Conduct of Business Before the Closing. Seller hereby covenants as follows: (a) Except as set forth on Schedule 5.01 or as expressly contemplated in this Agreement or any of the Transaction Documents, without the prior written consent of Buyer, between the date hereof and the earlier to occur of the termination of this Agreement pursuant to Article XI or the Closing, Seller shall not, with respect to the Business and Purchased Assets: (i) make any material change in the conduct of the Business or enter into any transaction other than in the Ordinary Course of Business or as required by applicable Law; (ii) make any sale, assignment, transfer, abandonment, cancellation, disposition or other conveyance of any of its assets or rights or any part thereof other than in the Ordinary Course of Business; (iii) subject any of its assets or rights or any part thereof to any Lien other than in the Ordinary Course of Business; (iv) acquire or lease any assets, raw materials, or properties, other than in the Ordinary Course of Business; (v) hire or voluntarily terminate any officer, employee, consultant or independent contractor of Seller who provides services to the Business; (vi) enter into or announce any new (or, except as required by any Law, amend any existing) employee benefit plan, program, or arrangement or any new (or amend any existing) employment, severance, or consulting Contract, grant any general increase in the compensation of officers or employees (including any such increase pursuant to any bonus, pension, profit-sharing or other plan or commitment) or grant any increase in the compensation payable or to become payable to any employee, except in the Ordinary Course of Business, in accordance with preexisting contractual provisions in the Ordinary Course of Business or as contemplated by this Agreement;
Appears in 1 contract
Conduct of Business Before the Closing. Seller hereby covenants as follows: The Company hereby
(a) Except as set forth on Schedule 5.01 or as expressly contemplated in this Agreement or any of the Transaction Documents8.01, without the prior written consent of the Buyer, between the date hereof and the earlier to occur of the termination of this Agreement pursuant to Article XI XIV or the Closing, Seller the Company shall not, with respect to the Business and Purchased Assets: :
(i) make any material change in the conduct of the Business or enter into any transaction other than in the Ordinary Course of Business or as required by applicable Law; ;
(ii) make any change in its Charter or Bylaws; issue any equity securities, or grant any option, warrant, or right to acquire any equity securities, or issue any security convertible into or exchangeable for such securities; or alter in any way any of its outstanding securities, whether by reason of a reclassification, recapitalization, combination, exchange, or readjustment of its equity securities or otherwise redeem, retire, purchase, or otherwise acquire, directly or indirectly, any of its equity securities, or declare, set aside, or pay any dividends or other distribution in respect of such equity securities;
(iii) make any sale, assignment, transfer, abandonment, cancellation, disposition or other conveyance of any of its the Company’s assets or rights or any part thereof other than in the Ordinary Course of Business; ;
(iiiiv) subject any of its the Company’s assets or rights or any part thereof to any Lien (other than in the Ordinary Course of Business; );
(ivv) acquire or lease any assets, raw materials, or properties, other than in the Ordinary Course of Business; (v) hire or voluntarily terminate any officer, employee, consultant or independent contractor of Seller who provides services to the Business; ;
(vi) enter into or announce any new (or, except as required by any Law, or amend any existing) employee benefit plan, program, or arrangement or any new (or amend any existing) employment, severance, or consulting Contract, grant any general increase in the compensation of officers or employees (including any such increase pursuant to any bonus, pension, profit-sharing or other plan or commitment) or grant any increase in the compensation payable or to become payable to any employee, except in the Ordinary Course of Business, in accordance with preexisting contractual provisions in the Ordinary Course of Business or as contemplated by this Agreement;
(vii) other than expenditures made on employee labor and contractors related to internally developed software in the Ordinary Course of Business within the amounts projected for such expenditures in the information furnished to the Buyer, make or commit to make any capital expenditure greater than $25,000 individually or $100,000 in the aggregate;
(viii) pay, lend, or advance any amount to, or sell, transfer, or lease any assets, or enter into any Contract or arrangement with, any of its Affiliates, other than the payment of salary, bonus, and benefits to the officers, directors, and employees of the Company pursuant to existing arrangements or as otherwise contemplated herein;
(ix) fail to keep in full force and effect insurance comparable in amount and scope to coverage maintained on the date hereof;
(x) take any other action that would cause the conditions in Article XIII to not be satisfied fully;
(xi) make any change in any method of accounting or accounting period, principle, method, estimate, or practice, or write off as uncollectible any accounts receivable, except as required by GAAP or applicable law;
(xii) make, change, or revoke any election or method of accounting with respect to Taxes, except as required by GAAP or applicable law;
(xiii) file any amended Tax Return, enter into any closing agreement, settle any material Tax claim or assessment, surrender any right to claim a refund of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment (without the written consent of the Buyer which consent shall not be unreasonably withheld or delayed), or take any other similar action relating to the filing of any Tax Return or the payment of any such Tax;
(xiv) settle, release, or forgive any claim or litigation or waive any right thereto;
(xv) make, enter into, modify, or amend in any material respect or terminate any Material Contract or any other Contract (A) entailing annual payments in excess of $25,000, or (B) that is not terminable within ninety (90) days, except in the Ordinary Course of Business;
(xvi) make, enter into, modify, amend, or terminate any Contract or understanding with a Material Customer or Material Vendor;
(xvii) enter into any Contract or understanding that would otherwise be required to be disclosed or listed on Schedule 5.16 if such Contract or understanding had existed on the date of this Agreement; or
(xviii) agree to do any of the foregoing.
(b) From and after the date hereof and until the earlier of the termination of this Agreement pursuant to Article XIV or the Closing, the Company shall:
(i) continue to maintain the Company’s assets in accordance with present practice in a condition suitable for their current use;
(ii) continue to conduct the Business in the Ordinary Course of Business;
(iii) keep its books of account, files, and records in the Ordinary Course of Business; and
(iv) use Commercially Reasonable Efforts to preserve intact the operations and organization of the Business and use its and their Commercially Reasonable Efforts to keep available the services of the Company’s present officers and key employees and preserve the goodwill and business relationships of the Company’s customers.
Appears in 1 contract
Sources: Merger Agreement
Conduct of Business Before the Closing. Seller The Sellers hereby covenants covenant as follows: :
(a) Except as set forth on Schedule 5.01 or as expressly contemplated in this Agreement or any of the Transaction Documents, without the prior written consent of the Buyer, between the date hereof and the earlier to occur of the termination of this Agreement pursuant to Article XI or the Closing, Seller the Sellers shall not, with respect to the Business and Purchased Assets: :
(i) make any material change in the conduct of the Business or enter into any transaction other than in the Ordinary Course of Business or as required by applicable Law; ;
(ii) make any sale, assignment, transfer, abandonment, cancellation, disposition or other conveyance of any of its their assets or rights or any part thereof other than in the Ordinary Course of Business; ;
(iii) subject any of its assets or rights or any part thereof to any Lien other than in the Ordinary Course of Business; ;
(iv) acquire or lease any assets, raw materials, or properties, other than in the Ordinary Course of Business; ;
(v) hire or voluntarily terminate any officer, employee, consultant or independent contractor of either Seller who provides services to the Business; ;
(vi) enter into or announce any new (or, except as required by any Law, amend any existing) employee benefit plan, program, or arrangement or any new (or amend any existing) employment, severance, or consulting Contract, grant any general increase in the compensation of officers or employees (including any such increase pursuant to any bonus, pension, profit-sharing or other plan or commitment) or grant any increase in the compensation payable or to become payable to any employee, except in the Ordinary Course of Business, in accordance with preexisting contractual provisions in the Ordinary Course of Business or as contemplated by this Agreement;
(vii) make or commit to make any capital expenditure in excess of $10,000 in the aggregate;
(viii) pay, lend, or advance any amount to, or sell, transfer, or lease any assets, or enter into any Contract or arrangement with, any of its Affiliates, other than the payment of salary, bonus, and benefits to the officers and directors of the Sellers and Business Employees or Contactors pursuant to existing arrangements or as otherwise contemplated herein;
(ix) fail to keep in full force and effect insurance comparable in amount and scope to coverage maintained on the date hereof;
(x) take any other action that would cause the conditions in Article X to not be satisfied fully;
(xi) make any change in any method of accounting or accounting period, principle, method, estimate, or practice, or write off as uncollectible any accounts receivable;
(xii) make any change in policies, practices, or methodology of collecting accounts receivable or paying accounts payable or accrued liabilities outside of the Ordinary Course of Business;
(xiii) make, change, or revoke any election or method of accounting with respect to Taxes;
(xiv) except for amended Tax Returns related to CARES Act, file any amended Tax Return, enter into any closing agreement, settle any Tax claim or assessment, surrender any right to claim a refund of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment, or take any other similar action relating to the filing of any Tax Return or the payment of any Tax;
(xv) settle, release, or forgive any material claim or litigation or waive any right thereto;
(xvi) make, enter into, modify, or amend in any material respect or terminate (A) any Material Contract, or (B) any other Contract entailing annual payments in excess of $10,000 or that is not terminable within ninety (90) days, in each case except in the Ordinary Course of Business;
(xvii) make, enter into, modify, amend, or terminate any Contract or understanding with a Material Customer or Material Vendor, except in the Ordinary Course of Business;
(xviii) enter into any Contract or understanding that would otherwise be required to be set forth on Schedule 3.15 if such Contract or understanding had existed on the date of this Agreement;
(xix) sell or license any Owned Intellectual Property or Licensed Intellectual Property or execute any agreement with respect to any Owned Intellectual Property or Licensed Intellectual Property;
(xx) voluntarily destroy any Business records, including any emails or other electronic records maintained on any computers or servers used in connection with the Business; or
(xxi) agree to do any of the foregoing.
(b) From and after the date hereof and until the earlier of the termination of this Agreement pursuant to Article XI or the Closing, the Sellers shall, with respect to the Business and Purchased Assets, except as expressly contemplated in this Agreement or any of the Transaction Documents:
(i) continue to maintain their assets substantially in accordance with present practice in a condition suitable for their current use;
(ii) continue to conduct the Business in the Ordinary Course of Business;
(iii) keep their books of account, files, and records in the Ordinary Course of Business; preserve intact the material operations, organization, and reputation of the Business and use their Commercially Reasonable Efforts to keep available the services of their present officers and key employees and preserve the material goodwill and business relationships of their customers; and
(iv) refrain from delivering any invoices to Customers after April 30, 2020.
Appears in 1 contract