to change the manner in which contributions to such plans are made or implement or adopt any change in its accounting principles or material accounting practicesthe basis on which such contributions are determined, in all cases other than except as may be required by applicable Law GAAP; (F) forgive any loans to directors, officers or by Canadian GAAPemployees of the Company or any of its Subsidiaries; or (G) hire or terminate without cause any executive officer or any employee with a target annual compensation opportunity in excess of $200,000, other than any such hire that is a replacement hire to fill a position in existence as of the date of this Agreement;
(viixviii) neither it nor any of its Subsidiaries shall other than in compliance with Section 6.2, take any action or omit to take any action that it is reasonably expects would cause likely to result in any of its representations and warranties herein the conditions to become untrue the Merger set forth in any material respect; andArticle VII not being satisfied;
(viiixix) neither it nor any communicate with the directors, officers, employees or consultants of its Subsidiaries the Company regarding the compensation, benefits or other treatment they will receive in connection with the Merger or after the Closing, other than communications that are not inconsistent with (a) the terms of this Agreement or (b) previous public announcements or communications; or
(xx) agree, authorize or enter into an agreement commit to do any of the foregoingforegoing actions or enter into any Contracts with respect to any of the foregoing actions.
(b) Nothing contained in this Agreement is intended to give Parent covenants and agrees as or Merger Sub the right to itself and control or direct the Company’s or its Subsidiaries that, after the date hereof and Subsidiaries’ operations prior to the Effective Time (unless Time. Prior to the Effective Time, each of Parent and the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) will exercise, consistent with the terms and except as otherwise expressly set forth in conditions of this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):Agreement, complete control and supervision over their respective operations.
(ic) From and after the business date of it and its Subsidiaries shall be conducted in this Agreement, the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Company will notify Parent Rights Agreement; (C) other than in the case promptly of any direct notice or indirect, wholly owned Subsidiary, split, combine other communication received by the Company or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase from the PBGC regarding any defined benefit pension plan of the Company 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers routine notices in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in business. In the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock event of any of its Subsidiaries); (C) incur such notice or modify any indebtedness other than (x) commercial papercommunication, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company will consult with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase any communications with the compensation of any employee PBGC or (Cits representatives and will act in accordance with Section 6.1(c) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingCompany Disclosure Letter.
Appears in 2 contracts
Sources: Merger Agreement (G&k Services Inc), Merger Agreement (Cintas 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 approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in Schedule 7.1 hereof or as otherwise expressly contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective reasonable best efforts efforts, consistent with the limitations of this Article VII, to preserve its business organization substantially intact and maintain its existing relations and goodwill with customers, suppliers, distributors, strategic partners, creditors, lessors, employees and business associates;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentscertificate of incorporation or by-laws; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (Ev) repurchasepurchase, redeem or otherwise acquire, except for the acquisition of shares of Company Common Stock from holders of Company Stock Options in full or partial payment of the exercise price payable by such holder upon exercise of Company Stock Options to the extent required or permitted under the terms of such Company Stock Options, 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;
(iiic) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt or any other property or assets (other than shares of Company Common Shares Stock issuable pursuant to options outstanding on the date hereof under the Company Option Stock Plans); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, abandon, cancel, surrender or allow to lapse or expire or encumber any other material property or material assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness business other than (x) indebtedness existing solely between the licenses of Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired Products entered into in the ordinary and usual course of business consistent with past practicebusiness;
(d) neither it nor any of its Subsidiaries shall restructure, recapitalize, reorganize or completely or partially liquidate or adopt a plan of complete or partial liquidation or otherwise enter into any agreement or arrangement imposing material changes or restrictions on the operation of its assets, product lines or businesses, or its interests therein, or adopt resolutions providing for or authorizing any of the foregoing;
(e) neither it nor any of its Subsidiaries shall acquire (i) by merging or consolidating with, or by purchasing all or a substantial portion of the assets of or any means, make any acquisitions stock of, or investments in stock of (by any other manner, any business or any corporation, partnership, joint venture, limited liability company, association or other interest inbusiness organization or division thereof, or (ii) any material assets or assets businesses, except purchases of any other Personinventory and raw materials in the ordinary course of business;
(ivf) neither it nor any of its Subsidiaries shall adopt or implement any stockholder rights plan, “poison pill” anti-takeover plan or other similar plan, device or arrangement that, in each case, is applicable to Parent or any of its Affiliates, the Agreement or any of the transactions contemplated by this Agreement;
(g) neither it nor any of its Subsidiaries shall (Ai) terminateincur any indebtedness for borrowed money or guarantee any such indebtedness of another Person (other than pursuant to equipment lease borrowings in the ordinary course of business), establish(ii) issue, adoptsell or amend any debt securities or warrants or other rights to acquire any debt securities of the Company or any of its Subsidiaries, guarantee any debt securities of another Person, enter intointo any “keep well” or other agreement to maintain any financial statement condition of another Person or enter into any arrangement having the economic effect of any of the foregoing, (iii) make any new grants loans, advances (other than routine travel advances to employees of the Company and its Subsidiaries in the ordinary course of business, not exceeding $10,000 for any individual employee for any single trip and not exceeding $30,000 in the aggregate) or awards undercapital contributions to, amend or otherwise modifyinvestment in, any other Person, other than the Company Compensation and Benefit Plans except as required by or any Laws of its direct or the terms of applicable collective bargaining agreementsindirect wholly owned Subsidiaries, or (Biv) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, enter into any hedging agreement or other financial agreement or arrangement designed to protect the Company or its Subsidiaries against fluctuations in commodities prices or exchange rates;
(h) neither it nor any of its Subsidiaries shall settle make any capital expenditures or compromise any material claims other expenditures with respect to property, plant or litigation equipment in excess of $100,000 in the aggregate for the Company and its Subsidiaries, taken as a whole, other than as set forth in the Company’s budget for capital expenditures previously made available to Parent or modify, amend or terminate any the specific capital expenditures disclosed in Section 7.1(h) of its material Contracts or waive, release or assign any material rights or claimsthe Company Disclosure Schedule;
(vii) neither it nor any of its Subsidiaries shall make any material Tax election changes in accounting methods, principles or file practices, except insofar as may have been required by a change in GAAP or, except as so required, change any assumption underlying, or method of calculating, any bad debt, contingency or other reserve;
(j) neither it nor any of its Subsidiaries shall, except in the ordinary course of business consistent with past practice, enter into, renew, modify, amend, terminate, waive, delay the exercise of, release or assign any material income Tax Return inconsistent rights or claims under, any Company Material Contract; provided, however, that nothing herein shall permit the Company or any of its Subsidiaries to (1) enter into any Contract of the type specified in Section 5.5(a)(iii) or (xiii) (excluding Section 5.5(a)(xiii)(D) solely with past practice respect to Company Products) to the extent such Contract would survive after the Effective Time or implement modify or adopt amend in a manner adverse to the Company or any of its Subsidiaries any existing Contract of the type specified in Section 5.5(a)(iii) or (xiii), or (2) except to the extent permitted by Section 7.2(a) of this Agreement, enter into, renew, modify, amend, terminate, waive delay the exercise of, or release or assign any material rights or claims under, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is bound by or subject;
(k) neither it nor any of its Subsidiaries shall, except as required to comply with applicable Law or agreements, plans or arrangements existing on the date hereof, (i) take any action with respect to, adopt, enter into, terminate or amend any employment (whether at will or otherwise), severance, change in control, retirement, retention, welfare, incentive or similar agreement, arrangement or benefit plan for the benefit or welfare of any current or former director, officer, employee or consultant or any collective bargaining agreement, (ii) increase in any respect the compensation or fringe benefits of, or pay any bonus to, any director, officer, employee or consultant, (iii) amend or accelerate the payment, right to payment or vesting of any compensation or benefits, including any outstanding options or restricted stock awards, (iv) pay any benefit not provided for as of the date of this Agreement under any Company Benefit Plan, (v) grant any awards under any bonus, incentive, performance or other compensation plan or arrangement or benefit plan, including the grant of stock options, stock appreciation rights, stock based or stock related awards, performance units or restricted stock, or the removal of existing restrictions in any benefit plans or agreements or awards made thereunder, except for option awards to purchase Company Common Stock that the Company expects to grant to certain new hires in the ordinary course of business as specifically set forth in Section 7.1(k) of the Company Disclosure Schedule which Schedule includes the maximum number of options issuable to such new hires or (vi) take any action to fund or in any other way secure the payment of compensation or benefits under any Company Benefit Plan;
(l) except as otherwise contemplated by this Section 7.1, neither it nor any of its accounting principles Subsidiaries shall make 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 contemplated by this Agreement, unless the Company provides Parent with a copy of the intended communication, Parent has 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;
(m) neither it nor any of its Subsidiaries shall initiate, settle or compromise any material accounting practiceslitigation, in all cases claim, grievance, charge or proceeding (other than as may be required by applicable Law set forth in Section 7.1(m) of the Company Disclosure Schedule or by Canadian GAAPin connection with the enforcement of the Company’s rights under this Agreement);
(viin) neither it nor any of its Subsidiaries shall make or rescind any Tax election, amend any Tax Return, settle or otherwise finally resolve any material tax controversy, 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;
(o) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause likely to result in any of its representations and warranties herein the conditions to become untrue the Merger set forth in any material respectArticle VIII not being satisfied; and
(viiip) neither it nor any of its Subsidiaries will authorize any of, or enter into an agreement commit, resolve or agree, in writing or otherwise, to do take, any of the foregoingforegoing actions.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Computer Associates International Inc), Merger Agreement (Niku 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 in writing (approve, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective all 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;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries other than sales, dispositions or transfers of such capital stock between the Company and/or its Subsidiaries; (B) amend its Organizational Documentscertificate of incorporation or by-laws; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly wholly-owned SubsidiariesSubsidiaries and other than regular quarterly cash dividends not in excess of $.04 per Share; or (E) repurchase, redeem or otherwise acquire, except in connection with the Stock Plan (including any Tax withholding in connection with awards under the Stock Plan), 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 (A) 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 Company Voting Debt (other than Company Common Shares issuable pursuant to options outstanding on the date hereof under the Stock Plan or Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsPlans) or, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Personand;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 General Corp /Tx/), Merger Agreement (Western National Corp)
Interim Operations. Except as set forth on Schedule 3.23, since the Interim Balance Sheet Date, the Company has operated only in the Ordinary Course of Business and has not:
(a) The Company covenants and agrees as changed its authorized or issued capital stock; granted any stock option or right to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding purchase shares of capital stock; (D) declare, set aside or pay issued any dividend payable in cash, stock or property in respect of any security convertible into such capital stock other than dividends from its direct or indirect wholly owned Subsidiariesstock; or made any Equity Distributions;
(Eb) repurchase, redeem incurred or otherwise acquirebecome subject to, or permit agreed to incur or become subject to, any material obligation or Liability, except in the Ordinary Course of Business;
(c) mortgaged or pledged any of its Subsidiaries to purchase assets, tangible or otherwise acquireintangible, any shares of its capital stock or any securities convertible into or exchangeable or exercisable except for any shares of its capital stockPermitted Liens;
(iiid) neither it nor sold or transferred or agreed to sell or transfer any of its Subsidiaries shall (A) issue, sell, pledge, dispose of or encumber any shares ofassets, or securities convertible into canceled or exchangeable agreed to cancel any debts owed to it or exercisable forany of its claims except in the Ordinary Course of Business;
(e) suffered any extraordinary losses (as that term is defined by GAAP) or, except in the Ordinary Course of Business, waived any material rights;
(f) terminated or agreed to terminate any material contract, agreement, license, or optionsother instrument to which it is a party, warrantsexcept in the Ordinary Course of Business;
(g) increased or agreed to increase the rate of compensation payable by it to any employee, callswhose compensation is determined other than by multiplying the number of hours worked by an hourly rate (a “Salaried Employee”), commitments over the rate being paid or rights accrued to them as of the Interim Balance Sheet Date (other than increases granted to individual Salaried Employees for merit, length of service, change in position or responsibility or other reasons specific to individual Salaried Employees and not generally to a class or group of Salaried Employees);
(h) made or agreed to make any accrual or arrangement for or payment of bonuses or special compensation of any kind to acquire, any shares of its capital stock of Salaried Employees or made any class general increase in the salary or bonus payable or to become payable by the Company to any Company Voting Debt Employee other than Salaried Employees (other than Company Common Shares issuable under the Company Option Plans); (B) increases granted to individual Employees for merit, length of service, change in position or responsibility or other than products sold reasons applicable to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business specific Employees and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of generally to a class or encumber any other property or assets (including capital stock of any of its Subsidiariesgroup thereof); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) entered into any agreement, written or oral, providing for the business employment of it and its Subsidiaries shall be conducted in any Employee or any severance or termination benefits payable or to become payable by the ordinary and usual course and, Company to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associatesany Employee;
(iij) it shall not taken any action which would have constituted a breach of any negative covenant of Seller set forth in Article V if such negative covenant had applied since the Interim Balance Sheet Date; or
(Ak) issue, sell, pledge, dispose suffered any shortages of materials or encumber supplies or any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents casualty that individually or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct aggregate has had or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems would reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level be expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoinghave a Material Adverse Effect.
Appears in 2 contracts
Sources: Stock Purchase Agreement, Stock Purchase Agreement (Eagle Family Foods Inc)
Interim Operations. (a) The Company covenants and agrees as that during the period from the date of this Agreement and until the earlier of the termination of this Agreement pursuant to itself Section 6.1 or the Closing, unless the Company and Two-Thirds in Interest of the Purchasers otherwise prior thereto agree, each of the Company and its Subsidiaries thatsubsidiaries shall conduct its business in the ordinary course in the three markets, after two pilot programs and facility update programs listed on Schedule 4.14 or in furtherance of the date hereof and Business Plan as it relates to the period prior to the Effective Time (unless Parent commencement of revenue operations thereunder and shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and not, except either as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) in furtherance of the Company Disclosure Letter):
Business Strategy Plan, do any of the following: (i) the business of it and its Subsidiaries shall except for any payments required to obtain consents required to be conducted in the ordinary and usual course andobtained pursuant to this Agreement, to the extent consistent therewithincur, it 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 customersassume or guarantee any liability or pay, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of discharge or encumber satisfy any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) liability other than in the case ordinary course of business; (ii) create or assume any Lien other than in the ordinary course of business; (iii) waive, release, cancel, settle or compromise any debt, claim or right of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stockmaterial value; (Div) declaretransfer or waive any material right under any material lease, set aside license or agreement or any material Company Intellectual Property; (v) pay or agree to pay any dividend payable in cashbonus, stock extra compensation, pension, continuation, severance or property in respect termination pay, or otherwise increase the wage, salary, pension, continuation, severance or termination pay or other compensation (of any capital stock nature) to its directors, officers or employees, except as required by law, other than dividends from its direct for normal compensation increases and promotions for employees (other than for executive officers) in the ordinary course of business, as provided in the Company's plans and agreements identified in the Disclosure Schedule or indirect wholly owned Subsidiariesas are not material in the aggregate; (vi) make any loan to or (E) repurchase, redeem or otherwise acquire, or permit enter into any transaction with any of its Subsidiaries directors, officers or employees (other than pursuant to purchase any such person's status as an employee of the Company) giving rise to any claim or otherwise acquireright of, by, or against any person in an amount or having a value in excess of $10,000 individually, except travel and entertainment advances in the ordinary course of business and consistent with Company policies; (vii) enter into, amend or terminate any material agreement or transaction; (viii) make any contribution to any Employee Plan, other than regularly scheduled contributions and contributions required to maintain the funding levels of any Employee Plan, or make or incur any commitment to establish or increase the obligation of the Company or a subsidiary to any Employee Plan; (ix) create, assume or incur any indebtedness for money borrowed, or guaranties thereof, except for trade accounts payable incurred in the ordinary course of business or borrowings under the Company's working capital line of credit facility as in effect on the date hereof, or issue any debt securities, warrants or other rights to acquire any debt securities of the Company or any of its subsidiaries; (x) issue, deliver or sell, or authorize or propose the issuance, delivery or sale of, any shares of its capital stock or of any class, 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) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or optionsany rights, warrants, calls, commitments warrants or rights of any kind options to acquire, any shares such shares, of the Company or any of its capital stock subsidiaries except for (A) the grant of any class options to acquire not more than 100,000 shares in the aggregate to new employees or any Company Voting Debt promoted employees (other than Company Common Shares issuable under executive officers) in the Company Option Plans); ordinary course of business pursuant to its equity incentive plans or automatic grants of options and deferred stock pursuant to the director's equity incentive plan, in each case as in effect on the date hereof or (B) other than products sold to customers in the ordinary stock issued upon exercise of outstanding options and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries)warrants; (Cxi) incur amend or modify any indebtedness other than (x) indebtedness existing solely between provision of the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned SubsidiariesBusiness Strategy Plan; (Dxii) amend or modify any provision of its charter, by-laws or other governing documents, except as approved by for the Transition Team, proposed amendments to the Company's by-laws set forth on Schedule 2.8; (xiii) make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) for capital improvements or commitments therefor except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after committed on the date hereof and prior in any event limited in the aggregate to $6,200,000; (xiv) expand the Effective Time Company's network or operations beyond its three existing markets, two pilot programs and facility update program or expand its marketing beyond its three existing markets; (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld xv) sell, assign or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection dispose of Section 3.1(b) any of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of FCC Licenses listed on Exhibit 2.19 or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practiceright thereunder; or (Exvi) repurchase, redeem agree to 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit commitment to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingactions prohibited by this Section 4.14.
Appears in 2 contracts
Sources: Preferred Stock Purchase Agreement (Qwest Communications International Inc), Preferred Stock Purchase Agreement (Advanced Radio Telecom 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 approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, strategic partners, creditors, lessors, employees and business associates;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentsarticles of organization or by-laws; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly wholly-owned Subsidiaries; or (Ev) repurchasepurchase, redeem or otherwise acquire, except for the acquisition of shares of Company Common Stock from holders of Company Stock Options in full or partial payment of the exercise price payable by such holder upon exercise of Company Stock Options to the extent required or permitted under the terms of such Company Stock Options, 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;
(iiic) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt or any other property or assets (other than shares of Company Common Shares Stock issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Company Option PlansStock Plans or upon conversion of the Convertible Senior Notes); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, abandon, cancel, surrender or allow to lapse or expire or encumber any other material property or material assets (including capital stock of any of its Subsidiaries); ) or business;
(Cd) incur neither it nor any of its Subsidiaries shall restructure, recapitalize, reorganize or modify completely or partially liquidate or adopt a plan of complete or partial liquidation or otherwise enter into any indebtedness agreement or arrangement imposing material changes or restrictions on the operation of its assets or businesses or adopt resolutions providing for or authorizing any of the foregoing;
(e) neither it nor any of its Subsidiaries shall acquire (i) by merging or consolidating with, or by purchasing all or a substantial portion of the assets of or any stock of, or by any other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries manner, any business or between such wholly owned Subsidiaries any corporation, partnership, joint venture, limited liability company, association or other business organization or division thereof, or (yii) indebtedness in an aggregate amount less than $30,000,000; providedany assets that are material, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees individually or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess to the Company and any of $10,000,000; its Subsidiaries, taken as a whole, except purchases of inventory and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired materials in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Personbusiness;
(ivf) neither it nor any of its Subsidiaries shall adopt or implement any stockholder rights plan, “poison pill” anti-takeover plan or other similar plan, device or arrangement that, in each case, is applicable to Parent or any of its Affiliates, the Agreement or any of the transactions contemplated by this Agreement;
(g) neither it nor any of its Subsidiaries shall (Ai) terminateincur any indebtedness for borrowed money or guarantee any such indebtedness of another Person (other than pursuant to existing credit facilities in the ordinary course of business), establish(ii) issue, adoptsell or amend any debt securities or warrants or other rights to acquire any debt securities of the Company or any of its Subsidiaries, guarantee any debt securities of another Person, enter intointo any “keep well” or other agreement to maintain any financial statement condition of another Person or enter into any arrangement having the economic effect of any of the foregoing, (iii) make any new grants loans, advances (other than routine advances to employees of the Company and its Subsidiaries in the ordinary course of business) or awards undercapital contributions to, amend or otherwise modifyinvestment in, any other Person, other than the Company Compensation and Benefit Plans except as required by or any Laws of its direct or the terms of applicable collective bargaining agreementsindirect wholly owned Subsidiaries, or (Biv) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, enter into any hedging agreement or other financial agreement or arrangement designed to protect the Company or its Subsidiaries against fluctuations in commodities prices or exchange rates;
(h) neither it nor any of its Subsidiaries shall settle make any capital expenditures or compromise any material claims other expenditures with respect to property, plant or litigation equipment in excess of $250,000 in the aggregate for the Company and its Subsidiaries, taken as a whole, other than as set forth in the Company’s budget for capital expenditures previously made available to Parent or modify, amend or terminate any the specific capital expenditures disclosed in Section 7.1(h) of its material Contracts or waive, release or assign any material rights or claimsthe Company Disclosure Schedule;
(vii) neither it nor any of its Subsidiaries shall make any material Tax election changes in accounting methods, principles or file practices, except insofar as may have been required by a change in GAAP or, except as so required, change any assumption underlying, or method of calculating, any bad debt, contingency or other reserve;
(j) neither it nor any of its Subsidiaries shall, except in the ordinary course of business consistent with past practice, enter into, renew, modify, amend, terminate, waive, delay the exercise of, release or assign any material income Tax Return inconsistent rights or claims under, any Company Material Contract; provided, that, nothing herein shall permit the Company or any of its Subsidiaries to (1) enter into any Contract of the type specified in Section 5.5(a)(iii) to the extent such Contract would survive after the Effective Time or modify or amend in a manner adverse to the Company or any of its Subsidiaries any existing Contract of the type specified in Section 5.5(a)(iii) or (2) except to the extent permitted by Section 7.2(a) of this Agreement, enter into, renew, modify, amend, terminate, waive delay the exercise of, or release or assign any material rights or claims under, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is bound by or subject;
(k) neither it nor any of its Subsidiaries shall, except as required to comply with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPagreements, plans or arrangements existing on the date hereof, (i) take any action with respect to, adopt, enter into, terminate or amend any employment, severance, change in control, retirement, retention, welfare, incentive or similar agreement, arrangement or benefit plan for the benefit or welfare of any current or former director, officer, employee or consultant or any collective bargaining agreement, (ii) increase in any respect the compensation or fringe benefits of, or pay any bonus to, any director, officer, employee or consultant (except for annual increases of salaries of Persons who are not officers in the ordinary course of business that do not exceed 2%), (iii) amend or accelerate the payment, right to payment or vesting of any compensation or benefits, including any outstanding options or restricted stock awards, (iv) pay any benefit not provided for as of the date of this Agreement under any Company Benefit Plan, (v) grant any awards under any bonus, incentive, performance or other compensation plan or arrangement or benefit plan, including the grant of stock options, stock appreciation rights, stock based or stock related awards, performance units or restricted stock, or the removal of existing restrictions in any benefit plans or agreements or awards made thereunder, except for grants of options to purchase Company Common Stock to new hires in the ordinary course of business, which options (1) shall have an exercise price equal to the fair market value of the Company Common Stock on the date of grant (determined in a manner consistent with the Company’s existing practice for establishing fair market value for option grants) and (2) shall otherwise be upon the Company’s customary terms or (vi) take any action to fund or in any other way secure the payment of compensation or benefits under any Company Benefit Plan;
(viil) neither it nor any of its Subsidiaries shall initiate, settle or compromise any material litigation, claim, grievance, charge or proceeding (other than in connection with the enforcement of the Company’s rights under this Agreement);
(m) neither it nor any of its Subsidiaries shall make or rescind any Tax election, amend any Tax Return 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;
(n) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause likely to result in any of its representations and warranties herein the conditions to become untrue the Merger set forth in any material respectArticle VIII not being satisfied; and
(viiio) neither it nor any of its Subsidiaries will authorize any of, or enter into an agreement commit, resolve or agree, in writing or otherwise, to do take, any of the foregoingforegoing actions.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Computer Associates International Inc), Merger Agreement (Concord Communications Inc)
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 approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practices and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially 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;
(iib) it shall not not, (Ai) issue, sell, pledge, sell or otherwise dispose of or encumber any capital stock owned by it in subject to Lien (other than Permitted Liens) any of its Subsidiaries' Capital Stock owned by it; (Bii) amend its Organizational Documentscharter, bylaws or, except for any amendment which will not hinder, delay or make more costly to Parent the Offer or the Merger; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stockCapital Stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned SubsidiariesCapital Stock; or (Ev) repurchase, redeem or otherwise acquire, acquire or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Capital Stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stockCapital Stock; or (vi) adopt a plan of complete or partial liquidation or dissolution, merger or otherwise restructure or recapitalize or consolidate with any Person other than Merger Sub or another wholly-owned Subsidiary of Parent;
(iiic) neither it nor any of its Subsidiaries shall (Ai) authorize for issuance or issue, sell, pledge, sell or otherwise dispose of or encumber subject to any Lien (other than Permitted Liens) 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 Capital Stock of any class or any Company Voting Debt (other than Company Common Shares issuable under pursuant to Company Options outstanding on the Company Option Plansdate hereof); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practicepractices, transfer, lease, license, guarantee, sell or otherwise dispose of or subject to any Lien (other than Permitted Liens) any other property or assets or incur or modify any material indebtedness or other liability (except for additional borrowings in the ordinary course under lines of credit in existence on the date hereof); (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person except in the ordinary course of business consistent with past practices and except for obligations of Subsidiaries of the Company incurred in the ordinary course of business; (iv) make any loans to any other Person (other than to Subsidiaries of the Company or, customary loans or advances to employees in connection with business-related travel in the ordinary course of business consistent with past practices); or (v) make any commitments for, make or authorize any capital expenditures other than in amounts less than $50,000 individually and $250,000 in the aggregate or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other Person;
(ivd) except as may be required to comply with applicable law or by existing contractual commitments, neither it nor any of its Subsidiaries shall (Ai) enter into any new agreements or commitments for any severance or termination pay to, or enter into any employment or severance agreement with, any of its directors, officers or employees or consultants except for (a) specific arrangements with 13 of the Company's employees, including one of its directors, which have been previously disclosed to Parent and (b) reasonable severance payments made to employees in the ordinary course of business and consistent with past practices, or (ii) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws Plan or increase or accelerate the terms of applicable collective bargaining agreementssalary, (B) wage, bonus or other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee employees or directors (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except for increases occurring in the ordinary and usual course of business, which shall include normal periodic performance reviews and related compensation and benefit increases, but not any general across-the-board increases) or consultants or pay or agree to pay any pension, retirement allowance or other employee benefit not required by any existing Compensation and Benefit Plan;
(e) neither it nor any of its Subsidiaries shall, except as may be required as a result of a change in law or in GAAP, change any of the accounting principles or practices used by it;
(f) neither it nor any of its Subsidiaries shall revalue in any respect any of its material assets, including writing down the value of inventory or writing-off notes or accounts receivable, other than in the ordinary course of business consistent with past practices;
(g) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, terminate or materially amend or terminate modify any of its material Contracts or waive, release or assign any material rights or claims;
(vih) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss- payable payee to be canceled or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPterminated;
(viii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiij) neither it nor any of its Subsidiaries will authorize or enter into an any agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Fluor Daniel Gti Inc), Merger Agreement (International Technology Corp)
Interim Operations. (a) The Company Debtor covenants and agrees as to itself and its Subsidiaries that, after the date hereof of this Agreement and prior to the Effective Time Closing, except (unless i) as otherwise expressly required or contemplated by this Agreement, (ii) as Parent shall otherwise consent may approve in writing (which consent shall such approval not to be unreasonably withheld withheld, conditioned or delayed), (iii) and except as otherwise expressly required by applicable Laws or (iv) as set forth in this Agreement or the corresponding subsection of Section 3.1(a) 4.1 of the Company Debtor Disclosure Letter):
(i) , the business of it and its Subsidiaries Business shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it the Debtor and each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve its their business organization intact organizations intact, preserve governmental licenses, permits, consents, approvals, authorizations and qualifications 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 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, (ii) as Parent 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) it shall not 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 (Aother than the sale or disposition of obsolete or worn-out assets in the ordinary course of business);
(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 Parent 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 or encumber any capital stock owned by it in of the Debtor or any of its Subsidiaries; Subsidiaries (B) amend its Organizational Documents; (C) 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;
(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 clause (d) 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 case of 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 indirect wholly-owned Subsidiary, split, combine or reclassify its outstanding shares Subsidiary of capital stock; the Debtor);
(Dviii) declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to any of any its capital stock other than (except for dividends from its paid by any direct or indirect wholly wholly-owned Subsidiaries; Subsidiary to the Debtor or (Eto any other direct or indirect wholly-owned Subsidiary) repurchase, redeem or otherwise acquire, or permit enter into any agreement with respect to the voting of its Subsidiaries to capital stock (other than the Restructuring Support Agreement);
(ix) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiix) neither it nor 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 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 capital expenditure determined in good faith by the Debtor Board to be required for (A) the protection of, or to avoid injury to, any Person, (B) the care or safety of any patient under the care of any facility operated by the Debtor or any of its Subsidiaries shall 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;
(xiii) make any material changes with respect to material accounting policies or procedures, except as required by changes in applicable Law or GAAP;
(xiv) settle any litigation or other Proceeding brought against the Debtor or its Subsidiaries by a Governmental Entity (A) issue, sell, pledge, dispose for an amount in excess of $100,000 individually 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 Company Voting Debt $1,000,000 in the aggregate for all such Proceedings (other than Company Common Shares issuable under any resolution of claims processing for government reimbursement in the Company Option Plans)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 Proceedings in the 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 Debtor or its Subsidiaries for Tax purposes; (B) 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 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 products sold to customers in the ordinary and usual course of business business);
(without limitation as to dollar amountxviii) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000transfer, transfersell, lease, license, guarantee, sell, mortgage, pledge, divest or otherwise dispose of any material tangible or encumber any other property 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 of its Subsidiaries, except in connection with services provided in the ordinary course of business and sales or other dispositions of obsolete or worn-out assets and except for 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, other than pursuant to Contracts in effect prior to the date of this Agreement;
(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) incur grant any new awards, or amend or modify the terms of any indebtedness 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) indebtedness existing solely between any officer of the Company and Debtor or its wholly owned Subsidiaries with a title of Vice President or between such wholly owned Subsidiaries higher or (y) indebtedness in an any employee of the Debtor or its Subsidiaries with aggregate amount less annual base salary and target bonus of more than $30,000,000; provided250,000, howeverexcept, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness the foregoing clauses (x) and (y), to the extent jointly determined by the Chief Restructuring Officer of the 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, a “New Hire”), provided that (i) any such officer New Hire (and his or her terms and conditions of employment, including any base and target incentive compensation) hired pursuant to this clause (H) shall be reasonably acceptable to Parent and (ii) the terms and conditions of employment of any New Hire that is not an officer, including base and target incentive compensation, shall be subject to notice and consultation with Parent, or (I) make any incentive payment or payment in respect of letters severance or any nonqualified deferred compensation entitlement to any current or former director, officer or employee of creditthe 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, guarantees officer or performance bonds employee of the Debtor or indebtedness its Subsidiaries), except, with respect to clause (I) payment of any nondiscretionary incentive payments under existing solely between 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 Company and its wholly owned Subsidiaries Debtor Disclosure Letter) or between such wholly owned Subsidiariesas otherwise required by applicable Law; (D) except as approved by the Transition Team, make provided that payment in respect of any severance or authorize or commit for any capital expenditures which, individually, is nonqualified deferred compensation amount in excess of $1,000,000 or200,000 shall be subject to prior notice and consultation with Parent and, in the aggregate, are in excess of $10,000,000; and with respect to clauses (EA) except as otherwise provided in clause through (DH) immediately above and other than raw materials, supplies and other inventory items acquired above,
(1) amendments to welfare plans in the ordinary and usual course of business business, consistent with past practicepractices that do not materially increase the costs of such welfare plans, by (2) with respect to any meanshourly employees and salaried facility-level employees of the Debtor or its Subsidiaries, make any acquisitions of, or investments in stock of (or other interest in) or assets of and any other Person;
(iv) neither it nor any employees of the Debtor or its Subsidiaries shall (A) terminatewhose annual base salary does not exceed $150,000, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than increases in compensation in the ordinary and usual course materially consistent with the Debtor’s 2018 operating budget or otherwise as reasonably determined by the CRO, in consultation with the QCP Consultants, 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 the Company’s compensation budget with respect (4) as required pursuant to employees at an annual compensation level of less than $150,000existing Company Plans, increase the compensation of any employee or (C) except as approved otherwise required by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000applicable Law;
(vxx) except 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 ordinary 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 usual course its Subsidiaries;
(xxiii) change in any material respect any of businessthe Debtor’s or its Subsidiaries’ material policies or procedures for or timing of the collection of accounts receivable (or any other trade receivables), neither it nor 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 shall settle or compromise currently subleases real property to any material claims or litigation or modify, amend or terminate any other Subsidiary of its material Contracts or waive, release or assign any material rights or claims;the Debtor; or
(vixxvi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practicesagree, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, knowingly take 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause any of its representations and warranties herein likely to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize prevent or enter into an agreement to do any materially impede the consummation of the foregoingTransactions.
Appears in 2 contracts
Sources: Plan Sponsor Agreement, Plan Sponsor Agreement (Quality Care Properties, Inc.)
Interim Operations. (a) The Company covenants and agrees Except as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or on Schedule 5.08, since the corresponding subsection of Section 3.1(a) of Interim Financial Statement Date: the Business has been conducted by the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted only in the ordinary and usual course andconsistent with past practices; there has not occurred any change, event or circumstance that has had, or could reasonably be expected to have, a Material Adverse Effect; the extent consistent therewithCompany has not: paid, it 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 customersdischarged or satisfied any claims, suppliersliabilities or obligations (absolute, distributorsaccrued, creditorscontingent or otherwise), lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct payment, discharge or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise satisfaction in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice of liabilities and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise obligations incurred in the ordinary and usual course of business and not in an aggregate consistent with past practice; borrowed any amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber incurred or become subject to any other liabilities (absolute or contingent), other than trade payables in the ordinary course of business, except as set forth on Schedule 5.08(c)(ii); declared or made any payment or distribution of cash or other property to Seller or assets (including purchased or redeemed, or made any agreements to purchase or redeem, any of its equity securities; issued, delivered, sold, pledged or encumbered, or authorized, proposed or agreed to the issuance, delivery, sale, pledge or encumbrance of, any shares of capital stock or bonds or any other security (or any right to acquire such capital stock or other security, including options) of the Company or any of its Subsidiaries), or any right, options or warrants with respect thereto; (C) incur effected any recapitalization, reclassification or modify like change in the capitalization of the Company or any indebtedness of its Subsidiaries, or declared or paid dividends on, or made other distributions in respect of, any of its capital stock, or issued or authorized the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, or repurchased, redeemed or otherwise acquired, or modified or amended, any shares of capital stock of the Company or any of its Subsidiaries or any other securities thereof or any rights, warrants or options to acquire any such shares or other securities; canceled any debts owing to the Company or waived any claims or rights; sold, transferred, or otherwise disposed of, any of the Assets; disposed of, failed to take reasonable steps to protect, or permitted to lapse, any rights for the use of, any Intellectual Property, or disposed of, failed to take reasonable steps to protect, or disclosed to any Person any Proprietary Information or Confidential Information; made any change in any its methods of accounting or accounting practices; written off as uncollectible any notes or accounts receivable, other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice; made any capital expenditures or capital expenditure commitments in excess of $10,000 individually or $25,000 in the aggregate, except as set forth on Schedule 5.08(c)(xi); entered into any transaction or series of related transactions providing for payments by or to the Company in excess of $25,000 in the aggregate, whether or not in the ordinary course of business; made any means, make change in the manner in which products or services have been developed or marketed; had any acquisitions oflabor dispute or received notice of any grievance with respect thereto; loaned or advanced any amount to, or investments in stock of (made any payments to or other interest in) received any payments from, or assets of any other Person;
(iv) neither it nor sold, transferred or leased any of its Subsidiaries shall assets to, any Affiliate, except in the ordinary course of business; discharged or satisfied any Encumbrance or paid any obligation or liability (absolute or contingent), other than current liabilities paid in the ordinary course of business consistent with past practices; made any change in the cash management or working capital management of the Company other than in the ordinary course of business; (A) terminateterminated, establishcanceled or requested any material change in, or agreed to any material change in, any Subsisting Contract, or (B) entered into any contract which would constitute a Subsisting Contract as defined herein, other than in the ordinary course of business consistent with past practices, in either case, other than as set forth on Schedule 5.08(c)(xviii); adopted, agreed to adopt, enter into, make or made any announcement regarding the adoption of (A) any new grants pension, retirement or awards underother employee benefit plan, amend program or otherwise modifypolicy or (B) any amendment to any existing plan, policy or program; increased the compensation, bonuses or benefits of any Parent Compensation and Benefit Plans employee, officer, director, or consultant of the Company or any of its Subsidiaries, other than annual increases in the ordinary course of business consistent with past practices at the regularly scheduled times, other than as set forth on Schedule 5.08(c)(xx); amended or modified any of the organizational documents of the Company; made any material election with respect to Taxes or made any change in any such election; made any change in its methods of accounting in effect at November 30, 2005, except as required by changes in GAAP as agreed to by the Company's independent public accountants or as required by applicable law; made any Laws charitable contributions or the terms of applicable collective bargaining agreementspledges, (B) other than as set forth on Schedule 5.08(c)(xxiv); settled any Legal Proceeding to which the Company is or was a party, other than as set forth on Schedule 5.08(c)(xxv); or suffered or agreed to take any of the actions set forth in this subparagraph (c); the Business has been conducted by the Company only in the ordinary and usual course of business consistent with past practice practices; the Company has taken no steps to seek protection pursuant to any bankruptcy law, Seller has no reason to believe that any creditors of the Company intend to initiate involuntary bankruptcy proceedings against the Company, and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation Seller has no knowledge of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it fact which would reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement lead a creditor to do any so; and none of the foregoingAssets has suffered any damage, destruction or casualty loss (as a result of fire, explosion or otherwise), whether or not covered by insurance.
Appears in 2 contracts
Sources: Stock Purchase Agreement (Cyber Digital Inc), Stock Purchase Agreement (Cyber Digital Inc)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after During the period from the date hereof and prior of this Agreement to the Effective Time (unless Parent shall Time, except as contemplated by this Agreement, as set forth on the Disclosure Schedule, as expressly permitted by Section 4.1 or as otherwise consent approved in writing (which consent by the Purchaser, the Company shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):shall cause its subsidiaries not to:
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Dx) declare, set aside or pay any dividend payable in cashdividends on, stock or property make any other distributions in respect of, any of any its capital stock stock, other than dividends from its and distributions by a direct or indirect wholly owned Subsidiaries; subsidiary of the Company to its parent, (y) split, combine or (E) repurchase, redeem or otherwise acquire, or permit reclassify any of its Subsidiaries to purchase capital stock or otherwise acquireissue or authorize the issuance of any other securities in respect of, any in lieu of or in substitution for shares of its capital stock or (z) purchase, redeem or otherwise acquire any shares of capital stock of the Company or any of its subsidiaries or any other securities convertible into thereof or exchangeable any rights, warrants or exercisable for options to acquire any such shares or other securities;
(ii) grant, issue, deliver, sell, pledge or otherwise encumber any shares of its capital stock, any other voting securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, voting securities or convertible securities, except upon exercise of any Option;
(iii) neither it nor amend its certificate of incorporation, by-laws or other comparable organizational documents;
(iv) acquire or agree to acquire (x) by merging or consolidating with, or by purchasing a substantial portion of the assets of, or by any other manner, any business or any corporation, limited liability company, partnership, joint venture, association or other business organization or division thereof or (y) any assets or services of its Subsidiaries shall any kind other than (A) 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 pursuant to acquire, any shares of its capital stock of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers written purchase orders issued in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and in customary amounts consistent with past practices or (B) acquisitions of assets or services in the ordinary course of business and in customary amounts consistent with past practices that, individually, do not in an aggregate amount of more than exceed $5,000,000, transfer25,000;
(v) sell, lease, license, guarantee, sell, mortgage, pledge, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur properties or modify any indebtedness assets, other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Personthat are material to the Company and its subsidiaries taken as a whole;
(ivvi) neither it nor incur any indebtedness, except for borrowings for working capital purposes not in excess of its Subsidiaries shall recent past practice and current lending arrangements;
(Avii) terminate, establish, adopt, enter into, make or agree to make any new grants capital expenditure or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than capital expenditures which in the ordinary and usual course aggregate are in excess of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(vviii) pay (or commit to pay) any bonus or other incentive compensation to any officer, director, partner or other employee or grant (or commit to grant) to any officer, director, partner or employee any other increase in compensation, except, in the case of employees who are not executive officers or directors, normal salary increases consistent with recent practice;
(i) enter into, adopt or amend (or commit to enter into, adopt or amend) any employment, retention, change in control, collective bargaining, deferred compensation, severance, retirement, bonus, profit-sharing, stock option or other equity, pension or welfare plan or agreement maintained for the benefit of any officer, director, partner or employee, except as required by law, or (ii) except as required by agreements set forth on the Disclosure Schedule, grant or pay (or commit to grant or pay) any severance or termination compensation or benefits to any officer, director, partner or employee;
(x) make any tax election inconsistent with past practices or settle or compromise any material income tax liability;
(xi) except in the ordinary and usual course of businessbusiness or except as would not reasonably be expected to have a Material Adverse Effect on the Company, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, amend or terminate any of its material Contracts contract or agreement to which the Company or any subsidiary is a party or waive, release or assign any material rights or claimsclaims thereunder;
(vixii) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in to its accounting methods, principles or material accounting practices, in all cases other than except as may be required by applicable Law or by Canadian GAAP;generally accepted accounting principles; or
(viixiii) neither it nor any of its Subsidiaries shall take any action authorize, or omit commit or agree to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do take, any of the foregoingforegoing actions.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Defiance Inc), Merger Agreement (General Chemical Group Inc)
Interim Operations. (a) The Company FEI covenants and agrees as to itself and its Subsidiaries thatSubsidiaries, and PIE covenants and agrees as to the PEO Group and the PEO Business that after the date hereof and prior to the Effective Time Closing (unless Parent the other party shall otherwise consent approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) and ), except as otherwise expressly set forth in contemplated by this Agreement or in connection with the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):Restructuring:
(ia) the its business and that of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its they and their Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations intact and maintain its their existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(iib) it they shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it them in any of its their Subsidiaries; (Bii) amend its Organizational Documentstheir Articles of Association, certificate of incorporation or by-laws; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its their outstanding shares of capital stock; (Div) declare, set aside or pay any dividend or make any distribution payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly wholly-owned Subsidiaries; or (Ev) repurchase, redeem or otherwise acquire, or permit any of its their Subsidiaries to purchase or otherwise acquire, any shares of its their capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(iiic) neither it they nor any of its their Subsidiaries shall (Ai) 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 their capital stock of any class or any Company Voting Debt or any other property or assets (other than Company than, in the case of FEI, shares of Common Shares Stock issuable without further action of FEI's board of directors pursuant to options outstanding on the date hereof under the Company Stock Option PlansPlan); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its their Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiariesliability; (Diii) except as approved by disclosed in budgets provided to the Transition Teamother party hereto prior to the date hereof, make any commitments for, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practiceand in amounts less than $50,000 individually and $250,000 in the aggregate or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other Person or entity; or (iv) enter into any joint venture, merger or other similar agreement with any Person;
(ivd) except for grants of options, consistent with FEI's past practice, pursuant to its Stock Option Plan to purchase no greater than 5,000 shares of Common Stock, neither it they nor any of its their Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans Plans, or increase the salary, wage, bonus or other compensation of any employees except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than increases occurring in the ordinary and usual course of business consistent in accordance with established past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000and benefit increases);
(ve) except in the ordinary and usual course of business, neither it they nor any of its their Subsidiaries shall settle or compromise any material claims or litigation or or, except in the ordinary and usual course of business modify, amend or terminate any of its their material Contracts or waive, release or assign any material rights or claims;
(vif) neither it they nor any of its their Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viig) neither it they nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its their Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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: Combination Agreement (Fei Co), Combination Agreement (Philips Electronics N V)
Interim Operations. Except with Purchaser’s prior written consent (a) The not to be unreasonably withheld, conditioned or delayed), Seller shall cause each of 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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the to conduct its business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially reasonable best efforts to (A) preserve its business organization intact and organizations intact, (B) maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates, and (C) keep available the services of its present employees and agents; and (ii) not to (other than as set forth in the corresponding section of the Seller Disclosure Letter):
(a) amend its Organizational Documents;
(iib) it shall not merge or consolidate with any other Person;
(Ac) acquire assets outside of the ordinary course of business consistent with past practice from any other Person with a value or purchase price in the aggregate in excess of $50,000,000.00 or that would have any possibility of preventing or delaying the Closing beyond the Termination Date;
(d) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirectof, wholly owned Subsidiarygrant, splittransfer, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquireEncumber, or permit any of its Subsidiaries to purchase or otherwise acquireauthorize the issuance, 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 (A) issue, sellsale, pledge, dispose of or encumber any shares ofdisposition, 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000grant, transfer, lease, license, guaranteeguarantee or other Encumbrance of, any Equity Interests of the Company or any of its Subsidiaries (other than the issuance of Equity Interests (i) by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary or (ii) by the Company to Seller), securities convertible or exchangeable into, or exercisable for, any Equity Interests or any options, warrants or other rights of any kind to acquire any such Equity Interests or such convertible or exchangeable securities;
(e) create or incur any Encumbrance (other than a Permitted Encumbrance) on the assets of the Company or any of its Subsidiaries that, individually or in the aggregate, is material to the Company or any of its Subsidiaries;
(f) make any loans, advances, guarantees or capital contributions to or investments in any Person, other than (x) any of the foregoing to or on behalf of the Company or any direct or indirect wholly-owned Subsidiary of the Company, or (y) in the ordinary course of business consistent with past practice and which do not have any possibility of preventing or delaying the Closing beyond the Termination Date;
(g) declare, set aside, make or pay any (i) cash distributions or dividends in any month that in the aggregate are in excess of the lesser of (A) $150,000,000.00 and (B) the amount of Free Cash Flow generated by the Company and its Subsidiaries for the preceding month, prorated for the month in which this Agreement is entered into, and for the month in which the Closing occurs; provided, that if distributions or dividends in respect of any month shall have been less than $150,000,000.00 as a result of the foregoing limitation or otherwise, Seller shall be entitled to make additional cash distributions at any time or from time to time up to an amount equal to the lesser of (x) Free Cash Flow for the period since the date of this Agreement and (y) the product of (A) $150,000,000.00 and (B) the number of whole and, without duplication, partial months in such period, or (ii) non-cash distributions or dividends, payable in stock, property or otherwise, with respect to any of its Equity Interests (except for non-cash distributions 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 Equity Interests;
(h) (i) incur any Indebtedness for borrowed money, 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 consistent with past practice that is satisfied in full at or prior to the Closing, or (ii) amend, modify, supplement or waive the terms of any existing Indebtedness, debt securities or warrants or other rights to acquire debt securities of the Company or any of its Subsidiaries, except in the ordinary course of business consistent with past practice;
(i) except as contemplated by the capital budget set forth in the business plan set forth on Schedule 4.16 of the Seller Disclosure Letter, make or authorize any payment of, or accrual or commitment for, capital expenditures in excess of $25,000,000.00 in the aggregate in any consecutive six-month period (or $50,000,000.00 in the event of an increase in data demand in the Business significantly in excess of the demand anticipated on the date hereof);
(j) amend, supplement, waive, terminate, assign, convey, encumber or otherwise transfer, in whole or in part, its rights or interests under or in any Material Contract, or enter into any Intercompany Contract or Company Contract that would be a Material Contract if in effect as of the date hereof;
(k) enter into any Intercompany Contract or amend, modify or waive any Intercompany Contract in any manner that would result in the Company or its Subsidiaries paying to the other parties thereto aggregate consideration greater than that provided for in the copies of Intercompany Contracts provided to Purchaser pursuant to Section 4.2(a)(v);
(l) make any changes with respect to material financial accounting policies or procedures, except as required by changes in GAAP;
(m) (i) 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 ancillary Internet services), 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, (ii) except as currently conducted, engage in the conduct of any business in any state that 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 License to the extent such License would reasonably be expected to prevent, materially delay or materially impair the consummation of the Transaction, or (iii) enter into any business or operations outside of the United States;
(n) file for any Company License the receipt of which would reasonably be likely to prevent, materially impair or materially delay consummation of the Transaction;
(o) settle any litigation or other proceedings before a Governmental Entity for an amount in excess of $15,000,000.00;
(p) except to the extent otherwise required by Law, make or change any Tax election, change any method of Tax accounting or settle or finally resolve any controversy with respect to Taxes for an amount that materially exceeds the amount reserved with respect thereto in the most recent Financial Statements, in each case, if such action would have an adverse affect on the Company or Purchaser that is more than immaterial;
(q) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of (i) any Communications Licenses or encumber any other property or assets wireless spectrum and (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (Dii) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other PersonLicenses, assets, operations, rights, product lines, businesses or interests therein of the Company or its Subsidiaries that are material to the Business, other than pursuant to Company Contracts in effect prior to the date hereof;
(ivr) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or pursuant to the existing terms and conditions of any Benefit Plan as in effect on the date hereof, (i) terminate, establish, adopt or amend any Benefit Plan other than the adoption of annual Benefit Plans in the ordinary course of business consistent with past practice and amendments to health and welfare plans (other than severance plans) that do not increase benefits or result in materially increased administrative costs, (ii) grant any salary or wage increase, other than to increase salary and wages for employees by Canadian no more than 4% in the aggregate in the ordinary course of business consistent with past practice, (iii) pay aggregate bonus or incentive compensation other than in the ordinary course consistent with past practice, (iv) (x) grant any new compensation award, other than bonus awards and cash-based long term incentive compensation awards, in each case in amounts and on terms that are in the ordinary course of business consistent with past practice; provided, however, that no new awards shall be granted under the Phantom Share Plan, (y) amend the terms of outstanding compensation awards other than in a manner that does not increase the amounts payable or accelerate the timing of any payment under such awards and in the ordinary course of business consistent with past practice, or (z) change the compensation opportunity under any Benefit Plan, (v) pay any severance other than in the ordinary course of business consistent with past practice in connection with employees’ entering into and not revoking a release of claims against the Company in connection with terminations of employment, (vi) take any action to accelerate the vesting or payment, or fund or secure the payment, of any amounts under any Benefit Plan, (vii) change any assumptions used to calculate funding or contribution obligations under any Benefit Plan, other than as required by GAAP, (viii) forgive any loans to directors, officers or employees of the Company or any of its Subsidiaries, or (ix) voluntarily establish or adopt any collective bargaining agreement;
(viis) neither it nor transfer, sell, lease, license, divest or otherwise dispose of any transmission towers owned or leased by the Company or any of its Subsidiaries (it being understood that the foregoing shall take not apply to the decommisions of towers in the ordinary course of business consistent with past practice);
(t) purchase, lease or otherwise acquire any action or omit wireless spectrum;
(u) make a fundamental change to take any action that it reasonably expects would cause any of important elements of the network technologies or principal billing systems of the Company and its representations Subsidiaries (excluding system upgrades, equipment replacement and warranties herein to become untrue similar matters, in any material respecteach case within the same fundamental framework of network technologies and billing systems); andor
(viiiv) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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: Stock Purchase Agreement, Stock Purchase Agreement (At&t Inc.)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof of this Agreement and prior to the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall writing, such approval not to be unreasonably withheld withheld, conditioned or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) Agreement), the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, and it and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates 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 required by this Agreement, (B) as Parent may approve in writing, such approval not to be unreasonably withheld, conditioned or delayed, (C) as contemplated by the IP Group Sale and Trust Distribution as described in the term sheet attached hereto as Exhibit B or (D) as expressly set forth on Section 5.1(a) of the Company Disclosure Letter, the Company will not and will not permit its Subsidiaries to:
(i) amend any of its organizational documents, except as specifically required by this Agreement;
(ii) it shall not 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 changes or restrictions on its assets, operations or businesses;
(Aiii) acquire from any other Person any asset or group of related assets with a value or purchase price in excess of $25,000 individually or $100,000 in the aggregate, in any transaction or series of related transactions;
(iv) issue, sell, pledge, dispose of, grant, transfer, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or Encumbrance of, any shares of or encumber any capital stock owned by it in of the Company or any of its Subsidiaries; Subsidiaries (B) amend its Organizational Documents; (C) other than the issuance of shares by a Subsidiary of the Company to the Company or a wholly owned Subsidiary of the Company), 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 Encumbrances on any FCC Licenses, or create or incur any Encumbrances on any other asset or group of related assets of the Company or any of its Subsidiaries having a value in excess of $25,000 individually or $100,000 in the case of aggregate;
(vi) make any direct loans, advances, guarantees or indirect, wholly owned Subsidiary, split, combine capital contributions to or reclassify its outstanding shares of capital stock; investments in any Person (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its the Company or any direct or indirect wholly owned Subsidiaries; Subsidiary of the Company), except in the ordinary course of business consistent with past practice and in no event in excess of $10,000 individually or $25,000 in the aggregate;
(Evii) repurchasedeclare, redeem set aside, make or otherwise acquirepay any dividend or other distribution, payable in cash, stock, property or permit otherwise, with respect to any of its Subsidiaries capital stock, (except for dividends paid by any direct or indirect Subsidiary of the Company to its stockholders or unit-holders on a pro rata basis in the ordinary course of business consistent with past practices) 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 shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiiix) neither it nor incur any indebtedness for borrowed money or guarantee such indebtedness of its Subsidiaries shall (A) issue, sell, pledge, dispose of or encumber any shares ofanother Person, or issue or sell any debt securities convertible into or exchangeable warrants or exercisable for, or options, warrants, calls, commitments or other rights to acquire any debt security of any kind to acquire, any shares of its capital stock of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); , except for indebtedness for borrowed money incurred in the ordinary course of business consistent with past practices (CA) incur in replacement of existing indebtedness for borrowed money on terms substantially consistent with or modify any more beneficial than the terms of the indebtedness other than being replaced as of the date of such replacement, or (B) in connection with guarantees by the Company of indebtedness of wholly owned Subsidiaries of the Company as of the Effective Time complying with clause (A) above;
(x) indebtedness existing solely between enter into any Contract that would have been a Material Contract had it been entered into prior to 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 and Affiliates following the Closing) than, a Contract it is replacing;
(xi) amend, modify or terminate any Material Contract, or waive, release or assign any material rights, claims or benefits under any Material Contract, in each case except in the ordinary course of business consistent with past practices;
(xii) make any changes with respect to accounting policies or procedures, except as required by changes in applicable generally accepted accounting principles, by Regulation S-X under the Securities Act, or by the Public Company Accounting Oversight Board or Financial Accounting Standards Board;
(xiii) settle (x) any litigation or claim or (y) other proceedings before a Governmental Entity, in each case for an amount in excess of $25,000 (excluding amounts that may be paid under insurance policies);
(xiv) except as required by applicable Law, (A) make any Tax election that is material to the Company and its wholly owned Subsidiaries Subsidiaries, taken as a whole, or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, take any position that prior is material to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries Subsidiaries, taken as a whole, on any material Tax Return filed on or between such wholly owned after the date of this Agreement, that is inconsistent with elections made or positions taken in prior periods, (B) change any material 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) except settle or resolve any Tax controversy that is material to the Company and its Subsidiaries, taken as approved by the Transition Teama whole, make or authorize or commit for any capital expenditures whichother than, individually, is in excess of $1,000,000 oreach case, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(ivxv) neither it nor transfer, sell, lease, assign, license, surrender, divest, forfeit, cancel, abandon or allow to lapse or expire, fail to extend or defend or otherwise dispose of any part of its Subsidiaries shall assets (including material Intellectual Property), FCC Licenses, securities or equity of any Subsidiary, licenses, operations, rights, product lines, businesses or interests therein of the Company or its Subsidiaries, except (A) terminatein connection with services or products provided in the ordinary course of business consistent with past practices or sales of obsolete assets, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) for sales, leases, licenses or other dispositions of any asset or any group of related assets (other than FCC Licenses or wireless spectrum) with a fair market value not in excess of $100,000 individually or $250,000 in the aggregate;
(xvi) make or commit to any capital expenditures other than in the ordinary and usual course of business consistent with past practice and in the Company’s compensation budget with respect to employees at an annual compensation level aggregate in any event not in excess of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(vxvii) enter into any Contract pursuant to which the Company or any of its Subsidiaries agrees to provide any wireless services to any Person 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;
(xviii) hire or rehire any new or additional employees or terminate any current employees, except in the ordinary and usual course of business, neither it nor consistent with past practice;
(xix) except as required pursuant to a Benefit Plan or existing written, binding agreements as in effect as of the date of this Agreement, or as otherwise required by applicable Law, (A) grant new or increase existing compensation, severance or other benefits payable or to become payable to any director, officer or employee of the Company or any of its Subsidiaries shall settle Subsidiaries, (B) adopt, enter into, establish, or compromise any material claims or litigation or modifymaterially amend, amend modify or terminate any Benefit Plan or any arrangement that would constitute a Benefit Plan had it been in effect as of its material Contracts the date of this Agreement or waive, release or assign any material rights or claims;
(viC) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action to accelerate the vesting or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue payment, or fund or in any material respectother way secure the payment, of compensation or benefits under any Benefit Plan (including any equity-based awards), except to the extent expressly required by any such Benefit Plan or provided in this Agreement; andor
(viiixx) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Straight Path Communications Inc.), Merger Agreement (Straight Path Communications Inc.)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof of this Agreement and prior to the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(aAgreement) of the Company Disclosure Letter):
(i) 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 each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Authorities, customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates 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 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 of the Company Disclosure Letter, the Company will not and will not permit its Subsidiaries to:
(i) adopt or propose any change in its Certificate of Formation or By-Laws or other applicable governing instruments;
(ii) it shall not 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;
(Aiii) 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 $250,000 in any transaction or series of related transactions, other than acquisitions pursuant to Company 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 or encumber any capital stock owned by it in of the Company or any of its Subsidiaries; 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 not incurred in the ordinary course of business consistent with past practice, except for any Permitted Liens;
(vi) (A) make any loan or loan commitment to any Person which would, when aggregated with all outstanding loans or loan commitments or any renewals or extensions thereof made to such Person and any Affiliate or immediate family member of such Person, exceed $500,000 or (B) amend its Organizational Documents; (C) other than purchase or sell any loan or loan participation, individually or in bulk, in one or a series of related transactions in excess of $500,000 in the case aggregate, in each case, without first informing the deputy chief credit officer of Hanmi Bank two (2) full Business Days prior to taking such action and considering in good faith his views and receiving the approval of United Central Bank’s Chief Executive Officer, at a minimum, and any direct committee as required by United Central Bank’s current loan authority policy and administration. Neither the Company nor any of its Affiliates shall forgive any loans to directors, officers or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; employees;
(Dvii) declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to or declare or make any distribution on, any of any its capital stock other than (except for dividends from its paid by any direct or indirect wholly wholly-owned Subsidiaries; 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) except to make changes that are required by applicable Law or to satisfy contractual obligations existing as of the date hereof which are listed on Section 6.1(a)(viii) of the Company Disclosure Letter, (A) terminate, enter into, amend or renew (or communicate any intention to take such action) any Benefit Plans, other than routine amendments to health and welfare plans (other than severance plans) that do not increase benefits or result in materially increased administrative costs, (B) grant any salary or wage increase, other than annual increases in salary and wages for employees who are not officers by no more than 5% in the aggregate in the ordinary course of business consistent with past practice, (C) pay any bonus or incentive compensation in excess of the amount earned based on actual performance, (D) grant any new award, amend the terms of outstanding awards or change the compensation opportunity under any Benefit Plan, (E) repurchaseset any bonus metrics or targets, redeem (F) pay any severance in excess of payments by the Company or otherwise acquire, or permit any of its Subsidiaries made in the ordinary course of business consistent with past practice, (G) take any action to fund or secure the payment of any amounts under any Benefit Plan, (H) change any assumptions used to calculate funding or contribution obligations under any Benefit Plan, other than as required by GAAP (I) hire any employee or consultant with annualized cash compensation opportunities in excess of $150,000, other than to fill vacancies of persons who are not officers or (J) terminate any officer or other person with an annual compensation opportunity in excess of $150,000 other than for “cause”;
(ix) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiix) neither it nor incur any indebtedness for borrowed money or assume, guarantee, endorse or otherwise as an accommodation become responsible for the long-term indebtedness of its Subsidiaries shall any other Person (other than (A) issue, sell, pledge, dispose deposits and similar liabilities in the ordinary course 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); business consistent with past practice (B) other than products sold indebtedness of the Company’s Subsidiaries to customers the Company and (C) short term advances from the Federal Home Loan Bank in the ordinary and usual course of business consistent with past practice);
(without limitation xi) except as set forth in the capital budgets set forth in Section 6.1(a)(xi) of the Company Disclosure Letter and consistent therewith, make or authorize any capital expenditure in excess of $250,000 in the aggregate during any twelve (12) month period;
(xii) enter into any contract that would have been a Material Contract had it been entered into prior to dollar this Agreement;
(xiii) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP;
(xiv) enter into any settlement, compromise or similar agreement with respect to, any action, suit, proceeding, order or investigation before a Governmental Authority, individually or with respect to multiple actions, suits, proceedings, orders or investigations arising generally out of the same set of facts or circumstances, for an amount greater than $250,000 in excess of applicable and confirmed insurance coverage or specific loss reserves reflected on the Company Interim Financial Statements, or any obligation or liability of the Company in excess of such amount, or would impose any material restriction on the business of Parent or the Surviving Corporation or create adverse precedent for claims that are reasonably likely to be material to Parent, the Company or the Surviving Corporation;
(xv) amend, modify or otherwise terminate any Material Contract, or cancel, modify or waive any material debts or claims held by it or waive any rights having in each case a value in excess of $500,000 other than any loan restructures or workouts in the ordinary and usual course of business and not in an aggregate amount following prior consultation with the deputy chief credit officer of more than $5,000,000Hanmi Bank;
(xvi) sell, transfer, lease, license, guarantee, sell, mortgage, pledge, encumber or otherwise create any Lien on, dispose of or encumber discontinue any of its assets, deposits, business or properties (other property than sales of loans and loan participations pursuant to Section 6.1(a)(vi)) except in the ordinary and usual course of business consistent with past practice and in a transaction that, together with all other such transactions, is not material to the Company and its Subsidiaries, taken as a whole;
(xvii) except as required by applicable Law or assets the Federal Reserve Board, the FDIC, the CDBO or the TDB, (including capital stock A) implement or adopt any material change in its interest rate and other risk management policies, procedures or practices, (B) fail to follow in all material respects, the Company’s or its applicable Subsidiary’s existing policies or practices with respect to managing its exposure to interest rate and other risk or (C) fail to use commercially reasonable efforts to avoid any material increase in the Company’s aggregate exposure to interest rate risk;
(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;
(xix) (A) other than in accordance with the Company’s or any of its Subsidiaries); ’ investment policies in effect on the date hereof or in securities transactions as provided in (CB) incur below, make any investment either by contributions to capital, property transfers or modify purchase of any indebtedness property or assets of any Person or (B) other than (x) indebtedness existing solely between purchases of direct obligations of the Company United States of America or obligations of United States government agencies which are entitled to the full faith and its wholly owned Subsidiaries credit of the United States of America, in any case with a remaining maturity at the time of purchase of one year or between such wholly owned Subsidiaries less, purchase or (y) indebtedness in an aggregate amount less than $30,000,000acquire securities of any type; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide notify Parent with a reasonable right of consultation; the purchase of any investment security in writing within one (1) Business Day after such purchase, and such notice shall describe in detail the investment securities purchased and the price thereof), and provided, further, that the foregoing right Company shall consult with Parent from time to time regarding the Company’s investment securities policies and consider in good faith the views of consultation shall not apply in Parent with respect thereto.
(xx) (A) commence or settle any litigation or proceeding with respect to any liability for material Taxes, take any action which is reasonably likely to have an adverse impact on the case Tax position of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or, after the Merger, which is reasonably likely to have an adverse impact on the Tax position of Parent or between such wholly owned Subsidiaries; the Surviving Corporation, (DB) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by make or change any meansmaterial express or deemed Tax election, make file any acquisitions of, amended Tax Return or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor change any of its Subsidiaries shall methods of reporting income or deductions for Tax purposes or (AC) terminate, establish, adopt, enter into, make take any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in action with respect to Taxes that is outside the ordinary and usual course of business or inconsistent with past practice;
(xxi) make application for the opening, relocation or closing of any, or open, relocate or close any, branch office, loan production office or other significant office or operations facility of it or any of its Subsidiaries;
(xxii) enter into any new line of business or, other than in the ordinary course of business consistent with past practice practice, change in any material respect its lending, investment, underwriting, risk and asset liability management and other banking and operating, securitization and servicing policies, as applicable (including any change in the Company’s compensation budget maximum ratio or similar limits as a percentage of its capital exposure applicable with respect to employees at an annual compensation level of less than $150,000its loan portfolio or any segment thereof), increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or policies imposed by Canadian GAAP;any Governmental Authority; or
(viixxiii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as Prior to itself and making any written or oral communications to the directors, officers or employees of the Company or any of its Subsidiaries thatpertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent 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 writing providing any such mutually agreeable communication.
(which consent c) Parent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, knowingly take 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause any of its representations and warranties herein likely to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any prevent the consummation of the foregoingMerger.
Appears in 2 contracts
Sources: Agreement and Plan of Merger (Hanmi Financial Corp), Merger Agreement (Hanmi Financial Corp)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after From the date hereof through the Closing, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and prior to the Effective Time (unless Parent Seller shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of cause the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted subsidiaries to conduct their business and operations in the ordinary course of business consistent with past practice and usual course andto preserve intact its present business organization and maintain good relationships with its customers, to suppliers lenders and others having material business relationships with it. Without limiting the extent consistent therewithgenerality of the foregoing, it ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and the Seller shall cause the Company and each of its Subsidiaries shall use subsidiaries not to:
(a) amend its respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customerscharter, supplierscertificate or articles of incorporation or formation, distributorsbylaws, creditorsoperating agreement or other constituent or organizational document (whether by merger, lessors, employees and business associatesconsolidation or otherwise);
(iib) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify any Capital Stock of the Company or any of its outstanding shares of capital stock; subsidiaries (Dwhether by merger, consolidation or otherwise);
(c) declare, set aside or pay any dividend payable or other distribution (whether in cash, stock or property or any combination thereof) in respect of any capital stock other than dividends from its direct the Capital Stock of the Company or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase subsidiaries (whether by merger, consolidation or otherwise acquire, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stockotherwise);
(iiid) neither it nor redeem, repurchase or otherwise acquire any Capital Stock of the Company or any of its Subsidiaries shall subsidiaries (Awhether by merger, consolidation or otherwise);
(e) issue, selldeliver or sell any Capital Stock of the Company or any of its subsidiaries (whether by merger, pledgeconsolidation or otherwise), dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights other than the issuance of any kind Capital Stock of any wholly owned subsidiary of the Company to acquire, the Company or any shares other wholly owned subsidiary of the Company;
(f) amend any term of any Capital Stock of the Company or any of its capital stock subsidiaries (whether by merger, consolidation or otherwise);
(g) increase the compensation or benefits of any class current or former director, officer, employee or consultant of the Company or any of its subsidiaries;
(h) grant or increase any severance, retention, change-of-control or similar payments to any current or former director, officer, employee or consultant of the Company Voting Debt or any of its subsidiaries;
(i) create, incur, assume or guarantee any indebtedness for borrowed money, other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers borrowings in the ordinary and usual course of business (without limitation under any credit facility in effect as to dollar amount) or otherwise in of the ordinary and usual course date of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries)this Agreement; (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(ivj) neither it nor any of its Subsidiaries shall (A) terminateagree, establish, adopt, enter into, make any new grants commit or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement offer to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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: Stock Purchase Agreement, Stock Purchase Agreement (HC2 Holdings, Inc.)
Interim Operations. (a) The Company Yankees covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to until the earlier of the Effective Time (or the termination of this Agreement in accordance with its terms, unless Parent Braves shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly contemplated by this Agreement or except as otherwise set forth in this Agreement or the corresponding subsection of Section 3.1(a4.1(a) of the Company Yankees Disclosure Letter)::
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associatespast practice;
(ii) (A) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) it shall not amend its Organizational Documentscertificate of incorporation or bylaws; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, it shall not split, combine or reclassify its outstanding shares of capital stock; (D) it shall not declare, set aside or pay any dividend type of dividend, whether payable in cash, stock or property property, in respect of any capital stock other than the quarterly dividends from payable by Yankees (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, subject to Section 4.1(a)(viii) of the Yankees Disclosure Letter, dividends payable by its direct or indirect wholly owned Subsidiaries to it or another of its direct or indirectly wholly owned Subsidiaries; or and (E) 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 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) issue, sell, pledge, dispose of or encumber (v) any shares of, or (w) securities payable in, convertible into or exchangeable or exercisable for, or (x) options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class class, as appropriate, or (y) any Company Voting Debt bonds, debentures, notes or other obligations the holders of which have the right to vote (other than Company Common Shares issuable under or convertible into or exercisable for securities having the Company Option Plans); (Bright to vote) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) with its stockholders on any matter or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets other than Yankees Shares issuable pursuant to stock-based awards outstanding on or awarded prior to the date hereof under the Yankees Stock Plans; (B) (1) increase the amount of net indebtedness for borrowed money, including capital stock any guarantee of such indebtedness, by $100,000,000 in excess of the net indebtedness set forth in the Yankees Financial Statement as of December 31, 2012 (it being understood that net indebtedness shall be calculated as the amount of debt less the sum of the amount of cash and marketable securities, in each case, set forth in the Yankees Financial Statements as of December 31, 2012; it being further understood that notwithstanding the amount set forth in such Yankees Financial Statements, the non-U.S. dollar-denominated portion of such calculation shall be determined using the exchange rates in effect as of the date hereof without regard to any subsequent changes in such rates) or (2) incur any additional indebtedness for borrowed money with a tenor of its Subsidiaries)greater than 90 days, including any guarantee of such indebtedness; or (C) incur make or modify authorize or commit for any indebtedness other than (x) indebtedness existing solely between capital expenditures, except for in accordance with the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, 2013 capital expenditure target for Yankees that has been provided to Braves prior to incurring any indebtedness, if practicable, the Company date of this Agreement or such other capital expenditures targets as may be agreed by Yankees and Braves (provided that (1) Yankees shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, be permitted to make or authorize or commit for any capital expenditures which, individually, in an amount that is in excess between 75% and 110% of $1,000,000 or, in the aggregate, are in excess of $10,000,000; its capital expenditure target and (E2) except as otherwise provided in clause (D) immediately above if the Effective Time shall not have occurred on or prior to December 31, 2013, then, for purposes of this Section 4.1(a)(iii), Yankees’s capital expenditure target will be adjusted upwards to take into account the number of days between December 31, 2013 and other than raw materials, supplies the Effective Time and other inventory items acquired in assuming that the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person2014 capital expenditure target shall be equal to the 2013 capital expenditure target);
(iv) except as required pursuant to existing written, binding agreements in effect prior to the date hereof and set forth in Section 4.1(a)(iv) of the Yankees Disclosure Letter, or as otherwise required by applicable Law, neither it Yankees nor any of its Subsidiaries shall (A) terminategrant or provide any severance or termination payments or benefits to any director, officer or employee of Yankees or any of its Subsidiaries, (B) increase in any manner the compensation, bonus, pension, welfare, fringe, severance or other benefits of, pay any bonus to, or make any new equity awards to any current or former director, officer, employee or consultant of Yankees or any of its Subsidiaries (other than increases in base salary in the ordinary course of business for employees who are not officers), (C) become a party to, establish, adopt, enter into, make any new grants or awards undercommence participation in, amend or otherwise modifyterminate any stock option plan or other stock-based compensation plan, or any Company Compensation and Benefit Plans except as required by compensation, severance, pension, retirement, profit-sharing, welfare benefit, or other employee benefit plan or agreement with or for the benefit of any Laws current or former directors, officers, employees or consultants of Yankees or its Subsidiaries (or newly hired employees) or amend the terms of applicable 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 Benefit Plan, to the extent not already provided in any such Benefit Plan, (E) enter into any collective bargaining agreementsagreement or other agreement with a labor union, works council or similar organization, (BF) change any actuarial or other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget assumptions used to calculate funding obligations with respect to employees at an annual compensation level of less than $150,000any Benefit Plan or to change the manner in which contributions to such plans are made or the basis on which such contributions are determined, increase except as may be required by GAAP, (G) terminate without cause the compensation employment of any employee member of the management committee of Yankees, or (CH) except as approved by the Transition Teamforgive any loans or issue any loans to directors, hire officers or employees of Yankees or any employee at an annual compensation level expected to be more than $100,000of its Subsidiaries;
(v) except in the ordinary and usual course of business, neither it Yankees 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 (i) dispositions of assets that in total have an aggregate fair market value of less than $50,000,000;
(vi) neither Yankees nor any of its Subsidiaries shall (A) acquire or invest in or agree to acquire or invest in (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) (I) for all such acquisitions exceeds, in the aggregate, $50,000,000 or (II) is reasonably likely, individually or in the aggregate, to delay the satisfaction of the conditions set forth in Article V hereof or prevent the satisfaction of such conditions or (B) enter into any joint venture, partnership or similar agreement with any Person;
(vii) subject to Section 4.13, neither Yankees nor any of its Subsidiaries shall (A) 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 Yankees or its Subsidiaries of $60,000,000 (provided that Yankees shall consult in good faith with respect to any such proposed settlement or compromise individually in excess of $20,000,000) or more or would involve any admission of material wrongdoing or any material conduct requirement or restriction by Yankees or its Subsidiaries, (B) modify, amend or terminate in any material respect any of its material Material Contracts or waive, release or assign any material rights or claimsclaims thereunder in excess of $10,000,000 individually or in the aggregate or (C) enter into any new clearing services agreement or arrangement or modify or amend in any material respect any existing clearing services agreement or arrangement to extend the term or to increase the commitments of Yankees or any of its subsidiaries thereunder;
(viviii) except to the extent otherwise required by Law, neither it Yankees nor any of its Subsidiaries shall (A) 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 Yankees and its Subsidiaries that is material; (B) take any action specified in Section 4.1(a)(viii)(B) of the Yankees Disclosure Letter; or (C) permit any material Tax election insurance policy naming it as a beneficiary or file any material income Tax Return inconsistent with past practice loss-payable payee to be cancelled or implement or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viiix) neither it Yankees 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 Yankees nor any of its Subsidiaries shall enter into any Contract that includes a “non-compete,” exclusivity or similar provision that would materially restrict the business of Braves or any of its Subsidiaries (including Yankees and its Subsidiaries) following the Effective Time;
(xi) except as permitted pursuant to Section 4.1(a)(iv), neither Yankees nor any of its Subsidiaries shall enter into any Contract between itself, on the one hand, and any of its employees, officers or directors, on the other hand;
(xii) neither Yankees nor any of its Subsidiaries shall knowingly take any action or omit to take any action that it if such action or failure to act would be reasonably expects would cause any likely to prevent or impede the Merger from qualifying as a reorganization within the meaning of its representations and warranties herein to become untrue in any material respect; andSection 368(a) of the Code;
(viiixiii) neither it Yankees nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing set forth in Section 4.1(a)(i) through Section 4.1(a)(xii) if Yankees would be prohibited by the terms of Section 4.1(a)(i) through Section 4.1(a)(xii) from doing the foregoing; and
(xiv) it shall not fail to make in a timely manner any filings with the SEC required under the Securities Act or the Exchange Act or the rules and regulations promulgated thereunder.
(b) Parent Braves covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to until the earlier of the Effective Time (or the termination of this Agreement in accordance with its terms, unless the Company Yankees shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly contemplated by this Agreement or except as otherwise set forth in this Agreement or the corresponding subsection of Section 3.1(b4.1(a) of the Parent Braves Disclosure Letter)::
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(iiA) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (DB) it shall not declare, set aside or pay any dividend type of dividend, whether payable in cash, stock or property property, in respect of any of its capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries stock; and (yC) regular quarterly cash dividends in respect of Parent Common Stock, it shall not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; directly or (E) indirectly 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, if such repurchase or acquisition is at a price above the then market value;
(iiiii) neither it nor any of its Subsidiaries shall (A) not issue, sell, pledge, dispose of or encumber grant, or authorize the issuance, sale, disposition or grant of, any shares of, of any class of its capital stock except (A) for fair market value or securities convertible into (B) upon the vesting of restricted stock units or exchangeable or exercisable for, or the exercise of options, warrants, calls, commitments convertible securities or other rights of any kind to acquire, acquire any shares of its capital stock which were issued with an exercise or conversion price of any class or any Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000the market price at the time of issuance; provided, however, that prior to incurring any indebtednessthe foregoing shall not prohibit issuances of common stock, if practicablerestricted stock units, Parent shall provide options or rights as part of normal employee compensation in the Company with a reasonable right ordinary course of consultationbusiness; and provided, further, that the foregoing right of consultation this clause (B) shall not apply in prohibit the case issuance of indebtedness in respect of commercial papercapital stock, letters of creditrestricted stock units, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Teamoptions, make or authorize or commit for any capital expenditures whichwarrants, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (convertible securities or other interest inrights in connection with any equity financing contemplated by Braves in connection with the transactions contemplated by this Agreement;
(iii) it shall not fail to make in a timely manner any filings with the SEC required under the Securities Act or assets of any other Personthe Exchange Act or the rules and regulations promulgated thereunder;
(iv) neither it nor any of its Subsidiaries shall (Aknowingly 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) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or of the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000Code;
(v) except in the ordinary and usual course of business, neither it Braves 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;
acquire (vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required with respect to any agreements entered into prior to the date of this Agreement) or agree to acquire (whether by applicable Law merger, consolidation, purchase or by U.S. GAAP;
(viiotherwise, which have been previously publically disclosed or provided to Yankees) neither it nor any of its Subsidiaries shall take any action Person or omit assets that is reasonably likely, individually or in the aggregate, to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue delay in any material respectrespects the satisfaction of the conditions set forth in Article V hereof or prevent the satisfaction of such conditions; and
(viiivi) 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 Section 4.1(b)(v) if it would be prohibited by the terms of Section 4.1(b)(i) through Section 4.1(b)(v) from doing the foregoing.
Appears in 2 contracts
Sources: Merger Agreement (NYSE Euronext), Merger Agreement (Intercontinentalexchange Inc)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after From the date hereof and prior to of this Agreement until the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) in its sole discretion, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of Agreement), the Company Disclosure Letter):
shall ensure that (i) the business and operations of it and its Subsidiaries the Acquired Companies shall be conducted (A) in the ordinary and usual course andand (B) in compliance with all applicable Laws and the requirements of all Material Contracts, and (ii) to the extent consistent therewith, it and each of its Subsidiaries Acquired Company shall use its respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, strategic partners, suppliers, distributors, creditors, lessors, employees and business associates;.
(iib) it From the date of this Agreement until the Effective Time (unless Parent shall otherwise approve in writing in its sole discretion, and except as otherwise expressly contemplated by this Agreement), the Company shall not, and shall cause each of the other Acquired Companies not to:
(i) (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend or waive or propose to amend or waive any provision of its Organizational Documentscertificate of incorporation or bylaws; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, accrue, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly wholly-owned Subsidiaries; or (E) repurchase, redeem or otherwise acquire, except as may be required by the Company Stock Plans, 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;
(iiiii) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt other property or assets (other than Company Common Shares issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Company Option PlansStock Plans and other than the sale by a Subsidiary of the Company of assets pursuant to a Contract executed prior to the date of this Agreement); (B) transfer, lease (other than products sold to customers leases for equipment entered into in the ordinary course for construction, maintenance and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, leasefacilities development projects), license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness Liability in an aggregate amount less amounts greater than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply 75,000 individually and $500,000 in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiariesaggregate; (DC) except as approved by the Transition Team, make or authorize or commit for any capital expenditures whichother than pursuant to the capital appropriations/spending budgets set forth in the Company Disclosure Schedule after deducting amounts previously authorized or committed by the Company with respect to calendar year 2018 or, individuallyby any means, is in excess make any acquisition of, or investment in, assets or stock of $1,000,000 oror other interest in, any other Person or entity; or (D) enter into any joint venture agreement, partnership agreement or similar agreement with any Person;
(iii) (A) grant or provide any severance or termination payments or benefits to any director, officer or employee of any Acquired Company except, in the aggregatecase of employees who are not officers, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, (B) increase the compensation, bonus or pension, welfare, profit-sharing, severance or other benefits of, pay any bonus to, or make any new equity awards to any director, officer or employee of any Acquired Company, (C) enter into, adopt, extend, amend or renew any employment, severance, change in control, termination, deferred compensation or other similar agreement with any director, officer or employee of any Acquired Company, (D) establish, adopt, amend, suspend, terminate or exercise any discretion under any Company Benefit Plan or amend the terms of or exercise any discretion under any Company Awards, (E) take any action to fund or in any other way secure the payment of compensation or benefits under any Company Benefit Plan, (F) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan, to the extent not already required by any meanssuch Company Benefit Plan, make (G) change any acquisitions ofactuarial 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 investments in stock of (H) forgive any loans to directors, officers or other interest in) or assets employees of any other PersonAcquired Company;
(iv) neither it nor commence or settle or compromise any claims or litigation to which an Acquired Company is a party or is threatened to be made a party (except with respect to non-material disputes as may arise from time to time in the ordinary course of its Subsidiaries shall business of such Acquired Company that involve only the payment of monetary damages not in excess (A) terminate, establish, adopt, enter into, make any new grants of $100,000 individually or awards under, amend or otherwise modify, any Company Compensation $250,000 in the aggregate and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) in the case of such disputes disclosed on Section 6.1(h), in amounts not exceeding 25% of the amount accrued or reserved against in the unaudited consolidated balance sheet of the Acquired Companies as of September 30, 2017);
(v) (A) modify, amend, enter into or terminate any material Company Contract other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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 claimsclaims with respect thereto; or (B) (1) modify or amend the KKR Facility in a manner materially adverse to the Acquired Companies or Parent or (2) modify or amend the KKR Forbearance;
(vi) neither it nor make any Tax election, settle or compromise any Tax claim or Liability, change (or make a request to any Governmental Entity to change) any material aspect of its Subsidiaries shall make method of accounting for Tax purposes, file any amended Tax Return, prepare any Tax Return in a manner inconsistent with the past practice of the Acquired Companies, surrender any claim for a refund of a material amount of Taxes, or consent to any extension or waiver of the limitation period applicable to any material Tax election claim or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPassessment;
(vii) neither permit any insurance policy naming it nor any as a beneficiary or loss-payable payee to be cancelled or terminated except in the ordinary and usual course of its Subsidiaries shall business;
(viii) take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect;
(ix) authorize or enter into any ▇▇▇▇▇▇;
(x) enter into any agreement that limits the ability of any Acquired Company, or would limit the ability of Parent or any Subsidiary of Parent (including any Acquired Company) after the Effective Time, to compete in or conduct any line of business or compete with any Person in any geographic area or during any period;
(xi) enter into any new business line;
(xii) (A) adopt a plan or agreement of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other material reorganization of such Acquired Company; (B) consent to or support the commencement of an involuntary case against such Acquired Company or the filing of an involuntary petition seeking bankruptcy, winding up, dissolution, liquidation, administration, moratorium, reorganization or other relief in respect of such Acquired Company or its debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency, administrative, receivership or similar law now or hereafter in effect; or (C) fail to contest or controvert any involuntary proceeding or petition described in this Section 7.1(b)(xii) within ten days following the commencement of such involuntary proceeding against such Acquired Company; and
(viiixiii) neither it nor any of its Subsidiaries will authorize authorize, commit or enter into an agreement to do any of the foregoing.
(bc) Nothing contained in this Agreement shall give to Parent covenants or Merger Sub, directly or indirectly, rights to control or direct the operations of the Acquired Companies prior to the Closing Date. Prior to the Closing Date, the Acquired Companies shall exercise, consistent with the terms and agrees as conditions of this Agreement, complete control and supervision of their operations.
(d) Prior to itself the Effective Time, the Company shall promptly notify Parent in writing of: (i) the occurrence or non-occurrence of any event, condition, fact or circumstance that occurred or existed on or prior to the date of this Agreement and its Subsidiaries thatthat caused or constitutes a material inaccuracy in any representation or warranty made by the Company in this Agreement; (ii) any event, condition, fact or circumstance that occurs, arises or exists after the date hereof of this Agreement and that would cause or constitute a material inaccuracy in any representation or warranty made by the Company in this Agreement if: (A) such representation or warranty had been made as of the time of the occurrence, existence or discovery of such event, condition, fact or circumstance; or (B) such event, condition, fact or circumstance had occurred, arisen or existed on or prior to the Effective Time date of this Agreement; (unless iii) any material breach of any covenant or obligation of the Company; and (iv) any event, condition, fact or circumstance that would make the timely satisfaction of any of the conditions set forth in Article VIII impossible or unlikely or that would, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. Without limiting the generality of the foregoing, the Company shall otherwise consent promptly advise Parent in writing of any (which consent i) Legal Proceeding or material claim threatened, commenced or asserted against or with respect to any of the Acquired Companies, (ii) commencement of an involuntary case against any Acquired Company or the filing of an involuntary petition seeking bankruptcy, winding up, dissolution, liquidation, administration, moratorium, reorganization or other relief in respect of such Acquired Company or its debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency, administrative, receivership or similar law now or hereafter in effect or (iii) occurrence of any default under, and as defined in, the Bank of America Facility or the KKR Facility or the occurrence of any Specified Default Event. No notification given to Parent pursuant to this Section 7.1(d) shall not be unreasonably withheld limit or delayed) and except as otherwise expressly set forth affect any of the representations, warranties, covenants or obligations of the Company contained in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingremedies available to Parent hereunder.
Appears in 2 contracts
Sources: Merger Agreement (Willbros Group, Inc.\NEW\), Merger Agreement (Primoris Services 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 approve in writing (which consent shall writing, such approval not to be unreasonably withheld or delayed) withheld, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(aAgreement) of the Company Disclosure Letter):
(i) and except as required by applicable Law, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, consistent with past practice and to the extent consistent therewith, it the Company and each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributorslandlords, creditorslicensors, lessorslicensees, employees and business associates. Notwithstanding the foregoing and in furtherance thereof, from the date of this Agreement until the Effective Time, except (i) as otherwise contemplated by this Agreement, (ii) as Parent may approve in writing (such approval not to be unreasonably withheld), (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 Schedule, the Company will not and will not permit its Subsidiaries to:
(a) adopt or propose any change in its certificate of incorporation (including by way of any certificates of designation) or bylaws or other applicable governing instruments;
(iib) it shall not 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;
(Ac) 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 $500,000 in any transaction or series of related transactions, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement, all of which are identified on Section 5.1(q) of the Company Disclosure Schedule;
(d) issue, sell, pledgedispose of, dispose grant, transfer or subject to any Lien, or authorize the issuance, sale, disposition, grant or transfer of or encumber Lien on, any shares of capital stock owned by it in of the Company or any of its Subsidiaries; , including, without limitation shares of Series A Junior Participating Preferred Stock (B) amend its Organizational Documents; (C) in each case, other than in (i) the case issuance or grant of any direct Shares upon the exercise of Company Options that are outstanding as of the date hereof, or indirect, (ii) the issuance of capital stock or other equity interests by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary), splitor securities convertible or exchangeable into or exercisable for any such capital stock or other equity interests, combine or reclassify its outstanding any options, warrants or other rights of any kind to acquire any shares of such capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property such convertible or exchangeable securities;
(e) make any loans, advances or capital contributions to or investments in respect of any capital stock Person (other than dividends from its the Company or any direct or indirect wholly owned Subsidiaries; Subsidiary of the Company) in excess of $500,000 in the aggregate;
(f) declare, set aside, make or (E) repurchasepay any dividend or other distribution, redeem payable in cash, stock, property or otherwise acquireotherwise, or permit with respect to any of its Subsidiaries capital stock (except for (i) one quarterly dividend to be issued by the Company in its fourth fiscal quarter ended March 3, 2007, not to exceed $0.04 per Share in the aggregate, and (ii) 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;
(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 (other than the acquisition of any such capital stock or other securities tendered by current or former employees or directors in connection with the exercise of currently outstanding Company Options);
(h) incur any indebtedness for borrowed money or guaranty 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, except in each case for indebtedness, in the ordinary course of business and consistent with past practice, for borrowed money under credit facilities, lines of credit and other debt or borrowing arrangements reflected in the Financial Statements; provided, however that neither the Company nor its Subsidiaries shall draw down on any amounts under its existing credit facilities except to the extent necessary to comply with letters of credit, under credit facilities, lines of credit and other debt or borrowing arrangements reflected in the Company's most recent financial statements included in the Company Reports issued from time to time in the ordinary course of business in an amount not to exceed $1,000,000 in the aggregate outstanding at any given time;
(i) make any material changes with respect to accounting policies or procedures, except as required by changes in GAAP or Law or by a Governmental Entity;
(j) make, alter or revoke any Tax accounting method or material Tax election, or settle or compromise any Tax liability or otherwise pay or consent to any assessment as the result of an audit, file any amended Tax Return, enter into any closing agreement relating to Taxes, or waive or extend the statute of limitations in respect of Taxes (other than pursuant to extensions of time to file Tax Returns obtained in the ordinary course of business);
(k) 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, other than inventory, supplies and other assets in the ordinary course of business consistent with past practice;
(l) except as expressly contemplated by this Agreement, required pursuant to the Benefit Plans in effect on the date of this Agreement disclosed in Section 5.1(h)(i) of the Company Disclosure Schedule, pursuant to any employment or separation agreement disclosed in Section 5.1(h)(vi) of the Company Disclosure Schedule or any collective bargaining agreement disclosed in Section 5.1(m) of the Company Disclosure Schedule, or as otherwise required by applicable Law, including to comply with Section 409A of the Code, (i) grant or provide any severance or termination payments or benefits to any officers, employee, independent contractor or consultant of the Company or any of its Subsidiaries, (ii) increase (or commit to increase) the compensation, perquisites or benefits payable to any director, officer, employee, independent contractor or consultant of the Company or any of its Subsidiaries, except for increases with respect to non-executive employees in the ordinary course of business consistent with past practice, (iii) enter into any new, or amend the terms of any existing, employment agreement or Benefit Plan with any member of management of the Company or any of its Subsidiaries, (iv) 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, (vi) 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, (vii) change the terms of any outstanding Company Option, or (viii) terminate or materially amend any existing, or adopt any new, Benefit Plan (other than changes that may be necessary to comply with applicable Law, in each case that do not materially increase the costs of any such Benefit Plans); provided, however, that the manner of any change, amendment or acceleration to comply with Section 409A of the Code must be approved by Parent, which approval shall not be unreasonably withheld or delayed);
(m) enter into, amend or extend any collective bargaining agreement or other labor agreement;
(n) enter into, amend or modify any agreement of the type described in Section 5.1(s);
(o) make any capital expenditures in excess of $100,000 individually or $300,000 in the aggregate over and above those capital expenditures identified in the capital expenditure plan set forth in Section 6.1(o) of the Company Disclosure Schedule;
(p) enter into any rights agreement, establish any stockholder rights plan (or similar plan commonly referred to as a "poison pill") or enter into any Contract (in each case other than the Stock Plans existing on the date hereof and Company Options issued thereunder) under which the Company or any of its Subsidiaries is or may become obligated to sell or otherwise issue, register, redeem, repurchase, vote, transfer or dispose of any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;other securities; or
(iiiq) neither it nor except as provided in Section 6.2 and Section 6.3, agree, authorize or commit to do any of its Subsidiaries shall the foregoing. Nothing contained in this Agreement (Aincluding, without limitation, this Section 6.1) issueis intended to give Parent, selldirectly or indirectly, pledge, dispose of the right to control or encumber any shares of, direct the Company's 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur ' operations prior to the Effective Time, and nothing contained in this Agreement is intended to give the Company, directly or modify indirectly, the right to control or direct Parent's or any indebtedness other than (x) indebtedness existing solely between 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. Subject to the immediately preceding paragraph, in connection with the continued operation of the Company and its wholly owned Subsidiaries the Subsidiaries, the Company will reasonably confer in good faith on a regular basis with one or between such wholly owned Subsidiaries more representatives of Parent, designated by Parent to the Company in writing, regarding operational matters, and the general status of ongoing operations of the Company and will notify Parent promptly of any event or (y) indebtedness occurrence that has had or may reasonably be expected to have a Company Material Adverse Effect or that, individually or in an aggregate amount less than $30,000,000the aggregate, has materially delayed or impaired, or would reasonably be expected to materially delay or impair, consummation of the transactions contemplated by this Agreement, or that, individually or in the aggregate, has resulted, or would reasonably be expected to result, in the failure by the Company to comply with or satisfy in any material respect any condition set forth in Section 7.1 or 7.2; provided, however, that prior to incurring any indebtedness, if practicable, no such notification shall affect the Company shall provide Parent with a reasonable right covenants or agreements of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws parties or the terms of applicable collective bargaining agreements, (B) other than in conditions to the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any obligations of the foregoing.
(b) parties under this Agreement. The Company acknowledges that Parent covenants does not and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall will not be unreasonably withheld or delayed) and except as otherwise expressly set forth in waive any rights it may have under this Agreement as a result of such notice or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingconsultations.
Appears in 2 contracts
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 in writing (writing, which consent shall not unreasonably be unreasonably withheld or delayed) withheld, and except as otherwise expressly contemplated by this Agreement or as set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, strategic partners, creditors, lessors, employees and business associates;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentscertificate of incorporation or by-laws; (Ciii) other than in the case of any direct or indirect, wholly wholly-owned Subsidiarysubsidiaries, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock stock, other than dividends from its direct or indirect wholly wholly-owned Subsidiaries; or (Ev) repurchasepurchase, redeem or otherwise acquire, except for the acquisition of shares of Company Common Stock from holders of Company Stock Options in full or partial payment of the exercise price payable by such holder upon exercise of Company Stock Options to the extent required or permitted under the terms of such Company Stock Options, 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;
(iiic) neither it nor any of its Subsidiaries shall (Ai) issue, sell, pledge, dispose of or encumber (A) any shares ofof its capital stock of any class, Rights or any Voting Debt, or (B) 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 class, Rights, any Voting Debt or any Company Voting Debt other property or assets (other than shares of Company Common Shares Stock and associated Rights issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Company Option Stock Plans); or (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of of, abandon, cancel, surrender or allow to lapse or expire or encumber any other material property or material assets (including capital stock of any of its Subsidiaries); ) or business;
(Cd) incur neither it nor any of its Subsidiaries shall restructure, recapitalize, reorganize or modify completely or partially liquidate or adopt a plan of complete or partial liquidation or otherwise enter into any indebtedness agreement or arrangement imposing material changes or restrictions on the operation of its assets or businesses or adopt resolutions providing for or authorizing any of the foregoing;
(e) neither it nor any of its Subsidiaries shall acquire (i) by merging or consolidating with, or by purchasing all or a substantial portion of the assets of or any stock of, or by any other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries manner, any business or between such wholly owned Subsidiaries any corporation, partnership, joint venture, limited liability company, association or other business organization or division thereof, or (yii) indebtedness in an aggregate amount less than $30,000,000; providedany assets that are material, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees individually or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess to the Company and any of $10,000,000; its Subsidiaries, taken as a whole, except purchases of inventory and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired materials in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) as permitted by Section 7.1(g), whether or assets of any other Personnot material);
(ivf) neither it nor any of its Subsidiaries shall (Ai) terminateincur any indebtedness for borrowed money or guarantee any such indebtedness of another Person (other than pursuant to the Credit Agreement in the ordinary course of business), establish(ii) issue, adoptsell or amend any debt securities or warrants or other rights to acquire any debt securities of the Company or any of its Subsidiaries, guarantee any debt securities of another Person, enter intointo any “keep well” or other agreement to maintain any financial statement condition of another Person or enter into any arrangement having the economic effect of any of the foregoing, (iii) make any new grants loans, advances (other than routine advances to employees of the Company and its Subsidiaries in the ordinary course of business) or awards undercapital contributions to, amend or otherwise modifyinvestment in, any other Person, other than the Company Compensation and Benefit Plans except as required by or any Laws of its direct or the terms of applicable collective bargaining agreementsindirect wholly owned Subsidiaries, or (Biv) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, enter into any hedging agreement or other financial agreement or arrangement designed to protect the Company or its Subsidiaries against fluctuations in commodities prices or exchange rates;
(g) neither it nor any of its Subsidiaries shall settle make any capital expenditures or compromise other expenditures with respect to property, plant or equipment in excess of $10 million per quarter in the aggregate for the Company and its Subsidiaries, taken as a whole (it being understood that if capital expenditures in any material claims or litigation or modifyquarter are less than $10 million, amend or terminate any of its material Contracts or waive, release or assign any material rights or claimsthe shortfall shall be available to the Company to spend in future quarters);
(vih) neither it nor any of its Subsidiaries shall make any material Tax election changes in accounting methods, principles or file practices, except insofar as may have been required by a change in GAAP or applicable Law or, except as so required, change any assumption underlying, or method of calculating, any bad debt, contingency or other reserve;
(i) neither it nor any of its Subsidiaries shall, except in the ordinary course of business consistent with past practice, enter into, renew, modify, amend, terminate, waive, delay the exercise of, release or assign any material income rights or claims under, any Company Material Contract or Company Lease in a manner materially adverse to Parent; provided, that, nothing herein shall permit the Company or any of its Subsidiaries to (i) enter into any Contract of the type specified in Section 5.5(a)(viii) or Section 5.5(a)(ix) to the extent such Contract would survive after the Effective Time, or modify or amend in a manner adverse to the Company or any of its Subsidiaries any existing Contract of the type specified in Section 5.5(a)(viii) or Section 5.5(a)(ix), or (ii) except to the extent permitted by Section 7.2(a) of this Agreement, enter into, renew, modify, amend, terminate, waive, delay the exercise of, or release or assign any material rights or claims under, any confidentiality, standstill or similar agreement to which the Company or any of its Subsidiaries is bound by or subject;
(j) neither it nor any of its Subsidiaries shall, except as required to comply with applicable Law or agreements, plans or arrangements existing on the date hereof, (i) except as otherwise requested by Parent pursuant to Section 7.11(c), take any action with respect to, adopt, enter into, terminate or amend any change in control, retirement, retention, welfare, incentive or similar agreement, arrangement or benefit plan (excluding any employment or severance arrangements) for the benefit or welfare of any current or former director, officer, employee or consultant or any collective bargaining agreement, (ii) take any action with respect to, adopt, enter into, terminate or amend any employment or severance agreement or arrangement for the benefit or welfare of any current or former director, officer, employee or consultant, except actions in the ordinary course of business with respect to individual employment or severance agreements for employees below the level of Vice President, (iii) increase in any respect the compensation or fringe benefits of, or pay any bonus to, any director, officer, employee or consultant, except increases in the ordinary course of business given to employees below the level of Vice President on an individual basis, (iv) except as otherwise provided herein and other than as set forth on Section 7.1(j) of the Company Disclosure Schedule, amend or accelerate the payment, right to payment or vesting of any compensation or benefits, including any outstanding options or restricted stock awards, (v) pay any benefit not provided for as of the date of this Agreement under any Company Benefit Plan, (vi) other than with respect to existing commitments as of the date of this Agreement set forth on Section 7.1(j) of the Company Disclosure Schedule, grant any awards under any bonus, incentive, performance or other compensation plan or arrangement or benefit plan, including the grant of stock options, stock appreciation rights, stock based or stock related awards, performance units or restricted stock, or, except as otherwise provided herein, the removal of existing restrictions in any benefit plans or agreements or awards made thereunder, or (vii) take any action to fund or in any other way secure the payment of compensation or benefits under any Company Benefit Plan; provided, however, this Section 7.1(j) shall not prevent the Company or any of its Subsidiaries from (x) prior to the Closing Date, paying awards under the 2006 Executive Incentive Plan and commissions to employees at the level of Vice President and above in the ordinary course of business and consistent with past practices as to the approval of such awards and the timing of such payments, to the extent the performance standards and targets set for 2006 have been satisfied, and (y) prior to the Closing Date, establishing (with the input of Parent, to the extent permitted by applicable Law), adopting and maintaining plans providing for bonuses or incentive compensation in 2007 for employees (including those at the level of Vice President or above);
(k) except for matters identified in Section 7.1(k) of the Company Disclosure Schedule, which shall set forth in reasonable detail the Company’s plans with respect thereto, neither the Company nor any of its Subsidiaries shall initiate, settle or compromise any litigation, claim, grievance, charge or proceeding involving any Intellectual Property or any other material litigation, claim, grievance, charge or proceeding (other than in connection with the enforcement of the Company’s rights under this Agreement and other than in the ordinary course of business consistent with past practice); provided, however, that notwithstanding any other provision of this Agreement, neither the Company nor any of its Subsidiaries shall enter into any settlement of or compromise any litigation, claim, grievance, charge or proceeding that, whether at the time of the settlement or compromise or at any time in the future, materially increases the labor or operating costs of the Company or any of its Subsidiaries or places any material restrictions on the ability of the Company or any of its Subsidiaries to impose any labor saving or other cost reduction measures;
(l) neither it nor any of its Subsidiaries shall make or rescind any material Tax election, amend any material Tax Return inconsistent or permit any insurance policy naming it as a beneficiary or loss-payable payee to be cancelled or terminated, in each case except in a manner consistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPLaw;
(viim) other than with respect to any actions permitted under Section 7.2, neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause likely to result in any of its representations and warranties herein the conditions to become untrue the Merger set forth in any material respectArticle VIII not being satisfied; and
(viiin) neither it nor any of its Subsidiaries will authorize any of, or enter into an agreement commit, resolve or agree, in writing or otherwise, to do take, any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000foregoing actions; provided, however, that nothing contained in this Agreement shall give to Parent, directly or indirectly, rights to control or direct the operations of the Company prior to incurring any indebtednessClosing. Prior to Closing, if practicable, Parent shall provide the Company shall exercise, consistent with a reasonable right the terms and conditions of consultation; providedthis Agreement, further, that the foregoing right complete control and supervision of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent its and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing’ operations.
Appears in 2 contracts
Sources: Merger Agreement (Symbol Technologies Inc), Merger Agreement (Motorola Inc)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to until the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing), and except as otherwise expressly set forth in permitted by this Agreement or the corresponding subsection of Section 3.1(aas required in writing by a Governmental Entity (including Gaming Authorities) of the Company Disclosure Letter):
competent jurisdiction or required by applicable Laws (i) the business of including Gaming Laws), it shall and its Subsidiaries shall be conducted conduct their businesses in all material respects in the ordinary and usual course and, to the extent consistent therewithwith the foregoing, it the Company and each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve their business organizations substantially intact, maintain satisfactory relationships with customers and suppliers having business dealings with them, maintain the effectiveness of the Company’s Licenses and keep available the services of their key employees. Without limiting the generality 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 delayed, withheld or conditioned) (C) as required in writing by a Governmental Entity (including Gaming Authorities) of competent jurisdiction or required by applicable Laws (including Gaming Laws) or (D) as set forth in Section 6.1(a) of the Company Disclosure Schedule, the Company will not and will cause its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesSubsidiaries not to:
(i) adopt any change in the certificate of incorporation or bylaws of the Company;
(ii) it shall not merge or consolidate the Company or any of its Subsidiaries with any other Person;
(Aiii) make any acquisition of all or substantially all of the capital stock or assets of any other Person, whether by way of stock purchase, asset purchase, merger or otherwise (other than formation of new wholly-owned Subsidiaries), or of any other assets of any other Person for which the fair market value of the total consideration paid by the Company and its Subsidiaries exceeds $250,000 individually or $500,000 in the aggregate;
(iv) issue, sell, deliver, pledge, dispose of, grant, transfer, lease, license, guarantee or encumber, or authorize the issuance, sale, delivery, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of or encumber any capital stock owned by it in or voting debt of the Company or any of its Subsidiaries; Subsidiaries (other than (A) upon conversion of Preferred Stock outstanding as of the date hereof in accordance with the terms thereof and (B) amend its Organizational Documents; (C) the issuance of shares or other than in equity securities by a wholly-owned Subsidiary of the case Company to the Company or another wholly-owned Subsidiary of the Company), or securities convertible or exchangeable into or exercisable for any shares of such capital stock or voting debt, or any options, warrants or other rights of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding kind to acquire any shares of such capital stock; stock voting debt or such convertible or exchangeable securities, or stock appreciation rights;
(Dv) except for dividends in respect of the Preferred Stock required to be paid or accrued in accordance with the Company’s certificate of incorporation and the certificates of designations thereof, declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to any of any its capital stock other than (except dividends from paid by any direct or indirect wholly-owned Subsidiary of the Company);
(vi) except for transactions among the Company and its direct or indirect wholly wholly-owned Subsidiaries or among the Company’s direct or indirect wholly-owned Subsidiaries; , reclassify, split, combine, subdivide or (E) repurchaseredeem, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiivii) neither it nor subject to Section 6.20, change in any material respect its financial or Tax accounting policies or procedures, except as required by applicable Law or by changes in GAAP;
(viii) other than Transaction Litigation (which is addressed in Section 6.13), settle, release, waive or compromise any litigation or other pending or threatened proceedings or claims by or before a Governmental Entity or arbitrator 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 shall (A) issueof monetary damages exceeding $250,000 in any individual matter, 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 net of any kind to acquire, any shares amount covered by insurance or third-party indemnification in respect of its capital stock of any class such matter or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold with respect to customers any non-monetary terms and conditions therein, imposes or requires actions that would or would, individually or in the ordinary and usual course aggregate, reasonably be expected to materially restrict or limit the operations of the business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or as conducted on the date hereof;
(y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (Dix) except as approved required by a Benefit Plan in effect prior to the Transition Teamdate of this Agreement that is set forth on Section 6.1(a)(ix) of the Company Disclosure Schedule, make (A) grant or authorize provide any severance or commit for termination payments or benefits to any capital expenditures whichcurrent or former Company Employee or any other current or former service provider, individually(B) increase the compensation or benefits of any current or former Company Employee or any other current or former service provider, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired customary annual increases for non-executive Company Employees in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest inC) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make adopt, join, terminate or amend any Benefit Plan or any plan, program, arrangement, policy or agreement that would be a Benefit Plan if it were in existence on the date hereof, (D) hire or otherwise retain the services of any new grants member of the Company Board, officer or awards underother senior executive, amend (E) take any action to fund or otherwise modifyin any other way secure the payment of compensation or benefits under any Contract or Benefit Plan, any Company Compensation and Benefit Plans or (F) except as specifically required by this Agreement, exercise any Laws discretion to accelerate the vesting or the terms payment of applicable collective bargaining agreements, any compensation or benefit under any Benefit Plan;
(Bx) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xi) enter into any new line of business;
(xii) other than (A) any sale, lease, assignment, encumbrances or other disposition of inventory in the ordinary and usual course of business consistent with past practice and (B) dispositions of assets if the Company’s compensation budget with respect book value thereof does not exceed in the aggregate $500,000, sell, lease, assign, encumber or otherwise dispose of, or agree to employees at an annual compensation level sell, lease, assign, encumber or otherwise dispose of, any assets of less than $150,000, increase the compensation Company or any of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000its Subsidiaries;
(vxiii) fail to maintain its existing insurance coverage of all types;
(xiv) except in the ordinary and usual course of businessbusiness consistent with past practice, neither it nor enter into any Material Contract, or amend in any material respect or terminate any Material Contract or waive or grant any release or relinquishment of any material rights under, or renew, any Material Contract; provided, that, except as set forth in Section 6.1(a)(xiv) of the Company Disclosure Schedule, entry into, amendment in any material respect, termination of, waiver or granting of any release or relinquishment of any material rights under, or renewal of, any Contract either (1) described by any of clauses (B), (C), (D), (F), (G), (H), (I), (K) or (L) of the definition of “Material Contracts,” or (2) (x) with a term of 18 months or more, (y) that is not terminable by the Company or its Subsidiaries without fee or penalty upon 90 days’ or less prior notice and (z) that by its terms calls for aggregate payments by or to the Company or any of its Subsidiaries in excess of $1,500,000, shall settle require Parent approval in accordance with this Section 6.1(a) even if entered in the ordinary course of business consistent with past practice;
(xv) enter into any Contract with an Affiliate of the Company (other than a wholly-owned Subsidiary of the Company) (an “Affiliate Contract”), or compromise amend in any material claims or litigation or modifyrespect or, amend or except as contemplated by this Agreement, terminate any of its material Contracts Affiliate Contract or waive, waive or grant any release or assign relinquishment of any material rights under, or claimsrenew, any Affiliate Contract;
(vixvi) neither it nor spend the amounts in the Specified Reserve Account for any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases purpose other than as may be required by applicable Law or by Canadian GAAP;resolution of the Specified Matter; or
(viixvii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as Nothing contained in this Agreement gives, or is intended to itself and give Parent, directly or indirectly, the right to control or direct the Company’s or its Subsidiaries that, after the date hereof and Subsidiaries’ operations prior to the Effective Time (unless Time. Prior to the Effective Time, the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) exercise, consistent with the terms and except as otherwise expressly set forth in subject to the conditions of this Agreement or Agreement, including this Section 6.1, complete control and supervision over the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it Company’s and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing’ operations.
Appears in 1 contract
Sources: Merger Agreement (Tropicana Las Vegas Hotel & Casino, Inc.)
Interim Operations. (a) The Between signing of this Agreement and Closing, Seller shall cause each of the Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent Purchaser shall otherwise consent approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly contemplated hereby or set forth in this Agreement or the corresponding subsection of Section 3.1(aSeller Disclosure Schedule) to:
(a) other than consummation of the Company Disclosure Letter):
(i) the Scolari Acquisition, conduct its business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective all reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees suppliers and business associatesemployees;
(iib) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iiic) neither it nor any of its Subsidiaries shall not (Ai) issue, sell, pledge, dispose of or encumber any shares ofof the Company or its Subsidiaries capital stock, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of the Company or its Subsidiaries capital stock of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans)class; (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any material portion of its Subsidiaries); (C) incur or modify any indebtedness assets, other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right sales of consultation; provided, further, that the foregoing right of consultation shall not apply inventory in the case ordinary course of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above business and other than raw materialsamounts in cash equal to the Pre-Closing Distributions, supplies and other inventory items acquired in provided that, CHF 1’000’000 of the ordinary and usual course of business consistent with past practice, Pre-Closing Distributions will not be distributed by any means, make any acquisitions of, the Company or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall until Closing and will be available for funding of the Reserve Amount at Closing; or (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (Biii) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor incur any Indebtedness or issue any debt securities or guarantee or endorse the obligations 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 claimsPerson;
(vid) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law Law, not (i) increase the compensation payable or by Canadian GAAPto become payable to Group Employees; (ii) grant any rights to severance or termination pay to, or enter into any employment or severance agreement with any Group Employee (other than in connection with the Scolari Acquisition); or (iii) establish, adopt, enter into or amend, any collective bargaining agreement or Benefit Plan;
(viie) neither it nor except in the ordinary course of business, not (i) enter into, amend or terminate any of contract or agreement that would be material to the Company and its Subsidiaries shall take taken as a whole (other than in connection with the Scolari Acquisition); or (ii) exclusively license to any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in third party any material respectOwned Intellectual Property;
(f) other than consummation of the Scolari Acquisition, not acquire by merger, consolidation, acquisition of assets or equity interests or any similar transaction any corporation, partnership, limited liability company or other business organization or all or substantially all of the assets of any such entity;
(g) except in the ordinary course of business, not settle or compromise any material claims or litigation;
(h) not make any material change, other than as required by Swiss GAAP or U.S. GAAP, to its accounting principles or procedures;
(i) except as described in the funds flow chart attached as Annex C, not make any payment or distribution to Seller or its Affiliates; and
(viiij) neither it nor any of its Subsidiaries will not authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after from the date hereof and prior to of this Agreement until the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and Time, except as otherwise expressly specifically permitted by any other provision of this Agreement (or as set forth in this Agreement or the corresponding subsection of Section 3.1(a) 7.1 of the Company Disclosure Letter):
(i) or required by applicable Law or the regulations or requirements of any stock exchange or regulatory organization applicable to the Company or except with Parent’s prior written approval, which approval shall not be unreasonably withheld, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective reasonable best efforts to protect and preserve the scope and breadth of its assets and the Company Intellectual Property and to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, outside counsel, clinical trial investigators or managers of its clinical trials, employees and business associatesconsultants. Without limiting the generality of the foregoing, and as an extension thereof, the Company shall not and shall not permit any of its Subsidiaries to, from the date of this Agreement until the Effective Time, directly or indirectly, do, or agree to do, any of the following without the prior written consent of Parent:
(a) amend or propose to amend the certificate of incorporation or bylaws or other comparable governing instruments of the Company or any of its Subsidiaries or amend, modify or waive any provision of the Rights Agreement;
(iib) it shall not acquire (Aincluding, without limitation, by merger, consolidation, or acquisition of stock, assets or Intellectual Property or any other business combination) issueany corporation, sellpartnership, pledge, dispose of other business organization or encumber any capital stock owned by it division thereof or any assets or interest in any assets from any other Person in excess of its Subsidiaries; (B) amend its Organizational Documents; (C) other than $500,000 individually or $1,000,000 in the case of any direct or indirect, wholly owned Subsidiary, aggregate;
(c) split, combine or reclassify its outstanding shares of capital stock of the Company nor enter into any agreement with respect to voting of any of its capital stock; , or any securities convertible into or exchangeable for such shares;
(Dd) declare, set aside or pay any dividend or other distribution, payable in cash, stock stock, property or property otherwise, in respect of any the capital stock of the Company or any of its Subsidiaries, other than dividends from its direct or indirect wholly wholly-owned Subsidiaries; or ;
(Ee) repurchasepurchase, redeem or otherwise acquire, except in connection with the Company Option Plan, the Preferred Stock or the AZ Note, or permit any of its Subsidiaries to purchase or otherwise acquire, acquire any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(iiif) neither it nor transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any material property or assets or interest therein of the Company or any of its Subsidiaries shall (Aincluding (i) Intellectual Property material to the business of the Company and its Subsidiaries, but excluding non-exclusive Intellectual Property licenses granted in the ordinary course of business to third parties, and (ii) capital stock of any of the Company’s Subsidiaries);
(g) incur any indebtedness for borrowed money or issue any debt securities or warrants or other rights to acquire debt securities of the Company or any of its Subsidiaries or assume, guarantee or endorse, as an accommodation or otherwise, the obligations of any other Person, in the case of any of the foregoing, involving an aggregate principal amount or potential guaranteed amount in excess of $500,000 or otherwise incur or modify any material indebtedness or liability;
(h) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of the Company or any of its Subsidiaries); Subsidiaries (C) incur or modify any indebtedness other than (x) indebtedness existing solely between in accordance with the Company Rights Agreement and its wholly owned Subsidiaries other than shares issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Stock Plan or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicableupon conversion of the Convertible Notes, the Company shall provide Parent with a reasonable right of consultation; provided, further, that AZ Note or the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; Preferred Stock);
(Di) except as approved by the Transition Team, make or authorize or commit for agree to make any capital expenditures which, individually, is other than any such expenditure (A) not in excess of $200,000 individually or $1,000,000 or, in the aggregateaggregate or (B) in conformance with the Draft ET Meeting 2006 Plan Review, are dated December 7, 2005, furnished to Parent prior to the date hereof;
(j) waive any benefits of, agree to modify in excess any respect, fail to enforce or consent to any matter with respect to which consent is required under any (i) standstill or similar agreement containing provisions prohibiting a third party from purchasing the capital stock or assets of $10,000,000; the Company or any of its Subsidiaries or otherwise seeking to influence or exercise control over the Company or any of its Subsidiaries and to which the Company or any of its Subsidiaries is a party or (Eii) except as otherwise provided in clause (D) immediately above and other than raw materialsconfidentiality, supplies and other inventory items acquired non-solicitation or similar agreements to which the Company or any of its Subsidiaries is a party, excluding, however, waivers of confidentiality relating to non-material Intellectual Property in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(ivk) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants change in accounting practices, policies or awards underprinciples, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws GAAP or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and by Law or a Governmental Entity as concurred to by the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000independent auditors;
(vl) except in the ordinary and usual course of businessenter into, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, amend or terminate any of its material Contracts terminate, or waive, release or assign any material rights or claims;
claims under (vii) neither it nor any Contract pursuant to which the Company, any of its Subsidiaries or any other party thereto has material continuing obligations, rights or interests relating to research, development, clinical trial, distribution, supply, manufacturing, marketing or co-promotion of, or collaboration with respect to, any product or product candidate for which the Company or any of its Subsidiaries is currently engaged in research and development (excluding (A) clinical study agreements with clinical trial sites, (B) non-disclosure agreements (other than non-disclosure, standstill and exclusivity agreements relating to potential business combinations or acquisitions involving the Company or any of its Subsidiaries or similar transactions), (C) Contracts with independent contractors or vendors providing for services to the Company or any of its Subsidiaries (other than material manufacture or supply services Contracts or material Contracts with contract research organizations for clinical trials related services), and (D) customary material transfer Contracts (other than material transfer Contracts for pre-clinical products or clinical products of the Company or any of its Subsidiaries with commercial, pharmaceutical or biotechnology companies), in the case of each of the foregoing (A), (B), (C) or (D), entered into in the ordinary course of business consistent with past practice); or (ii) any Contract pursuant to which the Company, any of its Subsidiaries or any other party thereto has, or will have, material continuing obligations, rights or interests;
(m) make any material loan, advance, capital contribution to, or investment in, any Person other than (i) loans, advances or capital contributions to, or investments in, wholly-owned Subsidiaries of the Company and (ii) loans, advances or capital contributions to, or investments in, any other Person in an amount not in excess of $250,000 in the aggregate;
(n) enter into, modify, amend or terminate any Contract or waive, release or assign any rights or claims thereunder, which if so entered into, modified, amended, terminated, waived, released or assigned would be reasonably likely to (i) adversely affect the Company (or, following the Merger, Parent or any Affiliates of Parent) in any material respect, (ii) impair the ability of the Company to perform its obligations under this Agreement in any material respect, (iii) prevent or materially delay or impair the consummation of the Merger and the other transactions contemplated by this Agreement or (iv) limit or restrict the Surviving Corporation, any Affiliate of the Surviving Corporation or any of their successors and assigns from engaging or competing in any line of business, including the research, development and commercialization of any antibody or therapeutic agent directed at a specific antigen or other target or in any therapeutic area, or in any geographic area;
(o) pre-pay any long-term debt or accelerate or delay any material payments or the collection of payment due to the Company, except in the ordinary course of business consistent with past practice;
(p) unless reasonably determined to be beneficial to the Company’s prosecution of its patent or Trademark applications, (i) grant, extend, amend (except as required in the diligent prosecution of the Company Intellectual Property), waive or modify any material rights in or to the Company Intellectual Property, Co-Owned Intellectual Property or Licensed Intellectual Property, (ii) fail to diligently prosecute the Company’s and its Subsidiaries’ patent applications, or (iii) fail to exercise a right of renewal or extension under any material Licensed Intellectual Property;
(q) (i) increase the number of employees of the Company and the Company Subsidiaries by more than 4.5%, based on the number of employees employed by the Company and the Company Subsidiaries as of the date hereof, or (ii) enter into an employment agreement or relationship, other than an “at will” employment relationship, with any Person;
(r) except as required pursuant to existing written, binding agreements in effect prior to the date hereof and set forth in Section 5.8 of the Company Disclosure Letter, as provided in Section 4.5 of this Agreement or as otherwise required by applicable Law or tax qualification requirement, (i) grant or provide or adopt a plan intended to grant or provide any retention, 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, except for increases in base salary in the ordinary course of business consistent with past practice for employees who are not officers that do not exceed, on average, 5.0% of the base salary of those receiving such salary increases, and that the increases are not being given as promotional increases, (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 Company Benefit Plan, to the extent not already provided in any such Company Benefit Plan, (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 applicable Laws; or (vi) issue or forgive any loans to directors, officers, contractors or employees of the Company or any of its Subsidiaries;
(s) communicate with Company employees regarding the compensation, benefits or other treatment they will receive in connection with the proposed Merger, unless any such communications are consistent with prior directives or documentation provided to the Company by Parent (in which case, the Company shall provide Parent with prior notice of and the opportunity to review and comment upon any such communications);
(t) make any material Tax election or settle or compromise any material liability for Taxes, change any annual Tax accounting period (except as required by Law), change any Tax accounting method (except as required by Law), file any material income amended Tax Return inconsistent with past practice Return, enter into any closing agreement relating to any material Tax, surrender any right to claim a material Tax refund or implement consent to any extension or adopt waiver of the statute of limitations period applicable to any change in its accounting principles material Tax claim or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPassessment;
(viiu) neither it nor in respect of any Contract, grant rights thereunder to, or accept the designation thereunder of, any newly proposed antigen, which grant or designation would limit or restrict Parent or any of its Subsidiaries shall take Affiliates (other than, following the Effective Date, the Company and its Subsidiaries) from researching, developing or commercializing any action antibody or omit to take other therapeutic agent directed at such antigen, for any action that it reasonably expects would cause any of its representations and warranties herein to become untrue therapeutic area or in any material respectgeographic area, unless and only to the extent that any such failure to make such grant or acceptance will constitute a breach under such Contract and provided that the Company has provided to Parent at least 10 business days' prior written notice of any such grant or acceptance, which notice shall identify the antigen proposed to be designated, unless such disclosure is prohibited by the terms of such Contract; andor
(viiiv) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Amgen Inc)
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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective commercially 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;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational DocumentsDocuments or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, indirect wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect A-24 wholly owned SubsidiariesSubsidiaries and other than regular quarterly cash dividends not in excess of $0.165 per Share; or (E) repurchase, redeem or otherwise acquire, except in connection with the Stock Plans, 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 (A) 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 Company Voting Debt or any other property or assets (other than Company Common Shares issuable under the Stock Plans) except as set forth in Section 6.1(a)(iii) of the Company Option Plans)Disclosure Schedule; (B) other than as set forth on Section 6.1(a)(iii)(B) of the Company Disclosure Schedule, products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) tax-exempt indebtedness, indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,0002,000,000; provided, however, provided that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultationconsultation prior to incurring any such indebtedness; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures other than as set forth on Schedule 6.1(a)(iii) of the Company Disclosure Schedule or which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,0005,000,000; provided that prior to making any expenditure not set forth on Schedule 6.1(a)(iii) of the Company Disclosure Schedule, if practicable, the Company shall provide Parent with a reasonable right of consultation prior to making any such expenditure; and (E) by any means, make any acquisition of, or investment in (i) stock of or other interest in, any other Person or (ii) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) except as set forth in Section 6.1(a)(iv) of the Company Disclosure Schedule, or as required by the terms of this Agreement, neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementslaw, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s 's compensation budget with respect to employees at an annual a compensation level of less than $150,00080,000 a year, increase the compensation of any employee or employee, (C) except as approved by the Transition Team, hire any employee at an annual a compensation level expected to be more than $100,000100,000 a year;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice Refund or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law Laws or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective commercially 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;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; or (DB) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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 stockSubsidiaries;
(iii) neither it nor any of its Subsidiaries shall not (A) issueenter into any transaction, sellother than as contemplated pursuant to this Agreement, pledgeto the extent any such transaction would require approval of the stockholders of Parent under applicable law or stock exchange rules; or (B) enter into an agreement relating to any acquisition, dispose of merger, consolidation or encumber purchase that would reasonably be expected to (I) impose any shares material delay in the obtaining of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights significantly increase the risk of any kind to acquirenot obtaining, any shares of its capital stock of any class authorizations, consents, orders, declarations or any Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization approvals of any Governmental Entity in order necessary to consummate the transactions contemplated by this Agreement and Merger or the Arrangementexpiration or termination of any applicable waiting period, (yII) products sold to customers in significantly increase the ordinary and usual course risk of business (without limitation as to dollar amount) any Governmental Entity entering an order prohibiting the consummation of the Merger, or (zIII) otherwise in significantly increase the ordinary and usual course risk of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of being able to remove any such order on appeal or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Personotherwise;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants amend Parent's or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000Merger Sub's Organizational Documents;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiivi) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective commercially 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;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational DocumentsDocuments or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, indirect wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned SubsidiariesSubsidiaries and other than regular quarterly cash dividends not in excess of $0.165 per Share; or (E) repurchase, redeem or otherwise acquire, except in connection with the Stock Plans, 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 (A) 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 Company Voting Debt or any other property or assets (other than Company Common Shares issuable under the Stock Plans) except as set forth in Section 6.1(a)(iii) of the Company Option Plans)Disclosure Schedule; (B) other than as set forth on Section 6.1(a)(iii)(B) of the Company Disclosure Schedule, products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) tax-exempt indebtedness, indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,0002,000,000; provided, however, provided that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultationconsultation prior to incurring any such indebtedness; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures other than as set forth on Schedule 6.1(a)(iii) of the Company Disclosure Schedule or which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,0005,000,000; provided that prior to making any expenditure not set forth on Schedule 6.1(a)(iii) of the Company Disclosure Schedule, if practicable, the Company shall provide Parent with a reasonable right of consultation prior to making any such expenditure; and (E) by any means, make any acquisition of, or investment in (i) stock of or other interest in, any other Person or (ii) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) except as set forth in Section 6.1(a)(iv) of the Company Disclosure Schedule, or as required by the terms of this Agreement, neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementslaw, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s 's compensation budget with respect to employees at an annual a compensation level of less than $150,00080,000 a year, increase the compensation of any employee or employee, (C) except as approved by the Transition Team, hire any employee at an annual a compensation level expected to be more than $100,000100,000 a year;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice Refund or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law Laws or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective commercially 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;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; or (DB) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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 stockSubsidiaries;
(iii) neither it nor any of its Subsidiaries shall not (A) issueenter into any transaction, sellother than as contemplated pursuant to this Agreement, pledgeto the extent any such transaction would require approval of the stockholders of Parent under applicable law or stock exchange rules; or (B) enter into an agreement relating to any acquisition, dispose of merger, consolidation or encumber purchase that would reasonably be expected to (I) impose any shares material delay in the obtaining of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights significantly increase the risk of any kind to acquirenot obtaining, any shares of its capital stock of any class authorizations, consents, orders, declarations or any Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization approvals of any Governmental Entity in order necessary to consummate the transactions contemplated by this Agreement and Merger or the Arrangementexpiration or termination of any applicable waiting period, (yII) products sold to customers in significantly increase the ordinary and usual course risk of business (without limitation as to dollar amount) any Governmental Entity entering an order prohibiting the consummation of the Merger, or (zIII) otherwise in significantly increase the ordinary and usual course risk of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of being able to remove any such order on appeal or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Personotherwise;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants amend Parent's or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000Merger Sub's Organizational Documents;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiivi) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
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 in writing (which consent shall not be unreasonably withheld or delayed) Time, its business and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to in all material respects. To the extent consistent therewithwith the foregoing sentence, it the Company and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates 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 hereof until the Effective Time, except (A) as otherwise expressly required or permitted by this Agreement or the Voting Agreement, (B) as Purchaser may approve in writing (such approval not to be unreasonably withheld, delayed or conditioned), (C) as set forth in Section 5.1 of the Company Disclosure Letter or (D) as required by any applicable Laws (including any requirement of the SEC), the 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 documents;
(b) acquire or agree to acquire (i) by merging or consolidating with, or by purchasing a substantial portion of the stock, or other ownership interests in, or substantial portion of the assets of, or by any other manner, any business or any corporation, partnership, association, joint venture, limited liability company or other entity or division thereof or (ii) it shall not any assets that would be material, individually or in the aggregate, to the Company and its Subsidiaries, taken as a whole, except purchases of supplies, equipment, services and inventory in the ordinary course of business and except transactions involving only the Company and its wholly owned Subsidiaries;
(Ac) completely or partially liquidate the Company or adopt a plan of complete or partial liquidation with respect to the Company;
(d) other than (i) Shares issuable under the Company Options outstanding as of the date of this Agreement, (ii) Shares issuable in connection with the Company Awards outstanding as of the date of this Agreement, (iii) at any time after April 30, 2012, awards under the Stock Plan consistent with past practice, (iv) as may be required by the Revolving Credit Facility, and (v) subject to Section 3.3, 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 or encumber any capital stock of the Company or any its Subsidiaries (other than the issuance of shares by a wholly owned by it 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;
(e) make any loans, advances (except for advances to employees in respect of ordinary course business expenses) or capital contributions to or investments in any Person (other than the Company or any direct or indirect wholly owned Subsidiary of its Subsidiaries; (B) amend its Organizational Documents; (Cthe Company) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; ordinary course;
(Df) declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to any of any its capital stock other than (except for dividends from its paid by any direct or indirect wholly owned Subsidiaries; Subsidiary to the Company or (Eto any other direct or indirect wholly owned Subsidiary) repurchase, redeem or otherwise acquire, or permit enter into any agreement with respect to the voting of its Subsidiaries to capital stock;
(g) other than transactions involving a direct or indirect wholly owned Subsidiary of the Company, reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stockstock other than pursuant to the Stock Plan and the Company Awards;
(iiih) neither it nor 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 incurred in the ordinary course of business pursuant to the Revolving Credit Facility up to the amount at any one time reflected in the applicable “Weekly Borrowing Base Balance” contained in document 10.3.27 in the Data Room plus an additional $5,000,000 and (ii) guarantees incurred in compliance with this Section 5.1 by the Company or any of its direct or indirect wholly owned Subsidiaries of indebtedness of any direct or indirect wholly owned Subsidiary of the Company;
(i) except as set forth in the capital budgets contained in folders 3.1.2.1, 3.3.1, 3.3.2, 3.3.6, 5.10.2 5.10.3, 5.10.4, 10.3.3 and 10.3.16 of the Data Room and consistent therewith, make or authorize any capital expenditures in the aggregate in excess of $500,000;
(j) make any changes with respect to accounting policies or procedures, except as required by Law or changes in applicable GAAP;
(k) waive, release, assign, settle or compromise any material legal action (other than actions that are covered by Section 7.11 hereof), other than (i) in the ordinary course of business in an amount not to exceed $250,000 (net of any amount covered by insurance) and/or (ii) if the loss resulting from such waiver, release, assignment settlement or compromise is reasonably expected to be reimbursed to the Company or any of its Subsidiaries shall by an insurance policy (A) issue, sell, pledge, dispose of subject to any deductible 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 Company Voting Debt retention);
(other than Company Common Shares issuable under the Company Option Plans); (Bl) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by (i) make, revoke or change any meansmaterial Tax election, make (ii) settle or finally resolve any acquisitions ofTax contest with respect to a material amount of Tax, (iii) file any amended income or other material Tax Return that reflects a material increase in the tax liability of the Company, or investments (iv) prepare or file any material Tax Return other than in stock a manner consistent in all material respects with past practice, (v) consent to any extension or waiver of the limitation period applicable to any material Tax Return or any claim or assessment in respect of a material amount of Taxes, (vi) enter into any closing agreement relating to any material Tax liability, or other interest in(vii) give or assets request any waiver of a statute of limitation with respect to any other Personmaterial Tax Return;
(m) sell, lease, license, transfer, pledge, mortgage, encumber, grant or dispose of or enter into negotiations with respect to the disposition of any material assets of the Company, including the capital stock of Subsidiaries of the Company, other than (i) the sale of inventory in the ordinary course of business, (ii) the disposition of used, obsolete or excess equipment in the ordinary course of business, (iii) other dispositions in the ordinary course of business, (iv) neither it nor any Permitted Liens or (v) pursuant to any Contract existing and in effect as of the date hereof, true and complete copies of which are contained in the Data Room;
(n) enter into any (i) Contract containing any “change of control” or similar provision that would be triggered by the transactions contemplated hereby, or (ii) Affiliate Transaction;
(o) subject to Section 3.3, except as required pursuant to Contracts in effect prior to the date hereof or any Benefit Plan in effect prior to the date hereof, or as otherwise required by applicable Law and, at any time after April 30, 2012, awards under the Stock Plan consistent with past practice, (i) grant or provide any severance or termination payments or material benefits to any existing or former director, officer employee or consultant of the Company or any of its Subsidiaries, (ii) increase the compensation, bonus or pension, welfare, severance or other benefits of or pay any bonus to any current or former director, officer, employee or consultant of the Company or any of its Subsidiaries shall other than with respect to non-executive employees and in the ordinary course, in each case consistent with past practice, or make any new equity awards to any current or former director, officer, employee or independent contractor of the Company or any of its Subsidiaries, (Aiii) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, amend or terminate any Benefit Plan or arrangement that would be a Benefit Plan if in effect as of its material Contracts the date of this Agreement, or waiveamend the terms of any outstanding equity-based awards, release (iv) take any action to accelerate the vesting or assign payment, or fund or in any material rights other way secure the payment of compensation or claims;
benefits under any Benefit Plan, (viv) neither it nor change any of its Subsidiaries shall make actuarial or other assumptions used to calculate funding obligations with respect to any material Tax election Benefit Plan or file any material income Tax Return inconsistent with past practice to change the manner in which contributions to such plans are made or implement or adopt any change in its accounting principles or material accounting practicesthe basis on which such contributions are determined, in all cases other than except as may be required by applicable Law GAAP or by Canadian GAAP;
(viivi) neither it nor forgive any loans to any current or former directors, officers, employees or independent contractors of the Company or any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectSubsidiaries; andor
(viiip) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Golfsmith International Holdings Inc)
Interim Operations. (a) The Company Except as set forth in Section 3.1 of the Western Disclosure Letter, Western covenants and agrees as to itself and its the Transferred Subsidiaries that, after the date hereof and prior to the Effective Time Closing (unless Parent Protection One shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth in contemplated by this Agreement, the Stock Option Agreement or and the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterOption and Voting Agreement):
(ia) the business businesses of it and its the Transferred Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Western shall cause the Transferred Subsidiaries shall to use its respective all reasonable best efforts to preserve its their respective business organization organizations intact and maintain its their respective existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(iib) it neither Western nor any of its Subsidiaries shall not (Ai) issue, sell, pledge, dispose of of, encumber or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirectaccelerate, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquiremodify, or permit any amend the terms 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 (A) 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 any capital stock in any Transferred Subsidiary; (ii) amend the certificate of incorporation or by-laws of any Transferred Subsidiary; (iii) split, combine or reclassify the outstanding shares of capital stock of any class Transferred Subsidiary; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock of WestSec or Westar Security; (v) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of capital stock of any Transferred Subsidiary or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans)securities convertible into or exchangeable or exercisable for any shares of capital stock of any Transferred Subsidiary; (Bvi) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets, real, personal or mixed (including, without limitation, leasehold interests and intangible assets (including and capital stock of any Transferred Subsidiary) of its Subsidiaries); (C) any Transferred Subsidiary or permit any Transferred Subsidiary to incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yvii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior permit any Transferred Subsidiary to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregateby any means, are in excess permit any Transferred Subsidiary to make any acquisition of, or investment in, assets or stock of $10,000,000; and any other Person or entity, except for (EA) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired acquisitions of security monitoring accounts in the ordinary and usual course of business consistent with past practice, by any means, make any (B) other acquisitions of, or investments of security monitoring accounts not to exceed $5,000,000 in stock of the aggregate and (or C) other interest in) or assets of any other Personcapital expenditures not to exceed $500,000 in the aggregate;
(ivc) neither it Western nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees of any Transferred Subsidiary except as required by any Laws grants, awards or the terms of applicable collective bargaining agreements, (B) other than increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000and benefit grants, increase the compensation of any employee awards or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000increases);
(vd) except in the ordinary and usual course of business, neither it Western nor any of its Subsidiaries shall settle or compromise any material claims or litigation or involving any Transferred Subsidiary or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts to which a Transferred Subsidiary is party or waive, release or assign any material rights or claimsclaims of any Transferred Subsidiary;
(vie) neither it Western nor any of its Subsidiaries shall make any material Tax election with respect to Taxes payable by any Transferred Subsidiary or file permit any material income Tax Return inconsistent with past practice insurance policy naming any Transferred Subsidiary as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viif) neither it Western nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiig) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent . Except as set forth in Section 3.1 of the Protection One Disclosure Letter, Protection One covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time Closing (unless the Company Western shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth in contemplated by this Agreement, the Stock Option Agreement or and the corresponding subsection of Section 3.1(b) of the Parent Disclosure LetterOption and Voting Agreement):
(ih) the business of it Protection One and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it Protection One and each of its Subsidiaries shall use its respective all reasonable best efforts to preserve its their respective business organization organizations intact and maintain its their respective existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(iii) it neither Protection One nor any of its Subsidiaries shall not (Ai) issue, sell, pledge, dispose of of, encumber or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19accelerate, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquiremodify, or permit any amend the terms 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 (A) 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 any capital stock of any class Protection One or any Parent Voting Debt of its Subsidiaries; (ii) amend the certificate of incorporation or by-laws of Protection One or any of its Subsidiaries; (iii) split, combine or reclassify the outstanding shares of capital stock of Protection One or any of its Subsidiaries; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than Parent Common Stock issuable under dividends from Protection One's direct or indirect wholly-owned Subsidiaries and the Parent Stock Plans)dividend and other distributions referred to in the recitals to this Agreement; or (v) repurchase, redeem or otherwise acquire any shares of capital stock or any securities convertible into or exchangeable or exercisable for any shares of capital stock of Protection One or any of its Subsidiaries; (Bvi) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets, real, personal or mixed (including, without limitation, leasehold interests and intangible assets and (including capital stock of any of its Protection One's Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (zvii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregateby any means, are in excess make any acquisition of, or investment in, assets or stock of $10,000,000; and any other Person or entity, except for (EA) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired acquisitions of security monitoring accounts in the ordinary and usual course of business consistent with past practice, by any means, make any (B) other acquisitions of, or investments of security monitoring accounts not to exceed $5,000,000 in stock of the aggregate and (or C) other interest in) or assets of any other Personcapital expenditures not to exceed $500,000 in the aggregate;
(ivj) neither it Protection One nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Protection One Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except as required by any Laws grants, awards or the terms of applicable collective bargaining agreements, (B) other than increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and Parent’s related compensation budget with respect to employees at an annual compensation level of less than $150,000and benefit grants, increase the compensation of any employee awards or (Cincreases) except as approved by for the Transition Team, hire any employee at an annual compensation level expected bonuses referred to be more than $100,000in the recitals to this Agreement;
(vk) except in the ordinary and usual course of business, neither it Protection One nor any of its Subsidiaries shall settle or compromise any material claims or litigation or or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vil) neither it Protection One nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAPthe ordinary and usual course of business;
(viim) neither it Protection One nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiin) neither it Protection One nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after from the date hereof and prior to of this Agreement until the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) 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 each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve its the assets and properties of the Company and to preserve their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessorsvendors, 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, (C) as required by applicable Laws 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 or propose any change in its charter or bylaws or other applicable governing instruments;
(ii) it shall not merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among Subsidiaries of the Company, or restructure, reorganize or completely or partially liquidate the Company;
(Aiii) 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 agreements, contracts or other documents in effect as of the date of this Agreement or the creation and ownership of newly formed wholly owned Subsidiaries;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer or encumbrance of, any shares of or encumber any capital stock owned by it of the Company or any its Subsidiaries (other than (A) the issuance of Shares upon the exercise of Company Options or Warrants, and the settlement of Restricted Stock (and dividend equivalents thereon, if applicable), in any each case pursuant to the terms of its Subsidiaries; the Stock Plans and Warrants as in effect on the date hereof, (B) amend its Organizational Documents; the issuance of shares of capital stock by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary of the Company or (C) other than in the case pledge of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock of Subsidiaries of the Company in connection with the Financing Agreement), or securities convertible or exchangeable into or exercisable for any shares of such capital stock; (D) declare, set aside or pay any dividend payable in cashoptions, warrants or other rights of any kind to acquire any shares of such capital stock or property such convertible, exchangeable or exercisable securities;
(v) make any loans, advances or capital contributions to or investments in respect of any capital stock Person (other than dividends from its the Company or any direct or indirect wholly owned Subsidiaries; Subsidiary of the Company) in excess of $500,000 in the aggregate;
(vi) declare, set aside, make or (E) repurchasepay any dividend or other distribution, redeem payable in cash, stock, property or otherwise acquireotherwise, or permit with respect to any of its Subsidiaries capital stock (except for 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 enter into any agreement with respect to the voting of its capital stock;
(vii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stockstock (other than the (A) acquisition of any Shares tendered by current or former employees or directors consistent with past practices pursuant to the Stock Plans (including in order to pay Taxes in connection with the exercise of Company Options or the settlement of Restricted Stock) or (B) acquisition of any shares of capital stock of a wholly owned Subsidiary of the Company by the Company or any wholly owned Subsidiary of the Company);
(iiiviii) neither it nor incur any Specified Indebtedness or guarantee such Specified 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 shall (ASubsidiaries, except in each case for incurrences, guarantees, issuances or sales of Specified Indebtedness to the extent that Section 5.1(e)(iv) issue, sell, pledge, dispose of would not be breached as a result thereof and except for transactions between or encumber among the Company or 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 Subsidiaries, with or among the Company and any other Subsidiaries;
(ix) adopt or enter into a plan of any class complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of the Company or any Company Voting Debt Subsidiary (other than Company Common Shares issuable under this Agreement, the Merger or as otherwise permitted hereunder pursuant to Section 6.2);
(x) except as set forth in the capital budgets set forth in Section 6.1(a)(ix) of the Company Option Plans); Disclosure Letter, make or authorize any capital expenditure in excess of $1,000,000 in the aggregate;
(Bxi) make any material changes with respect to accounting policies or procedures, except as required by changes in GAAP or a Governmental Entity;
(xii) settle any litigation or other proceedings before a Governmental Entity for an amount in excess of $500,000 or any obligation or liability of the Company in excess of such amount;
(xiii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount consistent with past practice, make, change or rescind any material Tax election, change any method of more than $5,000,000Tax accounting, settle or compromise any material Tax liability, file any material amended Tax Return, enter into any closing agreement relating to Taxes, or waive or extend any material Tax statute of limitations;
(xiv) transfer, sell, lease, license, guarantee, sell, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets, product lines or encumber any other property businesses of the Company or assets (its Subsidiaries, including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between , in each case which are material to the Company and its wholly owned Subsidiaries taken as a whole, other than (A) in the ordinary course of business and consistent with past practice, (B) pursuant to agreements, contracts or between such wholly owned Subsidiaries or (y) indebtedness other documents in an aggregate amount less than $30,000,000; provided, however, that effect prior to incurring any indebtednessthe date of this Agreement, if practicable, and (C) transactions between or among the Company shall provide Parent or any of its Subsidiaries, with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between among the Company and its wholly owned Subsidiaries or between such wholly owned any other Subsidiaries; ;
(Dxv) except as approved by required pursuant to Benefit Plans, agreements, contracts or other documents in effect prior to the Transition Teamdate of this Agreement disclosed or made available to Parent, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause required by applicable Laws, (DA) immediately above and grant or provide any severance or termination payments or benefits to any director or officer of the Company or any of its Subsidiaries, or to any other than raw materials, supplies and other inventory items acquired employee of the Company or any of its Subsidiaries except in the ordinary and usual course of business consistent with past practice, by any means, (B) increase the compensation or make any acquisitions new equity awards to any director, officer or other employee of the Company or any of its Subsidiaries, except for increases in compensation to employees that are not officers in the ordinary course of business and consistent with past practice, (C) establish, adopt, terminate or materially amend any Benefit Plan (other than routine changes to welfare plans for 2009), (D) make any equity-based or other compensation awards to any director, officer or other employee of the Company or any of its Subsidiaries, except pursuant to commitments or agreements in effect on the date hereof or (E) take any action to fund, or require the funding of, any compensation or investments in stock of (or other interest in) or assets of benefits under any other PersonBenefit Plan;
(ivxvi) neither it nor enter into or amend in any material respect any transaction or agreement between (i) the Company or any Subsidiaries, on the one hand, and (ii) any affiliate of the Company (other than any of the Company’s Subsidiaries), on the other hand, of the type that would be required to be disclosed under Item 404 of Regulation S-K promulgated by the SEC;
(xvii) knowingly take or permit any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is intended to or reasonably expects would cause any likely to prevent the consummation of its representations and warranties herein the Merger (other than as permitted pursuant to become untrue in any material respectSection 6.2); andor
(viiixviii) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, knowingly take 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is intended to or reasonably expects would cause any of its representations and warranties herein likely to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any prevent the consummation of the foregoingMerger.
Appears in 1 contract
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 approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) withheld, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practices and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially 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;
(iib) it shall not not, (Ai) issue, sell, pledge, sell otherwise dispose of or encumber any capital stock owned by it in subject to Lien (other than Permitted Liens) any of its Subsidiaries' Capital Stock owned by it; (Bii) amend its Organizational Documentscharter, by-laws or, except for any amendment which will not hinder, delay or make more costly to Parent the Offer or the Merger; the Rights Agreement; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stockCapital Stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock Capital Stock other than dividends from its direct or indirect wholly owned Subsidiariesthe issuance of Rights in connection with the issuance of Capital Stock upon the exercise of Company Options; or (Ev) repurchase, redeem or otherwise acquire, acquire or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Capital Stock; or any securities convertible into or exchangeable or exercisable for any shares of its capital stockCapital Stock; or (vi) adopt a plan of complete or partial liquidation or dissolution, merger or otherwise restructure or recapitalize or consolidate with any Person other than Merger Sub or another wholly-owned Subsidiary of Parent;
(iiic) neither it nor any of its Subsidiaries shall (Ai) authorize for issuance or issue, sell, pledge, sell or otherwise dispose of or encumber subject to any Lien (other than Permitted Liens) 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 Capital Stock of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.any
Appears in 1 contract
Interim Operations. (a) The Company covenants From and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless earlier of the termination of this Agreement or the consummation of the Merger, the businesses of the Company and its Subsidiaries shall be operated and conducted in the ordinary course, except as otherwise contemplated by this Agreement, as required by applicable Laws or as Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld withheld, conditioned or delayed). Parent shall not take or permit any of its Subsidiaries (including, for this purpose, the Company or its Subsidiaries) and except as otherwise expressly to take any action or omit to take any action that is reasonably likely to (i) result in any of the conditions of the Merger set forth in Article VIII not being satisfied or (ii) prevent the consummation of the Merger. Without limiting the generality of the foregoing, from and after the date hereof and prior to the earlier of the termination of this Agreement or the corresponding subsection of Section 3.1(a) consummation of the Merger, the Company Disclosure Letter):
(i) the business of it shall not, and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each not permit any of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customersto, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, grant, transfer, encumber or otherwise dispose of or encumber any shares of capital stock owned by it in or other equity interests of the Company or any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 or other equity interests of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend or other distribution payable in cash, stock or property in (or any combination thereof) with respect of any to its capital stock or other than equity interests (x) except dividends from its or other distributions in cash, stock or property paid by any direct or indirect wholly owned Subsidiaries Subsidiary of the Company to the Company or to any other direct or indirect wholly owned Subsidiary of the Company).
(b) As a result of entering into this Agreement, neither Parent nor Merger Sub, directly or indirectly, has the right to control or direct the Company’s or its Subsidiaries’ operations prior to the Effective Time, and (y) regular quarterly cash dividends notwithstanding anything to the contrary contained in respect this Agreement, no consent of Parent Common Stockor Merger Sub will be required with respect to any matter set forth in this Agreement to the extent that the requirement of such consent would violate any applicable Law. Prior to the Effective Time, not in excess subject to applicable Law and the rights of $0.26 per share per quarterstockholders of the Company thereunder, with declaration and record dates the Company shall exercise, consistent with past practice; or (E) repurchasethe terms and conditions of this Agreement, redeem or otherwise acquire, or permit any of complete control and supervision over 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement operations and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any operations of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Cadus Corp)
Interim Operations. (a) The Except as otherwise expressly contemplated by this Agreement, as set forth in Section 5.1 of the Company covenants and agrees as Disclosure Schedule, or otherwise consented to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (by Purchaser, which consent shall not be unreasonably conditioned, withheld or delayed, the Company and the Owners covenant and agree that, prior to the Closing:
(a) The business and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) operations of the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent Ordinary Course of Business consistent therewith, it and each of its Subsidiaries with past practice;
(b) The Company shall use its respective commercially reasonable best efforts to preserve keep intact its rights, properties and assets, and employee, independent contractor, supplier, customer and other business organization intact relationships;
(c) The Company shall use its commercially reasonable efforts to keep and maintain its existing relations rights, properties and goodwill with customersassets in their present condition, suppliersrepair and working order, distributors, creditors, lessors, employees except for normal depreciation and business associateswear and tear;
(iid) it The Company shall not (Ai) authorize for issuance, issue, deliver, sell, pledgegrant options, dispose warrants or rights to receive, purchase or subscribe for, or agree or commit to issue, sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any capital stock owned by it in any equity interests of its Subsidiaries; such Company (B) amend its Organizational Documents; including securities convertible into, or rights or options to acquire, equity interests of such Company), (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (Eii) repurchase, redeem or otherwise acquire any equity interests of such Company (including securities convertible into, or rights or options to acquire, equity interests of such Company), or permit any of its Subsidiaries to purchase (iii) amend or otherwise acquire, any shares of change its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stockOrganizational Documents;
(iiie) neither it nor any of its Subsidiaries The Company shall (A) issuenot acquire, sellincluding by merging or consolidating with, pledge, dispose of or encumber any shares purchasing the assets or equity interests of, or securities convertible into in any other manner, any business or exchangeable any corporation, partnership, association or exercisable forother business organization or division thereof, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is or commitments in an amount in excess of Twenty-Five Thousand Dollars ($1,000,000 or, 25,000) in the aggregate, are other than pursuant to existing agreements;
(f) The Company shall not (i) increase in excess of $10,000,000; any manner the compensation or fringe benefits of, or pay any bonus to, any current or former director, manager, officer, employee or independent contractor, other than (A) increases and bonuses expressly contemplated by or required under existing employment or consulting agreements or bonus plans, and (EB) increases in compensation to employees in the Ordinary Course of Business, (ii) except as otherwise provided required to comply with applicable Law, become obligated under any Benefit Plan that was not in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after existence on the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in of this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate any Benefit Plan in existence on the Parent Rights date of this Agreement; , or (C3) other than in the case of any direct or indirectexcept as required to comply with applicable Law, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable benefit not required by any Benefit Plan as in cash, stock or property in respect effect as of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect the date of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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 stockthis Agreement;
(iiig) neither it nor any of its Subsidiaries The Company shall (A) issue, not 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, subject to any Lien (other than a Permitted Lien) or otherwise encumber or dispose of (including through any sale-leaseback or encumber similar transaction) any of its properties or assets, other property than (i) pursuant to existing agreements, (ii) immaterial properties or assets (including or immaterial portions of properties or assets), (iii) in the Ordinary Course of Business;
(h) The Company shall not (i) make or forgive any Company Indebtedness, loans, advances or capital stock contributions to, or investments in, any Person, other than trade accounts receivable incurred in the Ordinary Course of Business and cash advances to employees of the Company for reimbursable travel and other business expenses incurred in the Ordinary Course of Business, (ii) assume, guarantee or otherwise become liable or responsible (whether directly, contingently or otherwise) for the Indebtedness or other obligations of any other Person, or (iii) enter into any “keep well” or other agreement to maintain any financial statement condition of another Person;
(i) The Company shall not adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company;
(j) The Company shall not (i) enter into, or materially amend, modify or supplement outside the Ordinary Course of Business, any Material Contract or (ii) waive, release, grant, assign or transfer any of its Subsidiariesmaterial rights or claims (whether such rights or claims arise under a Material Contract or otherwise); ;
(Ck) incur The Company shall (i) comply in all material respects with its obligations under the Material Contracts as such obligations become due, (ii) maintain insurance covering risks of such types and in such amounts as are consistent with its past practices, and (iii) not to permit any insurance policy naming it as beneficiary or modify any indebtedness loss payable payee to be canceled or terminated;
(l) The Company shall not abandon, fail to maintain or allow to expire (other than at the natural expiration of its terms), or sell or exclusively license to any Person, any material Company Intellectual Property, except in the exercise of commercially reasonable business judgment consistent with industry practices;
(xm) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries The Company shall not fail to pay or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring satisfy when due any indebtedness, if practicable, Parent shall provide material Liability of the Company with a reasonable right of consultation; provided, further, (other than any such Liability that the foregoing right of consultation is being contested in good faith);
(n) The Company shall not apply in settle or compromise any Action pending before any Governmental Authority, or any other material Action, against the case of indebtedness in respect of commercial paperCompany, letters of credit, guarantees other than settlements or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures compromises which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Persondo not involve money damages;
(ivo) neither it nor The Company shall not (i) change any of its Subsidiaries shall material accounting policies, practices or procedures (A) terminateincluding material tax accounting policies, establishpractices and procedures), adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws applicable Law or the terms of applicable collective bargaining agreementsGAAP, (Bii) other than revalue in the ordinary and usual course any material respect any of business consistent with past practice and Parent’s compensation budget its assets (including writing down or writing off any notes or accounts receivable in any material manner), except as required by GAAP, (iii) make or change any material tax election, make or change any material method of accounting with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) Taxes except as approved required by the Transition Teamapplicable Law, hire any employee at an annual compensation level expected to be more than $100,000;
(viv) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims Liability for any Tax, or litigation or modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(viv) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income amended Tax Return inconsistent with past practice or implement or adopt that would materially increase the Liability of the Company for any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectTax after the Closing; and
(viiip) neither it nor any of its Subsidiaries will authorize The Company shall not agree or enter into an agreement commit to do take any of the foregoingforegoing actions prohibited by this Section 5.1. Notwithstanding anything to the contrary set forth in this Agreement, the parties acknowledge and agree that neither Purchaser nor its Affiliates have the right to control or direct the Company’s operations prior to the Closing. Prior to the Closing, the Company shall exercise, consistent with the terms of this Agreement, complete control and supervision over its operations.
Appears in 1 contract
Sources: Membership Interest Purchase Agreement (Amn Healthcare Services Inc)
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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective commercially 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;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational DocumentsDocuments or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, indirect wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned SubsidiariesSubsidiaries and other than regular quarterly cash dividends not in excess of $0.165 per Share; or (E) repurchase, redeem or otherwise acquire, except in connection with the Stock Plans, 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 (A) 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 Company Voting Debt or any other property or assets (other than Company Common Shares issuable under the Stock Plans) except as set forth in Section 6.1(a)(iii) of the Company Option Plans)Disclosure Schedule; (B) other than as set forth on Section 6.1(a)(iii)(B) of the Company Disclosure Schedule, products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) tax-exempt indebtedness, indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,0002,000,000; provided, however, provided that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultationconsultation prior to incurring any such indebtedness; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures other than as set forth on Schedule 6.1(a)(iii) of the Company Disclosure Schedule or which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,0005,000,000; provided that prior to making any expenditure not set forth on Schedule 6.1(a)(iii) of the Company Disclosure Schedule, if practicable, the Company shall provide Parent with a reasonable right of consultation prior to making any such expenditure; and (E) by any means, make any acquisition of, or investment in (i) stock of or other interest in, any other Person or (ii) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) except as set forth in Section 6.1(a)(iv) of the Company Disclosure Schedule, or as required by the terms of this Agreement, neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementslaw, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual a compensation level of less than $150,00080,000 a year, increase the compensation of any employee or employee, (C) except as approved by the Transition Team, hire any employee at an annual a compensation level expected to be more than $100,000100,000 a year;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice Refund or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law Laws or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective commercially 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;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; or (DB) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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 stockSubsidiaries;
(iii) neither it nor any of its Subsidiaries shall not (A) issueenter into any transaction, sellother than as contemplated pursuant to this Agreement, pledgeto the extent any such transaction would require approval of the stockholders of Parent under applicable law or stock exchange rules; or (B) enter into an agreement relating to any acquisition, dispose of merger, consolidation or encumber purchase that would reasonably be expected to (I) impose any shares material delay in the obtaining of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights significantly increase the risk of any kind to acquirenot obtaining, any shares of its capital stock of any class authorizations, consents, orders, declarations or any Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization approvals of any Governmental Entity in order necessary to consummate the transactions contemplated by this Agreement and Merger or the Arrangementexpiration or termination of any applicable waiting period, (yII) products sold to customers in significantly increase the ordinary and usual course risk of business (without limitation as to dollar amount) any Governmental Entity entering an order prohibiting the consummation of the Merger, or (zIII) otherwise in significantly increase the ordinary and usual course risk of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of being able to remove any such order on appeal or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Personotherwise;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000Merger Sub’s Organizational Documents;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiivi) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The From the date of this Agreement until the earlier of the Effective Time and termination of this Agreement in accordance with its terms, the Company covenants and agrees as to itself and its Subsidiaries that, after from the date hereof and prior to of this Agreement until the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) Time, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective reasonable best efforts to (x) preserve its intact their business organization intact organizations, assets and lines of business and (y) maintain its and their existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associatesagents. 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), (C) as required by applicable Laws or definitive interpretations thereof or by any Governmental Entity or (D) as set forth in Section 4.1(a) of the Company Disclosure Letter, the Company will not, and will not permit its Subsidiaries, to:
(i) adopt any amendments to its charter or bylaws or, in the case of any Subsidiary that is not a corporation, similar applicable organizational documents;
(ii) it shall not (A) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, business combination, restructuring, recapitalization or other reorganization (other than this Agreement), (B) acquire by merging or consolidating with, or by purchasing an equity interest in or portion of the assets of (other than as set forth in Section 4.1(a)(iii)), or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof, (C) take or omit to take any action that would cause any rights under Material Intellectual Property, including with respect to any registrations or applications for registration, to lapse, be abandoned or canceled, or fall into the public domain, other than actions or omissions in the ordinary course of business consistent with past practice and not otherwise in violation of this Section 4.1 or (D) enter into a joint venture or partnership or similar third-party business enterprise;
(iii) acquire assets outside of the ordinary course of business or capital stock from any other Person, other than (A) acquisitions of assets at or below fair market value with a purchase price not in excess of $500,000 individually or $2,000,000 in the aggregate, in each case for any transaction or series of related transactions, and capital expenditures permitted by clause (x) of this Section 4.1 and (B) acquisitions pursuant to the Contracts in effect as of the date of this Agreement set forth on Section 4.1(a) of the Company Disclosure Letter;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer or encumbrance of, any shares of or encumber any capital stock owned by it in of the Company or any its Subsidiaries (other than (A) the issuance of its Subsidiaries; Shares upon the exercise of Company Options and the settlement of Restricted Shares, Restricted Stock Units, and Performance Stock Units (and dividend equivalents thereon, if applicable) outstanding on the date of this Agreement or (B) amend its Organizational Documents; the issuance of shares of capital stock by a Subsidiary of the Company to the Company or another Subsidiary of the Company) 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, exchangeable or exercisable securities;
(Cv) make any loans, advances or capital contributions to or investments in any Person (other than in the case of Company or any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares indirect Subsidiary of capital stock; the Company);
(Dvi) (A) declare, set aside or pay any dividend or other distribution, whether payable in cash, stock or property in other property, with respect of to its capital stock, except for dividends by any capital stock other than dividends from its wholly owned direct or indirect Subsidiary of the Company to the Company or any other wholly owned Subsidiaries; direct or indirect Subsidiary of the Company, (EB) repurchasesplit, redeem combine or otherwise acquire, reclassify the Shares or permit any other outstanding capital stock of the Company or any of its the Subsidiaries of the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution therefor (other than issuances to the Company or another wholly owned Subsidiary of the Company), (C) redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares other Rights of its capital stock;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries), except for acquisitions, or deemed acquisitions, of Shares or other equity securities of the Company in connection with (1) the satisfaction of Tax withholding obligations with respect to Company Options, Restricted Shares, Restricted Stock Units or Performance Stock Units outstanding on the date of this Agreement, (2) the payment of the exercise price of Company Options outstanding on the date of this Agreement with Shares (including in connection with “net exercises”) and (3) forfeitures of Company Options, Restricted Shares, Restricted Stock Units or Performance Stock Units, in each case, outstanding on the date of this Agreement, pursuant to their terms as in effect on the date of this Agreement, and except for acquisitions or deemed acquisitions of Shares or other equity securities of the Company or any of its wholly owned Subsidiaries by the Company or any of its wholly owned Subsidiaries, or (D) enter into any agreement, understanding or arrangement with respect to the sale, voting, registration or repurchase of the Company’s capital stock or other Rights of the Company or any of its Subsidiaries; provided that nothing contained herein shall prohibit dividends and distributions paid or made on a pro rata basis by direct or indirect Subsidiaries of the Company in the ordinary course consistent with past practice;
(Cvii) incur redeem, repurchase, prepay, defease, incur, assume, endorse, guarantee or otherwise become liable for or modify the terms of any indebtedness other than (x) indebtedness existing solely between Indebtedness of the Company and its wholly owned Subsidiaries in excess of $700,000 (it being understood that the terms of any such Indebtedness shall permit the repayment of such Indebtedness upon the Closing Date without premium or between such wholly owned Subsidiaries penalty). “Indebtedness” of any Person means (A) all indebtedness for borrowed money, (B) any other indebtedness which is evidenced by a note, bond, indenture, debenture or similar Contract, (C) all reimbursement obligations with respect to (1) letters of credit, bank guarantee or bankers’ acceptances or (y2) indebtedness surety, customs, reclamation or performance bonds (in an aggregate amount less than $30,000,000; providedeach case not related to judgments or litigation) other than, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials2), supplies and other inventory items acquired those entered into in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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 all guarantees by such Person for any shares of its capital stock;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets obligations of any other Person constituting Indebtedness of such other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
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 Acquiror shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(aAgreement) of the Company Disclosure Letter):
(i) 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 each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, key employees and business associatesassociates and keep available the services of its and its Subsidiaries’ present key employees. 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 Acquiror may approve in writing (such approval not to be unreasonably withheld or delayed) or (C) as set forth in Section 6.1 of the Company Disclosure Schedule, it 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) it shall not (A) issue, sell, pledge, dispose of merge or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct consolidate itself or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to with any other Person, except for any such transactions among its wholly owned Subsidiaries, or restructure, reorganize or completely or partially liquidate;
(iii) acquire any business or Person by merger or consolidation, purchase or otherwise acquirelease of all or substantially all assets, or by any other manner, in a single or series of related transactions;
(iv) issue, sell or deliver, or authorize the issuance, sale or delivery of, any shares of its capital stock or of any of its Subsidiaries (other than the issuance of shares by its 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;
(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 it or to any other direct or indirect wholly owned Subsidiary or distributions made pursuant to Section 6.1(b));
(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 stockstock (it being understood that the net settlement of Company Awards including any deemed purchase of Shares in connection therewith shall not be covered by this clause (vi));
(iiivii) neither it nor (A) incur any indebtedness for borrowed money, or guarantee such indebtedness of another Person, except pursuant to the existing credit facilities of the Company or its Subsidiaries or the credit facilities contemplated in clause (B) in the ordinary course of business consistent with past practice, (B) enter into new credit facilities other than credit facilities that do not require commitment fees or non-usage fees and are for aggregate borrowings not in excess of $150,000,000, provided that the Company five (5) days prior written notice to Acquiror prior to entry into any such new credit facility, (C) issue or sell any debt securities or other rights to acquire any of its debt securities or of any of its Subsidiaries, or (D) cancel, modify or waive any debts or claims held by the Company or any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more greater than $5,000,000100,000, other than in connection with foreclosures, loan modifications, reformations or extensions in the ordinary course of business consistent with past practice, provided the Company provides Acquiror with five (5) days’ prior written notice to Acquiror of any such modifications, reformations or extensions;
(viii) except as contemplated by the Company plan previously provided by the Company to Acquiror, make or authorize any capital expenditure in excess of $200,000 in the aggregate during any 12-month period;
(ix) enter into any Contract that would have been a material contract as defined in Item 601 of Regulation S-K (a “Material Contract”) had it been entered into prior to the date hereof, except as otherwise specifically permitted in this Section 6.1(a);
(x) make any material changes with respect to accounting policies or procedures, except as required by changes in applicable generally accepted accounting principles;
(xi) settle any litigation or other proceedings before a Governmental Entity, other than settlements involving payments that are not individually in excess of $100,000 or in the aggregate in excess of $500,000 and which are not reasonably likely to establish an adverse precedent or basis for subsequent settlements, provided the Company provides five (5) days prior written notice to Acquiror of any such proposed settlement;
(xii) amend, modify or terminate any Material Contract, except as otherwise specifically permitted in this Section 6.1(a);
(xiii) make any material Tax election;
(xiv) transfer, sell, lease, license, guarantee, sell, 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 encumber any other property businesses or assets (of its Subsidiaries, including capital stock of any of its Subsidiaries); (C) incur or modify , except any indebtedness other than (x) indebtedness existing solely between the Company such transactions among it and its wholly owned Subsidiaries and except for Liens pursuant to the Company’s or between such wholly owned Subsidiaries any of its Subsidiaries’ existing lines of credit or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right sale of consultation; provided, further, that the foregoing right of consultation shall not apply mortgages in the case ordinary course of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; business consistent with past practice;
(Dxv) except as approved by required pursuant to agreements or policies and procedures in effect prior to the Transition Teamdate of this Agreement, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided required by applicable Law, (1) provide any severance or termination payments to any of its directors, officers or employees or of any of its Subsidiaries, (2) 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 or of any of its Subsidiaries, except for increases in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired base salary in the ordinary and usual course of business consistent with past practice for any individual who has a base salary that is less than or equal to $100,000 or (3) establish, adopt, amend or terminate any of its benefit plans, except in each case in the ordinary course of business consistent with past practice, by or amend the terms of any meansoutstanding equity-based awards; provided, make any acquisitions however, that the Company and its Subsidiaries shall be permitted to amend their respective Benefit Plans to comply with section 409A of the Code, but only to the extent that such amendments shall not accelerate the payment of, or investments in stock of (or other interest in) or assets of any other Personincrease the underlying benefits provided under, such Benefit Plans;
(ivxvi) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause likely to result in any of its representations and warranties herein the conditions to become untrue the Merger set forth in any material respectArticle VII not being satisfied; andor
(viiixvii) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent Notwithstanding anything to the contrary in this Agreement, prior to the Closing Date, the Company shall declare and pay one or more dividends to its stockholders distributing cash in an amount equal to the Company’s estimated “real estate investment trust taxable income” (as such term is used in Section 857 of the Code and reflecting any dividends previously paid during the tax year that would be expected to give rise to a dividends paid deduction for such tax year, but before reduction for the dividend contemplated by this Section 6.1(b)) for the tax year of the Company ending with the Merger, plus any other amounts required to be distributed in order for the Company to qualify as a REIT for such year and to avoid to the extent reasonably possible the incurrence of income or excise tax by the Company.
(c) Prior to making any written or oral communications to any of the directors, officers or employees of the Company or its Subsidiaries pertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement, the Company and Acquiror shall provide each other with a copy of the intended communication, the receiving party shall have 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.
(d) Acquiror covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(bAgreement) of the Parent Disclosure Letter):
(i) 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 each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, key employees and business associatesassociates and keep available the services of its and its Subsidiaries’ present key employees. 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 Company may approve in writing (such approval not to be unreasonably withheld or delayed) or (C) as set forth in Section 6.1 of the Acquiror Disclosure Schedule, it 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) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to any of any its capital stock other than (x) except for dividends from its paid by any direct or indirect wholly owned Subsidiaries Subsidiary to it or to any other direct or indirect wholly owned Subsidiary and (y) regular quarterly cash any dividends payable by Acquiror’s real estate investment trust on its outstanding 9.75% Series A Perpetual Cumulative Preferred Stock in respect accordance with the terms of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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 stockthe charter documents governing such securities);
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause likely to result in any of its representations and warranties herein the conditions to become untrue the Merger set forth in any material respectArticle VII not being satisfied; andor
(viiiiv) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
Appears in 1 contract
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 date on which Purchaser's nominees comprise a majority of the Board of Directors of the Company (unless Parent Praxair shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact and maintain its existing relations rela- tions and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;; 27
(ii) it shall not (A) issue, sell, pledge, dispose of sell or encumber pledge any capital stock owned by it in any of its Subsidiaries; (B) amend the Company Charter or its Organizational Documentsby-laws or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock Shares or Preferred Shares other than regular quarterly or semi- annual cash dividends from its direct not in excess of $0.12 per Share and regular quarterly or indirect wholly owned Subsidiariessemi-annual cash dividends on the Preferred Shares; or (E) 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 stockstock except in connection with the ordinary course of operations of the CBI Salaried Employee Stock Ownership Plan (1987);
(iii) neither it nor any of its Subsidiaries shall except as disclosed in Section 7.1(a) of the Company Disclosure Letter (A) issue, sell, pledge, dispose of or encumber encumber, or authorize or propose the issuance, sale, pledge, disposition or encumbrance of, 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 Company Voting Debt or any other property or assets (other than Company Common Shares issuable pursuant to options outstanding on the date hereof under the Company Option Plans)Stock Plan or upon conversion of Convertible Preferred Shares; (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000busi- ness, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of any other property or assets or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yC) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring make any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Teamcommitments for, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materialsexisting capital expenditures required to be made pursuant to existing capital projects, supplies and other inventory items acquired as set forth in Section 7.1(a)(iii) of the ordinary and usual course of business consistent with past practiceCompany Disclosure Letter, which have been previously authorized or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other PersonPerson or entity;
(iv) except as disclosed in Section 7.1(a) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by or increase the salary, wage, bonus or other compensation of any Laws or the terms of applicable collective bargaining agreements, (B) employees other than increases in compensation in the ordinary and usual course 28 of business business, in each case, consistent with past practice practices with regard to frequency and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000amount;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any the ordinary and usual course of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectbusiness; and
(viiivii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. Except as SN may otherwise consent in writing, between the date of this Agreement and the date of the Closing and except as contemplated by this Agreement, to the extent within its control, Altpoint shall not (nor shall it, to the extent within its control under the Redemption Agreement, permit Resources or Acquisition, through the granting of a consent or waiver thereunder, except as expressly required therein, to):
(a) The Company covenants sell, transfer, assign, convey or otherwise dispose of any Properties other than (i) oil, gas and agrees as other hydrocarbons produced, saved and sold in the ordinary course of business, (ii) personal property and equipment which is replaced with property and equipment of comparable or better value and utility in the ordinary and routine maintenance and operation of the Properties and (iii) sales, transfers, assignments, conveyances or other dispositions by and between Resources and Acquisition;
(b) create or permit the creation of any Encumbrance on the Properties, other than Permitted Encumbrances;
(c) grant any preferential right to itself and its Subsidiaries that, after purchase or similar right or agree to require the date hereof and prior consent of any party to the Effective Time transfer and assignment of the Properties to SN;
(unless Parent shall otherwise d) designate any Person, other than ▇▇▇▇▇▇▇ Oil & Gas Corporation, as an operator of the Properties;
(e) incur or agree to incur any contractual obligation or liability, whether absolute, contingent, matured or unmatured, which would constitute an assumed liability by SN as provided in Section 6 above; provided, that Altpoint may incur such obligations or liabilities in the ordinary course of business or in the ordinary and routine maintenance and operation of the Properties with the consent in writing (of SN, which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, howeverthat any such obligation or liability incurred with SN’s consent would not, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees either individually or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess have a material adverse effect on any of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other PersonProperties;
(ivf) neither it nor enter into any transaction the effect of which, considered as a whole, would be to cause Altpoint’s ownership interest in any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected Properties to be more than $100,000;altered from its ownership interest as of the date hereof; or
(vg) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle agree 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) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as foregoing or to itself and its Subsidiaries that, after grant a waiver of any covenant for the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection benefit of Altpoint under Section 3.1(b) 8.1 of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Redemption Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, that after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (approve, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it the Company and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective best reasonable best efforts to (A) preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates and (B) maintain and keep material properties and assets in as good repair and condition as such are in as of the date hereof, subject to ordinary wear and tear;
(ii) it the Company shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documentsarticles of incorporation or by-laws or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine combine, subdivide or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock (other than dividends from its direct or indirect wholly owned Subsidiaries and other than regular quarterly cash dividends not in excess of $0.255 per Share and regular quarterly cash dividends on the preferred and preference stock of its Subsidiaries); or (E) repurchase, redeem or otherwise acquireacquire (except for (I) mandatory sinking funds obligations existing on the date hereof and (II) open market repurchases pursuant to the terms of the Company's Direct Stock Purchase Plan and Dividend Reinvestment Plan), 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 the Company nor any of its Subsidiaries shall (A) 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 Company Voting Debt other property or assets (other than Company Common (I) Shares issuable pursuant to options and other rights outstanding on the date hereof under the Company Option Stock Plans); (B) other than products sold , issuances of additional options or rights to customers acquire Shares granted pursuant to the terms of the Stock Plans as in effect on the date hereof in the ordinary and usual course of business the operation of such Stock Plans and issuances of Shares pursuant to options granted after the date hereof pursuant to the Stock Plans and (without limitation II) Shares issuable pursuant to the terms of the outstanding Feline Prides); (B) (I) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any of its coal fines property or assets, or, (II) except as to dollar amountidentified on Section 6.1(a)(iii) or otherwise of the Company Disclosure Letter, other than in the ordinary and usual course of business and other than sales not in an excess of $100,000,000 in the aggregate amount or $30,000,000 in respect of more than $5,000,000any transaction or series of related transactions, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries)assets; (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is or operation and maintenance expenditures in excess of $1,000,000 or110% of those contemplated to be spent pursuant to the year 1999, 2000 or 2001 capital appropriations/spending budgets set forth in Section 6.1(a) of the aggregate, are in excess of $10,000,000Company Disclosure Letter; and (E) except as otherwise provided in clause or (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (of, or other interest in) , any other Person or assets entity in excess of $100,000,000 in the aggregate or $30,000,000 in respect of any other Persontransaction or series of related transactions;
(iv) except as set forth in Section 6.1(a)(iv) of the Company Disclosure Letter, neither it the Company nor any of its Subsidiaries shall (A) incur, assume or prepay any long-term debt or incur or assume any short-term debt other than in the ordinary and usual course of business in amounts and for purposes consistent with past practice under existing lines of credit, and except for the incurrence of long-term indebtedness in connection with the refinancing of existing indebtedness either at its stated maturity or at a lower cost of funds, (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any third-party, including by means of any "keep well" or other agreement to support or maintain any financial statement condition of another person, except in the ordinary and usual course of business, (C) accelerate or delay collection of notes or accounts receivable in advance of or beyond their regular due dates or the dates consistent with past practice, or (D) change any accounting principle, practice or method in a manner that is inconsistent with past practice, except to the extent required by U.S. GAAP as advised by the Company's regular independent accountants;
(v) neither the Company nor any of its Subsidiaries shall take or fail to take any action that is reasonably likely to make any representation or warranty of the Company contained herein inaccurate in any material respect at, or as of any time prior to, the Effective Time, or that is, individually or in the aggregate, reasonably likely to have a Material Adverse Effect;
(vi) except as required by applicable Law, an existing collective bargaining agreement or other Contract identified in Section 6.1(a)(vi) of the Company Disclosure Letter, 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 Company Compensation and Benefit Plans (other than issuances of additional options, performance shares or rights to acquire Shares granted pursuant to the terms of the Stock Plans as in effect on the date hereof in the ordinary and usual course of the operation of such Stock Plans, provided, that any such additional options, performance shares or rights to acquire Shares shall not vest in connection with the Merger and the other transactions contemplated by this Agreement), or except as required by any Laws existing contract with a non-officer employer increase the salary, wage, bonus or the terms other compensation of applicable collective bargaining agreementsany employees, (B) other than except increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or and benefit increases);
(Cvii) except as approved required by applicable law, an existing collective bargaining agreement or other Contract identified in Section 6.1(a)(vii) of the Transition TeamCompany Disclosure Letter, hire neither the Company nor any employee at an annual compensation level expected of its Subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer of it or such Subsidiaries, provided, that the foregoing shall not require the Company to be more than $100,000violate any of its obligations existing prior to the date hereof as set forth in Section 5.1(h) of the Company Disclosure Letter;
(vviii) except in neither the ordinary and usual course of business, neither it 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;
(viix) neither it the Company nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases (other than in the ordinary and usual course or as may be is required by applicable Law Law) or by Canadian GAAP;
(vii) neither permit any insurance policy naming it nor any as a beneficiary or loss-payable payee to be canceled or terminated except in the ordinary and usual course of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectbusiness; and
(viiix) neither it the Company nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, that after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (approve, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure LetterAgreement):
(i) the business of it Parent and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective best reasonable best efforts to (A) preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates and (B) maintain and keep material properties and assets in as good repair and condition as such are in as of the date hereof, subject to ordinary wear and tear;
(ii) it shall not (A) issue, sell, pledge, dispose amend its articles of incorporation or encumber any capital stock owned by it in any of its Subsidiariesby-laws; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine combine, subdivide or reclassify its outstanding shares of capital stock; (DC) declare, set aside or pay any dividend payable payable, in cash, stock or property in respect of any capital stock stock, other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular other than regularly quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 0.515 per share per quarterof Parent Common Stock and regularly quarterly cash dividends on the preferred and preference stock of its ▇▇▇▇▇▇▇▇▇▇▇▇; (▇) ▇▇▇▇▇▇▇▇▇▇, with declaration and record dates consistent with past practice; or (E) repurchase, redeem ▇▇deem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Parent Common Stock or any securities convertible into or exchangeable or exercisable for any shares of Parent Common Stock (other than repurchases, redemptions or other acquisitions which are made at the then-prevailing market price of Parent Common Stock on the NYSE and which in the aggregate do not exceed ten percent of the shares of Parent Common Stock outstanding as of the date hereof) or (E) except as permitted under this Agreement, enter into any agreement with respect to a merger, reorganization, share exchange, consolidation or similar transaction involving, or any purchase of all or substantially all of the equity securities of it or any of its capital stockSignificant Subsidiaries (as such term is defined in Rule 1-02 of Regulation S-X under the Exchange Act);
(iii) neither it Parent nor any of its Subsidiaries shall shall, (A) 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 Parent Voting Debt Common Stock (other than (I) shares of Parent Common Stock issuable pursuant to options outstanding on the date hereof under the Parent Stock PlansPlan, issuances of additional options or rights to acquire shares of Parent Common Stock granted pursuant to the terms of the Parent Stock Plan as in effect on the date hereof in the ordinary and usual course of the operation of such Parent Stock Plan and issuances of shares of Parent Common Stock pursuant to options granted after the date hereof pursuant to the Parent Stock Plan and (II) issuances of Parent Common Stock, or securities convertible with or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, shares of Parent Common Stock, to a third-party on arms-length terms not in excess of 20% of the number of shares of Parent Common Stock outstanding as of the date hereof); , (B) other than (xpursuant to the year 1999, 2000 or 2001 capital appropriations/ spending budgets set forth in Section 6.1(b) as of the Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement Disclosure Letter and the Arrangement, (y) products sold to customers other than in the ordinary and usual course of business (without limitation as to dollar amountI) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness assets, and other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall sales not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, 250,000,000 in the aggregate, are in excess of $10,000,000; and or (EII) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (of, or other interest in, any other Person or entity in excess of $250,000,000 in the aggregate or (C) or assets acquire "Beneficial Ownership" (as such term is defined in the Rights Agreement) of any other PersonShares;
(iv) neither it nor Parent shall not change any of its Subsidiaries shall (A) terminatematerial accounting principle, establishpractice or method in a manner that is inconsistent with past practice, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as to the extent required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and U.S. GAAP as advised by Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000's regular independent accountants;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it Parent nor any of its Subsidiaries shall take any action or omit fail to take any action that it is reasonably expects would cause likely to make any representation or warranty of its representations and warranties such party contained herein to become untrue inaccurate in any material respectrespect at, or as of any time prior to, the Effective Time, or that is, individually or in the aggregate, reasonably likely to have a Material Adverse Effect; and
(viiivi) neither it Parent nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Seller and the Company covenants covenant and agrees as to itself and its Subsidiaries thatagree that after June 30, after the date hereof 1997 and prior to the Effective Time Closing (unless Parent Buyer shall otherwise consent approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) and ), except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):Agreement:
(ia) the Company's business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to and the extent consistent therewith, it and each of its Subsidiaries Company shall use its respective reasonable best efforts to preserve its business organization organizations, manufacturing license, pioneer status and manufacturing warehouse license intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(iib) it the Company shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) voting debt or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries)assets; (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose amend its Memorandum and Articles of Association or encumber any capital stock owned by it in any of its Subsidiariesby-laws; (Biii) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend or make any distribution payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practicestock; or (Ev) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, acquire any shares of its capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(iiic) neither it nor any of its Subsidiaries the Company shall (A) issuenot, 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiariesliability; (Diii) except as approved by disclosed in budgets provided to the Transition Teamother party hereto prior to the date hereof, make any commitments for, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practiceand in amounts less than the equivalent of US $5,000 individually and US $25,000 in the aggregate or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other Personperson or entity; or (iv) enter into any joint venture, merger or other similar agreement with any person;
(ivd) neither it nor any of its Subsidiaries the Company shall (A) not terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans compensation or benefit plan, or increase the salary, wage, bonus or other compensation of any employee except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than increases occurring in the ordinary and usual course of business consistent in accordance with established past practice (which shall include normal periodic performance reviews and Parent’s related compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000and benefit increases);
(ve) the Company shall not settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or business modify, amend or terminate any of its material Contracts contracts or waive, release or assign any material rights or claims;
(vif) neither it nor any of its Subsidiaries the Company shall not make any material Tax tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be canceled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any the ordinary and usual course of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectbusiness; and
(viiig) neither it nor any of its Subsidiaries will the Company shall not authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Sources: Stock Purchase Agreement (Praegitzer Industries Inc)
Interim Operations. (a) The Company covenants and agrees Except as to itself and its Subsidiaries otherwise expressly permitted by this Agreement, Holdco agrees, that, after the date hereof and prior to the Effective Time Closing (unless Parent Buyer shall otherwise consent approve in writing (which consent shall writing, such approval not to be unreasonably withheld withheld, conditioned or delayed) and except as required by applicable Laws, Holdco shall cause each of the businesses utilizing the Brand Assets to be operated in the Ordinary Course. Without limiting the generality of, and in furtherance of, the foregoing, from the date hereof until the Closing, except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) as Buyer may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed), none of the Company Disclosure Letter):
nor (i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewithrelated to any business utilizing the Brand Assets) any Brand Companies shall, it and Holdco and its Affiliates shall cause the Company and (to the extent related to any business utilizing the Brand Assets) each such Brand Company not to, do any of the following:
(a) amend its Subsidiaries shall use its respective reasonable best efforts to preserve its business articles of organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesor limited liability company agreement;
(iib) it shall not acquire any assets of a type or in a manner that is inconsistent with the scope and purpose of its business;
(Ac) issuemerge or consolidate with any other Person, sellor recapitalize;
(d) sell all or substantially all of its assets;
(e) issue additional membership interests or admit additional Persons as members;
(f) borrow money, take any loans or refinance any borrowings, or execute and deliver on its own behalf any obligations, agreements, instruments or other documents of any character relating to any indebtedness, loans or other borrowings, including, mortgages, notes, deeds, trust indentures, guarantees and assignments, or pledge, dispose of mortgage or encumber any capital stock owned by it in its membership interests or any of its Subsidiaries; assets as security for any such borrowings, loans, guarantees or other assistance (B) amend its Organizational Documents; (C) in each case, other than as contemplated by any Licenses entered into in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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 stockOrdinary Course);
(iiig) neither it nor enter into any of its Subsidiaries shall (A) issueContract with ▇▇▇▇▇▇ ▇▇▇▇▇▇, 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 Company Voting Debt (Entity, other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved contemplated by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other PersonTransaction Documents;
(ivh) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file change any material income method of Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPaccounting;
(viii) neither it nor any directly or indirectly: (i) sell, convey, transfer, pledge or otherwise encumber or dispose of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
the Transferred JV Interest, (viiiii) neither it nor any of its Subsidiaries will authorize deposit such Transferred JV Interest into a voting trust or enter into an a voting agreement or arrangement with respect to such Transferred JV Interest or grant any proxy with respect thereto or (iii) enter into any Contract with respect to the direct or indirect acquisition or sale, assignment, transfer or other disposition of such Transferred JV Interest;
(j) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise; or
(k) 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 hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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: Membership Interest Purchase Agreement (B. Riley Financial, Inc.)
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 approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the its business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(iib) it shall not (Ai) issueform or acquire (by means of transfer, sell, pledge, dispose of purchase or encumber otherwise) any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentsarticles of incorporation or by-laws or amend, modify or terminate the Stock Plans, other than as expressly required hereunder (including, without limitation, as set forth in Section 6.10); (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iiic) neither it nor any of its Subsidiaries shall not (Ai) 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 Company Voting Debt or any other property or assets (other than Company Common Shares issuable pursuant to options outstanding on the date hereof under the Company Option Stock Plans); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries material liability or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring modify any current material indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (Diii) except as approved by the Transition Team, make or authorize or commit for any expenditures (including capital expenditures whichand expenditures relating to the use of Third-Party Intellectual Property Rights or the development, individually, is in excess marketing or in-licensing of $1,000,000 any products) or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments investment in, assets or stock of any other Person or entity in stock excess of (or reasonably likely to result in expenditures in excess of) $100,000 or (iv) authorize or enter into any agreement or other interest in) or assets commitment relating to the licensing of any other Personof the Company's products or the marketing by the Company of a third-party's products;
(ivd) neither it nor any of its Subsidiaries shall (A) not terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by or increase the salary, wage, bonus or other compensation or benefits of any Laws employees except, in the case of employees that are not executive officers or directors of the terms of applicable collective bargaining agreementsCompany, (B) other than increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000and benefit increases);
(ve) it will not (x) declare, set aside or pay any dividends on, or make any other distributions in respect of, any of its capital stock, (y) split, combine or reclassify any of its capital stock 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 (z) purchase, redeem or otherwise acquire any shares of capital stock of the Company or any other securities thereof (other than the acquisition of shares surrendered in whole or partial satisfaction of the exercise price for any stock options outstanding on the date hereof and properly exercised in accordance with their terms) or any rights, warrants or options to acquire any such shares or other securities;
(f) it shall not settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or business modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vig) neither it nor any of its Subsidiaries shall not make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be canceled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viih) neither it nor shall continue to take all actions reasonably necessary in connection with the continued leasing or subleasing of Building One, but shall not enter into any further agreements relating to the lease or sublease of its Subsidiaries such property;
(i) it shall continue to take all actions reasonably necessary in connection with the valuation of and sale of equipment in Building One, but shall not enter into any agreements relating to the sale of any such equipment;
(j) it shall not incur additional indebtedness;
(k) it shall not take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiil) neither it nor any of its Subsidiaries will not authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Skyepharma PLC)
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 approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(aAgreement) of the Company Disclosure Letter):
(i) 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 each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations substantially intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, 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 expressly required or expressly permitted by this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed) or (C) as set forth in Section 6.1 of the Company Disclosure Letter, the Company 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) it shall not 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 its assets, operations or businesses or otherwise enter into any hold separate agreement or other agreement imposing material limitations on its business;
(iii) acquire assets or any securities of any business from any other Person in any transaction or series of related transactions, other than (A) acquisitions pursuant to Contracts in effect as of the date of this Agreement, (B) capital expenditures made in accordance with capital budgets included in Section 6.1(a)(iii) of the Company Disclosure Letter, (C) acquisitions with a value or purchase price in the aggregate of less than $500,000 or (D) acquisitions of inventory and other purchases in the ordinary course of business;
(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 or encumber any capital stock owned by it in of the Company or any of its Subsidiaries; Subsidiaries (B) amend its Organizational Documents; (C) 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 required issuances of shares of Company Common Stock upon the exercise of Company Stock Options outstanding as of the date of this Agreement;
(v) create or incur any Lien on any assets of the Company or any of its Subsidiaries in amounts in excess of $1,000,000 in the case of aggregate;
(vi) make any loans, advances or capital contributions to or investments in any Person (other than the Company or any direct or indirect, wholly indirect wholly-owned Subsidiary, split, combine or reclassify its outstanding shares Subsidiary of capital stock; the Company) in excess of $100,000 in the aggregate;
(Dvii) declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to any of any its capital stock other than (except for dividends from its paid by any direct or indirect wholly wholly-owned Subsidiaries; Subsidiary to the Company or (Eto any other direct or indirect wholly-owned Subsidiary) repurchase, redeem or otherwise acquire, or permit enter into any agreement with respect to the voting of its Subsidiaries to capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiiix) neither it nor 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 shall Subsidiaries, except for (A) issueindebtedness for borrowed money incurred in the ordinary course of business consistent with past practices not to exceed $5,000,000 in the aggregate, 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) indebtedness for borrowed money in replacement of existing indebtedness for borrowed money on terms substantially consistent with or more beneficial than the indebtedness being replaced, (C) guarantees by the Company of indebtedness of wholly-owned Subsidiaries of the Company incurred in compliance with this Section 6.1 or (D) interest rate swaps on customary commercial terms consistent with past practice and not to exceed $5,000,000 of notional debt in the aggregate;
(x) except as set forth in the capital budgets set forth in Section 6.1(a)(iii) of the Company Disclosure Letter and consistent therewith, make or authorize any capital expenditure in excess of $500,000 in the aggregate during any 12 month period;
(xi) enter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement, other than products sold to customers Contracts that are entered into in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and do not include any agreement or commitment to take any action described by Sections 6.1
(a) (i) through (x) or Sections 6.1(a)(xii) through (xviii);
(xii) make any changes with respect to accounting policies or procedures, except as required by changes in GAAP;
(xiii) settle any litigation or other proceedings before a Governmental Entity for an amount in excess of $100,000 in the aggregate amount (net of more than insurance coverage) or any disputed obligation or liability of the Company in excess of such amount;
(xiv) amend, modify or terminate any Material 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 $5,000,000500,000 in the aggregate, other than, in each case, in the ordinary course of business;
(xv) make or change any Tax election, change an annual accounting period, file any material amended Tax Return, enter into any material closing agreement, waive or extend any statute of limitation with respect to Taxes, settle or compromise any material Tax liability, claim or assessment, or surrender any right to claim a refund of material Taxes;
(xvi) transfer, sell, lease, license, guarantee, sell, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets, product lines or encumber any other property businesses of the Company or assets (its Subsidiaries, including capital stock of any of its Subsidiaries); (C) incur , except for product sales in the ordinary course of business, sales of obsolete assets or modify any indebtedness sales, leases, licenses or other dispositions of assets with a fair market value not in excess of $500,000 in the aggregate, other than pursuant to Contracts in effect prior to the date of this Agreement;
(xxvii) indebtedness except as required pursuant to existing solely between written, binding agreements in effect prior to the date of this Agreement and set forth in Section 5.1(h)(i) of the Company and its wholly owned Subsidiaries Disclosure Letter, or between such wholly owned Subsidiaries as otherwise required by applicable Law, (A) grant or (y) indebtedness in an aggregate amount less than $30,000,000; providedprovide any severance or termination payments or benefits to any director, however, that prior to incurring any indebtedness, if practicable, officer or employee of the Company shall provide Parent with a reasonable right or any of consultation; providedits Subsidiaries, furtherexcept, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 oremployees who are not officers, in the aggregateordinary course of business, are in excess (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 director, officer or employee of $10,000,000; and the Company or any of its Subsidiaries, except (E) except as otherwise provided in clause (D) immediately above and other than raw materialswith respect to the grant of new equity awards), supplies and other inventory items acquired in the case of employees who are not officers, in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest inC) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, amend or terminate any Company Benefit Plan or amend the terms of its material Contracts any outstanding equity-based awards, (D) take any action to accelerate the vesting or waivepayment, release or assign fund or in any material rights other way secure the payment, of compensation or claims;
benefits under any Company Benefit Plan, to the extent not already provided in any such Company Benefit Plan, (viE) neither it nor change any of its Subsidiaries shall make actuarial or other assumptions used to calculate funding obligations with respect to any material Tax election Company Benefit Plan or file any material income Tax Return inconsistent with past practice to change the manner in which contributions to such plans are made or implement or adopt any change in its accounting principles or material accounting practicesthe basis on which such contributions are determined, in all cases other than except as may be required by applicable Law GAAP; or by Canadian GAAP(F) forgive any loans to directors, officers or employees of the Company or any of its Subsidiaries;
(viixviii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause likely to (A) result in any of its representations and warranties herein the conditions to become untrue the Merger set forth in any material respectArticle VIII not being satisfied or (B) prevent or materially delay the consummation of the Merger; andor
(viiixix) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, knowingly take 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause any of its representations and warranties herein likely to become untrue (i) result in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingconditions to the Merger set forth in Article VII not being satisfied or (ii) prevent or materially delay the consummation of the Merger.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after between the date hereof of this Agreement and prior the Effective Time, except (i) as expressly contemplated by this Agreement, (ii) as set forth in Section 7.1 of the Company Disclosure Letter, (iii) as required by applicable Law, or (iv) to the Effective Time (unless extent Parent shall otherwise consent consents in writing (which consent shall not be unreasonably withheld withheld, conditioned or delayed) and except as otherwise expressly set forth in this Agreement or ), the corresponding subsection of Section 3.1(a) businesses of the Company Disclosure Letter):
(i) and the business of it and its Subsidiaries shall be conducted in all material respects in the ordinary and usual course of business consistent with past practice and, to the extent consistent therewith, it and each of the Company and its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributorsemployees, creditors, lessors, employees creditors and business associates;
(ii) it shall not partners. Without limiting the generality of the foregoing, except (A) issue, sell, pledge, dispose of or encumber any capital stock owned as expressly contemplated by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsthis Agreement, (B) other than as set forth in Section 7.1 of the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000Company Disclosure Letter, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(viiD) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall extent Parent otherwise consent consents in writing (which consent shall not be unreasonably withheld withheld, conditioned or delayed) and except as otherwise expressly set forth in ), the Company agrees that neither the Company nor any Subsidiary shall, between the date of this Agreement or and the corresponding subsection of Section 3.1(b) Effective Time, do any of the Parent Disclosure Letter):following:
(ia) amend or restate the business articles of it and its Subsidiaries shall be conducted in incorporation or bylaws of the ordinary and usual course andCompany, to or such similar organizational or governing documents of the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associatesSubsidiaries;
(ii) it shall not (Ab) issue, deliver, sell, pledgetransfer, dispose of of, pledge or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock or equity interests, any other voting securities 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) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or optionsany rights, warrants, calls, commitments warrants or rights of any kind options to acquire, any such shares of capital stock or equity interests, voting securities or convertible securities or phantom stock or stock appreciation rights with respect thereto, other than the issuance of Shares issuable upon the exercise of Company Options outstanding under the Stock Plans as of the date of this Agreement;
(c) 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 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;
(d) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or equity interests of any class the Company or any Parent Voting Debt (Subsidiary, other than Parent Common Stock issuable under Shares acquired from holders of Company Options in payment of the Parent Stock Plans); exercise price for Company Options;
(Be) (i) acquire (including by merger, consolidation, or acquisition of stock or assets or any other business combination) any corporation, partnership, other business or business organization, any division or business unit thereof or, other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any meansmaterial assets, (ii) incur, create, assume or otherwise become liable for any indebtedness for borrowed money (other than in the ordinary course of business consistent with past practice or draws on any existing credit facility or line of credit of the Company or any of its Subsidiaries) or issue any debt securities or any right to acquire debt securities or assume, guarantee, endorse or otherwise become responsible or liable for any material liability of any other Person other than the guarantee of any liability of the Company or any of its Subsidiaries, (iii) enter into any hedging agreement or other financial agreement or arrangement designed to protect the Company or its Subsidiaries against fluctuations in commodities prices, exchange rates or interest rates, other than in the ordinary course of business consistent with past practice, (iv) make any acquisitions ofmaterial loans, advances or capital contributions to, or investments in, Persons other than wholly owned Subsidiaries and other than in the ordinary course of business, or (v) sell, lease, license, encumber or otherwise dispose of or transfer (by merger, consolidation, sale of stock of (or other interest in) or assets or otherwise) any material amount of any its assets other Personthan in the ordinary course of business;
(ivf) neither it nor make or commit to make any capital expenditure other than in respect of those capital expenditure projects that are (i) contemplated by the Company’s fiscal year 2011 forecast or (ii) not in excess of $1,000,000 in the aggregate;
(g) adopt or enter into a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of the Company or any Subsidiary;
(h) (i) increase the salary, wages, benefits, bonuses or other compensation payable or to become payable to its Subsidiaries shall current or former directors, officers or employees, except for increases required under employment agreements existing on the date hereof or other than general increases in wages to employees who are not officers, directors or Affiliates of the Company in the ordinary course of business consistent with past practice, (Aii) terminateenter into or amend or otherwise alter any employment agreement, change of control or severance agreement with any Person, or establish, adopt, enter intointo or amend any Benefits Plan, (iii) except as required under any employment or change of control agreement existing on the date hereof or as may be required to implement the actions contemplated by this Agreement, including Sections 4.3 and 7.8, accelerate the vesting or payment of any compensation or benefit under any Benefits Plan, or (iv) except as may be required by the terms of any such Benefit Plan in effect on the date hereof or to comply with applicable Law, including Section 409A of the Code;
(i) make any new grants or awards underchange to its methods of accounting in effect as of the date of this Agreement, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by changes in GAAP or Law or by the SEC or as recommended by the Company’s independent registered public accounting firm;
(j) make or change any Laws Tax election, settle or compromise any Tax liability, change in any respect any accounting method in respect of Taxes, file any amendment to an income or other material Tax Return, enter into any closing agreement, settle any material claim or material assessment in respect of Taxes, or consent to any extension or waiver of the terms limitation period applicable to any claim or assessment in respect of applicable collective bargaining agreementsTaxes, except, in each case, in the ordinary course of business consistent with past practice;
(k) write up, write down or write off the book value of any of its material assets, other than as may be required by GAAP;
(l) waive, settle, satisfy or compromise any material claim (which shall include any pending or threatened material action), except (i) in the ordinary course of business, (Bii) to the extent subject to reserves existing on the date of this Agreement, or (iii) involving amounts outside the ordinary course of business not to exceed $250,000 individually or $1,000,000 in the aggregate;
(m) except as provided in Section 7.1(e) or (h), enter into, amend, modify, cancel or consent to the termination of any Material Contract or any Contract that would be a Material Contract if in effect on the date of this Agreement (without regard to materiality in the case of Material Contracts of the type described in Section 5.11(a)(vii)(B)), other than in the case of customer or supplier Material Contracts if entered into in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level on terms that in the discretion of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level Company are not reasonably expected to be more than $100,000materially adverse to the Company and its Subsidiaries taken as a whole;
(vn) enter into, amend, modify, cancel or consent to the termination of any Labor Contract or any Contract that would be a Labor Contract if in effect on the date of this Agreement;
(o) enter into, renew or amend in any material respect any transaction, Contract, arrangement or understanding between the Company or any Subsidiaries, on the one hand, and any Affiliate of the Company (other than any of the Company’s Subsidiaries), on the other hand;
(p) (i) assign, transfer, license or sublicense, mortgage or encumber any Company Intellectual Property, except for non-exclusive licenses or non-exclusive sublicenses of Company Intellectual Property in the ordinary and usual course of businessbusiness or (ii) fail to pay any fee, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit make any filing in each case reasonably necessary to take any action that it reasonably expects would cause any maintain its ownership of or protect its representations and warranties herein to become untrue interests in any material respectCompany Intellectual Property; andor
(viiiq) neither it nor any of its Subsidiaries will authorize or enter into an agreement agree in writing to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Merger Effective Time (unless Parent shall otherwise consent approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) ), and except as otherwise expressly set forth in contemplated by this Agreement (including the Shrimp Business Divestiture) or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter)::
(i) it shall operate the business of it and its Subsidiaries shall be conducted only in the ordinary and usual course of business, consistent with past practice, and, to the extent consistent therewithwith such operation, it and each of its Subsidiaries shall use its respective reasonable best efforts to to: (A) preserve its the present business organization intact intact; and maintain its existing relations and goodwill (B) preserve all beneficial business relationships with all customers, suppliers, distributors, creditors, lessors, employees and others having business associatesdealings with the business of it and its Subsidiaries;
(ii) it shall maintain (A) the material assets of the Company in such condition and repair consistent with past practice, and (B) insurance upon all of the material assets of the Company and with respect to the conduct of the business of the Company in full force and effect, comparable in amount, scope, and coverage to that in effect on the date of this Agreement;
(iii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documentscertificate of incorporation or bylaws; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iiiiv) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans)Debt; (B) other than products sold grant or sell any option or right to customers purchase the assets of the Company, except regarding non-material assets in the ordinary and usual course of business business, consistent with past practice; or (without limitation as C) subject any of the assets of the Company to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000any further material lien, transfer, lease, license, guarantee, sellcharge, mortgage, pledge, dispose of security interest or encumber any other property or assets similar encumbrance (including capital stock of any of its Subsidiarieseach, an "Encumbrance"); (C) incur or modify any indebtedness , other than (xi) indebtedness existing solely between as reflected, reserved or otherwise disclosed in the financial statements included in or incorporated by reference in the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; Reports and (Eii) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business business, consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(ivv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans or pay or promise to pay, any bonus, profit-sharing or special compensation to the Employees or make any increase in the compensation payable or to become payable to any of such employees, except as (i) for changes that are required by any Laws or applicable law, (ii) to satisfy obligations under the terms of applicable collective bargaining agreementsany agreement or plan in effect as of the date hereof, (Biii) other than for increases in compensation that are made in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and related compensation and benefit increases) and (iv) for employment arrangements for or grants of awards to, newly hired employees in the Company’s compensation budget ordinary course of business consistent with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000past practice;
(vvi) except in the ordinary course of business consistent with past practice, neither it nor any of its Subsidiaries shall enter into or terminate any Company Contract, or make any change in any of its Company Contracts;
(vii) neither it nor any of its Subsidiaries shall make any tax election or permit any insurance policy naming it as a beneficiary or loss-payable payee to be canceled or terminated without prior notice to Parent, except in the ordinary and usual course of business, ;
(viii) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modifyor, amend or terminate any except in the ordinary and usual course of its material Contracts or business, waive, release or assign any material rights or claims;; and
(viix) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries thatThe provisions of this Section 6.1 notwithstanding, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth nothing in this Agreement shall be construed or interpreted to prevent the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
Company or any Subsidiary from (i) making, accepting or settling intercompany advances to, from or with one another; (ii) causing any Subsidiary to pay or distribute to the business Company all cash, money market instruments, bank deposits, certificates of it deposit, other cash equivalents, marketable securities and other investment securities then owned or held by such Subsidiary; or (iii) engaging in any other transaction incident to the normal cash management procedures of the Company and its Subsidiaries, including, without limitation, short-term investments in bank deposits, money market instruments, time deposits, certificates of deposit and bankers' acceptances and borrowings for working capital purposes and purposes of providing additional funds to Subsidiaries shall be conducted made, in each case, in the ordinary and usual course andof business, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Baltek Corp)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof of this Agreement and prior to the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(aAgreement) of the Company Disclosure Letter):
(i) and except as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in all material respects in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, 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 (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 of the Company Disclosure Letter, 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) it shall not 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;
(Aiii) 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 $100,000 in any transaction or series of related transactions, other than acquisitions pursuant to Material Contracts in effect as of the date of this Agreement or pursuant to Section 6.1(a)(x) 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 or encumber any capital stock owned by it in of the Company or any of its Subsidiaries; Subsidiaries (B) amend its Organizational Documents; (C) 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 upon the exercise of Company Options or warrants to purchase Shares that are outstanding on the date of this Agreement;
(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 $500,000;
(vi) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than the case of Company or any direct or indirect, wholly indirect wholly-owned Subsidiary, split, combine or reclassify its outstanding shares Subsidiary of capital stock; the Company) in excess of $500,000 in the aggregate;
(Dvii) declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to any of any its capital stock other than (except for dividends from its paid by any direct or indirect wholly wholly-owned Subsidiaries; Subsidiary to the Company or (Eto any other direct or indirect wholly-owned Subsidiary) repurchase, redeem or otherwise acquire, or permit enter into any agreement with respect to the voting of its Subsidiaries to capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiiix) neither it nor 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 shall Subsidiaries, except for indebtedness for borrowed money incurred in the ordinary course of business consistent with past practices not to exceed $500,000 in the aggregate;
(Ax) issueexcept as set forth in the capital budgets set forth in Section 6.1(i)(x) of the Company Disclosure Letter and consistent therewith, sellmake or authorize any capital expenditure in excess of $500,000 in the aggregate during any 12 month period;
(xi) other than in the ordinary course of business consistent with past practice, pledgeenter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement;
(xii) except for non-exclusive standard license agreements with customers that are entered into in the ordinary course of business upon terms and royalty rates that are consistent with the Company's past practice and do not include any cross-license of existing Intellectual Property of the licensee, dispose and that are not individually material to the business of the Company, enter into any new license agreement with respect to the Intellectual Property or encumber IT Assets of the Company;
(xiii) amend any shares ofexisting license agreement with respect to the Intellectual Property or IT Assets of the Company other than in the ordinary course of business consistent with past practice and in a manner that is not adverse to the Company;
(xiv) make any changes with respect to accounting policies or any material change in accounting procedures, except as required by changes in GAAP;
(xv) except in the ordinary course of business consistent with past practice, settle any litigation or other proceedings before a Governmental Entity for an amount in excess of $250,000 (net of insurance coverage), or securities convertible into any disputed obligation or exchangeable liability of the Company in excess of such amount;
(xvi) other than in the ordinary course of business consistent with past practice, amend, modify or exercisable forterminate any Material Contract, or optionscancel, warrantsmodify or waive any debts or claims held by it or waive any rights having in each case a value in excess of $250,000;
(xvii) make any Tax election, callschange an annual accounting period, commitments file any amended Tax Return, enter into any closing agreement, waive or rights extend any statute of limitation with respect to Taxes, settle or compromise any kind to acquireTax liability, any shares of its capital stock of any class claim or any Company Voting Debt assessment (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers payment in the ordinary and usual course of business of Taxes that are due and payable), or surrender any right to claim a refund of Taxes;
(without limitation as to dollar amountxviii) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000transfer, transfersell, lease, license, guarantee, sell, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any material assets, licenses (other than licenses to customers that lapse or encumber any other property expire in accordance with their terms), operations, rights, product lines, businesses or assets (interests therein of the Company or its Subsidiaries, including capital stock of any of its Subsidiaries); (C) incur , except in connection with the sale of Company products and services in the ordinary course of business and sales of obsolete assets and except for sales, leases, licenses or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent dispositions of assets with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall fair market value not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, 500,000 in the aggregate, are other than pursuant to Contracts in excess effect prior to the date of $10,000,000; and this Agreement;
(Exix) except as required pursuant to existing written, binding 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 provided 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, except for increases in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired base salary in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to for employees at an annual compensation level of less than $150,000who are not officers, increase the compensation of any employee or (Ciii) except as approved by the Transition Teamestablish, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modifyadopt, amend or terminate any Benefit Plan or amend the terms of its material Contracts any outstanding equity-based awards, (iv) take any action to accelerate the vesting or waivepayment, release or assign fund or in any material rights other way secure the payment, of compensation or claims;
benefits under any Benefit Plan, to the extent not already provided in any such Benefit Plan, (viv) neither it nor change any of its Subsidiaries shall make actuarial or other assumptions used to calculate funding obligations with respect to any material Tax election Benefit Plan or file any material income Tax Return inconsistent with past practice to change the manner in which contributions to such plans are made or implement or adopt any change in its accounting principles or material accounting practicesthe basis on which such contributions are determined, in all cases other than except as may be required by applicable Law GAAP; or by Canadian GAAP(vi) forgive any loans to directors, officers or employees of the Company or any of its Subsidiaries;
(viixx) neither it nor any of its Subsidiaries shall knowingly take any action or omit to take any action that it is reasonably expects would cause likely to result in any of its representations and warranties herein the conditions to become untrue the Merger set forth in any material respectArticle VIII not being satisfied or is reasonably likely to prevent the consummation of the Merger; andor
(viiixxi) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as Prior to itself and making any written or material oral communications to the directors, officers or employees of the Company or any of its Subsidiaries thatpertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement (other than an oral communication with any individual director, after the date hereof and prior to the Effective Time (unless officer or employee), the Company shall otherwise consent 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 writing providing any such mutually agreeable communication.
(which consent c) Parent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, knowingly take 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause any of its representations and warranties herein likely to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any prevent the consummation of the foregoingMerger.
Appears in 1 contract
Interim Operations. (a) The Company covenants In furtherance of, and agrees as to itself and its Subsidiaries thatwithout limiting, after the foregoing Section 6.2, from the date hereof and prior to of this Agreement until the Effective Time Time, except (unless w) as otherwise expressly contemplated by this Agreement, (x) as expressly required by applicable Law, (y) as Parent shall otherwise consent may approve in writing (which consent approval shall not be unreasonably withheld withheld, conditioned or delayed) and except or (z) as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) 6.3 of the Company MLP Disclosure Letter):, each of the MLP Entities (and with respect to Section 6.3(a) below, GP Holdings) will not and will not permit any of MLP’s Subsidiaries to, and GP Holdings will not permit any MLP Group Entity to, directly or indirectly:
(a) (i) issue (including issuing any certificate in connection therewith), grant, sell or otherwise permit to become outstanding, or authorize the business of it and its Subsidiaries shall be conducted in creation of, any additional Equity Interests (whether “phantom” or otherwise) or any additional Rights, including transactions between or among the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact and maintain its MLP Group Entities or (ii) certificate any existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesPartnership Interests;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify any of its outstanding shares Equity Interests or issue or authorize or propose the issuance of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property other securities in respect of, in lieu of any capital stock other than dividends from or in substitution for its direct or indirect wholly owned Subsidiaries; or Equity Interests, (Eii) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase purchase, redeem or otherwise acquireacquire any membership, partnership or other Equity Securities or (iii) enter into any shares Contract with respect to the voting of its capital stock Partnership Interests or any securities convertible into or exchangeable or exercisable for any shares of its capital stockother Equity Securities;
(iiic) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, licenseor otherwise dispose of, guarantee, sell, mortgage, pledge, dispose of or encumber all or any other property or assets (including capital stock of any portion of its Subsidiaries); assets, business or properties, except for (A) sales, transfers and dispositions of obsolete or worthless equipment, (B) sales, transfers and dispositions of inventory and produced hydrocarbons in the ordinary course of business or (C) incur sales, transfers, assignments, conveyances, abandonment, allowances to lapse, licenses, sublicenses, covenants not to assert or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right disposals of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired Intellectual Property in the ordinary and usual course of business consistent with past practice, (ii) acquire, by any means, make any acquisitions ofmerger or otherwise, or investments in stock lease any assets or securities or all or any portion of (the business or other interest in) or assets property of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than (x) acquisitions of goods and services in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, acquisitions pursuant to which the aggregate value exchanged or purchase price paid or payable by any MLP Group Entity would not in excess of exceed $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, 2,000,000 in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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
Interim Operations. (a) The Pursuant to the Merger Agreement, the Company covenants and agrees as to itself and its Subsidiaries has agreed that, after during the period from the date hereof and prior of the Merger Agreement to the Effective Time (unless Parent shall otherwise consent agrees in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of writing), the Company Disclosure Letter):
will, and will cause its subsidiary to, operate its business only in the ordinary course of business consistent with past practices and use its commercially reasonable efforts to (i) preserve its existing business organization, insurance coverage, material rights, material licenses or permits, advantageous business relationships, material agreements and credit facilities; and (ii) retain its key officers and employees. Pursuant to the business Merger Agreement, without limiting the generality of it the foregoing, the Company will not and will not permit its Subsidiaries shall be conducted subsidiary to: (A) enter into any material transaction or commitment, or sell, lease, or dispose of or acquire any material properties or assets, except purchases and sales of inventory in the ordinary and usual course and, to the extent of business consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiariespast practices; (B) amend its Organizational Documentsimplement any new employee benefit plan, or employment, compensatory or severance agreement; (C) other amend any existing employee benefit plan or employment agreement except as required by law or by the Merger Agreement; (D) enter into, amend or terminate any material contract except as required by law or by the Merger Agreement; (E) take any action that would jeopardize the continuance of its material supplier or customer relationships; (F) make any material change in the nature of their businesses and operations; (G) enter into any transaction or agreement with any officer, director or affiliate of the Company or its subsidiary or make any loan or advance to any employee of Company or its subsidiary; (H) incur or agree to incur any obligation or liability (absolute or contingent) that individually calls for payment by the Company or its subsidiary of more than $25,000 in any specific case or $100,000 in the aggregate, excluding purchases of inventory in the ordinary course of business; (I) make any change to its accounting (including tax accounting) methods, principles or practices, except as may be required by United States generally accepted accounting principles and except, in the case of tax accounting methods, principles or practices, in the ordinary course of business of the Company or its subsidiary consistent with past practice or any direct change in its tax elections that would materially increase its tax liabilities; (J) authorize or indirectmake capital expenditures in excess of $25,000; (K) mortgage or otherwise encumber or subject to any lien any properties or assets except pursuant to existing agreements; (L) grant, wholly owned Subsidiaryconfer or award any bonuses or other forms of cash incentives to any officer, splitdirector or employee except consistent with past practice; (M) enter into any new bank credit agreement or line of credit or amend in any material respect its existing bank credit agreement or lines of credit; (N) grant any severance or termination pay to, combine or reclassify its outstanding shares enter into any new employment or severance agreement with any present or future officer, employee or director, other than consistent with past practices; (O) take any action that would make any representation or warranty of the Company under the Merger Agreement to be inaccurate in any material (except where such representation or warranty is already qualified as to materiality) respect or omit to take any action necessary to prevent such representation or warranty from being inaccurate in any material (except where such representation or warranty is already qualified as to materiality) respect; (P) acquire any capital stock; or (DQ) authorize, commit or agree to take, any of the foregoing actions. Furthermore, pursuant to the Merger Agreement, the Company has agreed that, during the period from the date of the Merger Agreement to the Effective Time (unless Parent otherwise agrees in writing), it will not (i) declare, set aside or pay any dividend payable in cash, stock or property in make any other distribution or payment with respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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 other ownership interests, or exchangeable (ii) directly or exercisable for indirectly redeem, purchase or otherwise acquire any shares of its capital stock;
, or make any commitment for any such action. Furthermore, the Company will not and will not permit its subsidiary to (iii) neither it nor any amend its certificate of its Subsidiaries shall incorporation or bylaws or other charter documents, (Aiv) issue, sell, pledge, dispose of or encumber issue any shares ofof capital stock, effect any stock split or securities convertible into reclassification or exchangeable otherwise change (or exercisable foragree to change) its equity securities, or options, warrants, callsor convertible instruments as they existed on the date of the Merger Agreement, commitments or except pursuant to the exercise of options, warrants, conversion rights of any kind to acquire, any shares of its capital stock of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies contractual rights existing on the date of the Merger Agreement and other inventory items acquired in disclosed pursuant to the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions ofMerger Agreement, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in grant, confer or award any option, warrant, conversion right or other right not existing on the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any date of the foregoing.
(b) Parent covenants and agrees as Merger Agreement to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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 acquire any shares of its capital stock;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (International Rectifier Corp /De/)
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 approve in writing (which consent shall writing, such approval not to be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(aAgreement) of the Company Disclosure Letter):
(i) and except as required by applicable Laws, the business of it and its Subsidiaries shall be conducted in the ordinary and usual course of business consistent with past practice and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, agents, customers, suppliers, distributors, creditors, lessors, employees and other Persons with whom they have business associatesrelationships. 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 contemplated or permitted by this Agreement, (ii) as Parent may approve in writing (such approval not to be unreasonably withheld or delayed), (iii) as is required by applicable Law or any Governmental Entity or (iv) as set forth in Schedule 6.1(a) 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 bylaws or other applicable governing instruments;
(iiB) it shall not 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;
(AC) make any material acquisition, by purchase, merger, consolidation, other business combination or otherwise, of stock or assets from any Person (other than a wholly-owned Subsidiary of the Company);
(D) 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 or encumber any capital stock owned by it in of the Company or any of its Subsidiaries; Subsidiaries (B) amend its Organizational Documents; (C) other than in (1) the case issuance of any direct Shares upon the exercise of Company Options or indirect, Warrants or (2) the issuance of shares by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary, split, combine ) or reclassify its outstanding securities convertible or exchangeable into or exercisable for any shares of such capital stock; (D) declare, set aside or pay any dividend payable in cashoptions, warrants or other rights of any kind to acquire any shares of such capital stock or property such convertible or exchangeable securities;
(E) make any loans, advances or capital contributions to or investments in respect any Person in excess of any capital stock $250,000 in the aggregate (other than dividends from its the Company or any direct or indirect wholly owned SubsidiariesSubsidiary of the Company) except in accordance in all material respects with the Company’s investment policy in effect as of the date hereof (the “Investment Policy”), a copy of which is included in Schedule 6.1 of the Company Disclosure Letter; provided, however, that no investments whatsoever shall be made in those entities set forth on Schedule 6.1(a)(E) of the Company Disclosure Letter;
(F) declare, set aside, make or (E) repurchasepay any dividend or other distribution, redeem payable in cash, stock, property or otherwise acquireotherwise, or permit with respect to any of its Subsidiaries capital stock (other than the Company’s regular quarterly cash dividends in respect of the Shares not to exceed $0.08 per share) or enter into any agreement with respect to the voting of its capital stock or otherwise make any payments to its stockholders in their capacity as such;
(G) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, or amend the terms of any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stockstock (other than the acquisition of any Shares tendered by current or former employees or directors in connection with the exercise of Company Options or pursuant to puts and calls in employee and former employee stockholder agreements);
(iiiH) neither it nor incur, assume or prepay 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 shall (A) issueSubsidiaries, 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers except for borrowings in the ordinary course under the Company’s credit facility, a copy of which has been made available to Parent (and usual course which shall not be amended, waived or modified after the date hereof) the proceeds of business which shall be used for operating purposes;
(without limitation as to dollar amountI) make or otherwise authorize any capital expenditure in excess of $1,000,000 in the ordinary and usual course aggregate;
(J) make any material changes with respect to actuarial, marketing, underwriting, claims management, pricing, reserving, reinsurance, investment or accounting policies or procedures, except as required by changes in GAAP or Law or by a Governmental Entity;
(K) waive, release, assign, settle or compromise any litigation or other proceedings before a Governmental Entity for an amount in excess of $500,000 or any obligation or liability of the Company in excess of such amount, in any case without the imposition of equitable relief or any restrictions on the business and not in an aggregate amount operations of, on or the admission of more than $5,000,000wrongdoing by, the Company or any of its Subsidiaries;
(L) change or make any material Tax election, settle or compromise any material Tax liability or change any material method of accounting with respect to Taxes;
(M) transfer, sell, lease, license, guarantee, sell, mortgage, pledge, surrender, encumber, divest, cancel, abandon or otherwise dispose of any assets, securities, product lines or encumber any other property businesses of the Company or assets (its Subsidiaries, including capital stock of any of its Subsidiaries); (C) incur Subsidiaries and including by merger, consolidation, asset sale or modify any indebtedness other business combination, other than obsolete assets in the ordinary course of business and investments in accordance in all material respects with the Investment Policy;
(xN) indebtedness existing solely between except as contemplated by this Agreement, required pursuant to agreements in effect prior to the date of this Agreement, or as otherwise required by applicable Law, (1) grant or provide any severance or termination payments or benefits to any director, elected officer of the Company and its wholly owned Subsidiaries listed on Schedule 6.1(a)(N) (the “Elective Officers”) or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, employee of the Company shall provide Parent with a reasonable right or any of consultation; providedits Subsidiaries, furtherexcept, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 oremployees who are not Elective Officers, in the aggregateordinary course of business, (2) increase the compensation or make any new equity awards to any director, Elective Officer or employee of the Company or any of its Subsidiaries, except, in the case of employees who are in excess not Elective Officers of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materialsthe Company, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practicebusiness, by any means, make any acquisitions of, or investments in stock of (or other interest in3) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, terminate or materially amend any Benefit Plan (other than as may be necessary to comply with applicable Laws or to avoid adverse Tax consequences) or (4) enter into, make any new grants amend, waive or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, terminate (B) other than terminations in the ordinary and usual course of business consistent accordance with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of their terms) any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;Affiliate Transaction;1
(vO) except in the ordinary and usual course of businessenter into, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modifyrenew, extend, amend or terminate any Material Contract (other than Company Producer agreements in the ordinary course of its material Contracts or waive, release or assign any material rights or claimsbusiness);
(viP) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it would reasonably expects would cause be expected to result in a reduction of any financial ratings of the Company, including the insurer financial strength ratings of the Company and its representations and warranties herein to become untrue in any material respectinsurance Subsidiaries; andor
(viiiQ) neither it nor any of its Subsidiaries will except as provided in Section 6.2 and Section 8.3(a), agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, knowingly take or permit any of its Subsidiaries to purchase take, directly or otherwise acquireindirectly, 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause any of its representations and warranties herein likely to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize prevent, delay or enter into an agreement to do any impair the consummation of the foregoingMerger.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after During the period from the date hereof and prior of this Agreement to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) later of the Milestone or Option Closing Date, except with the Purchasers' prior specific written consent or as expressly contemplated by this Agreement, BSD, with respect to the BPH Business Assets, and the Company Disclosure Letter):
(i) the shall operate its business of it and its Subsidiaries shall be conducted only in the ordinary and usual course and, to the extent consistent therewith, it with past practices and each of its Subsidiaries shall use its respective reasonable best efforts to preserve intact its business organization intact and maintain good will in all material respects. Additionally, during the period from the date of this Agreement to the later of the Milestone or Option Closing Date, BSD, with respect to the BPH Business Assets for items (xi), (xiv) and (xv) below and only with respect to those actions which materially affects the BPH Business Assets for all other items below, and the Company, will not to do any of the following (unless otherwise expressly contemplated by this Agreement or permitted in writing by the Purchasers):
(i) amend its existing relations and goodwill with customersCertificate of Incorporation, suppliersany Certificate of Designation or By-Laws, distributors, creditors, lessors, employees and business associatesas the case may be;
(ii) it shall not (A) issue, sellsell or authorize for issuance or sale, pledge, dispose shares of or encumber any capital stock owned by it in any class of its Subsidiaries; securities (Bincluding, but not limited to, by way of stock split or dividend) amend its Organizational Documents; (C) other than in the case or any subscriptions, options, warrants, rights or covertible securities, or enter into any agreements or commitments of any direct character obligating it to issue or indirectsell any such securities;
(iii) redeem, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem purchase or otherwise acquire, directly or permit any of its Subsidiaries to purchase or otherwise acquireindirectly, any shares of its capital stock or any securities convertible into option, warrant or exchangeable other right to purchase or exercisable for acquire any shares of such shares;
(iv) declare or pay any dividend or other distribution (whether in cash, stock or other property) with respect to its capital stock;
(iiiv) neither it nor any of its Subsidiaries shall (A) issue, voluntarily 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, leasesurrender, license, guarantee, sell, mortgage, pledge, abandon or dispose of or encumber any other property or assets (including capital stock of any of its Subsidiariesassets or property rights (tangible or intangible); (C) incur or modify any indebtedness , other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Personpractices;
(ivvi) neither it nor grant or make any mortgage or pledge or subject itself or any of its Subsidiaries shall properties or assets to any lien, charge or encumbrance of any kind, except liens for taxes not currently due;
(Avii) terminatecreate, establishincur or assume any liability or indebtedness, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and practices;
(viii) make or commit to make any capital expenditures exceeding in the Company’s compensation budget aggregate Ten Thousand Dollars ($10,000.00);
(ix) become subject to any guaranty;
(x) grant any increase (outside the ordinary course of business consistent with respect to employees at an annual compensation level of less than $150,000, increase past practices) in the compensation of payable or to become payable to directors, officers or employees (including, without limitation, any employee such increase pursuant to any bonus, pension, profit-sharing or other plan or commitment);
(Cxi) except as approved by the Transition Teamlisted on Schedule 7.1, hire enter into any employee at an annual compensation level expected to agreement which would be more than $100,000;
(v) except in the ordinary and usual course of businessa Material Agreement, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, amend or terminate any existing Material Agreement, which is outside the ordinary course of its material Contracts business consistent with past practices. With respect to the foregoing, the Company or waive, release or assign BSD shall provide the Purchasers with a complete list of any material rights or claimssuch Material Agreement not entered into in the ordinary course of business between the date hereof and the Closing Date;
(vixii) neither it nor any alter the manner of keeping its Subsidiaries shall make any material Tax election books, accounts or file any material income Tax Return inconsistent with past practice records, or implement or adopt any change in its any manner the accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPpractices therein reflected;
(viixiii) neither it nor except as set forth on Schedule 7.1, enter into any commitment or transaction other than in the ordinary course of business consistent with past practices;
(xiv) do any act, or omit to do any act which would cause a violation or breach of any of its Subsidiaries shall the representations, warranties or covenants of the Company or BSD set forth in this Agreement;
(xv) take any action which has a material adverse effect on the condition (financial or omit to take any action that it reasonably expects would cause any otherwise), results of its representations and warranties herein to become untrue operations, assets, liabilities, properties, business or prospects of the Company or BPH Business Assets, or on employee, customer or supplier relations;
(xvi) alter in any material respectmanner any existing working capital facilities; andor
(viiixvii) neither it nor any of its Subsidiaries will authorize agree, whether in writing or enter into an agreement otherwise, to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, that after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (approve, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it the Company and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective best reasonable best efforts to (A) preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates and (B) maintain and keep material properties and assets in as good repair and condition as such are in as of the date hereof, subject to ordinary wear and tear;
(ii) it the Company shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documentsarticles of incorporation or by-laws or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine combine, subdivide or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock (other than dividends from its direct or indirect wholly owned Subsidiaries and other than regular quarterly cash dividends not in excess of $0.255 per Share and regular quarterly cash dividends on the preferred and preference stock of its Subsidiaries); or (E) repurchase, redeem or otherwise acquireacquire (except for (I) mandatory sinking funds obligations existing on the date hereof and (II) open market repurchases pursuant to the terms of the Company's Direct Stock Purchase Plan and Dividend Reinvestment Plan), 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 the Company nor any of its Subsidiaries shall (A) 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 Company Voting Debt other property or assets (other than Company Common (I) Shares issuable pursuant to options and other rights outstanding on the date hereof under the Company Option Stock Plans); (B) other than products sold , issuances of additional options or rights to customers acquire Shares granted pursuant to the terms of the Stock Plans as in effect on the date hereof in the ordinary and usual course of business the operation of such Stock Plans and issuances of Shares pursuant to options granted after the date hereof pursuant to the Stock Plans and (without limitation II) Shares issuable pursuant to the terms of the outstanding Feline Prides); (B) (I) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any of its coal fines property or assets, or, (II) except as to dollar amountidentified on Section 6.1(a)(iii) or otherwise of the Company Disclosure Letter, other than in the ordinary and usual course of business and other than sales not in an excess of $100,000,000 in the aggregate amount or $30,000,000 in respect of more than $5,000,000any transaction or series of related transactions, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries)assets; (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is or operation and maintenance expenditures in excess of $1,000,000 or110% of those contemplated to be spent pursuant to the year 1999, 2000 or 2001 capital appropriations/spending budgets set forth in Section 6.1(a) of the aggregate, are in excess of $10,000,000Company Disclosure Letter; and (E) except as otherwise provided in clause or (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (of, or other interest in) , any other Person or assets entity in excess of $100,000,000 in the aggregate or $30,000,000 in respect of any other Persontransaction or series of related transactions;
(iv) except as set forth in Section 6.1(a)(iv) of the Company Disclosure Letter, neither it the Company nor any of its Subsidiaries shall (A) incur, assume or prepay any long-term debt or incur or assume any short-term debt other than in the ordinary and usual course of business in amounts and for purposes consistent with past practice under existing lines of credit, and except for the incurrence of long-term indebtedness in connection with the refinancing of existing indebtedness either at its stated maturity or at a lower cost of funds, (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any third-party, including by means of any "keep well" or other agreement to support or maintain any financial statement condition of another person, except in the ordinary and usual course of business, (C) accelerate or delay collection of notes or accounts receivable in advance of or beyond their regular due dates or the dates consistent with past practice, or (D) change any accounting principle, practice or method in a manner that is inconsistent with past practice, except to the extent required by U.S. GAAP as advised by the Company's regular independent accountants;
(v) neither the Company nor any of its Subsidiaries shall take or fail to take any action that is reasonably likely to make any representation or warranty of the Company contained herein inaccurate in any material respect at, or as of any time prior to, the Effective Time, or that is, individually or in the aggregate, reasonably likely to have a Material Adverse Effect;
(vi) except as required by applicable Law, an existing collective bargaining agreement or other Contract identified in Section 6.1(a)(vi) of the Company Disclosure Letter, 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 Company Compensation and Benefit Plans (other than issuances of additional options, performance shares or rights to acquire Shares granted pursuant to the terms of the Stock Plans as in effect on the date hereof in the ordinary and usual course of the operation of such Stock Plans, provided, that any such additional options, performance shares or rights to acquire Shares shall not vest in connection with the Merger and the other transactions contemplated by this Agreement), or except as required by any Laws existing contract with a non-officer employer increase the salary, wage, bonus or the terms other compensation of applicable collective bargaining agreementsany employees, (B) other than except increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or and benefit increases);
(Cvii) except as approved required by applicable law, an existing collective bargaining agreement or other Contract identified in Section 6.1(a)(vii) of the Transition TeamCompany Disclosure Letter, hire neither the Company nor any employee at an annual compensation level expected of its Subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer of it or such Subsidiaries, provided, that the foregoing shall not require the Company to be more than $100,000violate any of its obligations existing prior to the date hereof as set forth in Section 5.1(h) of the Company Disclosure Letter;
(vviii) except in neither the ordinary and usual course of business, neither it 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;
(viix) neither it the Company nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases (other than in the ordinary and usual course or as may be is required by applicable Law Law) or by Canadian GAAP;
(vii) neither permit any insurance policy naming it nor any as a beneficiary or loss-payable payee to be canceled or terminated except in the ordinary and usual course of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectbusiness; and
(viiix) neither it the Company nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, that after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (approve, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure LetterAgreement):
(i) the business of it Parent and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective best reasonable best efforts to (A) preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates and (B) maintain and keep material properties and assets in as good repair and condition as such are in as of the date hereof, subject to ordinary wear and tear;
(ii) it shall not (A) issue, sell, pledge, dispose amend its articles of incorporation or encumber any capital stock owned by it in any of its Subsidiariesby-laws; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine combine, subdivide or reclassify its outstanding shares of capital stock; (DC) declare, set aside or pay any dividend payable payable, in cash, stock or property in respect of any capital stock stock, other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular other than regularly quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 0.515 per share per quarter, with declaration of Parent Common Stock and record dates consistent with past practiceregularly quarterly cash dividends on the preferred and preference stock of its Subsidiaries; or (ED) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Parent Common Stock or any securities convertible into or exchangeable or exercisable for any shares of Parent Common Stock (other than repurchases, redemptions or other acquisitions which are made at the then-prevailing market price of Parent Common Stock on the NYSE and which in the aggregate do not exceed ten percent of the shares of Parent Common Stock outstanding as of the date hereof) or (E) except as permitted under this Agreement, enter into any agreement with respect to a merger, reorganization, share exchange, consolidation or similar transaction involving, or any purchase of all or substantially all of the equity securities of it or any of its capital stockSignificant Subsidiaries (as such term is defined in Rule 1-02 of Regulation S-X under the Exchange Act);
(iii) neither it Parent nor any of its Subsidiaries shall shall, (A) 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 Parent Voting Debt Common Stock (other than (I) shares of Parent Common Stock issuable pursuant to options outstanding on the date hereof under the Parent Stock PlansPlan, issuances of additional options or rights to acquire shares of Parent Common Stock granted pursuant to the terms of the Parent Stock Plan as in effect on the date hereof in the ordinary and usual course of the operation of such Parent Stock Plan and issuances of shares of Parent Common Stock pursuant to options granted after the date hereof pursuant to the Parent Stock Plan and (II) issuances of Parent Common Stock, or securities convertible with or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, shares of Parent Common Stock, to a third-party on arms-length terms not in excess of 20% of the number of shares of Parent Common Stock outstanding as of the date hereof); , (B) other than (xpursuant to the year 1999, 2000 or 2001 capital appropriations/ spending budgets set forth in Section 6.1(b) as of the Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement Disclosure Letter and the Arrangement, (y) products sold to customers other than in the ordinary and usual course of business (without limitation as to dollar amountI) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness assets, and other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall sales not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, 250,000,000 in the aggregate, are in excess of $10,000,000; and or (EII) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (of, or other interest in, any other Person or entity in excess of $250,000,000 in the aggregate or (C) or assets acquire "Beneficial Ownership" (as such term is defined in the Rights Agreement) of any other PersonShares;
(iv) neither it nor Parent shall not change any of its Subsidiaries shall (A) terminatematerial accounting principle, establishpractice or method in a manner that is inconsistent with past practice, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as to the extent required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and U.S. GAAP as advised by Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000's regular independent accountants;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it Parent nor any of its Subsidiaries shall take any action or omit fail to take any action that it is reasonably expects would cause likely to make any representation or warranty of its representations and warranties such party contained herein to become untrue inaccurate in any material respectrespect at, or as of any time prior to, the Effective Time, or that is, individually or in the aggregate, reasonably likely to have a Material Adverse Effect; and
(viiivi) neither it Parent nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof of this Agreement and prior to the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall writing, such approval not to be unreasonably withheld withheld, conditioned or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) Agreement), the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, and it and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates 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 required by this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed) or (C) as expressly set forth in Section 6.1 of the Company Disclosure Letter, the Company will not and will not permit its Subsidiaries to:
(i) amend its charter or by-laws, or, subject to the terms of this Agreement, otherwise take any action to exempt any Person (other than Parent or its Subsidiaries) or any action taken by any Person from the Rights Agreement or any Takeover Statute or terminate, amend or waive any provisions of any confidentiality or standstill agreements in place with any third parties;
(ii) it shall not 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;
(Aiii) acquire from any other Person outside of the ordinary course of business any asset or group of related assets with a value or purchase price in excess of $1,000,000 individually or $2,500,000 in the aggregate, in any transaction or series of related transactions, in each case other than acquisitions pursuant to Contracts as in effect as of the date of this Agreement;
(iv) issue, sell, pledge, dispose of, grant, transfer, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or Encumbrance of, any shares of or encumber any capital stock owned by it in of the Company or any of its Subsidiaries; Subsidiaries (B) amend its Organizational Documents; (C) other than the issuance of shares by a Subsidiary of the Company to the Company or a wholly owned Subsidiary of the Company), 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 Encumbrances, individually or in the case aggregate, material to the Company or any of its Subsidiaries or on any asset or group of related assets of the Company or any of its Subsidiaries having a value in excess of $500,000 individually or $2,500,000 in the aggregate;
(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 indirect wholly-owned Subsidiary, split, combine Subsidiary of the Company) in excess of $100,000 individually or reclassify its $250,000 in the aggregate outstanding shares of capital stock; at any given time;
(Dvii) declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to any of any its capital stock other than (except for dividends from its paid by any direct or indirect wholly owned Subsidiaries; Subsidiary of the Company to its stockholders or (Eunit holders on a pro rata basis in the ordinary course of business consistent with past practices) repurchase, redeem or otherwise acquire, or permit enter into any agreement with respect to the voting of its Subsidiaries to capital stock;
(viii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiiix) neither 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 (A) in replacement of existing indebtedness for borrowed money on terms substantially consistent with or more beneficial than the terms of the indebtedness being replaced as of the date of such replacement, or (B) guarantees by the Company of indebtedness of wholly owned Subsidiaries of the Company complying with clause (A) above;
(x) except as expressly 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 expenditures that in the aggregate exceed by more than 15% from the aggregate capital expenditures in such capital budgets in respect of the period from the date of this Agreement to the Closing;
(xi) enter into any Contract that would have been a Material Contract had it nor been entered into prior to this Agreement, except for Contracts entered into the ordinary course of business consistent with past practices and (A) terminable by the Company, without penalty, on ninety (90) days or less notice effective on the later of September 30, 2014 or ninety (90) days or less after Closing and (B) not involving anticipated required consideration by the Company or any of its Subsidiaries shall at or after the Closing in excess of $5,000,000;
(xii) enter into any Contract of the type specified in clauses (A), (G), (I), (J), (K), (L), (M) or (N) of Section 5.1(m);
(xiii) amend, modify or terminate any Material Contract, except in the ordinary course of business consistent with past practices and (A) issueterminable by the Company, sellwithout penalty, pledgeon ninety (90) days or less notice effective on the later of September 30, dispose of 2014 or encumber ninety (90) days or less after Closing (or, in each case, such longer time period as in effect prior to any shares ofsuch amendment or modification pursuant hereto), 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); and (B) other than products sold to customers in not involving required anticipated additional consideration by the ordinary and usual course of business (without limitation as to dollar amount) Company or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); Subsidiaries at or after the Closing in excess of $5,000,000;
(Cxiv) incur make any changes with respect to accounting policies or modify any indebtedness other than procedures, except as required by changes in applicable generally accepted accounting principles, by Regulation S-X under the Securities Act, or by the Public Company Accounting Oversight Board or Financial Accounting Standards Board;
(xv) settle (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries any litigation or between such wholly owned Subsidiaries claim or (y) indebtedness other proceedings before a Governmental Entity, in each case for an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or(excluding amounts that may be paid under insurance policies);
(xvi) cancel, modify or waive any debts or claims held by it or waive any rights having in the aggregate, are each case a value or cost in excess of $10,000,000250,000 individually or $2,000,000 in the aggregate;
(xvii) make or change any material Tax election or method of Tax accounting; and (E) except as amend any Tax Return with respect to a material amount of Taxes; settle or otherwise provided finally resolve any audit or dispute with respect to material amount of Taxes, other than, in clause (D) immediately above and other than raw materialseach case, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice;
(xviii) transfer, sell, lease, assign, license, surrender, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any part of its assets (including Intellectual Property), licenses, operations, rights, product lines, businesses or interests therein of the Company or its Subsidiaries, except in connection with services or products provided in the ordinary course of business and sales of obsolete assets and except for sales, leases, licenses or other dispositions of any asset or any group of related assets (other than wireless spectrum) with a fair market value not in excess of $250,000 individually or $500,000 in the aggregate, other than pursuant to Contracts as in effect as of the date of this Agreement;
(xix) except as required pursuant to a Benefit Plan or existing written, binding agreements as in effect as of the date of this Agreement, or as otherwise required by any meansapplicable Law, (A) other than the payment of regular base salaries, at the rates in effect as of the date of this Agreement or wages and other non-discretionary compensation, make any acquisitions ofcompensation payments or awards, or investments in stock of (or other interest in) or assets including the grant of any other Person;
(iv) neither it nor equity or cash awards, to any director, officer or employee of the Company or any of its Subsidiaries shall Subsidiaries, (AB) terminategrant or increase the compensation, establishseverance or other benefits payable or to become payable to any director, officer or employee of the Company or any of its Subsidiaries, (C) adopt, enter into, make establish, or materially amend, modify or terminate any new grants Benefit Plan or awards underany employment, individual consulting, collective bargaining, bonus or other incentive compensation, health or other welfare, pension, retirement, severance, deferred compensation or other compensation or benefit plan with, for or in respect of any director, officer or employee of the Company or any of its Subsidiaries that would constitute a Benefit Plan had it been in effect as of the date of this Agreement, (D) materially amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsany outstanding equity-based 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 Benefit Plan, to the extent not already provided in any such Benefit Plan, (F) 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 (G) forgive any loans to any directors, officers or employees of the Company or any of its Subsidiaries;
(xx) (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 an FCC License or any other Permits 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 Permit or FCC License to the extent such license would be reasonably expected to prevent, materially delay or materially impair the consummation of the transactions contemplated herein;
(xxi) file for any Permit or FCC License (A) outside of the ordinary course of business or (B) the receipt of which would, individually or in the aggregate, reasonably be expected to prevent, materially delay or materially impair consummation of the transactions contemplated herein;
(xxii) assign, transfer, cancel, fail to renew or fail to extend any FCC License or Permit;
(xxiii) change (other than pursuant to software updates, upgrades and patches) any of the material technology in the Network Assets, enterprise software or billing software used in its respective businesses;
(xxiv) except in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000practices, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modifyterminate, amend or terminate modify in any of its material Contracts manner any Ground Lease, Governmental Use Permit, Colocation Agreement, Third Party Colocation Agreement or waive, release or assign any material rights or claims;Third Party Cell Site Agreement; or
(vixxv) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practicesagree, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as Prior to itself and its Subsidiaries that, after the date hereof and prior making any written or oral communications to the Effective Time (unless directors, officers or employees of the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries pertaining to purchase compensation 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate benefit matters that are affected by the transactions contemplated by this Agreement and Agreement, the Arrangement, (y) products sold to customers in Company shall provide Parent with a copy of the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicableintended communication, Parent shall provide have a reasonable period of time to review and comment on the communication, and Parent and the Company with shall cooperate in providing any such mutually agreeable communication.
(c) The Company and Parent shall cooperate in developing language for a reasonable right program of consultation; provided, further, that communications or notices relating to the foregoing right Merger or the other transactions contemplated by this Agreement to be sent to customers of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent Company and its wholly owned Subsidiaries on or between such wholly owned Subsidiaries; (D) except as approved by after the Transition Teamdate of this Agreement and prior to the Closing. The Company shall not, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of shall cause its Subsidiaries shall (A) terminatenot to, establish, adopt, enter into, make send any new grants communications or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws notices relating to the Merger or the terms other transactions contemplated by this Agreement to customers of applicable collective bargaining agreements, the Company and its Subsidiaries on or after the date of this Agreement and prior to the Closing without the prior written approval of Parent (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected not to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingunreasonably withheld).
Appears in 1 contract
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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) 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 each of its Subsidiaries shall use its 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;, and 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. By way of amplification of the foregoing and not limitation, neither the company nor any of its Subsidiaries shall, between the date of this Agreement and the Effective Time, directly or indirectly, take any action, including but not limited to the following, except with the prior consent of a Designated Officer (as defined below):
(iia) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bi) amend its Organizational Documentsarticles of incorporation or by-laws, except as may be required to increase the number of shares of Common Stock in connection with the conversion of the Convertible Loan, the Series A Preferred or the Series B Preferred, in each case outstanding as of the date hereof; (Cii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Diii) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiariesstock; or (Eiv) 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;
(iiib) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt or any other property or assets, except for (other than Company x) issuances of Common Shares issuable under Stock upon conversion of the Company Option Plans)Convertible Loan, the Series A Preferred or the Series B Preferred, in each case outstanding on the date hereof, and (y) issuances of Series B Preferred upon exercise of warrants outstanding on the date hereof; (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (yiii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of , any other PersonPerson or entity;
(ivc) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by (including, without limitation, any Laws grant or issuance of new Options, any amendment or changes to the terms of applicable collective bargaining agreementsany Options or any repricing of Options), (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, or increase the salary, wage, bonus or other compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000employees;
(vd) except in the ordinary and usual course of business, neither it 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;
(vie) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt terminated except in the ordinary and usual course of business;
(f) make any change in change, other than required by GAAP, to its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectprocedures; and
(viiig) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Sohu Com Inc)
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 approve in writing (writing, which consent approval shall not be unreasonably withheld withheld, conditioned or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in accordance with the Operating Budget, taken as a whole, and, to the extent consistent therewith, in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with all Governmental Entities (including, without limitation, the SEC), ETP Holders, OTP Holders, Current Company Related Persons, customers, suppliers, distributors, creditors, lessors, employees permit holders, Employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its SubsidiariesSubsidiaries or any of the shares of Parent Common Stock by the Company or any of its direct or indirect subsidiaries; (B) except as set forth in Sections 2.1 and 5.1(c)(ii) of this Agreement, amend its Organizational Documentscertificate of incorporation or by-laws; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquire, except in connection with the Stock Plan, 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 (A) 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 Company Voting Debt (or any other property or assets other than Company Common Shares issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Company Option PlansStock Plan); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yC) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring acquire any indebtedness, if practicable, the Company shall provide shares of Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other PersonCommon Stock;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adoptadopt or enter into any Benefit Plans, enter intoexcept as required under applicable Law, (B) make any new grants or awards underunder any Benefit Plans, except that the Company may reissue such Company Options and Company Restricted Stock which was issued and outstanding as of the date of this Agreement and which are subsequently cancelled prior to the Effective Time, in each case pursuant to the terms and conditions of the applicable Benefit Plan; or (C) or amend or otherwise modifymodify any Benefit Plan or increase the salary, wage, bonus or other compensation of any Company Compensation and Benefit Plans employees, except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the accordance with ordinary and usual course of business consistent with past practice and to the Company’s compensation budget extent all such increases and all such present or future costs associated with respect to employees at an annual compensation level of less than $150,000, increase such amendments or modifications (x) have been fully reserved against in the compensation of any employee Company Financial Statements or (Cy) except as approved by are in accordance with the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000Operating Budget;
(v) except in the ordinary and usual course of businessbusiness consistent with past practice or as fully reserved in the Operating Budget, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file 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;
(vii) it shall and shall cause its Subsidiaries to, (i) timely make all filings with the SEC and any other Governmental Entity required to maintain PCX’s status as a national securities exchange and as a self-regulatory organization (as registered under Section 6 and as defined in Section 3(a)(26), respectively, of the Exchange Act) and to keep it and all of its Subsidiaries in compliance in all material income Tax Return inconsistent respects with past practice or implement or adopt all Laws, (ii) keep PCX Equities and all of its Subsidiaries in compliance in all material respects with all Laws and PCX rules and (iii) cause PCX and its Subsidiaries to fulfill, in all material respects, its regulatory oversight functions over the ArcaEx Business in PCX’s capacity as a national securities exchange and self-regulatory organization (as registered under Section 6 and as defined in Section 3(a)(26), respectively, of the Exchange Act);
(viii) neither it nor any of its Subsidiaries (A) shall permit any change in its credit practices or accounting principles principles, policies or material practice (including, without limitation, any of its practices with respect to accounts receivable or accounts payable), except to the extent that any such changes in accounting practicesprinciples, in all cases other than as may policies or practices shall be required by applicable Law changes in GAAP and (B) shall pay, collect or by Canadian GAAPaccrue, as the case may be, the consolidated accounts receivable and accounts payable of the Company, for the period following the Calculation Month-End, other than in the ordinary and usual course of business consistent with past practice;
(viiix) neither it nor any of its Subsidiaries shall take any actions that, if taken prior to the date hereof, would constitute or result in a breach of Section 5.1(i);
(x) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectrespect at any time; and
(viiixi) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants If the Closing Date shall not have occurred by March 31, 2005, and agrees as the Company shall thereafter determine that additional funding is necessary in order for it to itself maintain a positive cash balance, Parent, within five business days of any written request therefor from the Company, will advance to the Company by wire transfer of immediately available funds to a bank account designated by the Company, the requested amount to support the Company and its Subsidiaries thatoperations; provided that the aggregate amount of such advances outstanding at any time (after giving effect to all outstanding requests therefor from the Company) shall not be required to exceed $10,000,000, after unless Parent shall consent in writing to a larger amount. Such advances may be repaid at any time at the option of the Company. Such advances: (i) for the avoidance of doubt, shall constitute a “Total Adjusted Liability” of the Company for purposes of the Calculation and the Final Working Capital Amount and for any other purpose required by GAAP or applicable Law, until repaid in accordance with the terms of this Agreement and the terms of any other customary evidence of indebtedness Parent may request that the Company and any of its Subsidiaries execute and deliver to it as a condition to Parent making such advances (which the Company shall, and shall cause its Subsidiaries to, execute and deliver to Parent prior to Parent becoming obligated to make any such advances pursuant to the terms of this Agreement); and (ii) shall not bear interest, and unless repaid by the Company, shall remain outstanding for so long as this Agreement shall remain in effect and the Effective Time shall not have occurred. If this Agreement is terminated and the Effective Time shall not have occurred, such advances shall bear interest and be repaid in accordance with Section 8.5(a) of this Agreement.
(c) Except for any resignation, retirements, dismissals or reductions in-force announced by the Company prior to the date hereof and hereof, in the event that the Company shall implement any reductions in-force prior to the Effective Time (unless Time, Parent shall, on demand, reimburse the Company for any severance costs associated therewith; provided that the Company shall otherwise consent in writing (which consent provide Parent reasonable prior notice of, and Parent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or have the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, right to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquireveto, 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingreductions.
Appears in 1 contract
Sources: Agreement and Plan of Merger (Archipelago Holdings Inc)
Interim Operations. (a) The Company covenants In furtherance of, and agrees as to itself and its Subsidiaries thatwithout limiting, after the foregoing Section 6.2, from the date hereof and prior to of this Agreement until the Effective Time Time, except (unless w) as otherwise expressly contemplated by this Agreement, (x) as expressly required by applicable Law, (y) as Parent shall otherwise consent may approve in writing (which consent approval shall not be unreasonably withheld withheld, conditioned or delayed) and except or (z) as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) 6.3 of the Company MLP Disclosure Letter):, each of the MLP Entities (and with respect to Section 6.3(a) below, GP Holdings) will not and will not permit any of MLP’s Subsidiaries to, and GP Holdings will not permit any MLP Group Entity to, directly or indirectly:
(a) (i) issue (including issuing any certificate in connection therewith), grant, sell or otherwise permit to become outstanding, or authorize the business of it and its Subsidiaries shall be conducted in creation of, any additional Equity Interests (whether “phantom” or otherwise) or any additional Rights, including transactions between or among the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact and maintain its MLP Group Entities or (ii) certificate any existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesPartnership Interests;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify any of its outstanding shares Equity Interests or issue or authorize or propose the issuance of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property other securities in respect of, in lieu of any capital stock other than dividends from or in substitution for its direct or indirect wholly owned Subsidiaries; or Equity Interests, (Eii) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase purchase, redeem or otherwise acquireacquire any membership, partnership or other Equity Securities or (iii) enter into any shares Contract with respect to the voting of its capital stock Partnership Interests or any securities convertible into or exchangeable or exercisable for any shares of its capital stockother Equity Securities;
(iiic) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, licenseor otherwise dispose of, guarantee, sell, mortgage, pledge, dispose of or encumber all or any other property or assets (including capital stock of any portion of its Subsidiaries); assets, business or properties, except for (A) sales, transfers and dispositions of obsolete or worthless equipment, (B) sales, transfers and dispositions of inventory and produced hydrocarbons in the ordinary course of business or (C) incur sales, transfers, assignments, conveyances, abandonment, allowances to lapse, licenses, sublicenses, covenants not to assert or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right disposals of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired Intellectual Property in the ordinary and usual course of business consistent with past practice, (ii) acquire, by any means, make any acquisitions ofmerger or otherwise, or investments in stock lease any assets or securities or all or any portion of (the business or other interest in) or assets property of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than (x) acquisitions of goods and services in the ordinary and usual course of business consistent with past practice and (y) acquisitions pursuant to which the Company’s compensation budget aggregate value exchanged or purchase price paid or payable by any MLP Group Entity would not exceed $2,000,000 in the aggregate, (iii) merge, consolidate or enter into any other business combination transaction with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee Person or (Civ) except as approved by the Transition Team, hire convert from any employee at an annual compensation level expected one form of business entity to be more than $100,000any other form of business entity;
(vd) except make or declare dividends or distributions to the Unitholders or holders of Phantom Units (whether in cash, assets, stock or other securities of any MLP Group Entity or of any other Person), other than (i) regular quarterly cash distributions to the ordinary Unitholders and usual course holders of businessPhantom Units declared and made in accordance with and subject to the limitations of Annex VI of the MLP Disclosure Letter and (ii) a one-time cash distribution to the Unitholders and holders of Phantom Units declared in accordance with and subject to the limitation of Annex VI of the MLP Disclosure Letter and made in accordance with the provisions of this Agreement;
(e) amend any MLP Charter Document, neither it nor the MLP GP LLC Agreement or any similar governing document of any of its Subsidiaries shall settle the MLP Group Entities;
(f) (i) enter into any Contract that would have been an MLP Material Contract if in effect on the date of this Agreement, (ii) amend any Contract in existence on the date hereof that is not a Material Contract on the date hereof if, after giving effect to such amendment, it would be an MLP Material Contract or compromise (iii) become a party to, establish or adopt any collective bargaining, union, labor or similar Contract;
(g) materially modify or amend, or waive or assign any material claims or litigation or modifyrights under, amend or terminate or assign, any of its material Contracts or MLP Material Contract;
(i) waive, release or assign its rights with respect to any material rights Proceeding in which any of the MLP Group Entities are seeking monetary damages in excess of $2,000,000 or claims(ii) compromise, settle or agree to settle any Proceeding in which damages are being sought against any of the MLP Group Entities, other than compromises, settlements or agreements in the ordinary course of business consistent with past practice that (A) involve only the payment of monetary damages not in excess of $5,000,000 individually or $10,000,000 in the aggregate and (B) do not involve any imposition of equitable relief on, or any admission of wrongdoing or, in the context of any actual or potential violation of any Criminal Law, any nolo contendere or similar plea by, any MLP Group Entity;
(vii) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or (i) implement or adopt any change in its GAAP accounting principles principles, practices or material accounting practicesmethods, in all cases other than as may be required by applicable Law GAAP or by Canadian GAAPSEC rules and regulations or (ii) write up, write down or write off the book value of any assets, except in accordance with GAAP consistently applied;
(viij) neither it nor any of its Subsidiaries shall take any action or omit fail to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact maintain, with financially responsible insurance companies, insurance in such amounts and maintain its existing relations against such risks and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associateslosses as is maintained by it on the date of this Agreement;
(iik) it shall not (Ai) issue, sell, pledge, dispose of or encumber change in any capital stock owned by it in material respect any of its Subsidiaries; express or deemed elections relating to Taxes, including elections for any and all Subsidiaries or other investments where it has the capacity to make such binding election, (Bii) settle or compromise any material Proceeding relating to Taxes or (iii) change in any material respect any of its methods of reporting income or deductions for federal income Tax purposes from those employed in the preparation of its federal income Tax Return for the most recent taxable year for which a return has been filed, except as may be required by applicable Law;
(l) except as provided expressly required by the terms of any MLP Benefit Plan as in Section 3.19effect on the date hereof, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (Ci) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any meansincrease or accelerate the payment or vesting of the compensation, make any acquisitions ofbenefits or rights payable to or accrued for, or investments in stock of (to become payable to or other interest in) accrued for, any current or assets former employee, officer, individual manager or director of any other Person;
(iv) neither it nor MLP Group Entity or any of its Subsidiaries shall their beneficiaries, (Aii) terminateother than in the ordinary course of business consistent with past practice, grant any severance or termination pay to any employee, officer, individual manager or director of any MLP Group Entity, (iii) establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, terminate any Parent Compensation and MLP Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsPlan, (Biv) other than in the ordinary course of business consistent with past practice, grant, pay, award or accelerate the vesting of, or commit to grant, pay, award or accelerate the vesting of, any bonuses or incentive compensation, any equity-based awards or any other compensation, (v) fund any rabbi trust or similar Contract, (vi) other than in the ordinary course of business consistent with past practice, terminate the employment or services of any officer or other employee whose target annual base compensation is greater than $100,000, other than for cause, (vii) forgive any loans of any current or former employee, manager, officer, director or consultant of any MLP Group Entity or GP Holdings, (viii) hire any officer, employee, independent contractor or consultant whose target annual base compensation is greater than $200,000 or (ix) enter into or modify or amend any indemnification or similar Contract with any current or former employee, individual manager, officer or director;
(m) (i) (A) incur, assume, guarantee or otherwise become liable, directly, contingently or otherwise, for any (1) Indebtedness under clause (a), (b) or (e) of the definition of Indebtedness (other than any borrowing or draws under existing revolving credit facilities in the ordinary course of business consistent with past practice), (2) Indebtedness under clause (c) of the definition of Indebtedness (other than standby letters of credit for collateral support) or (3) Indebtedness under clause (d) of the definition of Indebtedness, if in excess of $5,000,000 or (B) prepay or repurchase any Indebtedness prior to the stated maturity thereof, (ii) enter into any material lease (whether operating or capital), (iii) create any Lien (other than Permitted Liens) on its property or the property of its Subsidiaries in connection with any pre-existing Indebtedness, new Indebtedness or lease, (iv) make or commit to make any capital expenditures, other than such capital expenditures as are required on an emergency basis or for the safety of individuals, assets or the environment, (v) issue or sell any debt securities or warrants or other rights to acquire any debt security of any MLP Group Entity, (vi) enter into any “keep well” or other Contract to maintain any financial statement condition of another Person or (vii) enter into any Contract having the economic effect of any of the foregoing;
(n) restructure, reorganize or liquidate all or a material part of any MLP Group Entity’s assets or authorize, recommend, propose or announce an intention to adopt a plan of complete or partial dissolution or liquidation;
(o) make any loans, advances or capital contributions to, or investments in, any Person, other than (i) travel, relocation expenses and usual similar expenses or advances to its employees in the ordinary course of business consistent with past practice and Parent’s compensation budget (ii) trade credit granted in the ordinary course of business consistent with past practice;
(p) enter into any new Contract to sell propylene, produced hydrocarbons or other substances other than in the ordinary course of business consistent with past practice;
(q) implement or otherwise enter into any derivative security with respect to employees at an annual compensation level of less than $150,000, increase hydrocarbon production or marketing or enter into any Derivative Transaction;
(r) (i) engage in the compensation production of any employee chemical, petrochemical or produced hydrocarbon other than those produced in the ordinary course of business consistent with past practice or (Cii) except as approved by materially deviate from the Transition Teamoperating practices or production schedule of the Facility, hire including implementing or announcing any employee at an annual compensation level plant closing, material reduction in labor force or other material layoff of employees or service providers;
(s) take any action that is intended or would reasonably be expected to result in any of the conditions set forth in Article VII not being satisfied;
(t) convene any meeting, special or otherwise (or any adjournment or postponement thereof), of the Unitholders;
(u) enter into any transactions or Contracts with any Affiliate or other Person that would be more than $100,000required to be disclosed by MLP under Item 404 of Regulation S-K of the SEC;
(v) except conduct the businesses of any MLP Group Entity in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action a manner that it reasonably expects would cause any of its representations and warranties herein MLP Group Entity to become untrue in any material respectan “investment company” subject to registration under the Investment Company Act; andor
(viiiw) neither it nor any of its Subsidiaries will authorize agree or enter into an agreement commit to do any anything prohibited by clauses (a) through (v) of the foregoingthis Section 6.3.
Appears in 1 contract
Sources: Merger Agreement (PetroLogistics LP)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to until the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing), and except as otherwise expressly set forth in permitted by this Agreement or the corresponding subsection of Section 3.1(aas required in writing by a Governmental Entity (including Gaming Authorities) of the Company Disclosure Letter):
competent jurisdiction or required by applicable Laws (i) the business of including Gaming Laws), it shall and its Subsidiaries shall be conducted conduct their businesses in all material respects in the ordinary and usual course and, to the extent consistent therewithwith the foregoing, it the Company and each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve their business organizations substantially intact, maintain satisfactory relationships with customers and suppliers having business dealings with them, maintain the effectiveness of the Company’s Licenses and keep available the services of their key employees. Without limiting the generality 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 delayed, withheld or conditioned) (C) as required in writing by a Governmental Entity (including Gaming Authorities) of competent jurisdiction or required by applicable Laws (including Gaming Laws) or (D) as set forth in Section 6.1(a) of the Company Disclosure Schedule, the Company will not and will cause its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesSubsidiaries not to:
(i) adopt any change in the certificate of incorporation or bylaws of the Company;
(ii) it shall not merge or consolidate the Company or any of its Subsidiaries with any other Person;
(Aiii) make any acquisition of all or substantially all of the capital stock or assets of any other Person, whether by way of stock purchase, asset purchase, merger or otherwise (other than formation of new wholly-owned Subsidiaries), or of any other assets of any other Person for which the fair market value of the total consideration paid by the Company and its Subsidiaries exceeds $250,000 individually or $500,000 in the aggregate;
(iv) issue, sell, deliver, pledge, dispose of, grant, transfer, lease, license, guarantee or encumber, or authorize the issuance, sale, delivery, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of or encumber any capital stock owned by it in or voting debt of the Company or any of its Subsidiaries; Subsidiaries (other than (A) upon conversion of Preferred Stock outstanding as of the date hereof in accordance with the terms thereof and (B) amend its Organizational Documents; (C) the issuance of shares or other than in equity securities by a wholly-owned Subsidiary of the case Company to the Company or another wholly-owned Subsidiary of the Company), or securities convertible or exchangeable into or exercisable for any shares of such capital stock or voting debt, or any options, warrants or other rights of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding kind to acquire any shares of such capital stock; stock voting debt or such convertible or exchangeable securities, or stock appreciation rights;
(Dv) except for dividends in respect of the Preferred Stock required to be paid or accrued in accordance with the Company’s certificate of incorporation and the certificates of designations thereof, declare, set aside aside, make or pay any dividend or other distribution, payable in cash, stock stock, property or property in otherwise, with respect to any of any its capital stock other than (except dividends from paid by any direct or indirect wholly-owned Subsidiary of the Company);
(vi) except for transactions among the Company and its direct or indirect wholly wholly-owned Subsidiaries or among the Company’s direct or indirect wholly-owned Subsidiaries; , reclassify, split, combine, subdivide or (E) repurchaseredeem, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiivii) neither it nor subject to Section 6.20, change in any material respect its financial or Tax accounting policies or procedures, except as required by applicable Law or by changes in GAAP;
(viii) other than Transaction Litigation (which is addressed in Section 6.13), settle, release, waive or compromise any litigation or other pending or threatened proceedings or claims by or before a Governmental Entity or arbitrator 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 shall (A) issueof monetary damages exceeding $250,000 in any individual matter, 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 net of any kind to acquire, any shares amount covered by insurance or third-party indemnification in respect of its capital stock of any class such matter or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold with respect to customers any non-monetary terms and conditions therein, imposes or requires actions that would or would, individually or in the ordinary and usual course aggregate, reasonably be expected to materially restrict or limit the operations of the business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or as conducted on the date hereof;
(y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (Dix) except as approved required by a Benefit Plan in effect prior to the Transition Teamdate of this Agreement that is set forth on Section 6.1(a)(ix) of the Company Disclosure Schedule, make (A) grant or authorize provide any severance or commit for termination payments or benefits to any capital expenditures whichcurrent or former Company Employee or any other current or former service provider, individually(B) increase the compensation or benefits of any current or former Company Employee or any other current or former service provider, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired customary annual increases for non-executive Company Employees in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest inC) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make adopt, join, terminate or amend any Benefit Plan or any plan, program, arrangement, policy or agreement that would be a Benefit Plan if it were in existence on the date hereof, (D) hire or otherwise retain the services of any new grants member of the Company Board, officer or awards underother senior executive, amend (E) take any action to fund or otherwise modifyin any other way secure the payment of compensation or benefits under any Contract or Benefit Plan, any Company Compensation and Benefit Plans or (F) except as specifically required by this Agreement, exercise any Laws discretion to accelerate the vesting or the terms payment of applicable collective bargaining agreements, any compensation or benefit under any Benefit Plan;
(Bx) adopt a plan or agreement of complete or partial liquidation or dissolution;
(xi) enter into any new line of business;
(xii) other than (A) any sale, lease, assignment, encumbrances or other disposition of inventory in the ordinary and usual course of business consistent with past practice and (B) dispositions of assets if the Company’s compensation budget with respect book value thereof does not exceed in the aggregate $500,000, sell, lease, assign, encumber or otherwise dispose of, or agree to employees at an annual compensation level sell, lease, assign, encumber or otherwise dispose of, any assets of less than $150,000, increase the compensation Company or any of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000its Subsidiaries;
(vxiii) fail to maintain its existing insurance coverage of all types;
(xiv) except in the ordinary and usual course of businessbusiness consistent with past practice, neither it nor enter into any Material Contract, or amend in any material respect or terminate any Material Contract or waive or grant any release or relinquishment of any material rights under, or renew, any Material Contract; provided, that, except as set forth in Section 6.1(a)(xiv) of the Company Disclosure Schedule, entry into, amendment in any material respect, termination of, waiver or granting of any release or relinquishment of any material rights under, or renewal of, any Contract either (1) described by any of clauses (B), (C), (D), (F), (G), (H), (I), (K) or (L) of the definition of “Material Contracts,” or (2) (x) with a term of 18 months or more, (y) that is not terminable by the Company or its Subsidiaries without fee or penalty upon 90 days’ or less prior notice and (z) that by its terms calls for aggregate payments by or to the Company or any of its Subsidiaries in excess of $1,500,000, shall settle require Parent approval in accordance with this Section 6.1(a) even if entered in the ordinary course of business consistent with past practice;
(xv) enter into any Contract with an Affiliate of the Company (other than a wholly-owned Subsidiary of the Company) (an “Affiliate Contract”), or compromise amend in any material claims or litigation or modifyrespect or, amend or except as contemplated by this Agreement, terminate any of its material Contracts Affiliate Contract or waive, waive or grant any release or assign relinquishment of any material rights under, or claimsrenew, any Affiliate Contract;
(vixvi) neither it nor spend the amounts in the Specified Reserve Account for any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases purpose other than as may be required by applicable Law or by Canadian GAAP;resolution of the Specified Matter; or
(viixvii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as Nothing contained in this Agreement gives, or is intended to itself and give Parent, directly or indirectly, the right to control or direct the Company’s or its Subsidiaries that, after the date hereof and Subsidiaries’ operations prior to the Effective Time (unless Time. Prior to the Effective Time, the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) exercise, consistent with the terms and except as otherwise expressly set forth in subject to the conditions of this Agreement or Agreement, including this Section 6.1, complete control and supervision over the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it Company’s and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing’ operations.
Appears in 1 contract
Sources: Agreement and Plan of Merger (Penn National Gaming Inc)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after from the date hereof and prior to of this Agreement until the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) and except as required by applicable Laws), the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, 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, (C) as required by applicable Laws 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 or propose any change in its certificate of incorporation or By-laws or other applicable governing instruments;
(ii) it shall not 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 the Company or any of its Subsidiaries;
(Aiii) 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 million in any transaction or series of related transactions, other than acquisitions pursuant to Contracts in effect as of the date of this Agreement and set forth in Section 6.1(a)(iii) of the Company Disclosure Letter;
(iv) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer or encumbrance of, any shares of or encumber any capital stock owned by it of the Company or any its Subsidiaries (other than (A) the issuance of Shares upon the exercise of Company Options, the settlement of Restricted Share and conversion of the Convertible Notes (and dividend equivalents thereon, if applicable) in any each case which Company Options, Restricted Share or Convertible Notes were outstanding as of its Subsidiaries; the date hereof or (B) amend its Organizational Documents; (C) other than in the case issuance of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary of the Company), or securities convertible or exchangeable into or exercisable for any shares of such capital stock; (D) declare, set aside or pay any dividend payable in cashoptions, warrants or other rights of any kind to acquire any shares of such capital stock or property such convertible, exchangeable or exercisable securities;
(v) make any loans, advances or capital contributions to or investments in respect of any capital stock Person (other than dividends from its the Company or any direct or indirect wholly owned Subsidiaries; Subsidiary of the Company) in excess of $1 million in the aggregate;
(vi) declare, set aside, make or (E) repurchasepay any dividend or other distribution, redeem payable in cash, stock, property or otherwise acquireotherwise, or permit with respect to any of its Subsidiaries capital stock (except for 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 enter into any agreement with respect to the voting of its capital stock;
(vii) reclassify, split, combine, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stockstock (other than the acquisition of any Shares tendered by current or former employees or directors in order to pay Taxes in connection with the exercise of Company Options or the settlement of Restricted Share in accordance with the terms of the applicable plan);
(iiiviii) neither it nor 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 shall Subsidiaries, except for indebtedness for borrowed money incurred in the ordinary course of business;
(Aix) issue, sell, pledge, dispose except as set forth in the capital budgets set forth in Section 6.1(a)(ix) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); Disclosure Letter, make or authorize any capital expenditure in excess of $1 million in the aggregate;
(Bx) make any material changes with respect to accounting policies or procedures, except as required by changes in GAAP or applicable Law;
(xi) compromise, settle or agree to settle any suit, action, claim, proceeding or investigation (including any suit, action, claim, proceeding or investigation relating to this Agreement or the transactions contemplated hereby) or pay, discharge or satisfy or agree to pay, discharge or satisfy any claim, liability or obligation (absolute or accrued, asserted or unasserted, contingent or otherwise) other than products sold to customers the compromise, settlement, payment, discharge or satisfaction of claims, liabilities or obligations in the ordinary and usual course of business consistent with past practice which in any event does not exceed in any individual case $500,000 or an aggregate of more than $2 million;
(without limitation as to dollar amountxii) or otherwise other than in the ordinary and usual course of business and not consistent with past practice, make or change any material Tax election or settle or compromise any material Tax liability and except as are not, individually or in an aggregate amount the aggregate, material to the business or the Company and its Subsidiaries, taken as a whole, except as required by Law, change any of more than $5,000,000its material methods of reporting income or deductions for federal income tax purposes from those employed in the preparation of its federal income tax returns for the taxable year ended June 30, 2005;
(xiii) transfer, sell, lease, license, guarantee, sell, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any assets, product lines or encumber any other property businesses of the Company or assets (its Subsidiaries, including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between , in each case which are material to the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; providedtaken as a whole, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materialsinventory, supplies and other inventory items acquired assets in the ordinary course of business and usual other than pursuant to Contracts in effect prior to the date of this Agreement and set forth in Section 6.1(a)(xiii) of the Company Disclosure Letter;
(xiv) except as required pursuant to Contracts in effect prior to the date of this Agreement, or as otherwise required by applicable Laws, (A) grant or provide any severance or termination payments or benefits to or increase the compensation or make any new equity awards to any director, officer or other employee of the Company or any of its Subsidiaries, except for increases of non-equity compensation to non-director and non-officer employees in the ordinary course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest inB) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make terminate or materially amend any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, Plan (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect routine changes to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000welfare plans for 2007);
(vxv) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectrespect its debt collection practices; andor
(viiixvi) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, knowingly take 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it is reasonably expects would cause any likely to prevent or, solely in connection with the acquisition of its representations and warranties herein to become untrue an interest in any an Internet marketing services business, delay in a material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any respect the consummation of the foregoingMerger.
Appears in 1 contract
Sources: Merger Agreement (Vertrue Inc)
Interim Operations. (a) The Company Except as set forth in Section 3.1 of the Western Disclosure Letter, Western covenants and agrees as to itself and its the Transferred Subsidiaries that, after the date hereof and prior to the Effective Time Closing (unless Parent Protection One shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth in contemplated by this Agreement, the Stock Option Agreement or and the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterOption and Voting Agreement):
(ia) the business businesses of it and its the Transferred Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Western shall cause the Transferred Subsidiaries shall to use its respective all reasonable best efforts to preserve its their respective business organization organizations intact and maintain its their respective existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(iib) it neither Western nor any of its Subsidiaries shall not (Ai) issue, sell, pledge, dispose of of, encumber or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirectaccelerate, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquiremodify, or permit any amend the terms 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 (A) 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 any capital stock in any Transferred Subsidiary; (ii) amend the certificate of incorporation or by-laws of any Transferred Subsidiary; (iii) split, combine or reclassify the outstanding shares of capital stock of any class Transferred Subsidiary; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock of WestSec or Westar Security; (v) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of capital stock of any Transferred Subsidiary or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans)securities convertible into or exchangeable or exercisable for any shares of capital stock of any Transferred Subsidiary; (Bvi) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets, real, personal or mixed (including, without limitation, leasehold interests and intangible assets (including and capital stock of any Transferred Subsidiary) of its Subsidiaries); (C) any Transferred Subsidiary or permit any 39 Transferred Subsidiary to incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yvii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior permit any Transferred Subsidiary to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregateby any means, are in excess permit any Transferred Subsidiary to make any acquisition of, or investment in, assets or stock of $10,000,000; and any other Person or entity, except for (EA) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired acquisitions of security monitoring accounts in the ordinary and usual course of business consistent with past practice, by any means, make any (B) other acquisitions of, or investments of security monitoring accounts not to exceed $5,000,000 in stock of the aggregate and (or C) other interest in) or assets of any other Personcapital expenditures not to exceed $500,000 in the aggregate;
(ivc) neither it Western nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees of any Transferred Subsidiary except as required by any Laws grants, awards or the terms of applicable collective bargaining agreements, (B) other than increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000and benefit grants, increase the compensation of any employee awards or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000increases);
(vd) except in the ordinary and usual course of business, neither it Western nor any of its Subsidiaries shall settle or compromise any material claims or litigation or involving any Transferred Subsidiary or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts to which a Transferred Subsidiary is party or waive, release or assign any material rights or claimsclaims of any Transferred Subsidiary;
(vie) neither it Western nor any of its Subsidiaries shall make any material Tax election with respect to Taxes payable by any Transferred Subsidiary or file permit any material income Tax Return inconsistent with past practice insurance policy naming any Transferred Subsidiary as a beneficiary or implement loss- payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viif) neither it Western nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiig) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingfore going.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(ih) the business of it Protection One and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it Protection One and each of its Subsidiaries shall use its respective all reasonable best efforts to preserve its their respective business organization organizations intact and maintain its their respective existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(iii) it neither Protection One nor any of its Subsidiaries shall not (Ai) issue, sell, pledge, dispose of of, encumber or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19accelerate, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquiremodify, or permit any amend the terms 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 (A) 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 any capital stock of any class Protection One or any Parent Voting Debt of its Subsidiaries; (ii) amend the certificate of incorporation or by-laws of Protection One or any of its Subsidiaries; (iii) split, combine or reclassify the outstanding shares of capital stock of Protection One or any of its Subsidiaries; (iv) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than Parent Common Stock issuable under dividends from Protection One's direct or indirect wholly-owned Subsidiaries and the Parent Stock Plans)dividend and other distributions referred to in the recitals to this Agreement; or (v) repurchase, redeem or otherwise acquire any shares of capital stock or any securities convertible into or exchangeable or exercisable for any shares of capital stock of Protection One or any of its Subsidiaries; (Bvi) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets, real, personal or mixed (including, without limitation, leasehold interests and intangible assets and (including capital stock of any of its Protection One's Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (zvii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregateby any means, are in excess make any acquisition of, or investment in, assets or stock of $10,000,000; and any other Person or entity, except for
(EA) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired acquisitions of security monitoring accounts in the ordinary and usual course of business consistent with past practice, by any means, make any (B) other acquisitions of, or investments of security monitoring accounts not to exceed $5,000,000 in stock of the aggregate and (or C) other interest in) or assets of any other Personcapital expenditures not to exceed $500,000 in the aggregate;
(ivj) neither it Protection One nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Protection One Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except as required by any Laws grants, awards or the terms of applicable collective bargaining agreements, (B) other than increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and Parent’s related compensation budget with respect to employees at an annual compensation level of less than $150,000and benefit grants, increase the compensation of any employee awards or (Cincreases) except as approved by for the Transition Team, hire any employee at an annual compensation level expected bonuses referred to be more than $100,000in the recitals to this Agreement;
(vk) except in the ordinary and usual course of business, neither it Protection One nor any of its Subsidiaries shall settle or compromise any material claims or litigation or or, except in the ordinary and usual course of business modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vil) neither it Protection One nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAPthe ordinary and usual course of business;
(viim) neither it Protection One nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiin) neither it Protection One nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Sources: Contribution Agreement (Protection One Alarm Monitoring Inc)
Interim Operations. Except as set forth on Schedule 5.08, since December 31, 2009:
(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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):Business has been conducted by the Company only in the ordinary course consistent with past practices;
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, with respect to the extent consistent therewithCompany Business, it 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, suppliers, distributors, creditors, lessors, employees and business associates;the Company has not:
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber suffered any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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 stockMaterial Adverse Effect;
(iii) neither it nor incurred any of its Subsidiaries shall liabilities or obligations (A) issueabsolute, sellaccrued, pledgecontingent or otherwise), 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise except in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions ofor increased, or investments experienced any change in stock any assumptions underlying or methods of (calculating, any bad debt, contingency or other interest in) or assets of any other Personreserves;
(iv) neither it nor paid, discharged or satisfied any of its Subsidiaries shall claims, liabilities or obligations (A) terminateabsolute, establishaccrued, adoptcontingent or otherwise), enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000payment, increase the compensation of any employee discharge or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise satisfaction in the ordinary and usual course of business and not consistent with past practice liabilities and obligations reflected or reserved against in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees Financial Statements or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired incurred in the ordinary and usual course of business and consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) permitted or allowed the Company’s assets to be subjected to any Encumbrance (except Encumbrances created by Law);
(vi) canceled any debts owing to the Company or waived any claims or rights, except for amounts each individually under $5,000;
(vii) sold, transferred, or otherwise disposed of, or transferred or granted any rights under any lease, license or agreement with respect to, any of its assets, except in the ordinary course of business and consistent with past practices;
(viii) disposed of, failed to take reasonable steps to protect, or permitted to lapse, any rights for the use of, the Company’s Intellectual Property, or disposed of, failed to take reasonable steps to protect any Proprietary Information;
(ix) made any change in any method of accounting or accounting practice;
(x) made any single capital expenditure or future commitment in excess of $20,000, or made aggregate capital expenditures or future commitments in excess of $50,000;
(xi) made any material change in the manner in which the Company Business is conducted;
(xii) made any material change in policies relating to the Company Business (whether or not in the ordinary and usual course of business, neither it 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);
(vixiii) neither it nor had any labor dispute or received notice of any grievance;
(xiv) borrowed or agreed to borrow any funds;
(xv) paid and/or declared any dividends with respect to its Subsidiaries shall make shares of capital stock, whether in shares of capital stock or other property;
(xvi) granted to any material Tax election officer or file employee any material income Tax Return inconsistent with past practice increase in compensation or implement or adopt any change in its accounting principles or material accounting practicesbenefits, in all cases other than as may be increases in compensation or benefits to employees in the ordinary and usual course of business;
(xvii) paid any pension, retirement allowance or other employee benefit not required by any plan, policy or program identified on Schedule 5.21 hereto or any employment agreement set forth on Schedule 5.21 hereto;
(xviii) adopted, agreed to adopt, or made any announcement regarding the adoption of (i) any new pension, retirement or other employee benefit plan, program or policy, or (ii) any amendments to any existing pension, retirement or other employee benefit plan, policy or program identified on Schedule 5.21 unless otherwise required by applicable Law or by U.S. GAAP;Law; or
(viixix) neither it nor any of its Subsidiaries shall take any action suffered or omit agreed to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue the actions set forth in this subparagraph (ii).
(b) None of the assets of the Company have been affected in any material respect; and
way as a result of fire, explosion or other casualty (viii) neither it nor any of its Subsidiaries will authorize whether or enter into an agreement to do any of the foregoingnot covered by insurance).
Appears in 1 contract
Sources: Merger Agreement (MDRNA, Inc.)
Interim Operations. (a) The Except as otherwise expressly contemplated by this Agreement, as set forth in Section 5.1 of the Company covenants and agrees Disclosure Schedule, or as agreed to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing by Purchaser (which consent agreement shall not be unreasonably withheld withheld, delayed or delayedconditioned), the Company and the Stockholder covenant and agree that, prior to the Closing:
(b) The business and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) operations of the Company Disclosure Letter):
(i) and the business of it and its Company Subsidiaries shall be conducted in the ordinary course of business consistent with past practice;
(c) The Company shall, and usual course andshall cause each Company Subsidiary to, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially reasonable best efforts to preserve keep intact its rights, properties and assets, and employee, independent contractor, supplier, customer and other business organization intact relationships;
(d) The Company shall, and shall cause each Company Subsidiary to, use its commercially reasonable efforts to keep and maintain its existing relations rights, properties and goodwill with customersassets in their present condition, suppliersrepair and working order, distributors, creditors, lessors, employees except for normal depreciation and business associateswear and tear;
(iie) it The Company shall not, and shall not permit any Company Subsidiary to, (Ai) authorize for issuance, issue, deliver, sell, pledgegrant options, dispose warrants or rights to receive, purchase or subscribe for, or agree or commit to issue, sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect other equity interests of the Company or any Company Subsidiary (including securities convertible into, or rights or options to acquire, capital stock or other than dividends from its direct equity interests of the Company or indirect wholly owned Subsidiaries; or any Company Subsidiary), (Eii) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, acquire any shares of its capital stock or other equity interests of the Company or any Company Subsidiary (including securities convertible into into, or exchangeable rights or exercisable for options to acquire, capital stock or other equity interests of the Company or any shares Company Subsidiary), or (iii) amend or otherwise change its certificate of its capital stockincorporation or bylaws (or equivalent organizational documents);
(iiif) neither it nor The Company shall not, and shall not permit any of its Subsidiaries shall (A) issueCompany Subsidiary to, sellacquire, pledgeincluding by merging or consolidating with, dispose of or encumber any shares purchasing the assets or capital stock or other equity interests of, or securities convertible into in any other manner, any business or exchangeable any corporation, partnership, association or exercisable forother business organization or division thereof, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is or commitments in an amount in excess of One Hundred Thousand Dollars ($1,000,000 or, 100,000) in the aggregate, are other than pursuant to existing agreements;
(g) The Company shall not, and shall not permit any Company Subsidiary to, (i) increase in excess of $10,000,000; any manner the compensation or fringe benefits of, or pay any bonus to, any current or former director, manager, officer, employee or independent contractor, other than (A) increases and bonuses expressly contemplated by or required under existing employment or consulting agreements or bonus plans, and (EB) except as otherwise provided increases in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired compensation to employees in the ordinary and usual course of business consistent with past practice, (ii) except as required to comply with applicable Law, become obligated under any Benefit Plan that was not in existence on the date of this Agreement or amend, modify or terminate any Benefit Plan in existence on the date of this Agreement, or (iii) except as required to comply with applicable Law, pay any benefit not required by any meansBenefit Plan as in effect as of the date of this Agreement;
(h) The Company shall not, and shall not permit any Company Subsidiary to, sell, lease, license, subject to any Lien (other than a Permitted Lien) or otherwise encumber or dispose of (including through any sale-leaseback or similar transaction) any of its properties or assets, other than (i) pursuant to existing agreements, (ii) immaterial properties or assets (or immaterial portions of properties or assets), or (iii) in the ordinary course of business consistent with past practice;
(i) The Company shall not, and shall not permit any Company Subsidiary to, (i) make or forgive any acquisitions ofloans, advances or capital contributions to, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsPerson, (B) other than trade accounts receivable incurred in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect cash advances to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by Company and the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except Company Subsidiaries for reimbursable travel and other business expenses incurred in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means(ii) assume, make any acquisitions ofguarantee or otherwise become liable or responsible (whether directly, contingently or investments in stock of (otherwise) for the Indebtedness or other interest in) or assets obligations of any other Person, or (iii) enter into any “keep well” or other agreement to maintain any financial statement condition of another Person;
(ivj) neither it nor The Company shall not, and shall not permit any Company Subsidiary to, adopt or put into effect a plan of its Subsidiaries complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any Company Subsidiary;
(k) The Company shall not, and shall not permit any Company Subsidiary to, (Ai) terminate, establish, adopt, enter into, make any new grants or awards undermaterially amend, amend modify or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in supplement outside the ordinary and usual course of business consistent with past practice practice, any Material Contract or (ii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Material Contract or otherwise);
(l) The Company shall, and Parent’s compensation budget shall cause the Company Subsidiaries to, (i) comply in all material respects with its obligations under the Material Contracts as such obligations become due, (ii) maintain insurance covering risks of such types and in such amounts as are consistent with its past practices, and (iii) use commercially reasonable efforts not to permit any insurance policy naming it as beneficiary or loss payable payee to be canceled or terminated;
(m) The Company shall not abandon, fail to maintain or allow to expire (other than at the natural expiration of its terms), or sell or exclusively license to any Person, any material Company Intellectual Property, except in the exercise of commercially reasonable business judgment consistent with industry practices;
(n) The Company shall not fail to pay or satisfy when due any material Liability of the Company (other than any such Liability that is being contested in good faith);
(o) The Company shall not settle or compromise any Action pending before any Governmental Authority, or any other material Action, against the Company;
(p) The Company shall not, and shall not permit any Company Subsidiary to, (i) change any material accounting policies, practices or procedures (including material Tax accounting policies, practices and procedures), except as required by changes in applicable Law or GAAP, (ii) revalue in any material respect any of its assets (including writing down or writing off any notes or accounts receivable in any material manner), except as required by changes in GAAP, (iii) make or change any material Tax election (including any election under Section 338 of the Code or other similar election), make or change any material method of accounting with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) Taxes except as approved required by the Transition Teamchanges in applicable Law, hire any employee at an annual compensation level expected to be more than $100,000;
(viv) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims Tax liability (except to the extent permitted by Section 5.8(f)), (v) file any amended Tax Return that would materially increase the Tax Liability of the Company or litigation or modifyany Company Subsidiary after the Closing, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice in any jurisdiction in which the Company or implement any Company Subsidiary previously did not file Tax Returns, or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor waive the statute of limitations or extend the period for the assessment or collection with respect to any Tax or Tax Return of its Subsidiaries shall take the Company or any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectCompany Subsidiary; and
(viiiq) neither it nor The Company shall not, and shall not permit any of its Subsidiaries will authorize Company Subsidiary to, agree or enter into an agreement commit to do take any of the foregoingforegoing actions prohibited by this Section 5.1. Notwithstanding anything to the contrary set forth in this Agreement, the parties acknowledge and agree that neither Purchaser nor its affiliates have the right to control or direct the Company’s or any Company Subsidiary’s operations prior to the Closing. Prior to the Closing, the Company and each Company Subsidiary shall exercise, consistent with the terms of this Agreement, complete control and supervision over its operations.
Appears in 1 contract
Sources: Stock Purchase Agreement (Amn Healthcare Services Inc)
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 approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its 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;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentscertificate of incorporation or by-laws or, amend, modify or terminate the Rights Agreement; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly wholly-owned SubsidiariesSubsidiaries and other than regular quarterly cash dividends not in excess of $0.055 per Share; or (Ev) repurchase, redeem or otherwise acquire, except in connection with the Stock Plans, 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;
(iiic) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt or any other property or assets (other than Company Common in accordance with the Rights Agreement and other than Shares issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Company Option Stock Plans); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiariesliability; (Diii) except as approved by the Transition Team, (A) make or authorize or commit for any capital expenditures which, individually, is other than capital expenditures (a) in the aggregate amount remaining in the capital appropriations/spending budgets set forth in the Company Disclosure Schedule after deducting amounts previously authorized or committed by the Company with respect to calendar year 2005 and (b) in amounts not in excess of $1,000,000 or, 2 million individually and $10 million in the aggregateaggregate with respect to all unbudgeted capital expenditures, are in excess of $10,000,000; and or (EB) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of , any other Person or entity for consideration in excess of (a) in the aggregate amount remaining in the acquisitions budget set forth in the Company Disclosure Schedule after deducting amounts previously spent by the Company with respect to acquisitions and investments in calendar year 2005 and (b) in amounts not in excess of $2 million individually and $10 million in the aggregate with respect to all unbudgeted acquisitions; and (iv) enter into any joint venture agreement, partnership agreement or similar agreement with any Person;
(ivd) except as set forth in Sections 5.1(h)(i) and 5.1(h)(xii) of the Company Disclosure Schedule, or as otherwise required by applicable Law, neither it nor any of its Subsidiaries shall (Ai) terminategrant or provide any severance or termination payments or benefits to any director, establishofficer or Employee of the Company or any of its Subsidiaries except, adoptin the case of Employees who are not officers, enter intoin the ordinary course of business consistent with past practice, (ii) increase the compensation, bonus or pension, welfare, profit-sharing, severance or other benefits of, pay any bonus to, or make any new grants equity awards to any director, officer or awards underEmployee of the Company or any of its Subsidiaries, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than for increases in base salary in the ordinary and usual course of business consistent with past practice and for Employees who are not officers, (iii) enter into, adopt, extend or renew any employment, severance, change in control, termination, deferred compensation or other similar agreement with any director, officer or Employee of the Company’s Company or any of its Subsidiaries, (iv) establish, adopt, amend, suspend, terminate or exercise any discretion under any Company Benefit Plan or amend the terms of or exercise any discretion under any Company Options or Company Awards, (v) take any action to fund or in any other way secure the payment of compensation budget or benefits under any Company Benefit Plan, (vi) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan, to the extent not already provided for under any such Company Benefit Plan, (vii) change any actuarial or other assumptions used to calculate funding obligations with respect to employees at an annual compensation level of less than $150,000any 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, increase the compensation of any employee except as may be required by GAAP; or (Cviii) except as approved by forgive any loans to directors, officers or Employees of the Transition Team, hire Company or any employee at an annual compensation level expected to be more than $100,000of its Subsidiaries;
(ve) prior to making any written or oral communications to any of its or its Subsidiaries’ directors, officers or Employees pertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement, it shall provide Parent with a copy of the intended communication, Parent shall have a reasonable period of time to review and comment on the intended communication, and Parent and the Company shall cooperate in providing any such communication;
(f) except in the ordinary and usual course of business, neither it 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;
(vig) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viih) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect;
(i) neither it nor any of its Subsidiaries will authorize or enter into any ▇▇▇▇▇▇;
(j) neither it nor any of its Subsidiaries will enter into any agreement that limits (other than in an insignificant manner) the ability of the Company or any Subsidiary of the Company, or would limit (other than in an insignificant manner) the ability of Parent or any Subsidiary of Parent after the Effective Time, to compete in or conduct any line of business or compete with any Person in any geographic area or during any period, it being understood that any restriction that by its terms does not extend more than six months beyond the Effective Time shall be deemed to be insignificant;
(k) neither it nor any of its Subsidiaries will enter into any marketing Contract with respect to natural gas for a term longer than 31 days from the date of such Contract (or six months in the case of Bolivia);
(l) neither it nor any of its Subsidiaries will enter into any marketing Contract with respect to crude oil for a term longer than two full months from the last day of the calendar month in which such Contract is entered into; and
(viiim) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. The Company has agreed that, from the date of the Merger Agreement until the Closing Time, unless the Parent has consented thereto in writing, the Company shall, and shall cause each of its subsidiaries to (a) The Company covenants conduct its business and agrees as operations only in the ordinary course of business consistent with past practice; (b) use reasonable efforts to itself preserve intact the business, organization, goodwill, rights, licenses, permits and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) franchises of the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact subsidiaries and maintain its their existing relations and goodwill relationships with customers, supplierssuppliers and other persons having business dealings with them, distributorsthe loss of any of which would be reasonably likely to result in a material adverse effect on the Company; (c) use reasonable efforts to keep in full force and effect adequate insurance coverage and maintain and keep its properties and assets in good repair, creditorsworking order and condition, lessorsnormal wear and tear excepted; (d) not amend or modify its respective charter or certificate of incorporation, employees and business associates;
by-laws, or other charter or organization documents; (iie) it shall not (A) authorize for issuance, issue, sell, pledgegrant, dispose of 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 owned by it in of the Company or any of its Subsidiariessubsidiaries 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 issuances of Shares upon exercise of Company Stock Options as then in effect granted to directors, officers, employees and consultants of the Company prior to the date of the Merger Agreement); (Bf) amend its Organizational Documents; not (Ci) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding any shares of capital its 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 stock; , (Dii) solely in the case of the Company, declare, set aside or pay any dividend payable in cashdividends on, stock or property make other distributions in respect of, any of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; the Company's stock, or (Eiii) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries agree or commit to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any other equity or debt securities convertible into or exchangeable equity interests of the Company or exercisable for any shares of its capital stock;
(iii) neither it nor any of its Subsidiaries shall subsidiaries; (Ag) issue, sell, pledge, dispose of not amend or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights otherwise modify the terms of any kind to acquire, any shares of its capital stock of any class Company Stock Options or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans), the effect of which would be to make such terms more favorable to the holders thereof or persons eligible for participation therein; (Bh) other than products sold to customers regularly scheduled seniority increases in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by not increase the compensation payable or to become payable to any meansdirectors, make any acquisitions of, officers or investments in stock employees of (the Company or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminatesubsidiaries, or grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer of the Company or any of its subsidiaries, or establish, adopt, enter intointo or amend in any material respect or take action to accelerate any material rights or benefits under any collective bargaining, make 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 new grants director, officer or awards underemployee or the Company of any of its subsidiaries; (i) not acquire or agree to acquire (including, amend 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 modify, acquire or agree to acquire any Company Compensation and Benefit Plans except as required by assets of any Laws or the terms of applicable collective bargaining agreements, (B) other than in person outside the ordinary and usual course of business consistent with past practice or any interest in any real properties (whether or not 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 or sell 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 Company’s compensation budget ordinary course of business not to exceed $1,000,000 in the aggregate and (ii) advances, loans or other indebtedness in the ordinary course of business consistent with respect past practice in an aggregate amount not to employees at an annual compensation level exceed $1,000,000; (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 less than the Company and its subsidiaries taken as a whole; (l) not authorize or make any capital expenditures (including by lease) in excess of $150,0001,000,000 in the aggregate 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, increase the compensation of any employee principles or (C) practices, except as approved may be required by the Transition Team, hire U.S. GAAP or applicable tax laws; (n) not make any employee at an annual compensation level expected to be more than $100,000;
material tax election or settle or compromise any material United States or foreign tax liability; (vo) except in the ordinary and usual course of businessbusiness consistent with past practice, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modifynot amend, amend modify or terminate any of its material Contracts certain specified contracts or waive, release or assign any material rights or claims;
claims thereunder; (vip) neither it nor 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 shall make any material Tax election subsidiaries; and (q) except as to subsections (a), (b) and (c) above, not agree or file any material income Tax Return inconsistent with past practice commit in writing or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement otherwise to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, that after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (approve, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it the Company and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective best reasonable best efforts to (A) preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates and (B) maintain and keep material properties and assets in as good repair and condition as such are in as of the date hereof, subject to ordinary wear and tear;
(ii) it the Company shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documentsarticles of incorporation or by-laws or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine combine, subdivide or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock (other than dividends from its direct or indirect wholly owned Subsidiaries and other than regular quarterly cash dividends not in excess of $0.255 per Share and regular quarterly cash dividends on the preferred and preference stock of its Subsidiaries); or (E) repurchase, redeem or otherwise acquireacquire (except for (I) mandatory sinking funds obligations existing on the date hereof and (II) open market repurchases pursuant to the terms of the Company's Direct Stock Purchase Plan and Dividend Reinvestment Plan), 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 the Company nor any of its Subsidiaries shall (A) 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 Company Voting Debt other property or assets (other than Company Common (I) Shares issuable pursuant to options and other rights outstanding on the date hereof under the Company Option Stock Plans); (B) other than products sold , issuances of additional options or rights to customers acquire Shares granted pursuant to the terms of the Stock Plans as in effect on the date hereof in the ordinary and usual course of business the operation of such Stock Plans and issuances of Shares pursuant to options granted after the date hereof pursuant to the Stock Plans and (without limitation II) Shares issuable pursuant to the terms of the outstanding Feline Prides); (B) (I) transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any of its coal fines property or assets, or, (II) except as to dollar amountidentified on Section 6.1(a)(iii) or otherwise of the Company Disclosure Letter, other than in the ordinary and usual course of business and other than sales not in an excess of $100,000,000 in the aggregate amount or $30,000,000 in respect of more than $5,000,000any transaction or series of related transactions, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries)assets; (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is or operation and maintenance expenditures in excess of $1,000,000 or110% of those contemplated to be spent pursuant to the year 1999, 2000 or 2001 capital appropriations/spending budgets set forth in Section 6.1(a) of the aggregate, are in excess of $10,000,000Company Disclosure Letter; and (E) except as otherwise provided in clause or (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (of, or other interest in) , any other Person or assets entity in excess of $100,000,000 in the aggregate or $30,000,000 in respect of any other Persontransaction or series of related transactions;
(iv) except as set forth in Section 6.1(a)(iv) of the Company Disclosure Letter, neither it the Company nor any of its Subsidiaries shall (A) incur, assume or prepay any long-term debt or incur or assume any short-term debt other than in the ordinary and usual course of business in amounts and for purposes consistent with past practice under existing lines of credit, and except for the incurrence of long-term indebtedness in connection with the refinancing of existing indebtedness either at its stated maturity or at a lower cost of funds, (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any third-party, including by means of any "keep well" or other agreement to support or maintain any financial statement condition of another person, except in the ordinary and usual course of business, (C) accelerate or delay collection of notes or accounts receivable in advance of or beyond their regular due dates or the dates consistent with past practice, or (D) change any accounting principle, practice or method in a manner that is inconsistent with past practice, except to the extent required by U.S. GAAP as advised by the Company's regular independent accountants;
(v) neither the Company nor any of its Subsidiaries shall take or fail to take any action that is reasonably likely to make any representation or warranty of the Company contained herein inaccurate in any material respect at, or as of any time prior to, the Effective Time, or that is, individually or in the aggregate, reasonably likely to have a Material Adverse Effect;
(vi) except as required by applicable Law, an existing collective bargaining agreement or other Contract identified in Section 6.1(a)(vi) of the Company Disclosure Letter, 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 Company Compensation and Benefit Plans (other than issuances of additional options, performance shares or rights to acquire Shares granted pursuant to the terms of the Stock Plans as in effect on the date hereof in the ordinary and usual course of the operation of such Stock Plans, provided, that any such additional options, performance shares or rights to acquire Shares shall not vest in connection with the Merger and the other transactions contemplated by this Agreement), or except as required by any Laws existing contract with a non-officer employer increase the salary, wage, bonus or the terms other compensation of applicable collective bargaining agreementsany employees, (B) other than except increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or and benefit increases);
(Cvii) except as approved required by applicable law, an existing collective bargaining agreement or other Contract identified in Section 6.1(a)(vii) of the Transition TeamCompany Disclosure Letter, hire neither the Company nor any employee at an annual compensation level expected of its Subsidiaries shall grant any severance or termination pay to, or enter into any employment or severance agreement with any director or officer of it or such Subsidiaries, provided, that the foregoing shall not require the Company to be more than $100,000violate any of its obligations existing prior to the date hereof as set forth in Section 5.1(h) of the Company Disclosure Letter;
(vviii) except in neither the ordinary and usual course of business, neither it 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;
(viix) neither it the Company nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases (other than in the ordinary and usual course or as may be is required by applicable Law Law) or by Canadian GAAP;
(vii) neither permit any insurance policy naming it nor any as a beneficiary or loss-payable payee to be canceled or terminated except in the ordinary and usual course of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectbusiness; and
(viiix) neither it the Company nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, that after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (approve, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure LetterAgreement):
(i) the business of it Parent and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective best reasonable best efforts to (A) preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates and (B) maintain and keep material properties and assets in as good repair and condition as such are in as of the date hereof, subject to ordinary wear and tear;
(ii) it shall not (A) issue, sell, pledge, dispose amend its articles of incorporation or encumber any capital stock owned by it in any of its Subsidiariesby-laws; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine combine, subdivide or reclassify its outstanding shares of capital stock; (DC) declare, set aside or pay any dividend payable payable, in cash, stock or property in respect of any capital stock stock, other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular other than regularly quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 0.515 per share per quarter, with declaration of Parent Common Stock and record dates consistent with past practiceregularly quarterly cash dividends on the preferred and preference stock of its Subsidiaries; or (ED) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Parent Common Stock or any securities convertible into or exchangeable or exercisable for any shares of Parent Common Stock (other than repurchases, redemptions or other acquisitions which are made at the then-prevailing market price of Parent Common Stock on the NYSE and which in the aggregate do not exceed ten percent of the shares of Parent Common Stock outstanding as of the date hereof) or (E) except as permitted under this Agreement, enter into any agreement with respect to a merger, reorganization, share exchange, consolidation or similar transaction involving, or any purchase of all or substantially all of the equity securities of it or any of its capital stockSignificant Subsidiaries (as such term is defined in Rule 1-02 of Regulation S-X under the Exchange Act);
(iii) neither it Parent nor any of its Subsidiaries shall shall, (A) 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 Parent Voting Debt Common Stock (other than (I) shares of Parent Common Stock issuable pursuant to options outstanding on the date hereof under the Parent Stock PlansPlan, issuances of additional options or rights to acquire shares of Parent Common Stock granted pursuant to the terms of the Parent Stock Plan as in effect on the date hereof in the ordinary and usual course of the operation of such Parent Stock Plan and issuances of shares of Parent Common Stock pursuant to options granted after the date hereof pursuant to the Parent Stock Plan and (II) issuances of Parent Common Stock, or securities convertible with or -42- 49 exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, shares of Parent Common Stock, to a third-party on arms-length terms not in excess of 20% of the number of shares of Parent Common Stock outstanding as of the date hereof); , (B) other than (xpursuant to the year 1999, 2000 or 2001 capital appropriations/ spending budgets set forth in Section 6.1(b) as of the Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement Disclosure Letter and the Arrangement, (y) products sold to customers other than in the ordinary and usual course of business (without limitation as to dollar amountI) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness assets, and other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall sales not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, 250,000,000 in the aggregate, are in excess of $10,000,000; and or (EII) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (of, or other interest in, any other Person or entity in excess of $250,000,000 in the aggregate or (C) or assets acquire "Beneficial Ownership" (as such term is defined in the Rights Agreement) of any other PersonShares;
(iv) neither it nor Parent shall not change any of its Subsidiaries shall (A) terminatematerial accounting principle, establishpractice or method in a manner that is inconsistent with past practice, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as to the extent required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and U.S. GAAP as advised by Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000's regular independent accountants;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it Parent nor any of its Subsidiaries shall take any action or omit fail to take any action that it is reasonably expects would cause likely to make any representation or warranty of its representations and warranties such party contained herein to become untrue inaccurate in any material respectrespect at, or as of any time prior to, the Effective Time, or that is, individually or in the aggregate, reasonably likely to have a Material Adverse Effect; and
(viiivi) neither it Parent 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 (Dte Energy Co)
Interim Operations. (a) The Company Each of the Vendors, jointly and severally, covenants and agrees as that during the Interim Period the Business shall be run in accordance with the following provisions:
(i) during the Interim Period the representatives of the Purchasers shall be entitled to itself have access to and its Subsidiaries thatbe present at the Business premises of the Vendors at all times during the Vendors' reasonable business hours;
(ii) during the Interim Period the Vendors shall not, after without the date hereof and prior written consent of the Purchasers, such consent not to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed:
(A) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) permit any of the Company Disclosure Letter):
(i) the business of it and its Subsidiaries shall Purchased Assets to be conducted in the ordinary and usual course and, subjected to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associatesany Encumbrance;
(iiB) it shall not (A) issue, sell, pledge, transfer or otherwise dispose of any of the Purchased Assets;
(C) grant any increase in the benefits, rate of wages, salaries, or encumber bonuses for Employees;
(D) make any capital stock owned by it change in any method of accounting practice applicable to the Business;
(E) cancel or reduce any of its Subsidiaries; insurance coverage relating to Purchased Assets or the Business;
(BF) amend its Organizational Documents; commit to expend more than $10,000 in the aggregate with respect to any capital expenditure of the Business;
(CG) acquire (by merger, amalgamation, consolidation or acquisition of shares or assets) any corporation, partnership or other business organization or division thereof, or, other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000within the limits specified herein, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber purchase any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Personindividual or entity;
(ivH) neither it nor incur any obligations of any kind in excess of $100,000 in the aggregate in respect of the Business; or
(I) authorize or propose any of its Subsidiaries shall (A) terminatethe foregoing, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement or modify any contract, agreement, commitment or arrangement to do any of the foregoing.; and
(biii) Parent covenants and agrees as the Vendors shall:
(A) use their commercially reasonable efforts to itself and its Subsidiaries that, after keep available the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) services of the Parent Disclosure Letter):
(i) the business of it Employees and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve its business organization intact and maintain its existing their relations and goodwill with the suppliers, customers, suppliers, distributors, creditors, lessors, employees distributors and any others having business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate relations with the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectBusiness; and
(viiiB) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any immediately upon becoming aware of the foregoingexistence of:
1. any notice from, proceeding before or order of any governmental entity requiring it to comply with or take action under any Environmental Law,
2. any notice from a lender asserting a violation or breach of any loan covenant or any other provision of any financing agreement, or
3. any state of affairs respecting the Leased Premises, Purchased Assets or Business which could reasonably be expected to give rise to future environmental liabilities, the imposition of any fine, or the shutting down of the Business for any period of time, notify the Purchasers in writing and provide details of any actions taken in response.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after During the period from the date hereof and prior of this Agreement to the Effective Time Closing (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in provided, contemplated or permitted by the terms of this Agreement or the corresponding subsection of Section 3.1(a) of Agreement), the Company Disclosure Letter):
(i) the shall carry on its business of it and its Subsidiaries shall be conducted in the usual, regular and ordinary and usual course in substantially the same manner as conducted at the date of this Agreement, and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best commercial efforts to preserve intact its current business organization intact organizations, keep available the services of its current officers and maintain employees and preserve its existing relations and goodwill relationships with customers, suppliers, distributorslicensors, creditorsgovernmental entities, lessorslicensees, employees distributors and others having business associatesdealings with the Company with respect to its business, in each case consistent with past practice. Without limiting the generality of the foregoing, and except as otherwise expressly provided or permitted by this Agreement, prior to the Closing, the Company shall not, and shall not permit any of its Subsidiaries to, without the prior written consent of the Buyer (which consent shall not be unreasonably withheld, conditioned or delayed):
(a) (i) declare, set aside or pay any dividends on, or make any other distributions in respect of, any of its capital stock, (ii) split, combine or reclassify any of its capital stock 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 (iii) purchase, redeem or otherwise acquire any shares of capital stock of the Company or any other securities thereof or any rights (including convertible debt), warrants or options to acquire any such shares or other securities;
(ii) it shall not (Ab) issue, deliver, grant, sell, pledge, dispose of or otherwise encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) issue, sell, pledge, dispose of or encumber any shares ofinto, or securities convertible into any rights, warrants or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind options to acquire, any such capital stock, other than (i) the issuance of shares of Common Stock upon the exercise of rights (including convertible debt), warrants or options outstanding on the date of this Agreement, (ii) options to purchase common stock issuable pursuant to the Company's policy of awarding options to its capital stock non-employee directors on the anniversary of their election to the Company's Board, (iii) modifications to or grants of directors' options as needed to prevent the forfeiture thereof upon a resignation of a director as contemplated by this Agreement (which modifications are described in the Company's Disclosure Schedule); or (iv) Common Stock or rights to purchase Common Stock triggered or issuable pursuant to antidilution provisions in warrants or other rights outstanding on the date of this Agreement;
(c) amend the Company's articles of incorporation or bylaws;
(d) acquire or agree to acquire (i) by merging or consolidating with, or by purchasing a substantial portion of the stock, or other ownership interests in, or substantial portion of assets of, or by any class other manner, any business or any Company Voting Debt corporation, partnership, association, joint venture, limited liability company or other entity or division thereof or (other than Company Common Shares issuable under ii) any assets that would be material, individually or in the Company Option Plans); (B) other than products sold aggregate, to customers the Company, except purchases of supplies, equipment and inventory in the ordinary and usual course of business consistent with past practice;
(without limitation as to dollar amounte) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000sell, lease, transfer, lease, license, guarantee, sellsublicense, mortgage, pledge, ▇▇▇▇▇ ▇ ▇▇▇▇, mortgage, pledge, security interest, charge, claim or other encumbrance of any kind or nature on or otherwise encumber or dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); properties or assets, except in the ordinary course of business consistent with past practice;
(Cf) (i) incur or modify any indebtedness for borrowed money or guarantee any such indebtedness of another person, issue or sell any debt securities or warrants or other than rights to acquire any debt securities of the Company, guarantee any debt securities of another person, enter into any "keep well" or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, except for (x) working capital borrowings and increases in letters of credit under revolving credit facilities incurred in the ordinary course of business consistent with past practice, (y) indebtedness incurred to refund, refinance or replace indebtedness for borrowed money outstanding on the date of this Agreement and (z) indebtedness existing solely between the Company and its wholly wholly-owned Subsidiaries or between such wholly owned Subsidiaries or (yii) indebtedness make any loans, advances or capital contributions to, or investments in, any other person;
(g) except for capital expenditures in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, compliance with the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply amounts and timing included in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between Company's written capital expenditure plan previously made available to the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition TeamBuyer, make or authorize or commit for incur any capital expenditures whichexpenditure, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by ;
(h) change any meansmethod of tax accounting, make or change any acquisitions material election relating to taxes, file any amended tax return, settle or compromise any material tax liability, agree to an extension or waiver of the statute of limitations with respect to the assessment or determination of taxes, enter into any closing agreement with respect to taxes, or surrender any right to claim a tax refund;
(i) except to the extent permitted by Section 5.2 of this Agreement, waive the benefits of, or investments agree to modify in stock of (any manner, any confidentiality, standstill or other interest in) or assets of any other Personsimilar agreement to which the Company is a party;
(ivj) neither it nor adopt a plan of complete or partial liquidation or resolutions providing for or authorizing such a liquidation or a dissolution, restructuring, recapitalization or reorganization;
(k) enter into any new collective bargaining agreement;
(l) change any accounting principle used by it, except as required by applicable laws or generally accepted accounting principles;
(m) settle or compromise any material litigation, including any litigation that is brought by any current, former or purported holder of any capital stock or debt securities of the Company or any of its Subsidiaries shall (A) terminaterelating to the transactions contemplated by this Agreement, establishor, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice or as otherwise required pursuant to contracts existing on or prior to the date of this Agreement or entered into in the ordinary course consistent with past practice after the date of this Agreement, and so long as such settlement would not impose any injunctive or similar order on the Company or restrict in any way the business of the Company’s , pay, discharge or satisfy any material claims, liabilities or obligations;
(n) except as set forth in the Company Disclosure Schedule, (i) enter into any new, or amend any existing, severance agreement or arrangement, deferred compensation budget arrangement or employment agreement with any officer, director or employee whose annual base salary exceeds $150,000, (ii) adopt any new incentive, retirement or welfare benefit arrangements, plans or programs for the benefit of current, former or retired employees or amend any existing Company compensation or benefit plan (other than amendments required by law or to maintain the tax qualified status of such plans), (iii) grant any increases in employee compensation, other than in the ordinary course consistent with past practice (which shall include normal individual periodic performance reviews and related compensation and benefit increases and bonus payments consistent with past practices) provided that any such increase shall not include increases in compensation to officers or any employee whose annual base salary exceeds $150,000 or (iv) grant any stock options or stock awards;
(o) cancel any debts or waive any claims or rights of substantial value (including the cancellation, compromise, release or assignment of any indebtedness owed to, or claims held by, the Company), except for cancellations made or waivers granted with respect to employees at an annual compensation level claims other than indebtedness in the ordinary course of less business consistent with past practice which, in the aggregate, are not material or for claims other than $150,000indebtedness which are cancelled or waived in connection with the settlement of the actions referred to in, increase and to the compensation of any employee or extent permitted by, clause (Cm) above;
(p) except as approved by set forth in the Transition TeamCompany Disclosure Schedule, hire (i) enter into any employee at an annual compensation level expected contract, agreement or other arrangement, or series of contracts, agreements or other arrangements, not in the ordinary course of business that would require the Company to be expend more than $100,000;
(v) except 200,000 individually or $500,000 in the ordinary and usual course of businessaggregate in any fiscal year, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or (ii) modify, amend in any material respect, transfer or terminate any material contract of its material Contracts the Company or waive, release or assign any material rights or claims;
claims thereto or thereunder, (viiii) neither it nor any of its Subsidiaries shall make any material Tax election enter into or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue extend in any material respect; and
(viii) neither it nor respect any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior lease with respect to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course andCompany's real property, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, amend, transfer or terminate in any Parent Compensation and Benefit Plans except as required by material respect any Laws or the terms of applicable collective bargaining Intellectual Property agreements, (B) other than in the ordinary and usual course of business consistent standstill or confidentiality agreement with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000any third party, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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 claimsclaims thereto or thereunder or (v) enter into, modify, amend, transfer or terminate any contract to provide exclusive rights or obligations;
(viq) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change except as provided in its accounting principles or material accounting practicesSection 5.2(b), in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoingforegoing or any action or fail to take any action which would result in any of the conditions set forth in Article 8 not being satisfied or that would reasonably be expected to result in a Material Adverse Effect; or
(r) authorize any of, or commit or agree to take any of, the foregoing actions.
Appears in 1 contract
Sources: Stock Purchase Agreement (Granite City Food & Brewery LTD)
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 approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) withheld, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
Agreement): (ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practices and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially 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;
; (iib) it shall not not, (Ai) issue, sell, pledge, sell otherwise dispose of or encumber any capital stock owned by it in subject to Lien (other than Permitted Liens) any of its Subsidiaries' Capital Stock owned by it; (Bii) amend its Organizational Documentscharter, by-laws or, except for any amendment which will not hinder, delay or make more costly to Parent the Offer or the Merger; the Rights Agreement; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stockCapital Stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock Capital Stock other than dividends from its direct or indirect wholly owned Subsidiariesthe issuance of Rights in connection with the issuance of Capital Stock upon the exercise of Company Options; or (Ev) repurchase, redeem or otherwise acquire, acquire or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Capital Stock; or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
Capital Stock; or (iiivi) adopt a plan of complete or partial liquidation or dissolution, merger or otherwise restructure or recapitalize or consolidate with any Person other than Merger Sub or another wholly-owned Subsidiary of Parent; 17 23 (c) neither it nor any of its Subsidiaries shall (Ai) authorize for issuance or issue, sell, pledge, sell or otherwise dispose of or encumber subject to any Lien (other than Permitted Liens) 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 Capital Stock of any class or any Company Voting Debt (other than Company Common Shares issuable under pursuant to Company Options outstanding on the date hereof, the grant of Company Options to newly hired employees in accordance with a benefit matrix previously provided to Parent and after notification of Parent and automatic grants of director stock options as mandated by the Company's First Amended 1988 Nonqualified Stock Option PlansPlan for Outside Directors); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practicepractices, transfer, lease, license, guarantee, sell or otherwise dispose of or subject to any Lien (other than Permitted Liens) any other property or assets or incur or modify any material indebtedness or other liability (except for additional borrowings in the ordinary course under lines of credit in existence on the date hereof); (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person except in the ordinary course of business consistent with past practices and except for obligations of Subsidiaries of the Company incurred in the ordinary course of business; (iv) make any loans to any other Person (other than to Subsidiaries of the Company or, customary loans or advances to employees in connection with business-related travel in the ordinary course of business consistent with past practices); or (v) make any commitments for, make or authorize any capital expenditures other than in amounts less than $150,000 individually and $3,000,000 in the aggregate or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other Person;
; (ivd) except as may be required to comply with applicable law or by existing contractual commitments, neither it nor any of its Subsidiaries shall (Ai) enter into any new agreements or commitments for any severance or termination pay to, or enter into any employment or severance agreement with, any of its directors, officers or employees or consultants except for (a) specific arrangements with ten of the Company's employees and one of its directors which have been previously disclosed to Parent and (b) reasonable severance payments made to employees in the ordinary course of business and consistent with past practices, or (ii) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws Plan or increase or accelerate the terms of applicable collective bargaining agreementssalary, (B) wage, bonus or other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee employees or directors (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except for increases occurring in the ordinary and usual course of business, which shall include normal periodic performance reviews and related compensation and benefit increases, but not any general across-the-board increases) or consultants or pay or agree to pay any pension, retirement allowance or other employee benefit not required by any existing Compensation and Benefit Plan; (e) neither it nor any of its Subsidiaries shall, except as may be required as a result of a change in law or in GAAP, change any of the accounting principles or practices used by it; (f) neither it nor any of its Subsidiaries shall revalue in any respect any of its material assets, including writing down the value of inventory or writing-off notes or accounts receivable, other than in the ordinary course of business consistent with past practices; (g) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, terminate or materially amend or terminate modify any of its material Contracts or waive, release or assign any material rights or claims;
; (vih) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be canceled or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
terminated; (viii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
and (viiij) neither it nor any of its Subsidiaries will authorize or enter into an any agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.. 18
Appears in 1 contract
Sources: Merger Agreement (Intel Corp)
Interim Operations. Except with Purchaser’s prior written consent (a) The not to be unreasonably withheld, conditioned or delayed), Seller shall cause each of 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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the to conduct its business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially reasonable best efforts to (A) preserve its business organization intact and organizations intact, (B) maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates, and (C) keep available the services of its present employees and agents; and (ii) not to (other than as set forth in the corresponding section of the Seller Disclosure Letter):
(a) amend its Organizational Documents;
(iib) it shall not merge or consolidate with any other Person;
(Ac) acquire assets outside of the ordinary course of business consistent with past practice from any other Person with a value or purchase price in the aggregate in excess of $50,000,000.00 or that would have any possibility of preventing or delaying the Closing beyond the Termination Date;
(d) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirectof, wholly owned Subsidiarygrant, splittransfer, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquireEncumber, or permit any of its Subsidiaries to purchase or otherwise acquireauthorize the issuance, 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 (A) issue, sellsale, pledge, dispose of or encumber any shares ofdisposition, 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000grant, transfer, lease, license, guaranteeguarantee or other Encumbrance of, sell, mortgage, pledge, dispose any Equity Interests of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course issuance of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
Equity Interests (i) by a wholly-owned Subsidiary of the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, Company to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
Company or another wholly-owned Subsidiary or (ii) it shall not (A) issueby the Company to Seller), sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) issueinto, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, any Equity Interests or any options, warrants, calls, commitments warrants or other rights of any kind to acquire, acquire any shares of its capital stock of such Equity Interests or such convertible or exchangeable securities;
(e) create or incur any class or any Parent Voting Debt Encumbrance (other than Parent Common Stock issuable under a Permitted Encumbrance) on the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain assets of the consentCompany or any of its Subsidiaries that, approval individually or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as aggregate, is material to dollar amount) the Company or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); ;
(Cf) incur or modify make any indebtedness other than (x) commercial paperloans, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of creditadvances, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, contributions to or investments in stock of (or any Person, other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.than
Appears in 1 contract
Sources: Stock Purchase Agreement
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after After the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) Closing, Seller covenants and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the agrees to cause each Acquired Entity to conduct its business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and Seller shall cause each of its Subsidiaries shall Acquired Entity to use its respective commercially reasonable best efforts to (x) preserve its business organization organizations intact and maintain its existing relations and goodwill with all Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates;
associates and (iiy) it shall not keep available the services of its present key employees and key agents. Without limiting the generality of the foregoing and in furtherance thereof, from the date of this Agreement until the Closing, except (A) issueas otherwise expressly contemplated by this Agreement, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; as Buyer may approve in writing or (C) other than in the case of any direct or indirectfor transactions set forth on Schedule 5.1, wholly owned SubsidiarySeller shall cause each Acquired Entity not to:
(i) (A) adjust, split, combine or reclassify its outstanding capital stock, (B) grant (whether or not for consideration) any Person any option or other right to acquire any shares of capital stock; stock or other securities, (C) issue (whether or not for consideration) any shares of capital stock or other securities, or (D) declareenter into any Contract with respect to the sale, set aside voting, registration or repurchase of capital stock or other securities;
(ii) declare or pay any non-cash dividend payable in cash, stock or property make any non-cash distribution in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquireof, or permit any of its Subsidiaries to purchase repurchase or otherwise acquireredeem, 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 (A) issuedirectly or indirectly sell, selltransfer, pledge, otherwise create any Encumbrance on or otherwise dispose of any assets, except for sale of products and services in the ordinary course of business;
(iv) amend its governing documents;
(v) merge or encumber consolidate with 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 Company Voting Debt other Person;
(vi) acquire assets (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amountbusiness) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets securities of any other Person;
(ivvii) neither it nor enter into or materially modify any material employment, consulting, severance, stay-pay, termination or similar Contracts with, or grant any bonuses, equity awards, salary increases, severance, pension, retirement or termination pay to, any Employee, or otherwise materially increase the compensation or benefits provided to any Employee, except as may be required by existing Contract or in the ordinary course of its Subsidiaries shall business;
(Aviii) terminate, establish, adopt, enter into, make into or adopt any new grants Company Benefit Plan or awards undermaterially increase benefits under or renew, amend or otherwise modify, terminate any Company Compensation and Benefit Plans Plan, except as may be required by applicable Law;
(ix) hire any Laws or the terms of applicable collective bargaining agreementsnew Employees, (B) other than except in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at Employees with an annual base salary and incentive compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected opportunity not to be more than exceed $100,000;
(vA) except in make any material Tax election (other than such elections which are consistent with the ordinary and usual course most recent past practice of businessthe relevant Acquired Entity) or rescind or change any material Tax election or adopt or change any method of accounting, neither it nor (B) enter into any settlement of its Subsidiaries shall settle or compromise any material claims Tax liability, (C) change any annual Tax accounting period, (D) enter into a closing agreement for any material amount of Tax, (E) surrender any right to any material Tax refund or litigation (F) file any amended Tax Return or modify, refund claim with respect to any material Tax;
(xi) materially amend or terminate any of its material Contracts terminate, or waive, release or assign any material rights or claims;
(vi) neither it nor claims with respect to any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles Material Contract or material accounting practicesPermit, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000business;
(vxii) except enter into any Contract that would constitute a Material Contract, other than in the ordinary and usual course of business;
(xiii) enter into, neither it nor amend, terminate or waive any provision of any Contract with Seller or any of its Subsidiaries shall or enter into any new transaction with Seller or any of its Subsidiaries, other than in the ordinary course of business;
(xiv) enter into, amend, renew, terminate or materially increase benefits under any labor or collective bargaining agreement;
(xv) incur any indebtedness for borrowed money, other than in the ordinary course of business;
(xvi) change any method of accounting or accounting practice or policy used by the Acquired Entities, other than such changes required by GAAP;
(xvii) fail to exercise any rights of renewal with respect to any material Leased Real Property that by its terms would otherwise expire;
(xviii) 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 claimsClaims;
(vixix) neither it nor any of its Subsidiaries shall make forgive or cancel any material Tax election Debts or file terminate or waive any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAPrights;
(viixx) neither it nor incur any capital expenditure or commitment in excess of its Subsidiaries shall take the annual capital expenditure budget of the Acquired Entities previously provided to Buyer;
(xxi) enter into any action commodity hedging, foreign exchange hedging or omit any other type of financial instrument other than in the ordinary course of business; or
(xxii) agree to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingforegoing actions.
Appears in 1 contract
Sources: Stock Purchase Agreement (Aleris International, Inc.)
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 approve in writing (writing, which consent approval shall not be unreasonably withheld withheld, conditioned or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in accordance with the Operating Budget, taken as a whole, and, to the extent consistent therewith, in the ordinary and usual course consistent with past practice and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with all Governmental Entities (including, without limitation, the SEC), ETP Holders, OTP Holders, Current Company Related Persons, customers, suppliers, distributors, creditors, lessors, employees permit holders, Employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its SubsidiariesSubsidiaries or any of the shares of Parent Common Stock by the Company or any of its direct or indirect subsidiaries; (B) except as set forth in Section 5.1(c)(ii) of this Agreement, amend its Organizational Documentscertificate of incorporation or by-laws; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquire, except in connection with the Stock Plan, 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 (A) 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 Company Voting Debt (or any other property or assets other than Company Common Shares issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Company Option PlansStock Plan); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yC) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring acquire any indebtedness, if practicable, the Company shall provide shares of Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other PersonCommon Stock;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adoptadopt or enter into any Benefit Plans, enter intoexcept as required under applicable Law, (B) make any new grants or awards underunder any Benefit Plans, except that the Company may reissue such Company Options and Company Restricted Stock which was issued and outstanding as of the date of this Agreement and which are subsequently cancelled prior to the Effective Time, in each case pursuant to the terms and conditions of the applicable Benefit Plan; or (C) or amend or otherwise modifymodify any Benefit Plan or increase the salary, wage, bonus or other compensation of any Company Compensation and Benefit Plans employees, except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the accordance with ordinary and usual course of business consistent with past practice and to the Company’s compensation budget extent all such increases and all such present or future costs associated with respect to employees at an annual compensation level of less than $150,000, increase such amendments or modifications (x) have been fully reserved against in the compensation of any employee Company Financial Statements or (Cy) except as approved by are in accordance with the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000Operating Budget;
(v) except in the ordinary and usual course of businessbusiness consistent with past practice or as fully reserved in the Operating Budget, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file 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;
(vii) it shall and shall cause its Subsidiaries to, (i) timely make all filings with the SEC and any other Governmental Entity required to maintain PCX’s status as a national securities exchange and as a self-regulatory organization (as registered under Section 6 and as defined in Section 3(a)(26), respectively, of the Exchange Act) and to keep it and all of its Subsidiaries in compliance in all material income Tax Return inconsistent respects with past practice or implement or adopt all Laws, (ii) keep PCX Equities and all of its Subsidiaries in compliance in all material respects with all Laws and PCX rules and (iii) cause PCX and its Subsidiaries to fulfill, in all material respects, its regulatory oversight functions over the ArcaEx Business in PCX’s capacity as a national securities exchange and self-regulatory organization (as registered under Section 6 and as defined in Section 3(a)(26), respectively, of the Exchange Act);
(viii) neither it nor any of its Subsidiaries (A) shall permit any change in its credit practices or accounting principles principles, policies or material practice (including, without limitation, any of its practices with respect to accounts receivable or accounts payable), except to the extent that any such changes in accounting practicesprinciples, in all cases other than as may policies or practices shall be required by applicable Law changes in GAAP and (B) shall pay, collect or by Canadian GAAPaccrue, as the case may be, the consolidated accounts receivable and accounts payable of the Company, for the period following the Calculation Month-End, other than in the ordinary and usual course of business consistent with past practice;
(viiix) neither it nor any of its Subsidiaries shall take any actions that, if taken prior to the date hereof, would constitute or result in a breach of Section 5.1(i);
(x) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectrespect at any time; and
(viiixi) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants If the Closing Date shall not have occurred by March 31, 2005, and agrees as the Company shall thereafter determine that additional funding is necessary in order for it to itself maintain a positive cash balance, Parent, within five business days of any written request therefor from the Company, will advance to the Company by wire transfer of immediately available funds to a bank account designated by the Company, the requested amount to support the Company and its Subsidiaries thatoperations; provided that the aggregate amount of such advances outstanding at any time (after giving effect to all outstanding requests therefor from the Company) shall not be required to exceed $10,000,000, after unless Parent shall consent in writing to a larger amount. Such advances may be repaid at any time at the option of the Company. Such advances: (i) for the avoidance of doubt, shall constitute a “Total Adjusted Liability” of the Company for purposes of the Calculation and the Final Working Capital Amount and for any other purpose required by GAAP or applicable Law, until repaid in accordance with the terms of this Agreement and the terms of any other customary evidence of indebtedness Parent may request that the Company and any of its Subsidiaries execute and deliver to it as a condition to Parent making such advances (which the Company shall, and shall cause its Subsidiaries to, execute and deliver to Parent prior to Parent becoming obligated to make any such advances pursuant to the terms of this Agreement); and (ii) shall not bear interest, and unless repaid by the Company, shall remain outstanding for so long as this Agreement shall remain in effect and the Effective Time shall not have occurred. If this Agreement is terminated and the Effective Time shall not have occurred, such advances shall bear interest and be repaid in accordance with Section 8.5(a) of this Agreement.
(c) Except for any resignation, retirements, dismissals or reductions in-force announced by the Company prior to the date hereof and hereof, in the event that the Company shall implement any reductions in-force prior to the Effective Time (unless Time, Parent shall, on demand, reimburse the Company for any severance costs associated therewith; provided that the Company shall otherwise consent in writing (which consent provide Parent reasonable prior notice of, and Parent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or have the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, right to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquireveto, 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingreductions.
Appears in 1 contract
Sources: Agreement and Plan of Merger (Archipelago Holdings Inc)
Interim Operations. (a) The Except as required by applicable Law or as expressly contemplated by this Agreement, the Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof of this Agreement and prior to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) Time, the business of it and its Subsidiaries shall be conducted in all material respects in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its their respective commercially reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, licensors, licensees, distributors, creditors, lessors, employees and business associatesassociates (other than as announced by the Company prior to the date hereof). 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 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 or delayed) 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 in its certificate of incorporation or by-laws or other applicable governing instruments;
(ii) it shall not 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 other than in the ordinary course restructure, reorganize or completely or partially liquidate or otherwise enter into any Contracts imposing material changes or restrictions on its assets, operations or businesses, other than in the ordinary course;
(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) in the ordinary course of business (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) if not in the ordinary course of business, with a value or purchase price (including the value of assumed liabilities) not in excess of $50 million in any transaction or related series of transactions or acquisitions pursuant to Contracts in effect as of the date of this Agreement and listed on Section 6.1 of the Company Disclosure Schedule (it being understood that capital expenditures are not meant to be captured by this Section 6.1(a)(iii));
(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 or encumber any capital stock owned by it in of the Company or any of its Subsidiaries; Subsidiaries (other than the issuances, sales, pledges, dispositions, grants, transfers, leases, licenses, guaranties or encumbrances of shares by a wholly owned Subsidiary of the Company to the Company or another wholly owned Subsidiary or the issuance or transfer of Shares pursuant to outstanding awards under Company Stock Plans), 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 (A) any lien or other security interest on any Company Intellectual Property owned or exclusively licensed or that is material and non-exclusively licensed by the Company or any of its Subsidiaries or (B) amend any Lien on any other assets of the Company or any of its Organizational Documents; Subsidiaries having a value in excess of $50 million;
(Cvi) make any loans, advances, guarantees or capital contributions to or investments in any Person (other than in the case of Company or any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; Subsidiary of the Company) in excess of $10 million in the aggregate;
(vii) declare, set aside, make or (E) repurchasepay any dividend or other distribution, redeem payable in cash, stock, property or otherwise acquireotherwise, or permit with respect to any of its Subsidiaries capital stock (except for dividends paid by any Subsidiary to the Company or to any other Subsidiary, or regular quarterly dividends not to exceed $0.37 per share, declared and paid consistent with prior timing) 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 shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiiix) neither it nor incur, alter, amend or modify, 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 shall Subsidiaries, or permit any Subsidiary of the Company to guarantee any indebtedness of the Company, other than in the case of indebtedness for borrowed money incurred in the ordinary course of business consistent with past practices (A) issuethat does not exceed $200 million in the aggregate, 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) debt of the Company or a Subsidiary that is in replacement of existing indebtedness for borrowed money of the Company or such Subsidiary, as applicable, (C) guarantees incurred in compliance with this Section 6.1 by the Company of indebtedness of wholly owned Subsidiaries of the Company or (D) 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 million of notional debt in the aggregate;
(x) make or authorize any capital expenditure in excess of $875 million in the aggregate during any 12 month period;
(xi) other than products sold to customers in the ordinary and usual course of business or in connection with an acquisition permitted under Section 6.1(a)(iii), enter into any Contract that would have been a Material Contract had it been entered into prior to this Agreement;
(without limitation xii) make any material changes with respect to accounting policies or procedures, except as to dollar amountrequired by changes in applicable generally accepted accounting principles;
(xiii) settle any Action before a Governmental Entity for an amount in the aggregate in excess of the amount set forth on Section 6.1(a)(xiii) of the Company Disclosure Schedule (excluding amounts covered by insurance) or otherwise for any obligation or liability of the Company in excess of such amount or agree to any material limitation or restriction on any aspect of the conduct of the Company’s or its Subsidiaries’ business (or, after giving effect to the Merger, Parent’s or its Subsidiaries’ business);
(xiv) other than in the ordinary and usual course course, amend or modify, in any material respect, or terminate any Material Contract or IP Contract, or cancel, modify or waive any material debts or claims held by it or waive any material rights;
(xv) except as in Section 6.1(a)(xv) of business and not the Company Disclosure Schedule, make any Tax election, amend any Tax Return, settle or finally resolve any controversy with respect to Taxes or change any method of Tax accounting in an aggregate each case, where the sum of amount of more than Taxes in question with respect to all such actions exceeds $5,000,00050 million;
(xvi) (A) with regard to Intellectual Property owned by the Company or any of its Subsidiaries, transfer, sell, lease, license, guaranteemortgage, pledge, surrender, encumber, divest, disclose, cancel, abandon or allow to lapse or expire or otherwise dispose of any material Intellectual Property, other than licenses or other non-material Contracts granted in the ordinary course of business, or cancellation, abandonment, allowing to lapse or expire such Intellectual Property that is no longer used or useful in any of the Company’s or its Subsidiaries’ respective businesses or pursuant to Contracts in effect prior to the date of this Agreement; and (B) with regard to other assets, transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any material assets, licenses, operations, rights, product lines, businesses or encumber any other property interests therein of the Company or assets (its Subsidiaries, including capital stock of any of its Subsidiaries); (C) incur , except in connection with services provided in the ordinary course of business and sales of obsolete assets and except for sales, leases, licenses or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent dispositions of assets with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall fair market value not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, 50 million in the aggregate, are other than pursuant to Contracts in excess effect prior to the date of $10,000,000; and this Agreement;
(Exvii) except as required pursuant to existing written, binding plans or agreements in effect prior to the date of this Agreement or as set forth in Section 5.1(h)(i) of the Company Disclosure Schedule, or as otherwise provided required by applicable Law, (A) grant or provide any severance or termination payments or benefits to any director, officer or employee of the Company or any of its Subsidiaries, (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 director, officer or employee of the Company or any of its Subsidiaries, in clause (D) immediately above and each case other than raw materials, supplies and other inventory items acquired to non-officer employees in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest inC) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, amend or terminate any Company Benefit Plan (except as required by Law) or amend the terms of its material Contracts any outstanding equity-based awards, (D) take any action to accelerate the vesting or waivepayment, release or assign fund or in any material rights other way secure the payment, of compensation or claims;
benefits under any Company Benefit Plan, to the extent not already provided in any such Company Benefit Plan, (viE) neither it nor materially change any of its Subsidiaries shall make actuarial or other assumptions used to calculate funding obligations with respect to any material Tax election Company Benefit Plan or file any material income Tax Return inconsistent with past practice to change the manner in which contributions to such plans are made or implement or adopt any change in its accounting principles or material accounting practicesthe basis on which such contributions are determined, in all cases other than except as may be required by applicable Law GAAP, or by Canadian GAAP(F) forgive any loans to directors, officers or employees of the Company or any of its Subsidiaries;
(viixviii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will agree, authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as Prior to itself and making any widely distributed written communications to the employees of the Company or any of its Subsidiaries thatpertaining to material compensation or benefit matters that are affected by the transactions contemplated by this Agreement, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve 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 the Company shall consider such comments prior to distributing any such communication to its business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;employees.
(iic) it Parent and Merger Sub (1) shall not (A) issuetake, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the and Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, shall not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquiretake, any shares action that is reasonably likely to prevent or materially impair the consummation of its capital stock or the Merger and (2) shall not enter into 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) issue, sell, pledge, dispose of or encumber any shares ofacquisition agreement, or securities convertible into make any acquisition, that is reasonably likely to prevent, materially delay or exchangeable or exercisable for, or options, warrants, calls, commitments or rights impair the consummation of the Merger. Parent shall not issue any kind to acquire, any shares of its capital stock of any class or any Parent Voting Debt (other than Parent Common Stock issuable under (or subscription rights with respect thereto) prior to obtaining the Requisite Parent Vote unless the Stichting agrees to vote any Parent Common Stock Plans); (B) received by it, or received by others who are bound to vote together with the Stichting, in favor of the proposal to approve the Merger and the other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement hereby.
(d) Nothing contained herein shall give to Parent or Merger Sub, 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, the Company shall exercise, consistent with the terms and the Arrangementconditions hereof, (y) products sold to customers in the ordinary complete control and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any supervision of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingoperations.
Appears in 1 contract
Interim Operations. Except as otherwise expressly contemplated by this Agreement, as required by applicable Law, as set forth in Section 5.1 of the Company Disclosure Schedule, or as agreed to in writing by Purchaser (which agreement shall not be unreasonably withheld, delayed or conditioned), the Company, the Stockholder, and the Asset Sellers covenant and agree that, prior to the Closing:
(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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the business of it and its Subsidiaries Business shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants The Company and agrees as the Asset Sellers shall use commercially reasonable efforts to itself keep intact the rights, properties and its Subsidiaries thatassets, after and vendor, supplier, customer, franchisee and other business relationships of the date hereof and prior to the Effective Time Business;
(unless the c) The Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course andauthorize for issuance, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect other equity interests of any the Company (including securities convertible into, or rights or options to acquire, capital stock or other than equity interests of the Company), (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (Eii) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, acquire any shares of its capital stock or any other equity interests of the Company (including securities convertible into into, or exchangeable rights or exercisable for any shares options to acquire, capital stock or other equity interests of the Company), or (iii) amend or otherwise change its capital stockcertificate of incorporation or bylaws;
(iiid) neither it nor any of its Subsidiaries The Company shall (A) issuenot acquire, sellincluding by merging or consolidating with, pledge, dispose of or encumber any shares purchasing the assets or capital stock or other equity interests of, or securities convertible into in any other manner, any business or exchangeable any corporation, partnership, association or exercisable forother business organization or division thereof, or optionsmake any capital expenditures or commitments in an amount in excess of $25,000 in the aggregate, warrants, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); pursuant to existing agreements;
(Be) other than The Company shall not hire any employees;
(xf) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and The Company shall not in an aggregate amount of more than $5,000,000, transfersell, lease, license, guarantee, sell, mortgage, pledge, subject to any Lien (other than a Permitted Lien) or otherwise encumber or dispose of or encumber any other property or assets (including capital stock of through any sale-leaseback or similar transaction) any of its Subsidiaries); (C) incur properties or modify assets, and no Asset Seller shall take any indebtedness such action with respect to any of the Purchased Assets, other than (xi) commercial paperpursuant to existing agreements, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (zii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. Except with Purchaser’s prior written consent (a) The not to be unreasonably withheld, conditioned or delayed), Seller shall cause each of 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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the to conduct its business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially reasonable best efforts to (A) preserve its business organization intact and organizations intact, (B) maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associates, and (C) keep available the services of its present employees and agents; and (ii) not to (other than as set forth in the corresponding section of the Seller Disclosure Letter):
(a) amend its Organizational Documents;
(iib) it shall not merge or consolidate with any other Person;
(Ac) acquire assets outside of the ordinary course of business consistent with past practice from any other Person with a value or purchase price in the aggregate in excess of $50,000,000.00 or that would have any possibility of preventing or delaying the Closing beyond the Termination Date;
(d) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirectof, wholly owned Subsidiarygrant, splittransfer, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) repurchase, redeem or otherwise acquireEncumber, or permit any of its Subsidiaries to purchase or otherwise acquireauthorize the issuance, 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 (A) issue, sellsale, pledge, dispose of or encumber any shares ofdisposition, 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000grant, transfer, lease, license, guaranteeguarantee or other Encumbrance of, any Equity Interests of the Company or any of its Subsidiaries (other than the issuance of Equity Interests (i) by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary or (ii) by the Company to Seller), securities convertible or exchangeable into, or exercisable for, any Equity Interests or any options, warrants or other rights of any kind to acquire any such Equity Interests or such convertible or exchangeable securities;
(e) create or incur any Encumbrance (other than a Permitted Encumbrance) on the assets of the Company or any of its Subsidiaries that, individually or in the aggregate, is material to the Company or any of its Subsidiaries;
(f) make any loans, advances, guarantees or capital contributions to or investments in any Person, other than (x) any of the foregoing to or on behalf of the Company or any direct or indirect wholly-owned Subsidiary of the Company, or (y) in the ordinary course of business consistent with past practice and which do not have any possibility of preventing or delaying the Closing beyond the Termination Date;
(g) declare, set aside, make or pay any (i) cash distributions or dividends in any month that in the aggregate are in excess of the lesser of (A) $150,000,000.00 and (B) the amount of Free Cash Flow generated by the Company and its Subsidiaries for the preceding month, prorated for the month in which this Agreement is entered into, and for the month in which the Closing occurs; provided, that if distributions or dividends in respect of any month shall have been less than $150,000,000.00 as a result of the foregoing limitation or otherwise, Seller shall be entitled to make additional cash distributions at any time or from time to time up to an amount equal to the lesser of (x) Free Cash Flow for the period since the date of this Agreement and (y) the product of (A) $150,000,000.00 and (B) the number of whole and, without duplication, partial months in such period, or (ii) non-cash distributions or dividends, payable in stock, property or otherwise, with respect to any of its Equity Interests (except for non-cash distributions 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 Equity Interests;
(h) (i) incur any Indebtedness for borrowed money, 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 consistent with past practice that is satisfied in full at or prior to the Closing, or (ii) amend, modify, supplement or waive the terms of any existing Indebtedness, debt securities or warrants or other rights to acquire debt securities of the Company or any of its Subsidiaries, except in the ordinary course of business consistent with past practice;
(i) except as contemplated by the capital budget set forth in the business plan set forth on Schedule 4.16 of the Seller Disclosure Letter, make or authorize any payment of, or accrual or commitment for, capital expenditures in excess of $25,000,000.00 in the aggregate in any consecutive six-month period (or $50,000,000.00 in the event of an increase in data demand in the Business significantly in excess of the demand anticipated on the date hereof);
(j) amend, supplement, waive, terminate, assign, convey, encumber or otherwise transfer, in whole or in part, its rights or interests under or in any Material Contract, or enter into any Intercompany Contract or Company Contract that would be a Material Contract if in effect as of the date hereof;
(k) enter into any Intercompany Contract or amend, modify or waive any Intercompany Contract in any manner that would result in the Company or its Subsidiaries paying to the other parties thereto aggregate consideration greater than that provided for in the copies of Intercompany Contracts provided to Purchaser pursuant to Section 4.2(a)(v);
(l) make any changes with respect to material financial accounting policies or procedures, except as required by changes in GAAP;
(m) (i) 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 ancillary Internet services), 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, (ii) except as currently conducted, engage in the conduct of any business in any state that 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 License to the extent such License would reasonably be expected to prevent, materially delay or materially impair the consummation of the Transaction, or (iii) enter into any business or operations outside of the United States;
(n) file for any Company License the receipt of which would reasonably be likely to prevent, materially impair or materially delay consummation of the Transaction;
(o) settle any litigation or other proceedings before a Governmental Entity for an amount in excess of $15,000,000.00;
(p) except to the extent otherwise required by Law, make or change any Tax election, change any method of Tax accounting or settle or finally resolve any controversy with respect to Taxes for an amount that materially exceeds the amount reserved with respect thereto in the most recent Financial Statements, in each case, if such action would have an adverse affect on the Company or Purchaser that is more than immaterial;
(q) transfer, sell, lease, license, mortgage, pledge, surrender, encumber, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of (i) any Communications Licenses or encumber any other property or assets wireless spectrum and (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (Dii) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other PersonLicenses, assets, operations, rights, product lines, businesses or interests therein of the Company or its Subsidiaries that are material to the Business, other than pursuant to Company Contracts in effect prior to the date hereof;
(ivr) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor pursuant to the existing terms and conditions of any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue Benefit Plan as in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after effect on the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
hereof, (i) terminate, establish, adopt or amend any Benefit Plan other than the business adoption of it and its Subsidiaries shall be conducted annual Benefit Plans in the ordinary course of business consistent with past practice and usual course andamendments to health and welfare plans (other than severance plans) that do not increase benefits or result in materially increased administrative costs, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issuegrant any salary or wage increase, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than to increase salary and wages for employees by no more than 4% in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers aggregate in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, (iii) pay aggregate bonus or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) incentive compensation other than in the ordinary course consistent with past practice, (iv) (x) grant any new compensation award, other than bonus awards and usual cash-based long term incentive compensation awards, in each case in amounts and on terms that are in the ordinary course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000practice; provided, increase however, that no new awards shall be granted under the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.Phantom Share Plan,
Appears in 1 contract
Sources: Stock Purchase Agreement
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 approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) withheld, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) its business and the business of it and its Subsidiaries (including, without limitation, research and development, establishment and maintenance of marketing and sales programs, and customer support) shall be conducted in the ordinary and usual course consistent in all material respects with past practices and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially 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;
(iib) it shall not not, (Ai) issue, sell, pledge, sell otherwise dispose of or encumber any capital stock owned by it in subject to Lien (other than Permitted Liens) any of its Subsidiaries; ' Capital Stock owned by it, (Bii) amend its Organizational Documents; (C) articles of organization, by-laws or, except for any amendment which will not hinder, delay or make more costly to Parent the Merger, the Rights Agreement other than in the case of any direct or indirectthat amendment contemplated hereby, wholly owned Subsidiary, (iii) split, combine or reclassify its outstanding shares of capital stock; Capital Stock, (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock Capital Stock other than dividends from its direct or indirect wholly owned Subsidiaries; or the issuance of Rights in connection with the issuance of Capital Stock upon the exercise of Company Options, (Ev) repurchase, redeem or otherwise acquire, acquire or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Capital Stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stockCapital Stock or (vi) adopt a plan of complete or partial liquidation or dissolution, merger or otherwise restructure or recapitalize or consolidate with any Person other than Merger Sub or another wholly owned Subsidiary of Parent;
(iiic) neither it nor any of its Subsidiaries shall (i) except as provided in ANNEX A) , authorize for issuance or issue, sell, pledge, sell or otherwise dispose of or encumber subject to any Lien (other than Permitted Liens) 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 Capital Stock of any class (other than Shares issuable pursuant to Company Options outstanding on the date hereof, Shares that may be issuable under the Company's 1994 Employee Stock Purchase Plan as of January 31, 1999, and automatic grants of director stock options that may be mandated by the Director Stock Option Plans) or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (Bii) other than for sales of products sold to customers in the ordinary and usual course licenses of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired software in the ordinary and usual course of business consistent with past practicepractices and as set forth on Schedule 5.1(c), by transfer, lease, license, guarantee, sell or otherwise dispose of or subject to any means, make any acquisitions of, or investments in stock of Lien (or other interest inthan Permitted Liens) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants property or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsassets, (Biii) other than in the ordinary and usual course of business consistent with past practice and practices, incur or modify any indebtedness or other material liability (except for borrowings in the Company’s compensation budget with respect to employees at an annual compensation level ordinary course under lines of less than $150,000credit in existence on the date hereof), increase (iv) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the compensation obligations of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) other Person except in the ordinary course of business consistent with past practices and usual except for obligations of Subsidiaries of the Company incurred in the ordinary course of business, (v) make any loans to any other Person (other than to Subsidiaries of the Company or reasonable and customary loans or advances to employees in connection with business-related travel in the ordinary course of business consistent with past practices) or (vi) make any commitments for, make or authorize any capital or prepaid expenditures other than in amounts less than $150,000 individually and $3,000,000 in the aggregate or, by any means, make any acquisition of, or investment in, assets or stock of any other Person;
(d) neither it nor any of its Subsidiaries shall settle shall, except as may be required as a result of a change in law or compromise any material claims or litigation or modifyin GAAP, amend or terminate change any of its material Contracts the accounting principles or waive, release or assign any material rights or claimspractices used by it;
(vie) neither it nor any of its Subsidiaries shall make revalue in any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor respect any of its Subsidiaries shall take any action material assets, including writing down the value of inventory or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize writing-off notes or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and accounts receivable except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than except as may be required by applicable Law as a result of a change in law or by U.S. in GAAP;
(viif) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.except as set forth on Schedule 5.1
Appears in 1 contract
Sources: Merger Agreement (Shiva 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 in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) 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 each of its Subsidiaries shall use its 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;, and 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. By way of amplification of the foregoing and not limitation, neither the company nor any of its Subsidiaries shall, between the date of this Agreement and the Effective Time, directly or indirectly, take any action, including but not limited to the following, except with the prior consent of a Designated Officer (as defined below):
(iia) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bi) amend its Organizational Documentsarticles of incorporation or by-laws, except as may be required to increase the number of shares of Common Stock in connection with the conversion of the Convertible Loan, the Series A Preferred or the Series B Preferred, in each case outstanding as of the date hereof; (Cii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Diii) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiariesstock; or (Eiv) 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;
(iiib) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt or any other property or assets, except for (other than Company x) issuances of Common Shares issuable under Stock upon conversion of the Company Option Plans)Convertible Loan, the Series A Preferred or the Series B Preferred, in each case outstanding on the date hereof, and (y) issuances of Series B Preferred upon exercise of warrants outstanding on the date hereof; (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (yiii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of , any other PersonPerson or entity;
(ivc) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any -23- Company Compensation and Benefit Plans except as required by (including, without limitation, any Laws grant or issuance of new Options, any amendment or changes to the terms of applicable collective bargaining agreementsany Options or any repricing of Options), (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, or increase the salary, wage, bonus or other compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000employees;
(vd) except in the ordinary and usual course of business, neither it 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;
(vie) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt terminated except in the ordinary and usual course of business;
(f) make any change in change, other than required by GAAP, to its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respectprocedures; and
(viiig) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that. For the purposes of this Section 6.1, after the date hereof and prior to the Effective Time (unless the Company "Designated Officer" shall otherwise consent in writing (which consent shall not be unreasonably withheld mean ------------------ any of ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇ or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, each of Section 3.1(b) whom is an officer of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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
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 approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Stock Option Agreement or set forth in Section 3.1(a) 6.1 of the Company Disclosure LetterSchedule):
(ia) the business of it its and its Subsidiaries Subsidiaries's businesses shall be conducted in the ordinary and usual course and(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 extent consistent therewith, with (a) above it and each of its Subsidiaries shall use its 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;
(iic) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentscharter or by-laws or amend, modify or terminate the Rights Agreement except as contemplated by Section 5.1(q)(ii); (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) authorize, declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly wholly-owned SubsidiariesSubsidiaries 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 the Company's Articles of Incorporation; or (Ev) 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 capital stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
(iiid) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt other property or assets (other than Company Common Shares issuable pursuant to options outstanding on the date hereof under any of the Company Option PlansStock Plans or upon conversion of the Preferred Shares or Convertible Notes); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;,
(ive) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsPlans, (B) 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 consistent with past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000and benefit increases);
(vf) except 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, neither it nor any claims arising under the terms of its 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 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 claimsnot exceed $5 million in the aggregate;
(vig) neither it nor any of its Subsidiaries shall make or change any Tax election, settle any material Tax election or audit, file any material income Tax Return inconsistent with past practice amended tax returns or implement permit any insurance policy naming it as a beneficiary or adopt any change loss-payable payee to be canceled or terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viih) 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 it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiil) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (American Bankers Insurance Group Inc)
Interim Operations. (a) The Except as expressly contemplated by this Agreement or the Company Disclosure Schedule or as agreed to in writing by Parent, the Company covenants and agrees as to itself and its Subsidiaries that, after that during the period from the date hereof and prior of this Agreement to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in until termination of this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letterin accordance with ARTICLE 7 hereof):
(ia) the business of it Company and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries subsidiaries shall use its respective their reasonable best efforts to preserve its intact their current business organization intact organizations, keep available the services of their current officers and maintain its existing relations employees and goodwill preserve their relationships with customers, suppliers, distributorslicensors, creditorslicensees, lessorsadvertisers, employees distributors and others having business associatesdealings with them and to preserve goodwill;
(iib) it the Company shall not (Ai) authorize for issuance, issue, selldeliver, pledgesell or agree or commit to issue, dispose sell or deliver (whether through the issuance or granting of options, commitments, subscriptions, rights to purchase or otherwise), pledge or otherwise encumber any shares of its capital stock owned by it in or the capital stock of any of its Subsidiaries; subsidiaries, any other voting securities or any securities convertible into, or any rights, warrants or options to acquire, any such shares, voting securities or convertible securities or any other securities or equity equivalents (B) amend its Organizational Documents; (C) other than in the case of any direct or indirectincluding, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cashwithout limitation, stock appreciation rights, phantom interests and stock purchase rights (whether pursuant to the 1996 Option Plan or property in respect otherwise)), except for issuances of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; Common Shares upon the exercise of Options outstanding prior to the date hereof or (Eii) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries subsidiaries to purchase repurchase, redeem or otherwise acquire, any shares of its capital stock or any securities convertible into other equity interests of the Company or exchangeable or exercisable for any shares of its capital stock;
(iii) neither it nor any of its Subsidiaries shall subsidiaries (A) issueincluding, sellwithout limitation, 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 or other equity interests of any class or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiariessubsidiaries); ;
(Cc) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, transfer or pledge, dispose of or encumber agree to sell, transfer or pledge, any capital stock equity interest owned by it in any of its Subsidiaries; subsidiaries or alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure or ownership of any of its subsidiaries, (Bii) except as provided in Section 3.19, amend or otherwise change its certificate of incorporation or bylaws or permit any of its subsidiaries to amend its Organizational Documents certificate of incorporation, bylaws or amend, modify equivalent organizational documents or terminate the Parent Rights Agreement; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock stock, and shall not permit any of its subsidiaries to split, combine or any securities convertible into or exchangeable or exercisable for reclassify any shares of its capital stock;
(iiid) the Company shall not, and shall not permit any of its subsidiaries to, declare, set aside or pay any dividends on (whether in cash, stock or property), or make any other distributions in respect of, any of its capital stock (except for dividends paid by direct or indirect wholly owned subsidiaries to the Company with respect to capital stock);
(e) neither it the Company nor any of its Subsidiaries subsidiaries shall (Ai) issue, sell, pledge, dispose of grant or encumber agree to any shares increase in any manner in the compensation or fringe benefits of, or securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of pay any kind to acquirebonus to, any shares current or former director, officer or employee except for increases and bonuses expressly contemplated by or required under existing employment agreements, bonus plans and other agreements and arrangements listed in SECTION 5.01(e) of its capital stock the Company Disclosure Schedule, (ii) subject to the covenants set forth in clause (i) of this SECTION 5.01(e), enter into any class new or materially amend any Parent Voting Debt (existing employment, severance or termination agreement with any current or former director, officer or employee of the Company other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, (iii) except as may be required to comply with applicable law and except as provided in this Agreement, become obligated under any Benefit Plan that was not in existence on the date hereof or amend, modify or terminate any Benefit Plan or other employee benefit plan or any agreement, arrangement, plan or policy for the benefit of any current or former director, officer or employee in existence on the date hereof or (iv) pay any benefit not required by any meansplan or arrangement as in effect as of the date hereof (including, without limitation, the granting of, acceleration of, exercisability of or vesting of stock options, stock appreciation rights or restricted stock);
(f) the Company shall not, and shall not permit any of its subsidiaries to, acquire or agree to acquire, including, without limitation, by merging or consolidating with, or purchasing all or substantially all the assets or capital stock or other equity interests of, or by any other manner, any business or any corporation, partnership, association or other business organization or division thereof, other than purchases of inventory, supplies or equipment parts in the ordinary course of business consistent with past practice;
(g) the Company shall not, and shall not permit any of its subsidiaries to, sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, or agree to sell, lease, license, mortgage or otherwise encumber or subject to any Lien or otherwise dispose of, any of its properties or assets, including any Company Intellectual Property, other than (i) pursuant to existing contracts and commitments described in SECTION 5.01(g) of the Company Disclosure Schedule, (ii) immaterial properties or assets or Company Intellectual Property (or immaterial portions of properties or assets or Company Intellectual Property) and (iii) inventory in the ordinary course of business consistent with past practice;
(h) the Company shall not, and shall not permit any of its subsidiaries to, incur, assume or pre-pay any indebtedness for borrowed money or enter into any agreement to incur, assume or pre-pay any indebtedness for borrowed money, or guarantee, or agree to guarantee, any such indebtedness or obligation of another person, or issue or sell, or agree to issue or sell, any debt securities or options, warrants or calls or rights to acquire any debt securities of the Company or any of its subsidiaries, guarantee any debt securities of others, enter into any "keep well" or other agreement to maintain any financial condition of another person or enter into any arrangement having the economic effect of any of the foregoing, other than borrowings by the Company under SECTION 5.15 or under its existing credit agreement;
(i) the Company shall not, and shall not permit any of its subsidiaries to, make or forgive any acquisitions loans, advances or capital contributions to, guarantees for the benefit of, or investments in stock in, any person or entity (other than loans between or among the Company and any of its wholly-owned subsidiaries);
(j) the Company shall not, and shall not permit any of its subsidiaries to, assume, guarantee or other interest inotherwise become liable or responsible (whether directly, contingently or otherwise) or assets for the obligations of any other PersonPerson except for the obligations of the subsidiaries of the Company permitted under this Agreement;
(ivk) neither it the Company nor any of its Subsidiaries subsidiaries shall adopt or put into effect a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its subsidiaries (Aother than any transaction specifically contemplated by this Agreement);
(l) terminatethe Company shall not, establishand shall not permit any of its subsidiaries to, adopt, (i) enter into, make amend, modify or supplement any new grants Material Contract or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms License Agreement outside of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice (except as may be necessary for the Company to comply with its obligations hereunder) or (ii) waive, release, grant, assign or transfer any of its material rights or claims (whether such rights or claims arise under a Material Contract or otherwise);
(m) the Company shall not, and shall not permit any of its subsidiaries to, authorize or make any capital expenditures (other than pursuant to commitments prior to the date hereof disclosed in SECTION 5.01(m) of the Company Disclosure Schedule) in excess of $100,000 in the aggregate for the Company and its subsidiaries taken as a whole;
(n) the Company and its subsidiaries shall comply with their non-monetary obligations (and shall use their reasonable best efforts to comply with their monetary obligations) under the Material Contracts and License Agreements as such obligations become due;
(o) the Company and its subsidiaries (i) shall continue in force with insurance companies adequate insurance covering risks of such types and in such amounts as are consistent with the Company's past practices and (ii) shall not permit any insurance policy naming it as beneficiary or loss payable payee to be canceled or terminated without the prior written approval of Parent’s compensation budget ;
(p) the Company shall not, and shall not permit any of its subsidiaries to, enter into, amend, modify or supplement any agreement, transaction, commitment or arrangement with respect to employees at an annual compensation level any current or former officer, director, employee or other affiliate of less than $150,000, increase the compensation Company or any of its subsidiaries (or any affiliate of any employee of the foregoing) other than agreements, transactions, commitments and arrangements (i) permitted by SECTION 5.01(e) hereof or (Cii) as otherwise expressly contemplated by this Agreement;
(q) the Company shall not, and shall not permit any of its subsidiaries to, establish or acquire (i) any subsidiary other than wholly-owned subsidiaries or (ii) subsidiaries organized outside of the United States and its territorial possessions;
(r) the Company shall not, and shall not permit any of its subsidiaries to, amend, modify or waive any term of any outstanding security of the Company and any of its subsidiaries, except as approved required by this Agreement;
(s) the Transition TeamCompany shall, hire and shall cause its subsidiaries to, (i) maintain any employee at an annual compensation level expected real property to be more than $100,000which the Company and any of its subsidiaries have a leasehold interest (including, without limitation, the furniture, fixtures, equipment and systems therein) in its current condition, subject to reasonable wear and tear and subject to any casualty or condemnation, (ii) timely pay all taxes, water and sewage rents, assessments and insurance premiums affecting such real property and (iii) timely comply in all material respects with the terms and provisions of all leases, contracts and agreements relating to affecting such real property and the use and operation thereof, in all cases to the extent required by any such lease, contract or agreement;
(t) the Company shall not, and shall not permit any of its subsidiaries to, enter into any labor or collective bargaining agreement, memorandum or understanding, grievance settlement or any other agreement or commitment to or relating to any labor union;
(u) the Company shall not, and shall not permit any of its subsidiaries to, settle or compromise any pending or threatened suit, action, claim or litigation (except in the ordinary course of business and with prior written notice to Parent);
(v) except in the ordinary Company shall not, and usual course of business, neither it nor shall not permit any of its Subsidiaries subsidiaries to, change any of the accounting policies, practices or procedures (including tax accounting policies, practices and procedures) used by the Company and its subsidiaries as of March 31, 2001, except as may be required as a result of a change in applicable law or in United States generally accepted accounting principles;
(w) the Company shall not, and shall not permit any of its subsidiaries to, revalue in any material respect any of its assets, including, without limitation, writing down the value of inventory in any material manner or the write-off of notes or accounts receivable in any material manner;
(x) the Company shall not, and shall not permit any of its subsidiaries to, make or change any material tax election, make or change any method of accounting with respect to Taxes, file any amended Tax Return or settle or compromise any material claims or litigation or modifytax liability;
(y) the Company shall not, amend or terminate and shall not permit any of its material Contracts subsidiaries to, pay, discharge or waivesatisfy any claims, release liabilities or assign any material rights obligations (absolute, accrued, asserted or claimsunasserted, contingent or otherwise), other than the payment, discharge or satisfaction of liabilities reflected or reserved against in the financial statements of the Company or incurred in the ordinary course of business and consistent with past practice (and in a manner that is not more rapid than past practice);
(viz) neither it nor the Company shall not, and shall not permit any of its Subsidiaries shall subsidiaries to, take, or agree or commit to take, any action that would, or is reasonably likely to, make any material Tax election representation or file warranty of the Company contained in this Agreement inaccurate at, or as of any material income Tax Return inconsistent with past practice time prior to, the Effective Time or implement or adopt any change result in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action the conditions to the Merger set forth in ARTICLE 6 not being satisfied, or omit omit, or agree to omit, to take any action that it reasonably expects would cause necessary to prevent any of its representations and warranties herein to become untrue such representation or warranty from being inaccurate in any material respectrespect at any such time or to prevent any such condition from not being satisfied; and
(viiiaa) neither it nor the Company shall not, and shall not permit any of its Subsidiaries will authorize subsidiaries to, agree or enter into an agreement commit to do any of the foregoing.
Appears in 1 contract
Sources: Merger Agreement (Rockshox Inc)
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries that, after the date hereof of this Agreement and prior to the Effective Time (unless Parent shall otherwise consent approve in writing (which consent shall writing, such approval not to be unreasonably withheld withheld, conditioned or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) Agreement), the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, and it and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization organizations intact and maintain its existing relations and goodwill with Governmental Entities, customers, suppliers, distributors, creditors, lessors, employees and business associatesassociates 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 required by this Agreement, (B) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed) or (C) as expressly set forth in Section 6.1 of the Company Disclosure Letter, the Company will not and will not permit its Subsidiaries to:
(i) amend its charter or by-laws, or, subject to the terms of this Agreement, otherwise take any action to exempt any Person (other than Parent or its Subsidiaries) or any action taken by any Person from the Rights Agreement or any Takeover Statute or terminate, amend or waive any provisions of any confidentiality or standstill agreements in place with any third parties;
(ii) it shall not 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;
(Aiii) acquire from any other Person outside of the ordinary course of business any asset or group of related assets with a value or purchase price in excess of $1,000,000 individually or $2,500,000 in the aggregate, in any transaction or series of related transactions, in each case other than acquisitions pursuant to Contracts as in effect as of the date of this Agreement;
(iv) issue, sell, pledge, dispose of, grant, transfer, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or Encumbrance of, any shares of or encumber any capital stock owned by it in of the Company or any of its Subsidiaries; Subsidiaries (B) amend its Organizational Documents; (C) other than the issuance of shares by a Subsidiary of the Company to the Company or a wholly owned Subsidiary of the Company), 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 Encumbrances, individually or in the case aggregate, material to the Company or any of its Subsidiaries or on any direct asset or indirectgroup of related assets of the Company or any of its Subsidiaries having a value in excess of $500,000 individually or $2,500,000 in the aggregate;
(vi) make any loans, wholly owned Subsidiaryadvances, split, combine guarantees or reclassify its outstanding shares of capital stock; contributions to or investments in any Person (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its the Company or any direct or indirect wholly owned Subsidiaries; Subsidiary of the Company) in excess of $100,000 individually or $250,000 in the aggregate outstanding at any given time;
(Evii) repurchasedeclare, redeem set aside, make or otherwise acquirepay any dividend or other distribution, payable in cash, stock, property or permit otherwise, with respect to any of its Subsidiaries capital stock (except for dividends paid by any direct or indirect Subsidiary of the Company to its stockholders or unit holders on a pro rata basis in the ordinary course of business consistent with past practices) 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 shares of its capital stock or any securities convertible into or exchangeable into or exercisable for any shares of its capital stock;
(iiiix) neither 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 (A) in replacement of existing indebtedness for borrowed money on terms substantially consistent with or more beneficial than the terms of the indebtedness being replaced as of the date of such replacement, or (B) guarantees by the Company of indebtedness of wholly owned Subsidiaries of the Company complying with clause (A) above;
(x) except as expressly 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 expenditures that in the aggregate exceed by more than 15% from the aggregate capital expenditures in such capital budgets in respect of the period from the date of this Agreement to the Closing;
(xi) enter into any Contract that would have been a Material Contract had it nor been entered into prior to this Agreement, except for Contracts entered into the ordinary course of business consistent with past practices and (A) terminable by the Company, without penalty, on ninety (90) days or less notice effective on the later of September 30, 2014 or ninety (90) days or less after Closing and (B) not involving anticipated required consideration by the Company or any of its Subsidiaries shall at or after the Closing in excess of $5,000,000;
(xii) enter into any Contract of the type specified in clauses (A), (G), (I), (J), (K), (L), (M) or (N) of Section 5.1(m);
(xiii) amend, modify or terminate any Material Contract, except in the ordinary course of business consistent with past practices and (A) issueterminable by the Company, sellwithout penalty, pledgeon ninety (90) days or less notice effective on the later of September 30, dispose of 2014 or encumber ninety (90) days or less after Closing (or, in each case, such longer time period as in effect prior to any shares ofsuch amendment or modification pursuant hereto), 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 Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); and (B) other than products sold to customers in not involving required anticipated additional consideration by the ordinary and usual course of business (without limitation as to dollar amount) Company or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); Subsidiaries at or after the Closing in excess of $5,000,000;
(Cxiv) incur make any changes with respect to accounting policies or modify any indebtedness other than procedures, except as required by changes in applicable generally accepted accounting principles, by Regulation S-X under the Securities Act, or by the Public Company Accounting Oversight Board or Financial Accounting Standards Board;
(xv) settle (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries any litigation or between such wholly owned Subsidiaries claim or (y) indebtedness other proceedings before a Governmental Entity, in each case for an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or(excluding amounts that may be paid under insurance policies);
(xvi) cancel, modify or waive any debts or claims held by it or waive any rights having in the aggregate, are each case a value or cost in excess of $10,000,000250,000 individually or $2,000,000 in the aggregate;
(xvii) make or change any material Tax election or method of Tax accounting; and (E) except as amend any Tax Return with respect to a material amount of Taxes; settle or otherwise provided finally resolve any audit or dispute with respect to material amount of Taxes, other than, in clause (D) immediately above and other than raw materialseach case, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice;
(xviii) transfer, sell, lease, assign, license, surrender, divest, cancel, abandon or allow to lapse or expire or otherwise dispose of any part of its assets (including Intellectual Property), licenses, operations, rights, product lines, businesses or interests therein of the Company or its Subsidiaries, except in connection with services or products provided in the ordinary course of business and sales of obsolete assets and except for sales, leases, licenses or other dispositions of any asset or any group of related assets (other than wireless spectrum) with a fair market value not in excess of $250,000 individually or $500,000 in the aggregate, other than pursuant to Contracts as in effect as of the date of this Agreement;
(xix) except as required pursuant to a Benefit Plan or existing written, binding agreements as in effect as of the date of this Agreement, or as otherwise required by any meansapplicable Law, (A) other than the payment of regular base salaries, at the rates in effect as of the date of this Agreement or wages and other non-discretionary compensation, make any acquisitions ofcompensation payments or awards, or investments in stock of (or other interest in) or assets including the grant of any other Person;
(iv) neither it nor equity or cash awards, to any director, officer or employee of the Company or any of its Subsidiaries shall Subsidiaries, (AB) terminategrant or increase the compensation, establishseverance or other benefits payable or to become payable to any director, officer or employee of the Company or any of its Subsidiaries, (C) adopt, enter into, make establish, or materially amend, modify or terminate any new grants Benefit Plan or awards underany employment, individual consulting, collective bargaining, bonus or other incentive compensation, health or other welfare, pension, retirement, severance, deferred compensation or other compensation or benefit plan with, for or in respect of any director, officer or employee of the Company or any of its Subsidiaries that would constitute a Benefit Plan had it been in effect as of the date of this Agreement, (D) materially amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsany outstanding equity-based 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 Benefit Plan, to the extent not already provided in any such Benefit Plan, (F) 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 (G) forgive any loans to any directors, officers or employees of the Company or any of its Subsidiaries;
(xx) (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 an FCC License or any other Permits 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 Permit or FCC License to the extent such license would be reasonably expected to prevent, materially delay or materially impair the consummation of the transactions contemplated herein;
(xxi) file for any Permit or FCC License (A) outside of the ordinary course of business or (B) the receipt of which would, individually or in the aggregate, reasonably be expected to prevent, materially delay or materially impair consummation of the transactions contemplated herein;
(xxii) assign, transfer, cancel, fail to renew or fail to extend any FCC License or Permit;
(xxiii) change (other than pursuant to software updates, upgrades and patches) any of the material technology in the Network Assets, enterprise software or billing software used in its respective businesses;
(xxiv) except in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000practices, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modifyterminate, amend or terminate modify in any of its material Contracts manner any Ground Lease, Governmental Use Permit, Colocation Agreement, Third Party Colocation Agreement or waive, release or assign any material rights or claims;Third Party Cell Site Agreement; or
(vixxv) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practicesagree, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as Prior to itself and its Subsidiaries that, after the date hereof and prior making any written or oral communications to the Effective Time (unless directors, officers or employees of the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries pertaining to purchase compensation 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 (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate benefit matters that are affected by the transactions contemplated by this Agreement and Agreement, the Arrangement, (y) products sold to customers in Company shall provide Parent with a copy of the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicableintended communication, Parent shall provide have a reasonable period of time to review and comment on the communication, and Parent and the Company with shall cooperate in providing any such mutually agreeable communication.
(c) The Company and Parent shall cooperate in developing language for a reasonable right program of consultation; provided, further, that communications or notices relating to the foregoing right Merger or the other transactions contemplated by this Agreement to be sent to customers of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent Company and its wholly owned Subsidiaries on or between such wholly owned Subsidiaries; (D) except as approved by after the Transition Teamdate of this Agreement and prior to the Closing. The Company shall not, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of shall cause its Subsidiaries shall (A) terminatenot to, establish, adopt, enter into, make send any new grants communications or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws notices relating to the Merger or the terms other transactions contemplated by this Agreement to customers of applicable collective bargaining agreements, the Company and its Subsidiaries on or after the date of this Agreement and prior to the Closing without the prior written approval of Parent (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected not to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoingunreasonably withheld).
Appears in 1 contract
Sources: Merger Agreement (At&t Inc.)
Interim Operations. Except (a1) The as required by applicable Law, (2) as Parent may approve in writing (such approval not to be unreasonably withheld, conditioned or delayed) (3) as expressly disclosed in Section 6.1(a) of the Company Disclosure Letter or (4) as expressly provided for in this Agreement, the Company covenants and agrees as to itself and its Subsidiaries that, from and after the date hereof execution of this Agreement and prior to the earlier of (x) the Effective Time or (unless Parent y) termination of this Agreement in accordance with ARTICLE VIII (A) the Company shall otherwise consent use its commercially reasonable efforts to conduct its business and the business of its Subsidiaries in writing the ordinary course of business consistent with past practice in all material respects; provided, however that no action that is specifically permitted by any of subclauses (which consent a) through (n) of Section 6.1 (B) shall be deemed a breach of either this clause (A) or any other subclause of Section 6.1 (B) and (B) without limiting the generality of, and in furtherance of, the foregoing the Company shall not be unreasonably withheld and will not permit any of its Subsidiaries to:
(a) (i) amend its certificate of incorporation or delayed) and except as otherwise expressly set forth in this Agreement bylaws (or comparable governing documents), other than amendments to the corresponding subsection governing documents of Section 3.1(a) any wholly owned Subsidiary of the Company Disclosure Letter):
(i) that would not prevent, materially delay or materially impair the business of it and its Subsidiaries shall be conducted in Merger or the ordinary and usual course andother transactions contemplated by this Agreement, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine combine, subdivide or reclassify its outstanding shares equity interests (except for any such transaction by a wholly owned Subsidiary of capital stock; the Company which remains a wholly owned Subsidiary after consummation of such transaction), (Diii) declare, set aside or pay any dividend or distribution payable in cash, stock or property (or any combination thereof) in respect of any capital stock other than of its equity interests (except for any dividends from its or distributions paid by a direct or indirect wholly owned Subsidiaries; Subsidiary of the Company to another direct or indirect wholly owned Subsidiary of the Company or to the Company) or (Eiv) purchase, repurchase, redeem or otherwise acquireacquire any of its equity interests or any securities convertible or exchangeable into or exercisable for any of its equity interests (other than (1) pursuant to the exercise of Company Options or the forfeiture of, or permit withholding of Taxes with respect to, Company Options, Restricted Stock Units or Performance Restricted Stock Units outstanding on the date hereof 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);
(b) 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 Merger or the other transactions contemplated by this Agreement);
(c) except as required by a Company Plan in effect as of the date hereof and disclosed in writing to Parent, (i) increase the compensation or benefits payable to the Chief Executive Officer of the Company or any employee of the Company who directly reports to the Chief Executive Office of the Company, (ii) accelerate the vesting or payment of any compensation, award or benefit, grant or pay any extraordinary bonus or implement any new severance or other compensation or benefit entitlements, including any transaction, retention or other similar bonus, (iii) adopt, terminate or make any change to any Company Plan that would materially increase the costs to the Company in respect of such Company Plan, or (iv) hire, engage or terminate the employment or engagement of any executive officer of the Company;
(d) incur any Indebtedness, guarantee, endorse, assume or otherwise become liable or responsible for any Indebtedness of another Person or issue any rights to acquire any Indebtedness, except (i) borrowings under the Company’s revolving credit facility (as in effect as of the date hereof) pursuant to the Company’s Existing Credit Agreement either (x) in the ordinary course of business or (y) as directed by Parent or Merger Sub at Closing, (ii) inter-company Indebtedness among the Company and its wholly owned Subsidiaries, (iii)(A) 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 (B) overdraft facilities or cash management programs, in each case issued, made or entered into in the ordinary course of business consistent with past practice, (iv) 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 or (v) Indebtedness incurred at Closing at the direction of Parent or Merger Sub in accordance with Section 6.19;
(e) make or commit to any capital expenditures other than in the ordinary course of business consistent with past practice and which do not exceed, in the aggregate, for the period between the date of this Agreement and the Closing Date, 55% of the capital expenditures provided for in the 2024 budget previously provided to Parent;
(f) other than in the ordinary course of business consistent with past practice, transfer, lease, license, sell, assign, mortgage, pledge, place a Lien upon or otherwise dispose of any properties or assets (including equity interests of any of its Subsidiaries to purchase but not including any Intellectual Property), with a fair market value in excess of $5,000,000 individually or otherwise acquire$10,000,000 in the aggregate (other than transactions among the Company and its wholly owned Subsidiaries);
(g) 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 other equity interest in the Company or any Company Subsidiary 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) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or any options, warrants, calls, commitments warrants or other rights of any kind to acquire, any such shares or equity interest, except (i) for any Shares issued pursuant to Company Options, Restricted Stock Units and Performance Restricted Stock Units outstanding on the date of its capital stock this Agreement in accordance with the existing terms of any class or any such awards and the applicable Company Voting Debt Stock Plan, that are outstanding on the date hereof and (other than Company Common Shares issuable under ii) by wholly owned Subsidiaries to the Company Option Plans); or to any other wholly owned Subsidiary of the Company;
(Bh) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize spend or commit for any capital expenditures which, individually, is to spend in excess of $1,000,000 or, 5,000,000 individually or $10,000,000 in the aggregateaggregate to acquire any business or to acquire assets or other property, are in excess whether by merger, consolidation, purchase of $10,000,000; and property or assets or otherwise (Evaluing any non-cash consideration at its fair market value as of the date of the agreement for such acquisition);
(i) make any material change with respect to its financial accounting policies or procedures, except as otherwise provided required by changes in clause GAAP (Dor any interpretation thereof) immediately above and or by applicable Law;
(j) abandon any material existing lines of business or enter into any new line of business other than raw materialsany 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, supplies and as determined by the Company in its sole discretion;
(k) other inventory items acquired than in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions ofloans, advances or capital contributions to, or investments in stock in, any Person (other than loans, advances or capital contributions to the Company or any direct or indirect wholly owned Subsidiary of (or other interest in) or assets of any other Personthe Company);
(ivl) neither it nor any of its Subsidiaries shall (Ai) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, modify in any Company Compensation and Benefit Plans except as required by any Laws material respect or terminate (excluding terminations upon expiration of the term thereof in accordance with the terms of applicable collective bargaining agreements, (Bthereof) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, amend or terminate any of its material Contracts Material Contract or waive, release or assign any material rights rights, claims or claims;
benefits under any Material Contract or (viii) neither enter into any Contract that would have been a Material Contract had it nor 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 or its Subsidiaries (and to Parent and its Subsidiaries following the Closing) than, either a Contract it is replacing; 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(l) in the ordinary course of business consistent with past practice; provided, further that (x) this Section 6.1(l) shall not prohibit or restrict the Company or any of its Subsidiaries from entering into a Contract to the extent that such Contract implements an act or failure to act that is expressly permitted under any of Sections 6.1(a) through 6.1(l) and (y) for the avoidance of doubt, this Section 6.1(k) shall make not prohibit or restrict any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practicesCompany Plans and (z) this Section 6.1(l) shall not apply to the Existing Credit Agreement and the Existing Receivables Agreement, in all cases other than as may each case, which shall be required exclusively governed by applicable Law or by Canadian GAAPSection 6.19;
(viiA) neither it nor settle any action, suit, case, litigation, claim, hearing, arbitration, investigation or other proceedings before or threatened to be brought before a Governmental Entity, other than settlements if the amount of its Subsidiaries shall take any action such settlement is not in excess of $1,000,000 individually or omit to take $5,000,000 in the aggregate, in each case in excess of amounts available under the Company’s applicable insurance policy; provided that such settlements do not involve any action that it reasonably expects would cause any admission of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize guilt, non-de minimis injunctive or enter into an agreement to do any equitable relief or impose non-de minimis restrictions on the business activities of the foregoing.
(b) Parent covenants and agrees as to itself Company and its Subsidiaries thator Parent and its Subsidiaries, after the date hereof and prior or (B) waive, release, grant or transfer any material claim or right of material value or knowingly consent to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld termination of any material claim or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection right of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associatesmaterial value;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (Cn) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by make or change any meansmaterial Tax election, make any acquisitions ofmaterial change to any annual Tax accounting period, adopt or investments in stock change any material method of (Tax accounting, amend any material Tax Returns or file any claims for material Tax refunds, enter into any material closing agreement, settle any material Tax claim, audit or assessment or surrender any right to claim a material Tax refund, offset or other interest in) or assets of any other Personreduction in Tax liability;
(ivo) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize negotiate or enter into an any agreement with a Union; or
(p) agree, resolve or commit to do any of the foregoing.
Appears in 1 contract
Sources: Merger Agreement (Agiliti, Inc. \De)
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 approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) withheld, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
Agreement): (ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course consistent with past practices and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially 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;
; (iib) it shall not not, (Ai) issue, sell, pledge, sell otherwise dispose of or encumber any capital stock owned by it in subject to Lien (other than Permitted Liens) any of its Subsidiaries' Capital Stock owned by it; (Bii) amend its Organizational Documentscharter, by-laws or, except for any amendment which will not hinder, delay or make more costly to Parent the Offer or the Merger; the Rights Agreement; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stockCapital Stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock Capital Stock other than dividends from its direct or indirect wholly owned Subsidiariesthe issuance of Rights in connection with the issuance of Capital Stock upon the exercise of Company Options; or (Ev) repurchase, redeem or otherwise acquire, acquire or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Capital Stock; or any securities convertible into or exchangeable or exercisable for any shares of its capital stock;
Capital Stock; or (iiivi) adopt a plan of complete or partial liquidation or dissolution, merger or otherwise restructure or recapitalize or consolidate with any Person other than Merger Sub or another wholly-owned Subsidiary of Parent; (c) neither it nor any of its Subsidiaries shall (Ai) authorize for issuance or issue, sell, pledge, sell or otherwise dispose of or encumber subject to any Lien (other than Permitted Liens) 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 Capital Stock of any class or any Company Voting Debt (other than Company Common Shares issuable under pursuant to Company Options outstanding on the date hereof, the grant of Company Options to newly hired employees in accordance with a benefit matrix previously provided to Parent and after notification of Parent and automatic grants of director stock options as mandated by the Company's First Amended 1988 Nonqualified Stock Option PlansPlan for Outside Directors); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practicepractices, transfer, lease, license, guarantee, sell or otherwise dispose of or subject to any Lien (other than Permitted Liens) any other property or assets or incur or modify any material indebtedness or other liability (except for additional borrowings in the ordinary course under lines of credit in existence on the date hereof); (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person except in the ordinary course of business consistent with past practices and except for obligations 16 22 of Subsidiaries of the Company incurred in the ordinary course of business; (iv) make any loans to any other Person (other than to Subsidiaries of the Company or, customary loans or advances to employees in connection with business-related travel in the ordinary course of business consistent with past practices); or (v) make any commitments for, make or authorize any capital expenditures other than in amounts less than $150,000 individually and $3,000,000 in the aggregate or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other Person;
; (ivd) except as may be required to comply with applicable law or by existing contractual commitments, neither it nor any of its Subsidiaries shall (Ai) enter into any new agreements or commitments for any severance or termination pay to, or enter into any employment or severance agreement with, any of its directors, officers or employees or consultants except for (a) specific arrangements with ten of the Company's employees and one of its directors which have been previously disclosed to Parent and (b) reasonable severance payments made to employees in the ordinary course of business and consistent with past practices, or (ii) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws Plan or increase or accelerate the terms of applicable collective bargaining agreementssalary, (B) wage, bonus or other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee employees or directors (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except for increases occurring in the ordinary and usual course of business, which shall include normal periodic performance reviews and related compensation and benefit increases, but not any general across-the-board increases) or consultants or pay or agree to pay any pension, retirement allowance or other employee benefit not required by any existing Compensation and Benefit Plan; (e) neither it nor any of its Subsidiaries shall, except as may be required as a result of a change in law or in GAAP, change any of the accounting principles or practices used by it; (f) neither it nor any of its Subsidiaries shall revalue in any respect any of its material assets, including writing down the value of inventory or writing-off notes or accounts receivable, other than in the ordinary course of business consistent with past practices; (g) neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, terminate or materially amend or terminate modify any of its material Contracts or waive, release or assign any material rights or claims;
; (vih) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be canceled or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
terminated; (viii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
and (viiij) neither it nor any of its Subsidiaries will authorize or enter into an any agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees the Stockholders covenant and agree as to itself the Company and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent grant prior approval in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth stated in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it the Company and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it the Company and each of its Subsidiaries shall use its their respective reasonable best efforts to preserve its their business organization intact and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it the Company shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documentscertificate of incorporation or bylaws; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) other than as set forth in Section 6.9, declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiariesstock; or (E) 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;
(iii) neither it the Company nor any of its Subsidiaries shall (A) 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 Company Voting Debt (Debt, other than Company Common Shares issuable under pursuant to the Company Option Plans); valid exercise of currently outstanding options or warrants, (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yC) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is other than in excess of amounts less than $1,000,000 or, 50,000 individually and $200,000 in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practiceaggregate or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of , any other PersonPerson or entity other than raw materials and inventory in the ordinary course of business;
(iv) neither it the Company nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the salary, wage, bonus or other compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000employees;
(v) except in neither the ordinary and usual course of business, neither it 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;
(vi) neither it the Company nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(vii) neither it the Company nor any of its Subsidiaries shall make or change any Tax election, obtain or request any private letter ruling, closing agreement or similar ruling or agreement with respect to Taxes or change any method of tax accounting;
(viii) neither the Company nor any of its Subsidiaries shall knowingly take any action or omit to take any action that it would be reasonably expects would likely to cause any of its representations and warranties herein to become untrue untrue;
(ix) neither the Company nor any of its Subsidiaries shall account for, manage, or treat accounts receivable, inventory or customer credits in any material respectmanner other than in the ordinary course of business, or (without limiting the generality of the foregoing) write off as uncollectible any notes or accounts receivable or write down the value of any inventory other than in the ordinary course of business;
(x) neither the Company nor any of its Subsidiaries shall (A) amend, terminate or enter into any Contract that is not a Material Contract except in the ordinary and usual course of the Company's or its Subsidiaries' business consistent with past practices or (B) amend, terminate or enter into any Material Contract; and
(viiixi) neither it the Company nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries Merger Sub agree that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent grant prior approval in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth stated in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it Parent nor any of its Subsidiaries Merger Sub shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall knowingly take any action or omit to take any action that it would be reasonably expects would likely to cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoinguntrue.
Appears in 1 contract
Sources: Merger Agreement (Moore Wallace Inc)
Interim Operations. From and after the date hereof, the Seller shall cause the Company and its Subsidiaries to conduct their respective businesses in the ordinary course consistent with past practice (including but not limited to in relation to sale practices and accounting practices) and use their commercially reasonable efforts to preserve intact the assets, properties and relationships with Employees and third parties having material business dealings with the Company and its Subsidiaries. Without limiting the generality of the foregoing, except (a) The Company covenants and agrees as to itself and its Subsidiaries thatotherwise required by this Agreement, after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent b) for actions approved in writing by the Purchaser (which consent approval shall not be unreasonably withheld withheld, conditioned or delayed), (c) as required to comply with applicable Law or (d) as described in the Disclosure Letter, from and except as otherwise expressly set forth in this Agreement or after the corresponding subsection of Section 3.1(a) date hereof, the Seller shall cause the Company and its Subsidiaries not to take any of the Company Disclosure Letter):following actions:
(i) the business of it and adopt any change in its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associatesconstitution;
(ii) it shall not adopt a plan or agreement of complete or partial liquidation, dissolution, restructuring, merger, consolidation, restructuring, recapitalization or other reorganization;
(iii) (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) issue, selltransfer, pledge, dispose of or encumber the Shares or any shares of, other equity or securities convertible into similar interests of the Company 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 Subsidiaries or any Company Voting Debt (other than Company Common Shares issuable under the Company Option Plans); (B) grant any option, warrant or other than products sold right to customers purchase or obtain, or otherwise dispose of or encumber, the Shares or any other equity or similar interests of the Company or any of its Subsidiaries;
(iv) enter into or consummate any transaction involving the acquisition of the business, stock, assets or other properties of any other Person for consideration in excess of $100,000 individually, or $1,000,000 in the ordinary and usual course of business aggregate;
(without limitation as to dollar amountv) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfersell, lease, license, guaranteetransfer, sellexchange or swap, mortgagemortgage or otherwise encumber, pledge, or subject to any Encumbrance (other than Permitted Encumbrance) or otherwise dispose of or encumber any other property material portion of its material properties or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply value or purchase price in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is aggregate in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and 500,000 other than raw materials, supplies and other inventory items acquired (A) in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsbusiness, (B) other than pursuant to existing agreements in effect prior to the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000date hereof, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or any Governmental Authority in order to permit or facilitate the consummation of the transactions contemplated by Canadian GAAPthis Agreement, (D) dispositions of obsolete or worthless assets or (E) transactions among the Company and/or any of its Subsidiaries;
(vi) incur, assume, guarantee, prepay or otherwise become liable for any Indebtedness, other than (A) in the ordinary course of business, (B) any Indebtedness among the Company and/or any of its Subsidiaries, (C) guarantees by the Company of Indebtedness of its Subsidiaries, and (D) Indebtedness incurred pursuant to agreements in effect prior to the execution of this Agreement;
(vii) neither it nor enter any of its Subsidiaries shall take any action Contract pursuant to which the Company or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize be liable to pay amounts in excess of $100,000 or enter into an agreement to do any receive amounts in excess of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates$250,000 individually within a 12-month period;
(iiviii) it shall not (A) issueenter into, sellrenew, pledge, dispose of amend or encumber any capital stock owned by it modify in any of its Subsidiaries; (B) except as provided in Section 3.19material respect, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) any Material Contract, other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000business; provided, however, that prior to incurring any indebtedness, if practicable, Parent nothing in this Agreement shall provide prevent the Company or its Subsidiaries from entering into employment agreements or severance agreements, in each case, with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply employees in the case ordinary course of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; business;
(Dix) except as approved by the Transition Team, make or authorize incur or commit for to any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired capital expenditures incurred or committed in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions ofbusiness, or investments in stock enter into any new line of (or other interest in) or assets of any other Personbusiness;
(ivx) neither it nor any of its Subsidiaries shall (A) terminatemake, establish, adopt, enter into, make change or revoke any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsmaterial Tax election, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of file any employee material amended Tax Return or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims liability for Taxes or litigation surrender any material claim for a refund of Taxes;
(xi) materially change its financial accounting policies or modify, amend procedures or terminate any of its methods of reporting income, deductions or other material Contracts items for financial accounting purposes, except as required by the Australian Financial Reporting Standards or waive, release or assign any material rights or claims;applicable Law; or
(vixii) neither it nor any of its Subsidiaries shall make any material Tax election authorize, or file any material income Tax Return inconsistent with past practice agree or implement commit to do, whether in writing or adopt any change in its accounting principles or material accounting practicesotherwise, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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: Equity Purchase Agreement (Primus Telecommunications Group Inc)
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 approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its 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;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentscertificate of incorporation or bylaws; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiariesstock; or (Ev) 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;
(iiic) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt or any other property or assets (other than Company Common than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Company Option Stock Plans); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiariesliability; (Diii) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, business; or (iv) by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of , any other PersonPerson or entity;
(ivd) neither it nor any of its Subsidiaries shall (Ai) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except as required by any Laws or the terms of applicable collective bargaining agreements, (Bx) other than increases occurring in the ordinary and usual course of business consistent (which shall include normal periodic performance reviews and related compensation and benefit increases) or (y) actions taken pursuant to Section 7.7, (ii) amend any existing, or enter into any new, employment agreements with past practice and employees of the Company’s compensation budget with respect to employees at Company or its Subsidiary or (iii) take any action that would cause an annual compensation level of less than $150,000, increase the compensation acceleration of any employee or (C) except as approved by rights under any Compensation and Benefit Plan, including but not limited to any vesting of stock options prior to the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000Effective Time;
(ve) neither it nor any of its Subsidiaries shall file, settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, neither it 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;
(vif) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viig) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiih) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
Interim Operations. (a) The Company Each of NationsRent and RSC covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless Parent the other party shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth contemplated by this Agreement, disclosed in this Agreement its respective Disclosure Letter or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):required by applicable Law): 6.
(i) 1.1. the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective best reasonable best efforts to preserve its business organization intact and maintain its existing relations and goodwill with customers, suppliers, regulators, distributors, creditors, lessors, employees and business associates;; 6.
(ii) 1.2. it shall not (A) issueamend its certificate of incorporation or by-laws, sellexcept that the certificate of incorporation and by-laws of RSC shall be amended as contemplated by the Charter Amendments and Section 5.1.15, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiariesrespectively; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine combine, subdivide or reclassify its outstanding shares of capital stock; (DC) declare, set aside or pay any dividend or distribution payable in cash, stock or property in respect of any capital stock (other than dividends from its direct or indirect wholly owned Subsidiariespursuant to the terms of any Rights Plan (as defined in Section 6.1.3)); or (ED) repurchase, redeem or otherwise acquireacquire (other than Rights (as defined in Section 6.1.3) pursuant to any Rights Plan), 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;; 6.
(iii) 1.3. neither it nor any of its Subsidiaries shall (Ai) issue, sell, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable or exercisable for, or rights, options, warrants, conversion rights, stock appreciation rights, redemption rights, repurchase rights, agreements, arrangements, calls, commitments or rights of any kind to acquire, any shares of its capital stock of any class or any Company Voting Debt (other than Company Common Shares (w) shares of capital stock issuable pursuant to options outstanding on the date hereof under the Company NationsRent Stock Plans or RSC Stock Plans, pursuant to the applicable Stock Option Plans); Agreement, or pursuant to outstanding options or rights to acquire shares of capital stock described in Section 5.1.2.1 or 5.1.2.2, (Bx) other than products sold additional options or rights to customers acquire shares of capital stock granted under the terms of any NationsRent Stock Plan or RSC Stock Plan, as the case may be, as in effect on the date hereof in the ordinary and usual course of business the operation of such Stock Plan, (without limitation as to dollar amounty) or otherwise in the ordinary and usual course shares of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur issuable pursuant to the options or modify any indebtedness other than rights described in clause (x) indebtedness existing solely between and (z) pursuant to the Company and its wholly owned Subsidiaries terms of any stockholder rights protection plan adopted by NationsRent or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; providedRSC, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in as the case of indebtedness in may be, after consultation with the other party (with respect of letters of creditto either party, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiariesa "Rights Plan"); (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall that (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreementsany Rights Plan shall provide that none of (I) the acquisition by NationsRent or RSC, (B) other than in as the ordinary and usual course case may be, of business consistent with past practice and shares of RSC Common Stock or NationsRent Common Stock, respectively, pursuant to, or the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee exercise or (C) except as approved performance by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any either Party 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practicesobligations under, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this RSC Stock Option Agreement or the corresponding subsection of Section 3.1(bNationsRent Stock Option Agreement, (II) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct such Rights Plan of RSC, the receipt or indirectownership by any Person of the shares of RSC Common Stock to be issued in the Merger, wholly owned Subsidiary, split, combine (III) the consummation of any of the other transactions contemplated hereby or reclassify its outstanding by the Stock Option Agreements or (IV) the acquisition by any director or officer or any Person who may be deemed to be an "affiliate" of NationsRent or RSC (as determined under Section 6.12) of any shares of capital stock; (D) declarestock of NationsRent or RSC, set aside as the case may be, issuable pursuant to any NationsRent Stock Options or pay RSC Stock Options, as the case may be, shall be deemed to cause or give rise to any dividend payable in cash, stock or property in respect distribution of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) repurchase, redeem or otherwise acquire, or permit any of its Subsidiaries the rights 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 (A) 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 a Party to be issued pursuant to the applicable Rights Plan (in either case, the "Rights") or any Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans)to cause such Rights to become void, separable, distributable, unredeemable or exercisable; (B) neither RSC or NationsRent nor any officer, director, affiliate or associate of NationsRent or RSC (or any group comprised of such persons) shall be deemed to become an "acquiring person" or to meet any other than similar definition of a Person which would (xwhether upon notice or lapse of time or both) cause any such Rights to become void, separable, distributable, unredeemable or exercisable as Parent deems reasonably necessary to obtain the consent, approval or authorization a result of any Governmental Entity in order to consummate the transactions contemplated hereby, by this Agreement and the ArrangementStock Option Agreements or by any acquisition referred to in clause (A) above, (y) products sold to customers individually or in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries)aggregate; (C) incur or modify any indebtedness other than such Rights Plan (xand any Rights issued thereunder) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved adopted by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practiceRSC shall, by its own terms and without any meansfurther action on the part of the board of directors of the Surviving Corporation, make any acquisitions of, or investments in stock terminate (without payment) 60 days after the earlier of (or other interest in) or assets the termination of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws this Agreement or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.A-16
Appears in 1 contract
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 date on which Purchaser's nominees comprise a majority of the Board of Directors of the Company (unless Parent Praxair shall otherwise consent approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of sell or encumber pledge any capital stock owned by it in any of its Subsidiaries; (B) amend the Company Charter or its Organizational Documentsby-laws or amend, modify or terminate the Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock Shares or Preferred Shares other than regular quarterly or semi-annual cash dividends from its direct not in excess of $0.12 per Share and regular quarterly or indirect wholly owned Subsidiariessemi-annual cash dividends on the Preferred Shares; or (E) 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 stockstock except in connection with the ordinary course of operations of the CBI Salaried Employee Stock Ownership Plan (1987);
(iii) neither it nor any of its Subsidiaries shall except as disclosed in Section 7.1(a) of the Company Disclosure Letter (A) issue, sell, pledge, dispose of or encumber encumber, or authorize or propose the issuance, sale, pledge, disposition or encumbrance of, 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 Company Voting Debt or any other property or assets (other than Company Common Shares issuable pursuant to options outstanding on the date hereof under the Company Option Plans)Stock Plan or upon conversion of Convertible Preferred Shares; (B) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of any other property or assets or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yC) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring make any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Teamcommitments for, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materialsexisting capital expenditures required to be made pursuant to existing capital projects, supplies and other inventory items acquired as set forth in Section 7.1(a)(iii) of the ordinary and usual course of business consistent with past practiceCompany Disclosure Letter, which have been previously authorized or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other PersonPerson or entity;
(iv) except as disclosed in Section 7.1(a) of the Company Disclosure Letter, neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by or increase the salary, wage, bonus or other compensation of any Laws or the terms of applicable collective bargaining agreements, (B) employees other than increases in compensation in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.course
Appears in 1 contract
Interim Operations. (a) The Company covenants and agrees as to itself and its Subsidiaries thatDuring the Interim Period, after the date hereof and prior to the Effective Time (unless Parent shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure Letter):
(i) the shall conduct its business of it and its Subsidiaries shall be conducted in the ordinary course consistent with past practice and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective reasonable best efforts to preserve intact its and the Company Subsidiaries' business organization intact organizations and maintain relationships with third parties and its existing relations present officers and goodwill with customersemployees. Without limiting the generality of the foregoing, suppliersfrom the date hereof until the Closing Date, distributorsexcept as set forth on Schedule 6.01, creditors, lessors, employees and business associatesneither the Company nor any Company Subsidiary will:
(a) adopt or propose any change in its organizational documents;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) amend its Organizational Documents; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned Subsidiaries; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (Ab) issue, sell, pledge, dispose of or encumber any shares ofof its capital stock, or any securities convertible into or exchangeable or exercisable for, or options, warrants, calls, commitments or rights of any kind to acquire, directly or indirectly, any shares of its capital stock of any class or any Company Voting Debt other property or assets;
(c) merge or consolidate with any other than Company Common Shares issuable under the Company Option Plans); Person;
(Bd) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfersell, lease, license, guarantee, sell, mortgage, pledge, pledge or otherwise dispose of or encumber any other assets or property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than exceeding $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, 25,000 in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired pursuant to existing contracts or commitments which have been disclosed to Parent or in the ordinary and usual course consistent with past practice;
(e) make any commitments for, or make or authorize any capital expenditures outside the ordinary course of business consistent with past practice, or make any commitments for, or make or authorize any capital expenditures for capital equipment for use by the Company at its premises in excess of $10,000 individually or $25,000 in the aggregate, except pursuant to existing contracts or commitments which have been disclosed to the Buyer or in the ordinary course consistent with past practice;
(f) by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other Person;
(ivg) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or or, modify, amend or terminate any of its material the Material Contracts or waive, release or assign any material rights or claims;
(vih) neither it nor permit any of its Subsidiaries shall make any material Tax election insurance policy naming the Company as a beneficiary or file any material income Tax Return inconsistent with past practice loss-payable payee to be canceled or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPterminated;
(viii) neither it nor increase the compensation of any employee or amend any Benefit Plan in a manner which would increase benefits thereunder except in the ordinary course of its Subsidiaries shall business consistent with past practice;
(j) take any action or omit to take any action that it would be reasonably expects would likely, taking into account the Company's current credit evaluation practices, to cause any of its representations and warranties herein to become untrue in any material and adverse respect; and
(viiik) neither it nor any of its Subsidiaries will authorize agree or enter into an agreement commit to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
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 approve in writing (which consent shall not be unreasonably withheld or delayed) writing, and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Stock Option Agreement or set forth in Section 3.1(a) 6.1 of the Company Disclosure Letter):
(ia) the business of it its and its Subsidiaries Subsidiaries' businesses shall be conducted only in the ordinary and usual course and(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 extent consistent therewithwith (a) above, it 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, suppliers, reinsurers, distributors, creditors, lessors, employees and business associates;
(iic) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentsany Governing Document or amend, modify or terminate the Rights Agreement; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) authorize, declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned SubsidiariesSubsidiaries and other than regular quarterly dividends paid by the Company on its Common Shares not in excess of $0.12 per share and regular quarterly dividends paid by the Company on its Preferred Shares in accordance with the Company's Governing Documents; or (Ev) repurchase, redeem or otherwise acquire, except in connection with any of the Company Stock Plans or pursuant to the American Bankers Insurance Group, Inc. 401(k) and Employee Stock Ownership Plan, 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;
(iiid) neither it nor any of its Subsidiaries shall (Ai) 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 acquireacquire any shares, any shares of its capital stock of any class or any Company Voting Debt other property or assets (other than Company Common exercise of the Rights and the Shares issuable pursuant to options outstanding on the date hereof under any of the Company Option PlansStock Plans or upon conversion of the Preferred Shares); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries liability; or (yiii) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures whichexpenditures, individuallyincluding entering into capital lease obligations, is other than in excess of amounts not exceeding $1,000,000 or, 5,000,000 in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practiceaggregate or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other PersonPerson or entity, including by way of assumption reinsurance, in excess of $2,000,000 individually or $5,000,000 in the aggregate (other than in connection with ordinary course investment activities);
(ive) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans Plans, or increase the salary, wage, bonus or other compensation of any employees except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and related compensation and benefit increases); provided, however, that the Company shall be entitled to (i) pay cash bonuses to sales personnel and the Company’s compensation budget with respect cash bonuses owed to employees at pursuant to the Company's Management Incentive Plan for 1998 in an annual compensation level of less than aggregate amount not to exceed $150,0006,100,000, increase and (ii) extend for up to 12 months the compensation expiration date of any Company Stock Options held by non-employee or (C) except as approved by directors of the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000Company;
(vf) except 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, neither it nor any claims arising under the terms of its 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 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 claimsnot exceed $5,000,000 in the aggregate;
(vig) neither it nor any of its Subsidiaries shall make or change any Tax election, settle any material Tax election or audit, file any material income amended Tax Return inconsistent with past practice Returns or implement permit any insurance policy naming it as a beneficiary or adopt any change loss-payable payee to be canceled or terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viih) 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 new quota share or other reinsurance transaction (i) which does not contain standard cancellation and termination provisions, (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) pursuant to which $10,000,000 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 it reasonably expects 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
(viiim) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (American Bankers Insurance Group Inc)
Interim Operations. (a) The Except as set forth in the Company Disclosure Schedule, 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 approve in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its 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;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentscertificate of incorporation or bylaws; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly wholly-owned SubsidiariesSubsidiaries and other than in the case of the Company, regular quarterly cash dividends not in excess of $0.075 per Share; or (Ev) repurchase, redeem or otherwise acquire, except in connection with the Vastar Resources, Inc. Capital Accumulation Plan, 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;
(iiic) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt or any other property or assets (other than Company Common than, in the case of the Company, Shares issuable pursuant to options outstanding on the date hereof under the Company Option Vastar Resources, Inc. Capital Accumulation Plan or the Stock Plans); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than liability (except for borrowings under the Company's (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or commercial paper program, (y) indebtedness in an aggregate amount less than $30,000,000; providedCredit Agreement, howeverdated as of May 5, that prior to incurring any indebtedness1995, if practicableamong the Company, the Banks which are parties thereto, the Co-Agents listed therein and ▇▇▇▇▇▇ Guaranty Trust Company shall provide Parent with a reasonable right of consultation; providedNew York, furtheras Agent, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters as amended to date and (z) uncommitted bank lines of credit, guarantees or performance bonds or indebtedness existing solely between which in each case are in the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiariesordinary course of business consistent with past practice); (Diii) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, pursuant to the calendar year 2000 capital appropriations/spending budgets set forth in the Company Disclosure Schedule; or (iv) by any means, make (except as contemplated by the Calendar Year 2000 Capital appropriations/spending budget set forth in the Company Disclosure Schedule) any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of , any other PersonPerson or entity;
(ivd) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans or increase the salary, wage, bonus or other compensation of any employees except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than increases occurring in the ordinary and usual course of business consistent with past practice (which shall include normal periodic performance reviews and the Company’s related compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000and benefit increases);
(ve) neither it nor any of its Subsidiaries shall file, settle or compromise any material claims or litigation or, except in the ordinary and usual course of business, neither it 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;
(vif) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viig) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiih) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) 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 (Bp Amoco PLC)
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 approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the The business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its respective commercially 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;
(iib) it It shall not not, (Ai) issue, sell, pledge, sell or otherwise dispose of or encumber subject to any capital stock owned by it in Lien (other than Permitted Liens) any of its Subsidiaries' Capital Stock owned by it; (Bii) amend its Organizational Documentscharter or bylaws, except for any amendment contemplated by this Agreement; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stockCapital Stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly owned SubsidiariesCapital Stock; or (Ev) repurchase, redeem or otherwise acquire, acquire or permit any of its Subsidiaries to purchase or otherwise acquire, any shares of its capital stock Capital Stock or any securities convertible into or exchangeable or exercisable for any shares of its capital stockCapital Stock; or (vi) adopt a plan of complete or partial liquidation or dissolution, merger or otherwise restructure or recapitalize or consolidate with any Person other than Merger Sub or another wholly-owned Subsidiary of Parent;
(iiic) neither Neither it nor any of its Subsidiaries shall (Ai) authorize for issuance or issue, sell, pledge, sell or otherwise dispose of or encumber subject to any Lien (other than Permitted Liens) 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 Capital Stock of any class or any Company Voting Debt (other than Company Common Shares issuable under pursuant to Company Options outstanding on the Company Option Plansdate hereof); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, sell or otherwise dispose of or encumber subject to any Lien (other than Permitted Liens) any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than liability (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired additional borrowings in the ordinary course under lines of credit in existence on the date hereof); (iii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person except in the ordinary course of business and usual except for obligations of Subsidiaries of the Company incurred in the ordinary course of business; (iv) make any loans to any other Person (other than to Subsidiaries of the Company or, customary loans or advances to employees in connection with business-related travel in the ordinary course of business consistent with past practicepractices); or (v) make any commitments for, make or authorize any capital expenditures other than in amounts less than $250,000 individually and $1,000,000 in the aggregate or, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of any other Person;
(ivd) Except as may be required to comply with applicable law or by existing contractual commitments, neither it nor any of its Subsidiaries shall (Ai) enter into any new agreements or commitments for any severance or termination pay to, or enter into any employment or severance agreement with, any of its directors, officers or employees or consultants except for reasonable severance payments made to employees in the ordinary course of business and consistent with past practices, or (ii) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws Plan or increase or accelerate the terms of applicable collective bargaining agreementssalary, (B) wage, bonus or other than in the ordinary and usual course of business consistent with past practice and the Company’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee employees or directors (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except for increases occurring in the ordinary and usual course of business, neither which shall include normal periodic performance reviews and related compensation and benefit increases, but not any general across-the-board increases) or consultants or pay or agree to pay any pension, retirement allowance or other employee benefit not required by any existing Compensation and Benefit Plan;
(e) Neither it nor any of its Subsidiaries shall, except as may be required as a result of a change in law or in GAAP, change any of the accounting principles, practices or methods used by it;
(f) Neither it nor any of its Subsidiaries shall revalue in any respect any of its material assets, including writing down the value of inventory or writing-off notes or accounts receivable, other than in the ordinary course of business consistent with past practices;
(g) Neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or modify, terminate or materially amend or terminate modify any of its material Contracts or waive, release or assign any material rights or claims;
(vih) neither Neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be canceled or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPterminated;
(viii) neither Neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viiij) neither Neither it nor any of its Subsidiaries will authorize or enter into an any agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract
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 approve in writing (writing, which consent approval shall not be unreasonably withheld or delayed) , and except as otherwise expressly set forth in contemplated by this Agreement or the corresponding subsection of Section 3.1(a) of the Company Disclosure LetterAgreement):
(ia) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it and each of its Subsidiaries shall use its 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;
(iib) it shall not (Ai) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (Bii) amend its Organizational Documentscertificate of incorporation or by-laws or, amend, modify or terminate the Rights Agreement; (Ciii) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (Div) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than dividends from its direct or indirect wholly wholly-owned SubsidiariesSubsidiaries and other than regular quarterly cash dividends not in excess of $0.055 per Share; or (Ev) repurchase, redeem or otherwise acquire, except in connection with the Stock Plans, 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;
(iiic) neither it nor any of its Subsidiaries shall (Ai) 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 Company Voting Debt or any other property or assets (other than Company Common in accordance with the Rights Agreement and other than Shares issuable pursuant to options and other stock-based awards outstanding on the date hereof under the Company Option Stock Plans); (Bii) other than products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000business, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) or incur or modify any material indebtedness or other than (x) indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (y) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, the Company shall provide Parent with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of letters of credit, guarantees or performance bonds or indebtedness existing solely between the Company and its wholly owned Subsidiaries or between such wholly owned Subsidiariesliability; (Diii) except as approved by the Transition Team, (A) make or authorize or commit for any capital expenditures which, individually, is other than capital expenditures (a) in the aggregate amount remaining in the capital appropriations/spending budgets set forth in the Company LA_LAN01:179306.23 Disclosure Schedule after deducting amounts previously authorized or committed by the Company with respect to calendar year 2005 and (b) in amounts not in excess of $1,000,000 or, 2 million individually and $10 million in the aggregateaggregate with respect to all unbudgeted capital expenditures, are in excess of $10,000,000; and or (EB) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions acquisition of, or investments in investment in, assets or stock of (or other interest in) or assets of , any other Person or entity for consideration in excess of (a) in the aggregate amount remaining in the acquisitions budget set forth in the Company Disclosure Schedule after deducting amounts previously spent by the Company with respect to acquisitions and investments in calendar year 2005 and (b) in amounts not in excess of $2 million individually and $10 million in the aggregate with respect to all unbudgeted acquisitions; and (iv) enter into any joint venture agreement, partnership agreement or similar agreement with any Person;
(ivd) except as set forth in Sections 5.1(h)(i) and 5.1(h)(xii) of the Company Disclosure Schedule, or as otherwise required by applicable Law, neither it nor any of its Subsidiaries shall (Ai) terminategrant or provide any severance or termination payments or benefits to any director, establishofficer or Employee of the Company or any of its Subsidiaries except, adoptin the case of Employees who are not officers, enter intoin the ordinary course of business consistent with past practice, (ii) increase the compensation, bonus or pension, welfare, profit-sharing, severance or other benefits of, pay any bonus to, or make any new grants equity awards to any director, officer or awards underEmployee of the Company or any of its Subsidiaries, amend or otherwise modify, any Company Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than for increases in base salary in the ordinary and usual course of business consistent with past practice and for Employees who are not officers, (iii) enter into, adopt, extend or renew any employment, severance, change in control, termination, deferred compensation or other similar agreement with any director, officer or Employee of the Company’s Company or any of its Subsidiaries, (iv) establish, adopt, amend, suspend, terminate or exercise any discretion under any Company Benefit Plan or amend the terms of or exercise any discretion under any Company Options or Company Awards, (v) take any action to fund or in any other way secure the payment of compensation budget or benefits under any Company Benefit Plan, (vi) take any action to accelerate the vesting or payment of any compensation or benefits under any Company Benefit Plan, to the extent not already provided for under any such Company Benefit Plan, (vii) change any actuarial or other assumptions used to calculate funding obligations with respect to employees at an annual compensation level of less than $150,000any 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, increase the compensation of any employee except as may be required by GAAP; or (Cviii) except as approved by forgive any loans to directors, officers or Employees of the Transition Team, hire Company or any employee at an annual compensation level expected to be more than $100,000of its Subsidiaries;
(ve) prior to making any written or oral communications to any of its or its Subsidiaries’ directors, officers or Employees pertaining to compensation or benefit matters that are affected by the transactions contemplated by this Agreement, it shall provide Parent with a copy of the intended communication, Parent shall have a reasonable period of time to review and comment on the intended communication, and Parent and the Company shall cooperate in providing any such communication;
(f) except in the ordinary and usual course of business, neither it nor any of its Subsidiaries shall settle or compromise any material claims or litigation or LA_LAN01:179306.23 modify, amend or terminate any of its material Contracts or waive, release or assign any material rights or claims;
(vig) neither it nor any of its Subsidiaries shall make any material Tax election or file permit any material income Tax Return inconsistent with past practice insurance policy naming it as a beneficiary or implement loss-payable payee to be cancelled or adopt any change terminated except in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by Canadian GAAPthe ordinary and usual course of business;
(viih) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect;
(i) neither it nor any of its Subsidiaries will authorize or enter into any ▇▇▇▇▇▇;
(j) neither it nor any of its Subsidiaries will enter into any agreement that limits (other than in an insignificant manner) the ability of the Company or any Subsidiary of the Company, or would limit (other than in an insignificant manner) the ability of Parent or any Subsidiary of Parent after the Effective Time, to compete in or conduct any line of business or compete with any Person in any geographic area or during any period, it being understood that any restriction that by its terms does not extend more than six months beyond the Effective Time shall be deemed to be insignificant;
(k) neither it nor any of its Subsidiaries will enter into any marketing Contract with respect to natural gas for a term longer than 31 days from the date of such Contract (or six months in the case of Bolivia);
(l) neither it nor any of its Subsidiaries will enter into any marketing Contract with respect to crude oil for a term longer than two full months from the last day of the calendar month in which such Contract is entered into; and
(viiim) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
(b) Parent covenants and agrees as to itself and its Subsidiaries that, after the date hereof and prior to the Effective Time (unless the Company shall otherwise consent in writing (which consent shall not be unreasonably withheld or delayed) and except as otherwise expressly set forth in this Agreement or the corresponding subsection of Section 3.1(b) of the Parent Disclosure Letter):
(i) the business of it and its Subsidiaries shall be conducted in the ordinary and usual course and, to the extent consistent therewith, it 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, suppliers, distributors, creditors, lessors, employees and business associates;
(ii) it shall not (A) issue, sell, pledge, dispose of or encumber any capital stock owned by it in any of its Subsidiaries; (B) except as provided in Section 3.19, amend its Organizational Documents or amend, modify or terminate the Parent Rights Agreement; (C) other than in the case of any direct or indirect, wholly owned Subsidiary, split, combine or reclassify its outstanding shares of capital stock; (D) declare, set aside or pay any dividend payable in cash, stock or property in respect of any capital stock other than (x) dividends from its direct or indirect wholly owned Subsidiaries and (y) regular quarterly cash dividends in respect of Parent Common Stock, not in excess of $0.26 per share per quarter, with declaration and record dates consistent with past practice; or (E) 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;
(iii) neither it nor any of its Subsidiaries shall (A) 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 Parent Voting Debt (other than Parent Common Stock issuable under the Parent Stock Plans); (B) other than (x) as Parent deems reasonably necessary to obtain the consent, approval or authorization of any Governmental Entity in order to consummate the transactions contemplated by this Agreement and the Arrangement, (y) products sold to customers in the ordinary and usual course of business (without limitation as to dollar amount) or (z) otherwise in the ordinary and usual course of business and not in an aggregate amount of more than $5,000,000, transfer, lease, license, guarantee, sell, mortgage, pledge, dispose of or encumber any other property or assets (including capital stock of any of its Subsidiaries); (C) incur or modify any indebtedness other than (x) commercial paper, (y) indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries or (z) indebtedness in an aggregate amount less than $30,000,000; provided, however, that prior to incurring any indebtedness, if practicable, Parent shall provide the Company with a reasonable right of consultation; provided, further, that the foregoing right of consultation shall not apply in the case of indebtedness in respect of commercial paper, letters of credit, guarantees or performance bonds or indebtedness existing solely between Parent and its wholly owned Subsidiaries or between such wholly owned Subsidiaries; (D) except as approved by the Transition Team, make or authorize or commit for any capital expenditures which, individually, is in excess of $1,000,000 or, in the aggregate, are in excess of $10,000,000; and (E) except as otherwise provided in clause (D) immediately above and other than raw materials, supplies and other inventory items acquired in the ordinary and usual course of business consistent with past practice, by any means, make any acquisitions of, or investments in stock of (or other interest in) or assets of any other Person;
(iv) neither it nor any of its Subsidiaries shall (A) terminate, establish, adopt, enter into, make any new grants or awards under, amend or otherwise modify, any Parent Compensation and Benefit Plans except as required by any Laws or the terms of applicable collective bargaining agreements, (B) other than in the ordinary and usual course of business consistent with past practice and Parent’s compensation budget with respect to employees at an annual compensation level of less than $150,000, increase the compensation of any employee or (C) except as approved by the Transition Team, hire any employee at an annual compensation level expected to be more than $100,000;
(v) except in the ordinary and usual course of business, neither it 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;
(vi) neither it nor any of its Subsidiaries shall make any material Tax election or file any material income Tax Return inconsistent with past practice or implement or adopt any change in its accounting principles or material accounting practices, in all cases other than as may be required by applicable Law or by U.S. GAAP;
(vii) neither it nor any of its Subsidiaries shall take any action or omit to take any action that it reasonably expects would cause any of its representations and warranties herein to become untrue in any material respect; and
(viii) neither it nor any of its Subsidiaries will authorize or enter into an agreement to do any of the foregoing.
Appears in 1 contract