Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to: (a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary; (b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction; (c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions; (d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents; (e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or (f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate; (g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund; (h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or (i) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 3 contracts
Sources: Merger Agreement (Warner Chilcott LTD), Merger Agreement (Allergan Inc), Merger Agreement (Actavis PLC)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement hereof and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 earlier of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is validly terminated pursuant to Section 8.19.1, except as set forth in Section 6.2 of the Parent Disclosure Letter, as specifically permitted or required by this Agreement, as required by applicable Law or as consented to in writing by the Company (such consent not to be unreasonably withheld, conditioned or delayed), Parent shall not, and shall not permit any cause each Parent Subsidiary not to, directly or indirectly:
(a) authorize amend, modify, waive, rescind, change or otherwise restate the Parent Governing Documents (whether by merger, consolidation, operation of law or otherwise) in a manner that would materially and adversely affect the Company Stockholders, or adversely affect the Company Stockholders relative to other holders of Parent Common Stock;
(b) authorize, declare, set aside, make or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, stock or other securities of Parent or any Parent SubsidiariesSubsidiary), except (i) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice by the Parent Subsidiaries to Parent or by a any other wholly owned Parent Subsidiary and (ii) for transactions that would require an adjustment to Parent or another wholly owned Parent Subsidiarythe Offer Consideration and the Merger Consideration pursuant to Section 1.1(d) and Section 3.1(d), respectively, and for which the proper adjustment is made;
(bc) split, combine, subdivide, reduce or reclassify any of its issued capital stock or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its sharesequity interests, except for (i) any such transaction by a involving only wholly owned Parent Subsidiary Subsidiaries and (ii) any transactions that would require an adjustment to the Offer Consideration and the Merger Consideration pursuant to Section 1.1(d) and Section 3.1(d), respectively, and for which remains a wholly owned Parent Subsidiary after consummation of such transactionthe proper adjustment is made;
(cd) authorize liquidate (completely or partially), dissolve or adopt any plan or resolution providing for any of the foregoing, in each case, with respect to Parent, Purchaser or any direct or indirect parent entity of Purchaser;
(e) acquire (including by merger, consolidation or acquisition of stock or assets or any other means) or publicly announce an intention to authorizeso acquire, or enter into any agreements providing forfor any acquisitions of, any acquisitions of a substantial equity interest interests in or a substantial material portion of the assets of any Person (or any business or division thereof, in each case whether ) that (i) would require (A) the filing by merger, consolidation, combination, acquisition Parent or any of stock or assets or formation its Subsidiaries of a joint venture Notification and Report Form pursuant to the HSR Act with respect to such acquisition or otherwise that(B) any pre-closing approvals, in consents, waivers or clearances under any caseAntitrust Laws of the jurisdictions set forth on Section 7.2 of the Parent Disclosure with respect to such acquisition and (ii) would, or would reasonably be expected to, prevent (A) any waiting period (or extensions thereof) applicable to prevent the Transactions under the HSR Act from expiring or materially delay terminating prior to the Outside Date or impede (B) Parent or Purchaser from obtaining, prior to the consummation Outside Date, any of the Transactions;
(d) amend required pre-closing approvals, consents, waivers or clearances applicable to the Transactions under any Antitrust Laws of the jurisdictions set forth on Section 7.2 of the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documentsDisclosure Letter;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly take any action, or indirectlyknowingly fail to take any action, purchasewhich action or failure to act would, redeem or otherwise acquire any shares in its capital or any rightswould be reasonably expected to, warrants or options to acquire any such shares in its capitalprevent the Offer and the Merger, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awardstaken together, (iii) transactions between the Parent and from qualifying as a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreementreorganization” within the meaning of Section 7121 368(a) of the Code Code;
(g) subject to Section 7.2, take or cause to be taken any similar provision action that would reasonably be expected to materially impede or prevent the consummation of state, local, the Transactions on or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;before the Outside Date; or
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking agree or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agreeauthorize, in writing or otherwise, to take any of the foregoing actions.
Appears in 3 contracts
Sources: Merger Agreement, Merger Agreement (Tableau Software Inc), Agreement and Plan of Merger (Salesforce Com Inc)
Conduct of Business by Parent Pending the Closing. Except for matters set forth in Section 6.02 of the Parent agrees that between Disclosure Letter or otherwise expressly permitted or contemplated by this Agreement (or as required by applicable Law or the regulations or requirements of any stock exchange or regulatory organization applicable to Parent), from the date of this Agreement and to the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned)Time, Parent (i) shall shall, and shall cause each Parent Subsidiary of its Subsidiaries to, conduct its business in all material respects in the ordinary course of business consistent with past practice. In addition, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customerswithout limiting the generality of the foregoing, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically except for matters set forth in Section 6.02 of the Parent Disclosure Letter or otherwise expressly permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i)Agreement, and (ii) agrees that between from the date of this Agreement and to the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1Time, Parent shall notnot (unless required by applicable Law or the regulations or requirements of any stock exchange or regulatory organization applicable to Parent), and shall not permit any Parent Subsidiary of its Subsidiaries to, do any of the following without the prior written consent of the Company, which consent shall not be unreasonably withheld or delayed:
(a) authorize (i) amend or propose to amend Parent’s certificate of incorporation or bylaws or similar governing documents, (ii) declare, set aside or pay any dividend or distribution payable in cash or otherwise (other than (A) stock dividends on or make any distribution with respect distributions for which an appropriate adjustment is effected pursuant to its outstanding shares Section 1.01(g) or 3.01(e), (whether in cash, assets, stock or other securities B) quarterly cash dividends paid to stockholders of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business amounts consistent with past practice and (C) the payment of dividends or by a wholly owned Parent Subsidiary distributions to Parent or another wholly any of its Subsidiaries by a Subsidiary of Parent), or (iii) redeem, purchase, acquire or offer to purchase or acquire any shares of its capital stock or any options, warrants or rights to acquire any of its capital stock or any security convertible into or exchangeable for its capital stock, or (iv) merge or consolidate with any Person or acquire any material business of any Person (other than a merger, consolidation or acquisition among wholly-owned Parent SubsidiarySubsidiaries of the Company or a merger consolidation or acquisition involving solely the Company and its wholly-owned Subsidiaries), in each case with respect to this clause (iv), if such action would be reasonably likely to delay the consummation of the Offer;
(b) split, combine, reduce take any action or reclassify omit to take any action that is intended or would reasonably be expected to result in any of its issued the conditions to the Offer set forth in Annex A or unissued shares, or issue or authorize the issuance of any other securities conditions to the Merger in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transactionArticle VII not being satisfied;
(c) authorize or announce an intention take any action that would result in a failure to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion maintain the trading of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede Parent Stock on the consummation of the Transactions;NYSE; or
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issueagree, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actions. Notwithstanding the foregoing, Parent shall be entitled to (a) repurchase, retire or refinance outstanding indebtedness or debt securities and (b) enter into negotiations, discussions and Contracts relating to, and may consummate, acquisitions of other Persons (regardless of whether accomplished through a merger, stock purchase, asset purchase, recapitalization or other transaction, and regardless of the method or source of financing for such acquisition), so long as (i) the fair market value of the total consideration (including license, royalty or other fees) does not exceed $500,000,000 individually, (ii) Parent does not issue in excess of 20% of the then outstanding Parent Stock as consideration in any such transaction and (iii) the negotiation or consummation of any such acquisition is not reasonably likely to materially delay or prevent the completion of the Offer or the Merger.
Appears in 3 contracts
Sources: Merger Agreement (Allergan Inc), Merger Agreement (Inamed Corp), Merger Agreement (Allergan Inc)
Conduct of Business by Parent Pending the Closing. Parent agrees that between that, during the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Interim Period, except (a) as set forth in Section 5.2 6.2 of the Parent Disclosure Letter, (b) as specifically required by Letter or described in this Agreement, (c) as required by Law or (d) as consented to unless Target shall otherwise consent in writing by the Company (which consent shall not be unreasonably withheld, delayed withheld or conditioneddelayed), Parent (i) shall and shall cause each Parent Subsidiary to, will conduct its business in all material respects only in the ordinary and usual course of business consistent with past practice, including by using and will use commercially reasonable best efforts to preserve intact keep available the services of its respective current key officers and their present business organizations and to preserve its and their present respective current relationships with Governmental Entities and with customerstheir advisors, suppliers and other Persons with whom it and they have material business relations; providedrelationships. Without limiting the foregoing, howeverand as an extension thereof, that no action that is specifically permitted by except as set forth in Section 6.2 of the Parent Disclosure Letter or described in this Agreement, during the Interim Period, Parent shall not do, or agree to do, nor shall Parent permit any of clauses its Subsidiaries to do, or agree to do, directly or indirectly, any of the following without the prior written consent of Target (a) through which consent shall not be unreasonably withheld or delayed): (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and make or enter into any material agreements or commitments; (ii) agrees that between incur or assume any material Liabilities, other than in connection with the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
transactions contemplated hereby; (aiii) authorize declare or pay any dividends on or make any distribution with respect to its outstanding shares other distributions (whether in cash, assets, stock or other securities property) in respect of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course any of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
its capital stock; (biv) split, combine, reduce combine or reclassify any of its issued or unissued shares, capital stock or issue or authorize or propose the issuance of any other securities in respect of, in lieu of or in substitution forfor shares of its capital stock; (v) repurchase, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture redeem or otherwise that, in acquire any case, would reasonably be expected to prevent or materially delay or impede the consummation shares of the Transactions;
its capital stock; (d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(evi) issue, deliver, grant, deliver or sell, pledge, dispose of or encumber, or authorize or propose the issuance, delivery, grant, sale, pledge, disposition delivery or encumbrance sale of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary shares of its capital stock or any securities convertible into or exchangeable for any such shares, voting securities or equity interestshares of its capital stock, or any rights, warrants or options to acquire any such shares, voting shares or convertible securities or equity interest any stock appreciation rights, phantom stock plans or stock equivalents, (vii) award or grant, or authorize or propose the award or grant of any options, warrants or other rights of any kind to acquire any stock or other securities of Parent or any “phantom” stockof its Subsidiaries or such convertible or exchangeable securities, “phantom” stock rightsor any other ownership interest (including, stock appreciation rights without limitation, any such interest represented by contract right), of Parent or stock based performance unitsany of its Subsidiaries, other than the issuance or grant of options to employees of the Surviving Corporation; (iviii) issuances of Parent Shares in respect of modify or adjust any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rightsoutstanding options, warrants or options other rights of any kind to acquire any such shares in its capital, except for (i) acquisitions stock or other securities of Parent Shares tendered by holders or any of Parent Equity Awards its Subsidiaries to acquire shares of Company Common Stock; (ix) take any action that would, or could reasonably be expected to, result in order any of the conditions set forth in Article VII not being satisfied; (x) authorize or enter into any agreement or otherwise make any commitment to satisfy obligations to pay do any of the exercise price and/or Tax withholding obligations foregoing; or (xi) solicit, enter into discussions, or enter into any agreements or arrangements, whether written or oral, with respect thereto any Person regarding (iiA) the acquisition by the Parent (through any means) of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, localit is assets or properties) by any Person, or non-U.S. Law(B) with respect to the investment in or acquisition of (through any material Taxmeans) Parent, or surrender any right to claim a material Tax refund;
(h) convene Affiliate of Parent, of any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actionsPerson.
Appears in 3 contracts
Sources: Merger Agreement (Research Pharmaceutical Services, Inc.), Merger Agreement (Research Pharmaceutical Services, Inc.), Merger Agreement (Research Pharmaceutical Services, Inc.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement hereof and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 earlier of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant in accordance with Article VIII, except as set forth in Section 5.2 of the Parent Disclosure Letter, as expressly required by this Agreement, as required by applicable Law or otherwise with the prior written consent of the Company (such consent not to Section 8.1be unreasonably withheld, conditioned or delayed), Parent (a) shall use commercially reasonable efforts to, and to cause each Parent Subsidiary to, conduct its business in the ordinary course of business consistent with past practice and use commercially reasonable efforts to (i) preserve intact its and their present business organizations, goodwill and ongoing businesses, (ii) keep available the services of its and their present officers and key employees (other than where termination of such services is for cause) and (iii) preserve its and their present relationships with customers, suppliers, vendors, licensors, licensees, Governmental Entities, employees and other Persons with whom it and they have material business relations and (b) shall not, and shall not permit any Parent Subsidiary to, directly or indirectly:
(ai) authorize amend the Parent Governing Documents (other than in immaterial respects) or adopt any material change in the certificate of incorporation, bylaws or equivalent organizational documents of any Parent Subsidiary that would adversely affect the consummation of the Transaction;
(ii) authorize, declare, set aside, establish a record date, make or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, stock or other securities of Parent or any Parent SubsidiariesSubsidiary), except (i) Parent’s regular quarterly dividend of $0.015 per Parent Common Share, (ii) dividends and distributions paid or made on a pro rata basis by from wholly-owned Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly between wholly-owned Parent SubsidiarySubsidiaries and (iii) for transactions that would require an adjustment to the Merger Consideration pursuant to Section 3.1(c), respectively, and for which the proper adjustment is made;
(biii) split, combine, subdivide, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its sharescapital stock, except for (i) any such transaction by a wholly involving only wholly-owned Parent Subsidiary Subsidiaries, and (ii) any transactions that would require an adjustment to the Merger Consideration pursuant to Section 2.1(e), respectively, and for which remains a wholly owned Parent Subsidiary after consummation of such transactionthe proper adjustment is made;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(eiv) issue, deliver, grant, sell, pledge, transfer, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, transfer, disposition or encumbrance of, any sharesshares in the capital stock, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable or exercisable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than than: (iA) issuances the issuance of Parent Common Shares in respect of under any exercise of Parent stock options or the vesting or settlement of existing Parent Equity AwardsPlan, (iiB) transactions solely between Parent and a wholly wholly-owned Parent Subsidiary or solely between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly wholly-owned Parent Subsidiaries and (ivC) issuances of Parent Common Shares through any public or private registered offering or other acquisitions transaction of up to 10% of the shares of Parent Stock for an amount not exceeding $100,000,000 Common Shares issued and outstanding as of the date of this Agreement, in the aggregate;
(gv) adopt any material plan of merger, consolidation, reorganization, liquidation or dissolution of Parent or any of the material Parent Subsidiaries, adopt resolutions providing for a material complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, file a petition in bankruptcy under any provisions of federal or state bankruptcy applicable Law on behalf of Parent or any material Parent Subsidiaries or consent to the filing of any bankruptcy petition against Parent or any material Parent Subsidiaries under applicable Law;
(vi) other than in the ordinary course of business consistent with past practice (A) enter into any Contract that would, if entered into prior to the date hereof, be a Parent Material Contract, (B) materially modify, materially amend, extend, accelerate, terminate, cancel, exercise or fail to exercise an expiring renewal option or terminate any Parent Material Contract or (C) waive, release or assign any material rights or claims thereunder;
(vii) make any change in financial accounting policies, practices, principles or procedures or any of its methods of reporting income, deductions or other material items for financial accounting purposes, except as required by GAAP or applicable Law;
(viii) make, change or rescind any material Tax election, adopt or change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any income or other material amended Tax ReturnReturn (other than in a manner that is not inconsistent with past practice), settle or compromise any audit material liability for Taxes or proceeding any Tax audit, claim or other Proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, local or non-U.S. Law) with respect to any material Tax), or surrender any right to claim a material Tax refundrefund of Taxes, or agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes without timely notifying the Company in writing;
(hix) convene enter into any meeting Contract or transaction with (including the making of any payment to) a Related Person (other than the Company or one of the holders Company Subsidiaries) or an Affiliate of Parent Stock for a Related Person (other than the purpose of revoking Company or varying the authority one of the directors Company Subsidiaries), in each case of a type that would be required to be disclosed under Item 404 of Regulation S-K under the Securities Act;
(x) fail to timely file any report required to be filed by Parent to allot or any Parent StockSubsidiary with the SEC or the Canadian Securities Administrators or any other Governmental Entity; or
(ixi) agreeagree or authorize, in writing or otherwise, to take any of the foregoing actions. Notwithstanding anything to the contrary in this Section 5.2, the Parties acknowledge and agree that nothing contained in this Agreement shall give the Company, directly or indirectly, the right to control or direct Parent or Merger Sub’s operations (including for purposes of the HSR Act) prior to the consummation of the Merger.
Appears in 2 contracts
Sources: Merger Agreement (Encana Corp), Merger Agreement (Newfield Exploration Co /De/)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this AgreementAgreement (including the Restructuring Transactions), (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using practice and use reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (ip) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock (whether in cash, assets, stock shares or other securities of Parent or any Parent SubsidiariesSubsidiary), except (i) that Parent may continue the declaration and payment of regular quarterly cash dividends on the Parent Shares, not to exceed $0.31 per share for each quarterly dividend, and (ii) for dividends and distributions paid or made on a pro rata basis by a Parent Subsidiaries Subsidiary in the ordinary course of business consistent with past practice or by a wholly wholly-owned Parent Subsidiary to Parent or another wholly wholly-owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued sharescapital stock (excluding the Consolidation, provided that the Consolidation shall not be consummated prior to the Effective Time), or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, shares of its sharescapital stock, except for any such transaction by a wholly wholly-owned Parent Subsidiary which remains a wholly wholly-owned Parent Subsidiary after consummation of such transaction;
(c) except as required by applicable Law or any Parent Benefit Plan, (i) increase the compensation or benefits payable or to be provided to any of its directors, officers, employees or consultants (other than increases in annual base salaries and incentive compensation opportunities at times and in amounts in the ordinary course of business consistent with past practice), (ii) grant or increase to any of its directors, officers, employees or consultants any severance, termination, change in control or retention pay, (iii) pay or award, or commit to pay or award, any cash bonuses or cash incentive compensation (other than the payment of accrued and unpaid cash bonuses or other cash incentive compensation), (iv) enter into any employment, severance, retention or change in control agreement with any of its directors, officers, employees or consultants (other than offer letters that do not otherwise provide for severance, retention or change in control payments or benefits), (v) establish, adopt, enter into, amend or terminate any collective bargaining agreement or Parent Benefit Plan (or a plan or arrangement that would be a Parent Benefit Plan if in existence as of the date hereof), or (vi) take any action to accelerate any payment or benefit, or the funding of any payment or benefit, payable or to be provided to any of its directors, officers, employees or consultants;
(d) make any material change in financial accounting policies or procedures or any of its methods of reporting income, deductions or other material items for financial accounting purposes, except as required by GAAP, applicable Law or SEC policy;
(e) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereofof any Person (including by means of an asset purchase), or any mergers, consolidations or business combinations, except for (i) such transactions that collectively do not have purchase prices that exceed $25 million in each case whether by mergerthe aggregate (provided that any such transactions, consolidation, combination, acquisition of stock individually or assets or formation of a joint venture or otherwise that, in any casethe aggregate, would not reasonably be expected to prevent or materially delay or impede the consummation of the Transactions), (ii) capital expenditures otherwise permitted by Section 5.2(ii)(n), (iii) transactions between Parent and a wholly-owned Parent Subsidiary or between wholly-owned Parent Subsidiaries or (iv) the creation of new wholly-owned Subsidiaries organized to conduct or continue activities otherwise permitted by this Agreement;
(df) amend the Parent Governing Documents or Documents, and shall not permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(eg) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any sharesshares in its capital stock (including restricted stock), voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such sharesshares in its capital stock, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance unitsunits or take any action to cause to be exercisable any otherwise unexercisable Parent Equity Award under any existing Parent Equity Plan (except as otherwise provided by the express terms of any Parent Equity Award outstanding on the date hereof), other than (i) issuances of Parent Shares (i) in respect of any exercise of Parent stock options Share Options under Parent Equity Awards or the vesting vesting, lapse of restrictions with respect to or settlement of Parent Equity Awards, outstanding as of the date hereof or issued in accordance with this Agreement, in each case, in accordance with their respective terms, (ii) pursuant to the terms of the Parent ESPP, or (iii) transactions between Parent and a wholly wholly-owned Parent Subsidiary or between wholly wholly-owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or;
(fh) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) redemptions or acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto thereto, (ii) the redemption or acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, awards and (iii) transactions between the Parent and a wholly wholly-owned Parent Subsidiary or between wholly wholly-owned Parent Subsidiaries;
(i) redeem, repurchase, prepay (other than prepayments of revolving loans), defease, incur, assume, endorse, guarantee or otherwise become liable for or modify in any material respects the terms of any Indebtedness for borrowed money or issue or sell any debt securities or calls, options, warrants or other rights to acquire any debt securities (directly, contingently or otherwise), except for (i) any Indebtedness for borrowed money among Parent and its wholly-owned Parent Subsidiaries or among wholly-owned Parent Subsidiaries, (ii) Indebtedness for borrowed money incurred to replace, renew, extend, refinance or refund any existing Indebtedness for borrowed money of Parent or any of the Parent Subsidiaries maturing on or prior to the six (6) month anniversary of the date of such refinancing, (iii) guarantees by Parent of Indebtedness for borrowed money of Parent Subsidiaries or guarantees by Parent Subsidiaries of Indebtedness for borrowed money of Parent or any Parent Subsidiary, which Indebtedness is incurred in compliance with this clause (i), (iv) Indebtedness for borrowed money incurred pursuant to (A) agreements entered into by Parent or any Parent Subsidiary in effect prior to the execution of this Agreement and set forth in Section 5.2(ii)(i)(A) of the Parent Disclosure Letter and (B) other agreements that may be entered into following the date hereof and set forth in Section 5.2(ii)(i)(B) of the Parent Disclosure Letter, (v) transactions at the stated maturity of such Indebtedness and required amortization or mandatory prepayments and (vi) Indebtedness for borrowed money not to exceed $100 million in aggregate principal amount outstanding at any time incurred by Parent or any of the Parent Subsidiaries other than in accordance with clauses (i) through (v); provided that nothing contained herein shall prohibit Parent and the Parent Subsidiaries from making guarantees or obtaining letters of credit or surety bonds for the benefit of commercial counterparties in the ordinary course of business consistent with past practice;
(j) make any loans to any other Person, except for loans among Parent and its wholly-owned Parent Subsidiaries or among Parent’s wholly-owned Parent Subsidiaries;
(k) sell, lease, license, transfer, exchange, swap or otherwise dispose of, or subject to any Lien (other than Parent Permitted Liens), any of its properties or assets (including shares in the capital of the Parent Subsidiaries), except (i) pursuant to an existing agreement in effect prior to the execution of this Agreement that is listed on Section 5.2(ii)(k) of the Parent Disclosure Letter, (ii) in the case of Liens, as required in connection with any Indebtedness permitted to be incurred pursuant to Section 5.2(ii)(i), (iii) such transactions with neither a fair market value of the assets or properties nor an aggregate purchase price that exceeds $25 million in the aggregate for all such transactions and (iv) for transactions among Parent and its wholly-owned Parent Subsidiaries or among wholly-owned Parent Subsidiaries;
(l) compromise or settle any claim, litigation, investigation or proceeding, in each case made or pending by or against Parent or any of the Parent Subsidiaries (for the avoidance of doubt, including any compromise or settlement with respect to matters in which any of them is a plaintiff), or any of their officers and directors in their capacities as such, other than the compromise or settlement of claims, litigation, investigations or proceedings that: (i) is for an amount (in excess of insurance proceeds) not to exceed, for any such compromise or settlement individually or in the aggregate, $50 million, (ii) does not impose any injunctive relief on Parent and the Parent Subsidiaries and (iviii) other acquisitions does not provide for the license covenant not to assert, or otherwise granting of shares any rights, of Parent Stock for an amount not exceeding $100,000,000 in the aggregateor under any Intellectual Property;
(gm) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund, or take any action which would cause the Company or any Company Subsidiary to be treated as an “expatriated entity” within the meaning of Section 7874(a)(2) of the Code as a result of the Transactions;
(hn) convene any meeting except in the ordinary course of business consistent with past practice, or in accordance with Parent’s anticipated 2015 or 2016 capital expenditures described on Section 5.2(ii)(n) of the holders Parent Disclosure Letter, make any new capital expenditure or expenditures, or commit to do so;
(o) except in the ordinary course of Parent Stock for business consistent with past practice or in connection with any transaction to the purpose extent specifically permitted by any other subclause of revoking or varying the authority this Section 5.2(ii) and excluding any Material Contract of the directors of type described in Section 4.20(a)(ii)(B) (but subject to the other restrictions set forth in this Section 5.2(ii)), (i) enter into any Contract that would, if entered into prior to the date hereof, be a Parent to allot Material Contract, or (ii) materially modify, materially amend or terminate any Parent StockMaterial Contract or waive, release or assign any material rights or claims thereunder; or
(ip) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Merger Agreement (Towers Watson & Co.), Merger Agreement (Willis Group Holdings PLC)
Conduct of Business by Parent Pending the Closing. Parent agrees that that, between the date of this Agreement and the earlier of the Effective Time or the time, if any, at which termination of this Agreement is terminated pursuant to Section 8.1Agreement, except (a) as set forth in Section 5.2 7.1 of the Parent Confidential Disclosure Letter, (b) Schedule or as specifically required or permitted by this Agreement or required by Law, unless the Company shall otherwise consent thereto in writing (which consent shall not be unreasonably withheld or delayed and shall be deemed to have been given by the Company if it does not refuse its consent within three (3) Business Days of its receipt of a request therefore from Parent), Parent shall, and shall cause each of its Subsidiaries to, conduct its operations only in the ordinary and usual course of business consistent with past practice and, to the extent consistent therewith, shall use its reasonable best efforts to (y) preserve its and each of its Subsidiaries’ business organization and its rights, authorizations, franchises and other authorizations issued by Governmental Entities intact and (z) preserve the goodwill of the customers of Parent and each of its Subsidiaries with whom business relationships exist. By way of amplification and not limitation, except as set forth in Section 7.1 of the Parent Confidential Disclosure Schedule or as specifically required or permitted by any other provision of this Agreement or required by Law, between the date of this Agreement and the earlier of the Effective Time or the termination of this Agreement, (c) as required by Law Parent shall not, and shall not permit any of its Subsidiaries to, directly or (d) as consented indirectly, do, or agree to in writing by do, any of the following without the prior written consent of the Company (which consent shall not be unreasonably withheldwithheld or delayed and which shall be deemed to have been given by the Company if it does not refuse its consent within three (3) Business Days of its receipt of a request therefor from Parent):
(a) amend or otherwise change its Articles of Incorporation or Bylaws or equivalent organizational documents in a manner which adversely affects the rights, delayed preferences or conditionedprivileges of Parent Common Stock;
(b) issue, sell, pledge, dispose of, grant, transfer, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, or encumbrance of any shares of capital stock or rights of, or other Equity Interests in, Parent or any of its Subsidiaries of any class, or securities convertible or exchangeable or exercisable for any shares of such capital stock or other Equity Interests, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or other Equity Interests or such convertible or exchangeable securities, or any other ownership interest (including, without limitation, any such interest represented by contract right), of Parent or any of its Subsidiaries, other than (ix) shall and shall cause each the issuance of Parent Subsidiary toCommon Stock upon the exercise or conversion of Parent options, conduct its business warrants or other rights to acquire any capital stock of the company (“Parent Options”) in all material respects accordance with their terms, (y) the granting of options to purchase shares of Parent Common Stock in the ordinary course of business consistent with past practice, including or (z) as contemplated by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:6.12 hereof;
(ac) sell, pledge, dispose of, transfer, lease, license, guarantee or encumber, or authorize the sale, pledge, disposition, transfer, lease, license, guarantee or pay encumbrance of, any dividends on material property or make any distribution with respect to its outstanding shares assets (whether in cash, assets, stock or other securities including Intellectual Property) of Parent or deposits of the Parent Subsidiaries)Bank, except dividends and distributions paid pursuant to existing Contracts or made commitments listed on a pro rata basis by Section 7.1(c) of the Parent Subsidiaries Disclosure Schedule or the sale or purchase of goods or the pledge of securities in the ordinary course of business consistent with past practice or by and in a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
(b) splittransaction that together with all other transactions will not have, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of individually or in substitution forthe aggregate, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the TransactionsMaterial Adverse Effect;
(d) amend the Parent Governing Documents make any material change in accounting policies or permit Merger Sub procedures, other than as required by GAAP or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;by a Governmental Entity; or
(e) issue, deliver, grant, sell, pledge, dispose of authorize or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (agreement or otherwise make any similar provision of state, local, or non-U.S. Law) with respect commitment to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take do any of the foregoing actionsforegoing.
Appears in 2 contracts
Sources: Merger Agreement (Placer Sierra Bancshares), Merger Agreement (Southwest Community Bancorp)
Conduct of Business by Parent Pending the Closing. Parent agrees that that, between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Time, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) Schedule or as specifically required contemplated by any other provision of this Agreement, (c) as required by Law or (d) as consented to in writing by unless the Company (shall otherwise agree in writing, which consent agreement shall not be unreasonably withheldwithheld or delayed, delayed or conditioned)the businesses of Parent and the Parent Subsidiaries shall be conducted only in, and Parent (i) and the Parent Subsidiaries shall and shall cause each Parent Subsidiary tonot take any action except in, conduct its business in all material respects in the ordinary course of business consistent with past practicebusiness. By way of amplification and not limitation, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted except as set forth in Section 5.2 of the Parent Disclosure Schedule or as contemplated by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach other provision of this clause Agreement, Parent shall not (i)unless required by applicable Laws or NASDAQ regulations) cause or permit Parent or any Parent Subsidiary, or any of their officers, directors, employees and (ii) agrees that agents, to, between the date of this Agreement and the Effective Time Time, directly or indirectly, do, or agree to do, any of the datefollowing, if anywithout the prior written consent of the Company, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and consent shall not permit any Parent Subsidiary tobe unreasonably withheld or delayed:
(a) authorize amend or pay any dividends on otherwise change its Articles of Incorporation or make any distribution with respect to its outstanding shares (whether in cash, assets, stock By- laws or other securities of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiaryequivalent organizational documents;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition disposition, grant, transfer, lease, license, guarantee or encumbrance of, (i) any sharesshares of capital stock of Parent or any Parent Subsidiary of any class, voting or securities convertible or exchangeable or exercisable for any shares of such capital stock, or any options, warrants or other equity rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable or exercisable securities, or any other ownership interest in the (including, without limitation, any phantom interest) of Parent or any Parent Subsidiary or (ii) other than in the ordinary course of business and in a manner consistent with past practice, any securities convertible into property or exchangeable for assets of Parent or any Parent Subsidiary, except (A) the issuance of Parent Common Stock upon the exercise of Parent Options, the grant of options to purchase up to an additional 50,000 shares of Parent Common Stock under the existing Parent stock option plans and the issuance of shares upon exercise thereof, (B) pursuant to contracts or agreements in force at the date of this Agreement and (C) that Parent may adopt and amend a share purchase rights plan of the type created by the Rights Agreement, with such terms and provisions as Parent may determine (except that any such sharesplan and amendment shall exempt the transactions contemplated by this Agreement);
(c) declare, voting securities set aside, make or equity interestpay any dividend or other distribution, or any rightspayable in cash, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” property or otherwise, with respect to any of its capital stock rights, stock appreciation rights or stock based performance units, other than (except (i) issuances for regular quarterly cash dividends at a rate not in excess of $.0625 per share of Parent Shares Common Stock declared and paid in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awardsaccordance with past practice, and (ii) transactions between for dividends paid by any Parent and Subsidiary to Parent or a Parent Subsidiary in the ordinary course) or enter into any agreement with respect to the voting of its capital stock;
(d) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock;
(i) acquire (including, without limitation, by merger, consolidation, or acquisition of stock or assets) any interest in any corporation, partnership, other business organization, person or any division thereof (other than a wholly owned Parent Subsidiary Subsidiary) or between wholly owned Parent Subsidiariesany assets, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except assets in the ordinary course of business; (ii) incur any indebtedness for borrowed money or issue any debt securities or assume, agree guarantee or endorse, or otherwise as an accommodation become responsible for, the obligations of any person for borrowed money, except for (A) indebtedness for borrowed money incurred in the ordinary course of business or in connection with transactions otherwise permitted under this Section 5.2, (B) indebtedness incurred to an extension refinance any existing indebtedness or waiver of the statute of limitations (C) other indebtedness for borrowed money under existing credit facilities; or (iii) enter into or amend any contract, agreement, commitment or arrangement that, if fully performed, would not be permitted under this Section 5.2(e);
(f) take any action with respect to accounting policies or procedures, other than actions in the ordinary course of business and consistent with past practice or except as required by changes in GAAP;
(g) take any action that would prevent or impede the Merger from qualifying (A) for "pooling-of-interests" accounting treatment or (B) as a material amount of Taxes, enter into any “closing agreement” reorganization within the meaning of Section 7121 368 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refundCode;
(h) convene take any meeting action that is intended or may reasonably be expected to result in any of its representations and warranties set forth in this Agreement being or becoming untrue in any material respect at any time prior to the Effective Time, or in any of the holders conditions to the Merger set forth in Article VII not being satisfied or in a violation of Parent Stock any provision of this Agreement, except, in every case, as may be required by applicable Law;
(i) amend any existing plan or program to provide, or adopt a new plan or program providing, for the purpose payment to any class of revoking employees of any additional compensation or varying benefits in connection with the authority of the directors of Parent to allot Parent Stocktransactions contemplated by this Agreement; or
(ij) agree, in writing authorize or otherwise, enter into any formal or informal agreement or otherwise make any commitment to take do any of the foregoing actionsforegoing.
Appears in 2 contracts
Sources: Merger Agreement (Wausau Paper Mills Co), Merger Agreement (Mosinee Paper Corp)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the Company Merger Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by pursuant to this Agreement, (c) as may be required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall shall, and shall cause each of the Parent Subsidiary Subsidiaries to, (x) conduct its business in all material respects in the ordinary course of business consistent with past practice, including practice (it being understood that this clause (x) shall not restrict Parent from the issuance of any Parent Equity Interests if such issuance is permitted by using Section 5.2(d) or the incurrence of any indebtedness or the entry into any transactions if such incurrence or entry is permitted by Section 5.2(i)) and (y) use their respective reasonable best efforts to maintain in all material respects their assets and properties in their current condition (ordinary wear and tear excepted), preserve intact its and their present business organizations intact in all material respects, and to preserve its maintain existing relations and their present relationships goodwill with Governmental Entities and with Entities, alliances, customers, suppliers lenders, tenants, employees and other Persons with whom it business associates in all material respects. Without limiting the generality of the foregoing, and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through except (i) as set forth in Section 5.2 of Section 5.2(ii) shall be deemed a breach of this clause (i)the Parent Disclosure Letter, and (ii) agrees that as required pursuant to this Agreement, (iii) as required by Law or (iv) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), between the date of this Agreement and the Company Merger Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to, directly or indirectly:
(a) authorize amend its charter, bylaws or equivalent organizational documents in a manner adverse to the Company;
(b) adjust, split, combine, subdivide or reclassify any shares of capital stock of Parent or any Parent Subsidiary;
(c) subject to the second sentence of Section 6.16(a), declare, set aside or pay any dividends dividend on or make any distribution with respect to its outstanding shares other distributions (whether in cash, assetsstock, property or otherwise) with respect to shares of capital stock of Parent, Parent Equity Interests of Parent, or other equity securities or ownership interests in Parent, except for the authorization and payment by Parent of dividends for the period up to the Closing Date (including the portion of any month in which the Closing occurs) at a rate not to exceed (i) in respect of Parent Common Stock, 100% of Parent’s Cash Available for Distribution (the dividend described in this clause (c)(A)(i), the “Parent Permitted Common Dividend”), (ii) $0.54688 per share of Parent Series A Preferred Stock, (iii) $0.51563 per share of Parent Series B Preferred Stock, (iv) $0.55469 per share of Parent Series C Preferred Stock, (v) $0.53125 per share of Parent Series D Preferred Stock and (vi) $0.54688 per share of Parent Series E Preferred Stock (the dividends described in clauses (c)(A)(ii) – (c)(A)(vi) together with the Parent Permitted Common Dividend, the “Parent Permitted Dividends”);
(d) (A) redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other securities Parent Equity Interests, except with respect to the settlement of any Parent RSU Awards pursuant to their terms, (B) grant any Person any right or option to acquire any Parent Equity Interests, (C) issue, deliver or sell any additional capital stock or other Parent Equity Interests, or (D) enter into any Contract with respect to the sale, voting registration or repurchase of any capital stock or other Parent Equity Interests; provided, however, that (1) Parent and/or Parent Subsidiaries, as applicable, may (i) grant annual equity awards to directors of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice practice, (ii) grant equity awards to employees of Parent or by a Parent Subsidiary in the ordinary course of business consistent with past practice, (iii) issue shares of Parent Common Stock, LTIP Units or other Parent Equity Interests (A) in connection with the settlement of any Parent RSU Awards outstanding as of the date hereof, (B) pursuant to the Parent Equity Plan as in effect as of the date hereof or (C) pursuant to the terms of the agreements or other awards set forth on Section 5.2(d) of the Parent Disclosure Letter, (iv) issue Parent Equity Interests in connection with a public offering or on market terms and (v) enter into any Contract with respect to any of the foregoing clauses (i) through (iv), and (2) the Parent Subsidiaries may issue equity solely to form special purpose entities that will be wholly owned Parent Subsidiary to Parent directly or another wholly owned Parent Subsidiaryindirectly by the Company as may be reasonably required for the completion of any pending acquisitions;
(be) split, combine, reduce or reclassify any enter into a line of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transactionbusiness that is not commercial real estate;
(cf) knowingly take any action, or knowingly fail to take any action, which action or failure would reasonably be expected to cause Parent to fail to qualify as a REIT;
(g) enter into, amend, modify or terminate, or grant any waiver under the NSAM Management Agreement or any similar external management or advisory agreement in a manner that is adverse to the stockholders of Parent, taken as a whole;
(h) take any action under the Parent Governing Documents or otherwise (including by resolution) that would give dissenters’, appraisal or similar rights to the holders of Parent Common Stock with respect to the Mergers or the other Transactions;
(i) incur indebtedness (other than the Debt Financing) or enter a merger agreement, acquisition agreement or disposition agreement or authorize a liquidation, dissolution, consolidation, bankruptcy or announce an intention other reorganization, in each case that would reasonably be expected to materially delay the Closing or have a material adverse effect on the ability of the Parent, Merger Sub or Partnership Merger Sub to consummate the Mergers; or
(j) authorize, or enter into agreements providing forany contract, agreement, commitment or arrangement to do any acquisitions of a substantial equity interest in or a substantial portion of the assets foregoing. Notwithstanding anything to the contrary set forth in this Agreement, nothing in this Agreement shall prohibit Parent from taking any action, at any time or from time to time, that in the reasonable judgment of Parent, upon advice of counsel to Parent, is reasonably necessary for Parent to maintain its qualification as a REIT under the Code for any Person period or any business portion thereof ending on or division thereofprior to the Company Merger Effective Time or to avoid incurring entity level income or excise Taxes under the Code, in each case whether by merger, consolidation, combination, acquisition of stock including making dividend or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected other distribution payments to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary stockholders of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection accordance with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing this Agreement or otherwise, . If Parent determines that it is necessary to take any such action, it shall notify the Company as soon as reasonably practicable prior to the taking of the foregoing actionssuch action.
Appears in 2 contracts
Sources: Merger Agreement (Griffin-American Healthcare REIT II, Inc.), Merger Agreement (Northstar Realty Finance Corp.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the First Merger Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.1in accordance with Article VIII, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically expressly required by or permitted pursuant to this Agreement, (c) as to the extent otherwise required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (ix) shall and shall cause each the Parent Subsidiary Subsidiaries to, conduct its business in all material respects in the ordinary course of business and in a manner consistent with past practice, including by using practice and (y) shall use its commercially reasonable best efforts to (A) preserve intact in all material respects its current business organization, goodwill, ongoing businesses and their present business organizations and to preserve its and their present significant relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i)third parties, and (iiB) maintain the qualification of Parent as a REIT. Without limiting the generality of the foregoing, Parent agrees that between the date of this Agreement and the First Merger Effective Time or the date, if any, on which this Agreement is terminated in accordance with Article VIII, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as expressly required or permitted pursuant to Section 8.1this Agreement, (c) to the extent otherwise required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, conditioned or delayed) Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize amend or pay any dividends on propose to amend the charter or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities bylaws of Parent or Parent Subsidiaries), except dividends and distributions paid or made on in a pro rata basis by Parent Subsidiaries in manner adverse to the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent SubsidiaryCompany;
(b) issue or grant any Parent Equity Interests at a price below the per share value of the Parent’s net assets as of the date of such issuance or grant;
(c) split, combine, reduce subdivide or reclassify any shares of its issued stock of the Parent or unissued shares, any Parent Subsidiary or any other Parent Equity Interests or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition outstanding shares of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the TransactionsParent;
(d) amend the Parent Governing Documents declare, set aside or permit Merger Sub pay any dividend on or make any Significant Subsidiary other distributions (whether in cash, stock, property or otherwise) with respect to shares of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose stock of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting other equity securities or equity interestownership interests in Parent or any Parent Subsidiary, except for (A) the declaration and payment by Parent of regular quarterly dividends payable in respect of the Parent Preferred Stock in accordance with past practice, (B) the declaration and payment of dividends or other distributions to Parent by any directly or indirectly wholly owned Parent Subsidiary, (C) the declaration and payment by Parent of regular quarterly dividends payable in respect of the Parent Common Stock in accordance with past practice; (D) the declaration and payment by Parent of a dividend in respect of the Parent Common Stock at or prior to Closing in an amount equal to a pro rata portion of its regularly quarterly dividend, based on the number of days elapsed in the quarter in which the Closing Date occurs to but not including the third (3rd) Business Day after the date on which the Company Stockholder Approval is obtained; and (E) any dividend which the Parent Board determines is or may be necessary to be authorized and declared to enable Parent to maintain its qualification as a REIT and avoid incurring U.S. federal, state or local income or excise taxes under the Code or applicable state or local law, including payment of dividends under Code Sections 858 or 860, with respect to 2016;
(e) redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, any rightsParent Equity Interests, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than except (i) issuances in accordance with Parent’s share repurchase plan as in effect as of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awardsdate hereof, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by from holders of Parent Equity Awards in order to satisfy obligations amounts necessary for such holders to pay any applicable Taxes payable by such holders upon the exercise price and/or Tax withholding obligations with respect thereto lapse of restrictions on the Parent Equity Awards or (iiiii) the acquisition as required by the Parent Governing Documents;
(f) make, change or revoke, any material Tax election, enter into any material closing agreement with a Tax authority, file any amended Tax Return with respect to any material Tax or change any material method of Parent Equity Awards accounting for Tax purposes or annual Tax accounting period, except in connection with the forfeiture of such awardseach case (A) if required by Law, (iiiB) transactions between in the Parent and ordinary course of business or (C) if necessary (x) to preserve Parent’s qualification as a wholly owned REIT under the Code or (y) to qualify or preserve the status of any Parent Subsidiary as a disregarded entity or between wholly owned Parent Subsidiaries and (iv) other acquisitions partnership for U.S. federal income tax purposes or as a Qualified REIT Subsidiary or a Taxable REIT Subsidiary under the applicable provisions of shares Section 856 of Parent Stock for an amount not exceeding $100,000,000 in the aggregateCode, as the case may be;
(g) make or change take any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, localaction that could reasonably be expected to, or non-U.S. Law) with respect fail to take any material Taxaction, or surrender any right the failure of which could reasonably be expected to, cause Parent to claim fail to qualify as a material Tax refundREIT;
(h) convene change an annual accounting period or change in any meeting material respect any of the holders accounting methods used by it materially affecting its assets, liabilities or business, except for such changes required by GAAP or applicable Laws;
(i) take any action that could, or fail to take any action, the failure of which could reasonably be expected to, result in Parent or any Parent Subsidiary being required to be registered as an investment company under the Investment Company Act;
(j) adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of Parent Stock for (other than the purpose of revoking or varying the authority of the directors of Parent to allot Parent StockMergers); or
(ik) agreeenter into any Contract with respect to, in writing or otherwise, agree to take or make any commitment to take, or cause Parent Board to adopt any resolutions approving, any of the foregoing actionsactions prohibited by this Section 5.2. Notwithstanding anything to the contrary set forth in this Agreement, nothing in this Agreement shall prohibit Parent from taking any action, at any time or from time to time, that in the reasonable judgment of Parent, upon advice of counsel to Parent, is reasonably necessary for Parent to (i) maintain its qualification as a REIT under the Code for any period or portion thereof ending on or prior to the First Merger Effective Time, (ii) avoid incurring U.S. federal, state or local income or excise Taxes under the Code or applicable state or local Law or (iii) avoid being required to register as an investment company under the Investment Company Act.
Appears in 2 contracts
Sources: Merger Agreement (Apollo Residential Mortgage, Inc.), Merger Agreement (Apollo Commercial Real Estate Finance, Inc.)
Conduct of Business by Parent Pending the Closing. Parent agrees that that, between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Time, except (a) as set forth in Section 5.2 of the Parent Disclosure LetterSchedule, (b) as specifically required permitted by any other provision of this Agreement, (c) or as required by applicable Law or (d) as consented to the regulations or requirements of the Exchange, unless the Company shall otherwise consent in writing by the Company (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), Parent (i) shall will, and shall will cause each Parent Subsidiary to, conduct use its business in all material respects in the ordinary course of business consistent with past practice, including by using commercially reasonable best efforts to preserve substantially intact its business organization and their present business organizations goodwill. Without limiting the foregoing, and to preserve its and their present relationships with Governmental Entities and with customersas an extension thereof, suppliers and other Persons with whom it and they have material business relations; providedexcept as set forth in the Parent Disclosure Schedule, however, that no action that is as specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach other provision of this clause (i)Agreement, and (ii) agrees that between the date of this Agreement and the Effective Time or as required by applicable Law or the date, if any, on which this Agreement is terminated pursuant to Section 8.1regulations or requirements of the Exchange, Parent shall not, and shall not permit any Parent Subsidiary to:, between the date of this Agreement and the Effective Time, directly or indirectly, do, or agree to do, any of the following without the prior written consent of the Company (which consent shall not be unreasonably withheld, conditioned or delayed):
(a) authorize Section 5.2.1 amend or otherwise change its articles of incorporation or bylaws or equivalent organizational documents, other than pursuant to any investment or business combination transaction that would not otherwise violate Section 5.2.6;
Section 5.2.2 declare, set aside, make or pay any dividends on dividend or make any other distribution (whether payable in cash, stock, property or a combination thereof), with respect to any of its outstanding shares capital stock (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except than dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly wholly-owned Parent Subsidiary to Parent or another wholly any other wholly-owned Parent Subsidiary);
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or Section 5.2.3 issue or authorize the issuance of any other securities in respect shares of capital stock of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Equity Interests in, Parent or any Parent Subsidiary of any class, or any securities convertible into or exchangeable or exercisable for any shares of such shares, voting securities capital stock or equity interestother Equity Interests, or any rightsoptions, warrants or options other rights of any kind to acquire any shares of such shares, voting capital stock or other Equity Interests or such convertible or exchangeable securities or equity interest of Parent or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance unitsParent Subsidiary, other than the issuance of (iw) issuances of Parent Shares in respect of any Common Stock upon the exercise of Parent stock options Options outstanding on the date hereof or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except granted in the ordinary course of business, agree (x) upon the exercise of warrants to an extension or waiver of purchase Parent Common Stock which are outstanding on the statute of limitations with respect date hereof, (y) Parent Common Stock pursuant to that certain Securities Purchase Agreement entered into by and among Cypress Pharmaceuticals, Inc., a material amount of TaxesMississippi corporation (“Cypress”), enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock all of the outstanding capital stock of Cypress, Parent, and for the purpose of revoking limited purposes set forth therein, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, or varying the authority of the directors of Parent (z) pursuant to allot Parent Stock; orany investment or business combination transaction that would not otherwise violate Section 5.2.6;
(i) agreeSection 5.2.4 reclassify, in writing combine, split, subdivide or otherwiseredeem, to take purchase or otherwise acquire, directly or indirectly, any of the foregoing actions.its capital stock, other Equity Interests or other securities;
Appears in 2 contracts
Sources: Merger Agreement (Pernix Therapeutics Holdings, Inc.), Merger Agreement (Somaxon Pharmaceuticals, Inc.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.19.1, except (i) as set forth in Section 6.2 of Parent Disclosure Letter, (ii) as expressly required by this Agreement, (iii) as may be required by Law or (iv) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (x) shall and shall cause its Subsidiaries to, conduct its business in all material respects in the ordinary course of business and use commercially reasonable efforts to preserve its business organization intact, and maintain its existing relations and goodwill with customers, suppliers, distributors, creditors, lessors and tenants, and shall not, and (y) shall not permit any Parent Subsidiary of its Subsidiaries to:
(a) authorize amend its declaration of trust, limited partnership agreement, operating agreement, bylaws, limited liability company agreement or equivalent organizational documents or waive any provision of Article VII of the Parent Declaration;
(b) split, combine, subdivide or reclassify any shares of beneficial interest of Parent or any of its Subsidiaries;
(c) declare, set aside or pay any dividends dividend on or make any distribution with respect to its outstanding shares other distributions (whether in cash, assetsstock, property or otherwise) with respect to shares of capital stock or other securities of Parent or any of its Subsidiaries or other equity securities or ownership interests in Parent or any of its Subsidiaries, except for (A) the authorization and payment by Parent of dividends, payable monthly in accordance with past practice for the period up to the Closing Date at a rate not to exceed a monthly rate of $0.0425 per Parent Common Share, and (B) the declaration and payment of dividends or other distributions to Parent by any directly or indirectly wholly owned Parent Subsidiary; provided, however, that, notwithstanding the restriction on dividends and other distributions in this Section 6.2(c), Parent and its Subsidiaries shall, subject to Section 6.7, be permitted to make Special Distributions;
(d) except as required by a Parent Benefit Plan, redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, any Parent Equity Interests, except from holders of (i) Restricted Parent Shares, Parent RSUs, Parent PSUs, or Trustee RSUs in full or partial payment of any purchase price and any applicable Taxes payable by such holder upon the lapse of restrictions on the Restricted Parent Shares, Parent RSUs, Parent PSUs or Trustee RSUs and (ii) fractional interests of Parent Equity Interests solely with respect to the fractional interests;
(e) except as required by any Parent Leases, acquire or agree to acquire (including by merger, consolidation or acquisition of stock or assets) any real property, personal property (other than personal property at a total cost of less than Two Million U.S. Dollars ($2,000,000) in the aggregate), corporation, partnership, limited liability company, other business organization or any division or material amount of assets thereof, except (A) acquisitions by Parent or any wholly owned Parent Subsidiary of or from an existing wholly owned Parent Subsidiary or joint venture partners pursuant to existing purchase rights or options or (B) the pending acquisitions set forth on Section 6.2(e) of Parent Disclosure Letter (the pending acquisitions described in this clause (B), the “Parent Pending Acquisitions”);
(f) sell, pledge, lease, assign, transfer dispose of or encumber, or effect a deed in lieu of foreclosure with respect to, any property or assets or voluntarily exercise any purchase or sale rights or rights of first offer pursuant to any agreement with a Parent Joint Venture where the exercise of any such right is not otherwise required under the circumstances pursuant to the terms of the applicable agreement, except (A) as set forth on Section 6.2(f) of Parent Disclosure Letter, (B) pledges and encumbrances on property and assets in the ordinary course of business and that would not be material to any Parent Property or any assets of Parent or any of its Subsidiaries, (C) with respect to property or assets with a value of less than Two Million U.S. Dollars ($2,000,000) in the aggregate, and (D) sales to joint venture partners pursuant to existing purchase rights or options;
(g) incur, create, assume, refinance or replace any Indebtedness for borrowed money or issue or amend or modify the terms of any debt securities or assume, guarantee or endorse, or otherwise become responsible (whether directly, contingently or otherwise) for the Indebtedness of any other Person (other than a wholly owned Parent Subsidiary), except (A) Indebtedness incurred under Parent’s existing revolving credit facility for working capital purposes in the ordinary course of business (including to the extent necessary to pay dividends permitted under this Agreement and distributions paid to pay Indebtedness that matures), (B) funding any Parent Pending Acquisitions, or made (C) the refinancing of any existing Indebtedness of Parent or any of its Subsidiaries to the extent that (1) the material terms and conditions of any newly incurred Indebtedness are reasonable market terms and (2) the aggregate principal amount of such Indebtedness is not increased as a result of such refinancing;
(h) make any material loans, advances or capital contributions to, or investments in, any other Person (including to any of its officers, trustees, affiliates, agents or consultants), make any change in its existing borrowing or lending arrangements for or on a pro rata basis behalf of such Persons, or enter into any “keep well” or similar agreement to maintain the financial condition of another entity, other than (A) by Parent or a wholly owned Parent Subsidiary to Parent or a wholly owned Parent Subsidiary, (B) loans or advances (i) required to be made under any of Parent Leases or ground leases affecting Parent Properties or (ii) made to non-Affiliate tenants in the ordinary course of business and consistent with past practice, or (C) the loans or advances set forth on Section 6.2(h) of Parent Disclosure Letter;
(i) enter into, renew, modify, amend or terminate, or waive, release, compromise or assign any rights or claims under, any Parent Material Contract (or any contract that, if existing as of the date of this Agreement, would be a Parent Material Contract), other than (A) any termination or renewal in accordance with the terms of any existing Parent Material Contract that occur automatically without any action by Parent or any of its Subsidiaries, (B) the entry into any modification or amendment of, or waiver or consent under, any mortgage or related agreement to which Parent or any of its Subsidiaries is a party as required or necessitated by this Agreement or the Transactions; provided that any such modification, amendment, waiver or consent does not increase the principal amount thereunder or otherwise materially adversely affect Parent, any of its Subsidiaries or the Company, (C) as may be reasonably necessary to comply with the terms of this Agreement, (D) to preserve the commercial interests of Parent and its Subsidiaries consistent with past practice; provided, that any actions taken by Parent pursuant to this clause (D) shall not have an adverse economic impact on Parent in excess of an aggregate of One Million U.S. Dollars ($1,000,000) per year in the case of a recurring payment or Five Million U.S. Dollars ($5,000,000) in the aggregate in the case of any non-recurring payment obligation, (E) the entry into any amendment, termination, waiver, release, compromise or assignment of any Parent Lease made in the ordinary course of business, or (F) actions permitted under clauses (A) through (C) of Section 6.2(g);
(j) except as set forth on Section 6.2(j) of Parent Disclosure Letter, enter into, renew, modify, amend or terminate, or waive, release, compromise or assign any rights or claims under, any Parent Lease (or any lease for real property that, if existing as of the date of this Agreement, would be a Parent Lease), except to preserve the commercial interests of the Company and its Subsidiaries consistent with past practice, provided, that any actions taken by Parent pursuant to this Section 6.2(j) shall not have an adverse economic impact on Parent in excess of an aggregate of One Million U.S. Dollars ($1,000,000) per year in the case of a recurring payment or Five Million U.S. Dollars ($5,000,000) in the aggregate in the case of any non-recurring payment obligation;
(k) settle or compromise (A) any material legal action, suit or arbitration proceeding, in each case made or pending against Parent or any of its Subsidiaries, including any such matter relating to Taxes, and (B) any legal action, suit or proceeding involving any present, former or purported holder or group of holders of Parent Common Shares, in each case, where the amount paid by Parent or any of its Subsidiaries in settlement exceeds Five Hundred Thousand U.S. Dollars ($500,000) individually and is not covered by insurance;
(l) except as required by Law or by a Parent Benefit Plan, (A) enter into, materially amend or terminate any Parent Benefit Plan, (B) except in the ordinary course of business consistent with past practice practice, increase the compensation or employee benefits of any employee or independent contractor, (C) grant any awards under a Parent Equity Plan, other than with respect to the grant of annual equity awards to trustees of Parent, (D) fund any rabbi trust or (E) hire or terminate (other than for cause) any employee of Parent;
(m) make any material change to its methods of accounting in effect at December 31, 2014, except as required by a change in GAAP (or any interpretation thereof) or in applicable Law, or make any change, other than in the ordinary course of business, with respect to accounting policies, unless required by GAAP or the SEC;
(n) enter into any material new line of business;
(o) take any action, or fail to take any action, which would reasonably be expected to cause Parent to fail to qualify as a REIT or any of its Subsidiaries to cease to be treated as a partnership or disregarded entity for federal income tax purposes (other than as contemplated by Section 6.9) or as a qualified REIT subsidiary, a taxable REIT subsidiary or a REIT under the applicable provisions of Section 856 of the Code, as the case may be;
(p) adopt a plan of merger, complete or partial liquidation or resolutions providing for or authorizing such merger, liquidation or a dissolution, consolidation, recapitalization or bankruptcy reorganization, except in connection with any Parent Pending Acquisitions permitted pursuant to Section 6.2(e);
(q) amend or modify the compensation terms or any other obligations of Parent contained in the engagement letters entered into with Parent Financial Advisor, in a manner materially adverse to Parent, any of its Subsidiaries or the Company or engage other financial advisers in connection with the transactions contemplated by this Agreement;
(r) make any capital expenditures or other investments except (A) in accordance with the Parent CapEx Budget, (B) as required to be made under any of the Parent Leases or ground leases affecting the Parent Properties, (C) as required to be made pursuant to any Law, (D) for ordinary course capital expenditures not to exceed $500,000 in the aggregate or (E) as reasonably required to satisfy any health or safety concerns at any of the Parent Properties;
(s) except for (A) issuances by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;, or (B) issuances as a result of the exercise of any Restricted Parent Shares or pursuant to a Parent Equity Plan that is settled with Parent Common Shares as of the date of this Agreement, issue, sell, pledge, dispose, encumber or grant any Parent Common Shares or any of the Parent Subsidiaries’ capital stock, or any options, warrants, convertible securities or other rights of any kind to acquire any Parent Common Shares or any of the Parent Subsidiaries’ capital stock or other equity interests; or
(bt) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing forany contract, any acquisitions of a substantial equity interest in agreement, commitment or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected arrangement to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take do any of the foregoing actionsforegoing. Notwithstanding anything to the contrary set forth in this Agreement, but subject to Section 6.7, nothing in this Agreement shall prohibit Parent from taking any action, at any time or from time to time, that in the reasonable judgment of Parent, upon advice of counsel, is reasonably necessary for Parent to maintain its qualification as a REIT under the Code for any period or portion thereof ending on or prior to the Effective Time or to avoid incurring entity level income or excise Taxes under the Code, including making dividend or other distribution payments to shareholders of Parent in accordance with this Agreement (including Section 6.7) or otherwise.
Appears in 2 contracts
Sources: Merger Agreement (Chambers Street Properties), Merger Agreement (Gramercy Property Trust Inc.)
Conduct of Business by Parent Pending the Closing. Parent agrees that that, between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Time, except (ai) as set forth in Section 5.2 6.02 of the Parent Disclosure LetterSchedule, (bii) for any actions taken by Parent relating to any other acquisitions or business combinations (including, without limitation, the RCA Merger) or (iii) as specifically required expressly contemplated by any other provision of this Agreement, (c) as required by Law or (d) as consented to in writing by unless the Company shall otherwise agree in writing, (which consent x) the respective businesses of Parent and the Parent Subsidiaries shall be conducted only in, and Parent and the Parent Subsidiaries shall not be unreasonably withheldtake any action except in, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using practice and (y) Parent shall use all reasonable best efforts to preserve intact its keep available the services of such of the current officers, significant employees and their present business organizations consultants of Parent and the Parent Subsidiaries and to preserve its the current relationships of Parent and their present relationships the Parent Subsidiaries with Governmental Entities and with such of the corporate partners, customers, suppliers and other Persons persons with whom it which Parent or any Parent Subsidiary has significant business relations in order to preserve substantially intact its business organization. By way of amplification and they have material business relations; providednot limitation, however, that no action that is specifically permitted by any of clauses (a) through except (i) as set forth in Section 6.02 of Section 5.2(ii) shall be deemed a breach of this clause (i)the Parent Disclosure Schedule, and (ii) agrees that for any actions taken by Parent relating to any other acquisitions or business combinations (including, without limitation, the RCA Merger) or (iii) as expressly contemplated by any other provision of this Agreement, neither Parent nor any Parent Subsidiary shall, between the date of this Agreement and the Effective Time Time, directly or indirectly, do, or agree to do, any of the datefollowing without the prior written consent of the Company, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and consent shall not permit any Parent Subsidiary tobe unreasonably withheld or delayed:
(a) authorize amend or otherwise change its certificate of incorporation or bylaws or equivalent organizational documents;
(b) declare, set aside, make or pay any dividends on dividend or make any distribution other distribution, payable in cash, stock, property or otherwise, with respect to any of its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries)capital stock, except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned that any Parent Subsidiary may pay dividends or make other distributions to Parent or another wholly owned any other Parent Subsidiary;
(bc) splitreclassify, combine, reduce split, subdivide or reclassify any of its issued or unissued sharesredeem, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture purchase or otherwise thatacquire, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in of its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregatestock;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Agreement and Plan of Merger and Reorganization (Sun Healthcare Group Inc), Agreement and Plan of Merger and Reorganization (Sun Healthcare Group Inc)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using and use reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock (whether in cash, assets, stock shares or other securities of Parent or any Parent SubsidiariesSubsidiary), except (i) that Parent may continue the declaration and payment of regular quarterly cash dividends on the Parent Shares, not to exceed $0.17 per share for each quarterly dividend, with usual record and payment dates for such dividends in accordance with past dividend practice, and (ii) for dividends and distributions paid or made on a pro rata basis by a Parent Subsidiaries Subsidiary in the ordinary course of business consistent with past practice or by a wholly wholly-owned Parent Subsidiary to Parent or another wholly wholly-owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued sharescapital stock (excluding the Consolidation, provided that the Consolidation shall not be consummated prior to the Effective Time), or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, shares of its sharescapital stock, except for any such transaction by a wholly wholly-owned Parent Subsidiary which remains a wholly wholly-owned Parent Subsidiary after consummation of such transaction;
(c) except as required by applicable Law or any Parent Benefit Plan in existence as of the date hereof, (i) increase the compensation or benefits payable or to be provided to any of its directors, officers, employees or consultants, (ii) grant or increase to any of its directors, officers, employees or consultants any severance, termination, change in control or retention pay, (iii) pay or award, or commit to pay or award, any cash bonuses or cash incentive compensation (other than the payment of unpaid cash bonuses or other cash incentive compensation accrued as of December 31, 2015), (iv) enter into any employment, severance, change in control or retention agreement with any of its directors, officers, employees or consultants (other than offer letters that do not otherwise provide for severance, change in control or retention payments or benefits), (v) establish, adopt, enter into, amend or terminate any collective bargaining agreement (other than a renewal of an existing collective bargaining agreement in the ordinary course of business) or Parent Benefit Plan (or a plan or arrangement that would be a Parent Benefit Plan if in existence as of the date hereof), or (vi) take any action to accelerate any payment or benefit, or the funding of any payment or benefit, payable or to be provided to any of its directors, officers, employees or consultants;
(d) make any material change in financial accounting policies or procedures or any of its methods of reporting income, deductions or other material items for financial accounting purposes, except as required by GAAP, applicable Law or SEC policy;
(e) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereof, or any mergers, consolidations or business combinations, except for (i) such transactions that collectively do not have purchase prices that exceed $1,000,000 in each case whether by mergerthe aggregate (provided that any such transactions, consolidation, combination, acquisition of stock individually or assets or formation of a joint venture or otherwise that, in any casethe aggregate, would not reasonably be expected to prevent or materially delay or impede the consummation of the Transactions), (ii) capital expenditures otherwise permitted by Section 5.2(ii)(n), (iii) transactions between Parent and a wholly-owned Parent Subsidiary or between wholly-owned Parent Subsidiaries or (iv) the creation of new wholly-owned Subsidiaries organized to conduct or continue activities otherwise permitted by this Agreement;
(df) amend the Parent Governing Documents or Documents, and shall not permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(eg) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any sharesshares in its capital stock (including restricted stock), voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such sharesshares in its capital stock, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance unitsunits or take any action to cause to be exercisable any otherwise unexercisable Parent Equity Award under any existing Parent Equity Plan (except as otherwise provided by the express terms of any Parent Equity Award outstanding on the date hereof), other than (i) issuances of Parent Shares (A) in respect of any exercise of Parent stock options Options under Parent Equity Awards or the vesting vesting, lapse of restrictions with respect to or settlement of Parent Equity AwardsAwards outstanding as of the date hereof, or issued in accordance with this Agreement, in each case, in accordance with their respective terms, or (B) pursuant to the terms of the Parent Stock Option Plans or (ii) transactions between Parent and a wholly wholly-owned Subsidiary of Parent Subsidiary or between wholly wholly-owned Parent Subsidiaries, (iii) issuances Subsidiaries of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; orParent;
(fh) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) redemptions or acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto thereto, (ii) the redemption or acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, awards and (iii) transactions between the Parent and a wholly wholly-owned Parent Subsidiary or between wholly wholly-owned Parent Subsidiaries;
(i) redeem, repurchase, prepay (other than prepayments of revolving loans), defease, incur, assume, endorse, guarantee or otherwise become liable for or modify in any material respects the terms of any Indebtedness for borrowed money or issue or sell any debt securities or calls, options, warrants or other rights to acquire any debt securities (directly, contingently or otherwise), except for (i) any Indebtedness for borrowed money among Parent and its wholly-owned Parent Subsidiaries or among wholly-owned Parent Subsidiaries, (ii) Indebtedness for borrowed money incurred to replace, renew, extend, refinance or refund any existing Indebtedness for borrowed money of Parent or any of the Parent Subsidiaries maturing on or prior to the six (6) month anniversary of the date of such refinancing, (iii) guarantees by Parent of Indebtedness for borrowed money of Parent Subsidiaries or guarantees by Parent Subsidiaries of Indebtedness for borrowed money of Parent or any Parent Subsidiary, which Indebtedness is incurred in compliance with this clause (i), (iv) Indebtedness for borrowed money incurred pursuant to agreements entered into by Parent or any Parent Subsidiary in effect prior to the execution of this Agreement and set forth in Section 5.2(ii)(i) of the Parent Disclosure Letter; provided that any such Indebtedness shall be drawn solely in the ordinary course of business, and in an aggregate amount not to exceed $28,000,000, and (v) transactions at the stated maturity of such Indebtedness and required amortization or mandatory prepayments;
(j) make any loans to any other Person, except for loans among Parent and its wholly-owned Parent Subsidiaries or among Parent’s wholly-owned Parent Subsidiaries;
(k) sell, lease, license, transfer, exchange, swap or otherwise dispose of, or subject to any Lien (other than Parent Permitted Liens), any of its properties or assets (including shares in the capital of the Parent Subsidiaries), except (i) pursuant to an existing agreement in effect prior to the execution of this Agreement that is listed on Section 5.2(ii)(k) of the Parent Disclosure Letter, (ii) in the case of Liens, as required in connection with any Indebtedness permitted to be incurred pursuant to Section 5.2(ii)(i), (iii) such transactions with neither a fair market value of the assets or properties nor an aggregate purchase price that exceeds $1,000,000 in the aggregate for all such transactions and (iv) for transactions among Parent and its wholly-owned Parent Subsidiaries or among wholly-owned Parent Subsidiaries;
(l) compromise or settle any claim, litigation, investigation or proceeding, in each case made or pending by or against Parent or any of the Parent Subsidiaries (for the avoidance of doubt, including any compromise or settlement with respect to matters in which any of them is a plaintiff), or any of their officers and directors in their capacities as such, other than the compromise or settlement of claims, litigation, investigations or proceedings that: (i) is for an amount (in excess of insurance proceeds) not to exceed, for any such compromise or settlement individually or in the aggregate, $5,000,000, (ii) does not impose any injunctive relief on Parent and the Parent Subsidiaries and (iviii) other acquisitions does not provide for the license covenant not to assert, or otherwise granting of shares any rights, of Parent Stock for an amount not exceeding $100,000,000 in the aggregateor under any Intellectual Property;
(gm) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund, or take any action which would cause Parent to be treated as a domestic corporation for U.S. federal income tax purposes pursuant to Section 7874(b) of the Code from and after the Closing Date as a result of the Transactions;
(hn) convene any meeting except in accordance with Parent’s anticipated monthly capital expenditures for its 2016 fiscal year described on Section 5.2(ii)(n) of the holders Parent Disclosure Letter, make any new capital expenditure or expenditures, or commit to do so;
(o) except in the ordinary course of business consistent with past practice or in connection with any transaction to the extent specifically permitted by any other subclause of this Section 5.2(ii), (i) enter into any Contract that would, if entered into prior to the date hereof, be a Parent Stock for the purpose of revoking Material Contract, or varying the authority of the directors of (ii) materially modify, materially amend or terminate any Parent to allot Parent StockMaterial Contract or waive, release or assign any material rights or claims thereunder; or
(ip) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Merger Agreement (Waste Connections, Inc.), Merger Agreement (Progressive Waste Solutions Ltd.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the date of the First Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.19.1, except (a) as set forth in Section 5.2 6.2 of the Parent Disclosure Letter, (b) as specifically permitted or required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using commercially reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with customers, suppliers, vendors, Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically expressly permitted by any of clauses (a) through (ie) of Section 5.2(ii6.2(ii) shall be deemed a breach of this clause (i) unless such action constitutes a breach of any such clauses (a) through (e), and (ii) agrees that between the date of this Agreement and the First Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.19.1, Parent shall not, and shall not permit any Parent Subsidiary to, directly or indirectly:
(a) authorize Authorize, declare, set aside, make or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except (i) Parent’s regular quarterly dividends determined in good faith by Parent’s board of directors, (ii) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice by Parent Subsidiaries or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent SubsidiarySubsidiary and (iii) for transactions that would require an adjustment to the Offer Consideration and the Merger Consideration pursuant to Section 1.1(d) and Section 3.1(e), respectively, and for which the proper adjustment is made;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction, except for transactions that would require an adjustment to the Offer Consideration and the Merger Consideration pursuant to Section 1.1(d) and Section 3.1(e), respectively, and for which the proper adjustment is made;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by mergeror any mergers, consolidationconsolidations or business combinations or any acquisitions of equity or assets, combinationmergers, acquisition of stock consolidations or assets or formation of a joint venture or otherwise business combinations that, in any each case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary in a manner that would be material and adverse to the holders of Company Shares relative to the treatment of existing holders of Parent to adopt any amendments to its governing documentsCommon Stock;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any sharesshares in its capital stock, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, in each case other than (i) issuances, deliveries, grants, sales, pledges, dispositions or encumbrances or authorizations of any of the foregoing to the extent that such transactions do not require a stockholder vote of Parent’s stockholders pursuant to the rules of Nasdaq, (ii) issuances of shares of Parent Shares Common Stock in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (iiiii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iiiiv) issuances or grants of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate Awards and (v) other than issuances of or other transactions with respect to shares of Parent Common Stock in connection with transactions that would require an adjustment to the FinancingOffer Consideration and the Merger Consideration pursuant to Section 1.1(d) and Section 3.1(e), respectively, and for which the proper adjustment is made; or
(f) directly agree or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agreeauthorize, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Agreement and Plan of Reorganization (Homeaway Inc), Agreement and Plan of Reorganization (Expedia, Inc.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date hereof and the earlier of this Agreement and the date of the Effective Time or the timedate, if any, at on which this Agreement is validly terminated pursuant to Section 8.1, except (av) as set forth in Section 5.2 of the Parent Disclosure Letter, (bw) as specifically permitted or required by this Agreement, (cx) as required by Law or applicable Law, (dy) as consented to in writing by the Company (which such consent shall not to be unreasonably withheld, delayed conditioned or conditioneddelayed) or (z) with respect to Section 5.2(a) only, as undertaken reasonably and in good faith by Parent or any Parent Subsidiary in response to any Emergency Event (substituting Parent with the Company in the definition thereof) to the extent such Emergency Event is directly impacting Parent or any Parent Subsidiary (provided, that Parent shall, to the extent reasonably practicable under the circumstances, consult with the Company in good faith and take into account its views prior to taking any such actions pursuant to this clause (z)), Parent (ia) shall shall, and shall cause each Parent Subsidiary to, use reasonable best efforts to conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (iib) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any cause each Parent Subsidiary not to, directly or indirectly:
(ai) authorize amend, modify, waive, rescind, change or otherwise restate the Parent Governing Documents (whether by merger, consolidation, operation of law or otherwise) in a manner that would materially and adversely affect the Company Shareholders, or adversely affect the Company Shareholders relative to other holders of Parent Common Stock;
(ii) authorize, declare, set aside, make or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, stock or other securities of Parent or any Parent SubsidiariesSubsidiary), except (i) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice by the Parent Subsidiaries to Parent or by a any other wholly owned Parent Subsidiary and (ii) for transactions that would require an adjustment to Parent or another wholly owned Parent Subsidiarythe Merger Consideration pursuant to Section 2.6(a) and for which the proper adjustment is made;
(biii) split, combine, subdivide, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of capital stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capitalinterests, except for (i) acquisitions of any such transaction involving only wholly owned Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto Subsidiaries, and (ii) any transactions that would require an adjustment to the acquisition by Merger Consideration pursuant to Section 2.6(a) and for which the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and proper adjustment is made;
(iv) other acquisitions of shares of Parent Stock liquidate (completely or partially), dissolve, or adopt any plan or resolution providing for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations foregoing, with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (Parent or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent StockMerger Sub; or
(iv) agreeagree or authorize, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Merger Agreement (CyberArk Software Ltd.), Merger Agreement (Palo Alto Networks Inc)
Conduct of Business by Parent Pending the Closing. Parent agrees that between during the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Interim Period, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically permitted or required by this Agreement, (c) as required by applicable Law or (d) as consented to in writing by the Company (which such consent shall not to be unreasonably withheld, delayed conditioned or conditioneddelayed), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any cause each Parent Subsidiary not to, directly or indirectly:
(a) authorize amend, modify, waive, rescind, change or otherwise restate the Parent Governing Documents (whether by merger, consolidation, operation of law or otherwise) in a manner that would materially and adversely affect the Company Stockholders, or adversely affect the Company Stockholders relative to other holders of Parent Class A Common Stock;
(b) authorize, declare, set aside, make or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, stock or other securities of Parent or any Parent SubsidiariesSubsidiary), except (i) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice by the Parent Subsidiaries to Parent or by a any other wholly owned Parent Subsidiary and (ii) for transactions that would require an adjustment to Parent or another wholly owned Parent Subsidiarythe Merger Consideration pursuant to Section 2.1(d) and for which the proper adjustment is made;
(bc) split, combine, subdivide, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” capital stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of any such transaction involving only wholly-owned Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto Subsidiaries, and (ii) any transactions that would require an adjustment to the acquisition by Merger Consideration pursuant to Section 2.1(d) and for which the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregateproper adjustment is made;
(gd) make adopt a plan of complete or change any material Tax election, change any Tax accounting period for purposes of a material Tax partial liquidation or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations dissolution with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (Parent or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent StockMerger Sub; or
(ie) agreeagree or authorize, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Merger Agreement (Zeo Energy Corp.), Merger Agreement (Heliogen, Inc.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by mergeror any mergers, consolidationconsolidations or business combinations or any acquisitions of equity or assets, combinationmergers, acquisition of stock consolidations or assets or formation of a joint venture or otherwise thatbusiness combinations if, in any such case, any such transaction would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or Documents, and shall not permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to amend its governing organizational documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares (including restricted shares), voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options Share Options or the vesting vesting, lapse of restrictions with respect to or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock Shares for an amount not exceeding $100,000,000 5 million in the aggregate and aggregate, (v) other than pledges of equity interests of any Parent Subsidiary pursuant to the terms of any agreement governing existing Indebtedness of Parent or any Parent Subsidiary, and (vi) in connection with the Financingany acquisitions of an equity interest in or any assets of any person or any business or division thereof, or any mergers, consolidations or business combinations permitted by clause (c) above; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock Shares for an amount not exceeding $100,000,000 10 million in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund, or take any action or fail to take any action which action or inaction would cause Parent to be treated as a domestic corporation for U.S. federal income tax purposes (including as a result of the Merger);
(h) convene any meeting of the holders of Parent Stock Shares for the purpose of revoking or varying the authority of the directors of Parent to allot Parent StockShares;
(i) make any material change in financial accounting policies or procedures or any of its methods of reporting income, deductions or other material items for financial accounting purposes, except as required by GAAP, applicable Law or SEC policy; or
(ij) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Merger Agreement (Questcor Pharmaceuticals Inc), Merger Agreement (Mallinckrodt PLC)
Conduct of Business by Parent Pending the Closing. (a) Parent agrees that between during the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Interim Period, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required expressly permitted by this AgreementAgreement (including with respect to the Financing or Partnership Combination), (c) as may be required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall shall, and shall cause each of the Parent Subsidiary Subsidiaries to, (i) conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using and (ii) use their respective reasonable best efforts to maintain in all material respects their assets and properties in their current condition (ordinary wear and tear excepted), preserve intact its and their present business organizations intact in all material respects, and to preserve its maintain existing relations and their present relationships goodwill with Governmental Entities and with Entities, alliances, customers, suppliers lenders, tenants, employees and other Persons with whom it business associates in all material respects and they have material business relations; providedmaintain the status of Parent as a REIT and each Parent Subsidiary as a Qualified REIT Subsidiary or a Taxable REIT Subsidiary, however, that no action that is specifically permitted by any as applicable.
(b) Without limiting the generality of clauses the foregoing clause (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and except as set forth in Section 5.2 of the Parent Disclosure Letter, as permitted by this Agreement, as required by Law or as consented to in writing by the Company (ii) agrees that between which consent shall not be unreasonably withheld, delayed or conditioned), during the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1Interim Period, Parent shall not, and shall not permit any Parent Subsidiary to, directly or indirectly:
(ai) authorize amend its charter, bylaws or equivalent organizational documents in a manner adverse to the Company;
(ii) adjust, split, combine, subdivide or reclassify any shares of capital stock or other Parent Equity Interests;
(iii) declare, set aside or pay any dividends dividend on or make any distribution with respect to its outstanding shares other distributions (whether in cash, assetsstock, property or otherwise) with respect to shares of capital stock of Parent or other Parent Equity Interests, except for the declaration and payment by Parent of dividends for the period up to the Closing Date (including the portion of any month in which the Closing occurs) in an aggregate amount not to exceed in respect of Parent Common Stock, (x) 100% of Parent’s Cash Available for Distribution minus (y) the amount of any redemption, purchase or other acquisition of any capital stock of Parent or other Parent Equity Interests effected during the Interim Period (the dividend described in this clause (b)(iii), the “Parent Permitted Dividend”); provided, however, that, notwithstanding anything herein to the contrary, Parent and any Parent Subsidiary shall be permitted to make (or increase) dividends or distributions, including under Sections 858 or 860 of the Code, reasonably necessary for Parent to maintain its status as a REIT under the Code and/or avoid or reduce the imposition of any entity-level income or excise Tax under the Code or applicable state Law;
(iv) (A) grant any Person any right or option to acquire any Parent Equity Interests, (B) issue, deliver or sell any additional capital stock or other securities Parent Equity Interests, or (C) enter into any Contract with respect to the sale, voting or registration of any capital stock or other Parent Equity Interests; provided, however, that Parent may grant awards under the Parent Equity Plan and issue shares of Parent Common Stock (x) upon the vesting or exercise of any Parent Equity Awards outstanding as of the date hereof or Parent SubsidiariesEquity Awards permitted to be granted after the date hereof under this Agreement, and (y) pursuant to the Parent Equity Plan to the extent required under the terms of the Parent Equity Plan as in effect as of the date hereof or in accordance with the past practices of Parent; provided, further, the Parent Subsidiaries may issue equity solely to form special purpose entities that will be wholly owned directly or indirectly by the Parent as may be reasonably required for the completion of a Parent Permitted Acquisition;
(v) acquire or agree to acquire (including by merger, consolidation or acquisition of stock, equity interests or assets) any real property, personal property (other than personal property at a total cost of less than $1,000,000 in the aggregate), except dividends and distributions paid corporation, partnership, limited liability company, other business organization or made on a pro rata basis by any division or material amount of assets thereof; provided, however, that any wholly owned Parent Subsidiaries Subsidiary shall be permitted to acquire real property (via acquisition of the fee interest or the equity interest in the entity which owns the fee interest) in the ordinary course of business consistent with past practice with an aggregate value of up to $100,000,000 (each such acquisition, together with any other acquisitions identified on Section 5.2 of the Parent Disclosure Letter, a “Parent Permitted Acquisition”);
(vi) sell, pledge, assign, transfer, dispose of or encumber, or effect a deed in lieu of foreclosure with respect to, any Parent Property or other Parent assets, except (A) pledges and encumbrances on property and assets in the ordinary course of business consistent with past practices and that would not be material to any Parent Property, and (B) with respect to any property or assets with a net book value of less than $50,000,000 in the aggregate;
(vii) incur, create, assume, refinance, replace or prepay any Indebtedness for borrowed money or issue or amend the terms of any Indebtedness or other debt securities or assume, guarantee or endorse, or otherwise become responsible (whether directly, contingently or otherwise) for the Indebtedness of any other Person (other than a wholly owned Parent Subsidiary), except (A) Indebtedness under Parent’s existing revolving credit facility in an amount not to exceed $100,000,000, or (B) Indebtedness to or among Parent and the Parent Subsidiaries;
(viii) make any loans, advances or capital contributions to, or investments in, any other Person (including to any of its officers, directors, affiliates, agents or consultants), make any change in its existing borrowing or lending arrangements for or on behalf of such Persons, or enter into any “keep well” or similar agreement to maintain the financial condition of another entity, other than (A) by Parent or a wholly owned Parent Subsidiary to Parent or another a wholly owned Parent Subsidiary, (B) loans or advances required to be made under any of the existing Parent Leases or ground leases affecting the Parent Properties, (C) loans or advances to non-affiliate tenants or borrowers in the ordinary course of business consistent with past practice in connection with capital expenditures for the improvement, maintenance or repair of Parent Property at a capitalization rate to Parent of at least eight percent (8%) or (D) loans or advances to non-affiliate borrowers in the ordinary course of business that constitute Parent Mortgage Agreements with a principal amount of up to $100,000,000 (any such loan also constituting a Parent Permitted Acquisition);
(bix) splitenter into, combinerenew, reduce materially modify or reclassify amend, terminate, or waive, release, compromise or assign any rights or claims under, any Company Material Contract (or any contract that, if existing as of the date hereof, would be a Company Material Contract), other than (A) any termination or renewal in accordance with the terms of such existing Company Material Contract that occur automatically without any action by Parent or any Parent Subsidiary, (B) the entry into any modification or amendment of, or waiver or consent under, any mortgage or related agreement to which the Company or any Company Subsidiary is a party as required or necessitated by this Agreement or the Transactions, provided, that any such modification, amendment, waiver or consent does not increase the principal amount thereunder or otherwise adversely affect the Company, any Company Subsidiary or Parent in any material respect or (C) as necessary to comply with the terms of this Agreement;
(x) enter into, renew, modify, amend or terminate, or waive, release, compromise or assign any rights or claims under, any Material Parent Lease (or any lease for real property that, if existing as of the date hereof, would be a Parent Lease), except (A) in connection with entering into any new lease (or assuming a lease) in the ordinary course of business consistent with past practice in connection with entering into a Parent Permitted Acquisition or (B) renewing, modifying or amending any Parent Lease in existence on the date hereof (1) in the ordinary course of business consistent with past practices or (2) where the change (whether an increase or decrease) in the aggregate annual rent payments under any such new lease, when aggregated together with the changes under any other lease with entities affiliated with the tenant, are not greater than $1,000,000, excluding, in the calculation of such change in rent, any rent increases arising out of landlord funded capital improvements to a Parent Property that result in an increase in rent at a capitalization rate of at least eight percent (8%);
(xi) waive, release, assign, commence, settle or compromise any pending or threatened Legal Proceeding (A) of or against Parent or any of its issued Subsidiaries or unissued shares(B) involving any present, former or purported holder or group of holders of the Parent Common Stock, that in the case of (A) or (B), (1) requires payment by Parent of an amount in excess of $1,000,000 in the aggregate, (2) entails the incurrence of any obligation or liability of Parent in excess of such amount, including costs or revenue reductions or obligations that would impose any material restrictions on the business or operations of Parent or its Subsidiaries, or issue (3) imposes any material non-monetary relief or authorize the issuance an admission of any other securities in respect of, in lieu of material liability or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transactionwrong doing;
(cxii) authorize fail to maintain all financial books and records in all material respects in accordance with GAAP (or announce an intention any interpretation thereof concurred with by Parent’s independent auditors) or make any material change to authorizeits methods of accounting in effect at December 31, 2013, except as required by a change in GAAP (or any interpretation thereof concurred with by Parent’s independent auditors) or in applicable Law, or enter into agreements providing formake any change with respect to accounting policies, any acquisitions of a substantial equity interest in unless required by GAAP or a substantial portion of the assets of any Person SEC or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, disclosed in any case, would reasonably be expected Parent SEC Document filed prior to prevent or materially delay or impede the consummation of the Transactionsdate hereof;
(dxiii) amend the Parent Governing Documents or permit Merger Sub or enter into any Significant Subsidiary new line of Parent to adopt any amendments to its governing documentsbusiness;
(exiv) issueform any new funds, deliver, grant, sell, pledge, dispose of joint ventures or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities non-traded real estate investment trusts or other equity interest pooled investment vehicles;
(xv) except as otherwise required pursuant to any written agreement or Benefit Plan as in existence on the date hereof or as otherwise required hereunder, (A) hire or terminate any executive officer or director of Parent or any Parent Subsidiary or promote or appoint any securities convertible into Person to a position of executive officer or exchangeable for director of Parent or any such sharesParent Subsidiary, voting securities or equity interest(B) increase, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or accelerate the vesting or settlement payment of, compensation or other benefits payable or provided to Parent’s directors or executive officers, or (C) enter into, amend or adopt any Benefit Plan; provided however, that the foregoing clauses (A)-(C) shall not restrict Parent or any of its Subsidiaries from (1) awarding annual performance-related merit increases in base salaries made in the ordinary course of business to executive officers of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for by an amount not exceeding $100,000,000 that in the aggregate and does not exceed 5% of such officers’ current aggregate annual base salaries, (v2) awarding annual performance-related merit increases in base salaries or base wages made in the ordinary course of business to all employees other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions executive officers of Parent Shares tendered by holders of Parent Equity Awards an amount that in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture aggregate does not exceed 5% of such awardsemployees’ current aggregate annual base salaries and base wages, (iii3) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 increasing annual bonus opportunities made in the aggregate;
ordinary course of business consistent with past practice, or (g4) make entering into or change any material Tax electionmaking available to newly hired employees (not including executive officers) or to employees (not including executive officers) in the context of promotions based on job performance or workplace requirements, change any Tax accounting period for purposes including replacement of a material Tax or material method of Tax accountingan open position, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in each case in the ordinary course of business, agree plans, agreements, benefits and compensation arrangements that have a value that is consistent with the past practice of making compensation and benefits available to an extension newly hired or waiver promoted employees (not including executive officers) in similar positions;
(xvi) take or fail to take any action, which action or failure would reasonably be expected to cause (A) Parent to fail to qualify as a REIT or (B) any Parent Subsidiary to cease to be treated as any of (x) a partnership or disregarded entity for United States federal income tax purposes or (y) a REIT, a Qualified REIT Subsidiary or a Taxable REIT Subsidiary under the applicable provisions of Section 856 of the statute Code, as the case may be;
(xvii) except as set forth in Section 5.2 of limitations with respect the Parent Disclosure Letter, (A) make, change or rescind any material election relating to Taxes, (B) change a material amount method of TaxesTax accounting, (C) amend any material Tax Return, (D) settle or compromise any material federal, state, local or foreign Tax liability, audit, claim or assessment, (E) enter into any “material closing agreement” within the meaning of Section 7121 of the Code agreement related to Taxes, (or F) knowingly surrender any similar provision of state, localright to claim any material Tax refund, or non-U.S. Law(G) give or request any waiver of a statute of limitation with respect to any material TaxTax Return, except in each case as reasonably necessary to (1) comply with Law or surrender (2) (x) preserve Parent’s qualification as a REIT under the Code or (y) to qualify or preserve the status of any right to claim Parent Subsidiary as a material Tax refunddisregarded entity or partnership for United States federal income tax purposes or as a REIT, Qualified REIT Subsidiary or a Taxable REIT Subsidiary under the applicable provisions of Section 856 of the Code, as the case may be;
(hxviii) convene adopt a plan of merger, complete or partial liquidation or resolutions providing for or authorizing such merger, liquidation or a dissolution, consolidation, recapitalization or bankruptcy reorganization, except in connection with a Company Permitted Acquisition or the Parent Partnership Restructuring;
(xix) make or commit to make any meeting capital expenditures that are not in respect of Parent Properties that are in excess of $1,000,000 individually or $4,000,000 in the aggregate;
(xx) take any action under the Parent Governing Documents or otherwise (including by resolution) that would give dissenters’, appraisal or similar rights to the holders of Parent Common Stock for with respect to the purpose of revoking Merger or varying the authority of the directors of Parent to allot Parent Stock; orother Transactions;
(ixxi) agreeauthorize, in writing or otherwiseenter into any contract, agreement or binding commitment or arrangement to take do any of the foregoing actionsforegoing. Notwithstanding anything to the contrary set forth in this Agreement, nothing in this Agreement shall prohibit Parent from taking any action, at any time or from time to time, that in the reasonable judgment of the Parent Board of Directors, upon advice of counsel to Parent, is reasonably necessary for Parent to maintain its qualification as a REIT under the Code for any period or portion thereof ending on or prior to the Merger Effective Time, including making dividend or other distribution payments to stockholders of Parent in accordance with this Agreement or otherwise. If Parent proposes any such action, it shall notify the Company as soon as reasonably practicable prior to the taking of such action.
Appears in 2 contracts
Sources: Merger Agreement (Omega Healthcare Investors Inc), Merger Agreement (Aviv Reit, Inc.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the earlier of the Effective Time or and the time, if any, at which termination of this Agreement is terminated pursuant to Section 8.1in accordance with Article 7, except (a) as set forth in Section 5.2 of the Parent Disclosure LetterSchedule, (b) as specifically required permitted by any other provision of this Agreement, (c) as required by applicable Law or (d) as consented to in writing by the Company (which consent shall will not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize amend the Parent Governing Documents in any manner that would reasonably be expected to materially delay, impede or pay prevent the consummation of the transactions contemplated by this Agreement or amends the terms of the Parent Shares in any dividends on or make manner that would reasonably be expected to be adverse in any distribution with material respect to its outstanding shares (whether in cash, assets, stock or other securities holders of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent SubsidiaryShares;
(b) splitdeclare, set aside, make or pay any dividend or other distribution (whether payable in cash, stock, property or a combination thereof) with respect to any of its capital stock, other than the quarterly dividend set forth on Section 5.2(b) of the Parent Disclosure Schedule and any share repurchases pursuant to the share repurchases program approved by the board of directors of Parent on July 23, 2015;
(c) reclassify, combine, reduce split, subdivide or reclassify amend the terms of, directly or indirectly, any of its issued capital stock or unissued sharesother Equity Interests, or issue authorize or authorize propose the issuance of any other securities in respect of, in lieu of or in substitution for, for shares of its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of capital stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactionsother Equity Interests;
(d) amend the merge or consolidate Parent Governing Documents with any Person or permit Merger Sub adopt a plan of complete or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issuepartial liquidation or resolutions providing for a complete or partial liquidation, deliverdissolution, grantrestructuring, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities recapitalization or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances reorganization of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the FinancingParent; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(ie) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Merger Agreement (Ch2m Hill Companies LTD), Merger Agreement (Jacobs Engineering Group Inc /De/)
Conduct of Business by Parent Pending the Closing. (a) Parent agrees that between during the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Interim Period, except (ai) as expressly contemplated or permitted by this Agreement, including Section 7.3, (ii) as set forth in Section 5.2 6.2 of the Parent Disclosure Letter, (biii) as specifically may be required by this AgreementLaw, (civ) as for any action reasonably required by Law in response to any Health and Safety Measures or (dv) as consented to in writing by the Company in accordance with Section 10.14 (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (iA) shall shall, and shall cause each of the Parent Subsidiary Subsidiaries to, use reasonable best efforts to conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any maintain the status of clauses (a) through (i) of Section 5.2(ii) shall be deemed Parent as a breach of this clause (i), REIT and (iiB) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit or deny permission to any Parent Subsidiary to:to (or any Parent JV with respect to Section 6.2(a)(i), Section 6.2(a)(iii), Section 6.2(a)(iv), to the extent the Parent or any Parent Subsidiary has a right to permit or deny permission for the same):
(ai) authorize amend or propose to amend the Parent Governing Documents or any Parent Subsidiary Governing Documents or any constituent organizational or governing documents of any Parent JV (including by merger, consolidation or otherwise), other than in connection with the Financing or (A) grant any exception pursuant to Section 7.2(e)(i) of the Parent Charter, or (B) establish or increase an “Excepted Holder Limit” for any “Excepted Holder,” as such terms are defined in Section 7.1 of the Parent Charter;
(ii) split, combine, subdivide, consolidate or reclassify any Parent Common Shares, capital stock or other equity interests of Parent;
(iii) declare, set aside for payment or pay any dividends dividend on or make any other actual, constructive or deemed distribution with respect to its outstanding shares (whether in cash, assetsshares, property or otherwise) with respect to any shares of beneficial interest, capital stock or other securities equity interests of Parent, any Parent Subsidiary or any Parent JV or otherwise make any payment to its or their shareholders or other equityholders in their capacity as such, other than (A) the declaration and payment (with declaration and payment date consistent with past practice) of cash dividends or other distributions for the period up to the Closing Date at a rate not to exceed an annual rate of $2.20 per Parent Common Share (including, to the extent that Parent has given the Company at least three (3) Business Days’ prior written notice of its intent to declare such a prorated dividend or other distribution, any prorated amount from the date of the payment of the last such regular dividend or distribution through the Closing Date) (provided that Parent shall maintain such cash dividends or other distributions at an annual rate of at least $1.00 per Parent Common Share), (B) the declaration and payment of dividends or other distributions to Parent or a direct or indirect wholly owned Parent Subsidiary by any direct or indirect wholly owned Parent Subsidiary, or (C) dividends or other distributions by any Parent Subsidiary or Parent JV that is not wholly owned, directly or indirectly, by Parent, in accordance with the requirements of the organizational documents of such Parent Subsidiary or Parent JV;
(iv) redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, any shares of beneficial interest, capital stock or other equity interests of Parent or any Parent Subsidiary or any Parent JV, except (A) with respect to the forfeiture of awards in respect of Parent Common Shares outstanding under the Parent Equity Compensation Plan that remain subject to vesting requirements in accordance with their terms or the repurchase of Parent Common Shares to satisfy withholding Tax obligations with respect to awards granted pursuant to the Parent Equity Compensation Plan, or (B) in accordance with Article VII of the Parent Charter;
(v) issue, sell, pledge, dispose, encumber or grant, or authorize or propose the issuance, sale, pledge, disposition, encumbrance or grant of, any shares of beneficial interest, capital stock or other equity interests of the Parent, any Parent Subsidiary or any Parent JV, or any options, warrants, convertible securities or other rights of any kind to acquire any of the foregoing, except for (A) issuances by a directly or indirectly wholly owned Parent Subsidiary to Parent or another existing directly or indirectly wholly owned Parent Subsidiary, or (B) issuances of Parent Common Shares pursuant to the Parent Equity Compensation Plan in the ordinary course of business consistent with past practice;
(vi) acquire or agree to acquire (including by merger, consolidation or acquisition of stock or assets) any real property (other than real property at a total cost of less than $25,000,000 in the aggregate), personal property (other than personal property at a total cost of less than $5,000,000 in the aggregate), corporation, partnership, limited liability company, other business organization or any division or material amount of assets thereof, except (A) as required by any of the Parent Landlord Leases, or (B) acquisitions by Parent or any wholly owned Parent Subsidiary of or from an existing wholly owned Parent Subsidiary;
(vii) sell, pledge, assign, transfer, lease, license, dispose of or encumber, or effect a deed in lieu of foreclosure, or agree to do any of the foregoing, with respect to, any property or assets, except (A) for sales of real property at a total price of less than $25,000,000 in the aggregate or other assets at a total price of less than $5,000,000 in the aggregate, (B) that this Section 6.2(a)(vii) shall not restrict any action expressly permitted pursuant to Section 6.2(a)(xi), (C) non-exclusive licenses of Intellectual Property entered into in the ordinary course of business, (D) Liens in connection with the Financing or any amendment of the Parent Credit Agreement or (E) for Parent Permitted Liens;
(viii) incur, create or assume any Indebtedness for borrowed money or assume, guarantee or endorse, or otherwise become responsible (whether directly, contingently or otherwise) for the Indebtedness of any other Person in excess of $25,000,000 in the aggregate, except (A) Indebtedness incurred under Parent’s existing revolving credit facility, (B) to refinance at maturity or in connection with the transactions contemplated hereby any existing Indebtedness of Parent or the Parent Subsidiaries, (C) Indebtedness incurred or assumed to finance the Merger and the other transactions contemplated hereby, including the Financing, (D) Indebtedness incurred pursuant to obligations under any Parent Landlord Leases, or (E) loans or advances by Parent or a direct or indirect wholly owned Parent Subsidiary to Parent or a direct or indirect wholly owned Parent Subsidiary;
(ix) make any loans, advances or capital contributions to, or investments in, any other Person (including to any of its officers, directors, Affiliates, agents or consultants), make any change in its existing borrowing or lending arrangements to any such Persons, or enter into any “keep well” or similar agreement to maintain the financial condition of another entity, in each case other than in the ordinary course of business consistent with past practice, except dividends and distributions paid or made on a pro rata basis (A) by Parent Subsidiaries or a direct or indirect wholly owned Parent Subsidiary to or for the benefit of Parent or a direct or indirect wholly owned Parent Subsidiary, including any Parent Property, or (B) loans or advances required to be made under any of the Parent Landlord Leases;
(x) enter into, renew, modify, amend or terminate in a manner adverse to Parent or any Parent Subsidiary, or waive, release, compromise or assign any rights or claims under, any Parent Material Contract (or any contract that, if existing as of the date hereof, would be a Parent Material Contract), other than (A) in the ordinary course of business consistent with past practice or (B) the entry into any agreement, modification, amendment, waiver or consent as may be necessary to consummate any transaction expressly permitted by Section 6.2(a)(vii), provided that any such agreement, modification, amendment, waiver or consent does not have, and would not reasonably be expected to have, a Parent Material Adverse Effect;
(xi) enter into, renew, modify, amend or terminate, or waive, release, compromise or assign any material rights or claims under, any Parent Landlord Lease or Parent Tenant Lease (or any lease for real property that, if existing as of the date hereof, would be a Parent Landlord Lease or a Parent Tenant Lease), except (A) in the ordinary course of business consistent with past practice, or (B) for any termination or renewal in accordance with the terms of any existing Parent Landlord Lease or Parent Tenant Lease as in effect on the date hereof;
(xii) waive, release or assign any material rights or claims or make any payment, direct or indirect, of any liability of the Parent or any Parent Subsidiary in an amount in excess of $10,000,000 before it is due in accordance with its terms, except by Parent or a direct or indirect wholly owned Parent Subsidiary to or for the benefit of Parent or another a direct or indirect wholly owned Parent Subsidiary;
(bxiii) split, combine, reduce settle or reclassify any of its issued or unissued sharescompromise, or issue offer or authorize the issuance of propose to settle, (A) any other securities in respect oflegal action, in lieu of suit, investigation, arbitration or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereofproceeding, in each case whether by merger, consolidation, combination, acquisition made or pending against Parent or any of stock the Parent Subsidiaries involving an amount paid in settlement in excess of $3,000,000 individually or assets or formation of a joint venture or otherwise that$6,000,000 in the aggregate (excluding, in any each case, amounts to be paid under existing insurance policies or renewals thereof) or which would include any non-monetary relief (other than customary confidentiality obligations), (B) any legal action, suit, investigation, arbitration or proceeding involving any present, former or purported holder or group of holders of Parent Common Shares, other than in accordance with Section 7.7, or (C) any legal action, suit, investigation, arbitration or proceeding involving any Governmental Authority;
(xiv) make any material change to its methods of financial accounting in effect at December 31, 2022, except as required by a change in GAAP (or any interpretation thereof) or in applicable Law, or make any material change, other than in the ordinary course of business consistent with past practice or as previously disclosed in the Parent SEC Documents, with respect to accounting policies, unless required by GAAP (or any interpretation thereof) or the SEC;
(xv) enter into any new line of business or exit from any existing line of business;
(xvi) take, or agree to take, any action, or knowingly fail to take any action, which action or failure to act would reasonably be expected to prevent cause (A) Parent to fail to qualify for taxation as a REIT, or materially delay (B) any Parent Subsidiary (1) to cease to be treated as any of a partnership, a QRS, a REIT or impede a TRS under the consummation applicable provisions of the TransactionsCode, as the case may be, or (2) that is not treated as a TRS at the date hereof to be so treated; provided, however, if an action described in clause (A) or (B) is required by Law or is necessary to preserve Parent’s qualification for taxation as a REIT under the Code, Parent shall (1) promptly notify the Company, (2) make reasonable effort to permit the Company to review and comment on such action, and (3) take such action;
(dxvii) amend (A) make, change or rescind any material election relating to Taxes (it being understood, for the avoidance of doubt, that nothing in this Agreement shall preclude Parent Governing Documents or permit Merger Sub or any Significant Subsidiary from designating dividends paid by it as “capital gain dividends” within the meaning of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose Section 857 of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity AwardsCode), (iiB) transactions between Parent and change a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, (C) file an amendment to any material amended Tax Return, (D) settle or compromise any audit material federal, state, local or proceeding relating foreign Tax liability, audit, claim or assessment, (E) enter into any material closing agreement related to a material amount of Taxes, except (F) consent (other than in the ordinary course of business, agree business consistent with past practice) to an any extension or waiver of the statute of limitations with respect limitation period applicable to a any material amount Tax claim or assessment, or (G) surrender any right to claim any material refund of Taxes; except in each case as necessary or appropriate, enter into as determined in consultation with the Company, to preserve the status of any Parent Subsidiary as a partnership or disregarded entity for United States federal income Tax purposes or as a QRS, a TRS or a REIT under the applicable provisions of Section 856 of the Code, as the case may be; provided, however, if an action described in clauses (A)-(G) is required by Law or is necessary to preserve Parent’s qualification for taxation as a REIT under the Code, Parent shall (1) promptly notify the Company, (2) make reasonable effort to permit the Company to review and comment on such action and (3) take such action;
(xviii) take, or agree to take, any action, or knowingly fail to take any action, which action or failure could be reasonably expected to prevent the Merger from qualifying as a “closing agreementreorganization” within the meaning of Section 7121 368(a) of the Code;
(xix) enter into, amend or modify any Parent Tax Protection Agreement, or take any action or knowingly fail to take any action that would give rise to a material liability with respect to any Parent Tax Protection Agreement;
(xx) authorize or adopt, or publicly propose, a plan of merger, complete or partial liquidation, consolidation, recapitalization or bankruptcy reorganization;
(xxi) amend or modify the compensation payable by Parent to ▇.▇. ▇▇▇▇▇▇ Securities LLC in connection with the Merger or the other transactions contemplated hereby, which compensation is set forth in Section 5.20 of the Parent Disclosure Letter, in a manner adverse to Parent or any Parent Subsidiary; or
(xxii) authorize, or enter into any contract, agreement, commitment or arrangement to do any of the foregoing.
(b) Notwithstanding anything to the contrary set forth in this Agreement, but subject to Section 7.11, nothing in this Agreement shall prohibit Parent from taking any action, at any time or from time to time, that in the reasonable judgment of the Parent Board, upon advice of counsel to Parent, is reasonably necessary for Parent to maintain its qualification for taxation as a REIT under the Code or to eliminate or reduce entity level income or excise Taxes under Sections 856, 857, 860 and 4981 of the Code (and similar provisions of state or local Tax Law) for any similar provision period or portion thereof ending on or prior to the Closing Date (including by making any dividend or other distribution payments to stockholders of stateParent in accordance with Section 7.11 (a “Special Parent Distribution”)).
(c) Notwithstanding anything to the contrary set forth in this Agreement, localas long as the Commitment Letter remains in full force and effect, Parent and the Parent Subsidiaries shall be prohibited from (i) selling, pledging, assigning, transferring to a third party, leasing, licensing, disposing of or encumbering, the Parent Commitment Letter Properties, or non-U.S. Laweffecting a deed in lieu of foreclosure on the Parent Commitment Letter Properties, or agreeing to do any of the foregoing, unless any such Lien thereon will be discharged prior to or in conjunction with the Closing or is a Parent Permitted Lien, (ii) incurring, creating or assuming any Indebtedness or assuming, guaranteeing or endorsing, or otherwise becoming responsible (whether directly, contingently or otherwise) for the Indebtedness on behalf of, on the Parent Commitment Letter Properties, unless any such Indebtedness will be terminated prior to or in conjunction with the Closing, or (iii) subject to Section 7.15, taking any other action with respect to any material Taxthe Parent Commitment Letter Properties or the owners thereof that would violate the terms of, or surrender hinder or frustrate the completion of any right condition in, the Commitment Letter, in each case, without the consent of the Company (such consent not to claim a material Tax refund;be unreasonably withheld or delayed).
(hd) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
shall (i) agreeuse reasonable best efforts to obtain the opinions of counsel referred to in Section 8.3(d) and Section 8.3(e), in writing (ii) deliver to ▇▇▇▇▇▇▇▇, Lipton, ▇▇▇▇▇ & ▇▇▇▇ (or otherwise, other nationally recognized law firm reasonably satisfactory to take any of Parent) and ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP (or other nationally recognized law firm reasonably satisfactory to the foregoing actions.Company) an officer’
Appears in 2 contracts
Sources: Merger Agreement (Diversified Healthcare Trust), Merger Agreement (Office Properties Income Trust)
Conduct of Business by Parent Pending the Closing. (a) Parent agrees that between during the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Interim Period, except (a) as set forth in Section 5.2 6.2 of the Parent Disclosure Letter, as expressly permitted by this Agreement (b) including with respect to the Manager Contribution or the Merger), as specifically may be required by this Agreement, (c) as required by applicable Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall shall, and shall cause each Parent Subsidiary to, (i) conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using and (ii) use their respective reasonable best efforts to maintain in all material respects their assets and properties in their current condition (ordinary wear and tear excepted), preserve intact its and their present business organizations intact in all material respects, and to preserve its maintain existing relations and their present relationships goodwill with Governmental Entities and with Entities, alliances, customers, suppliers lenders, tenants, employees and other Persons with whom it business associates in all material respects and they have material business relations; maintain the status of Parent as a REIT and each Parent Subsidiary as a Qualified REIT Subsidiary or a Taxable REIT Subsidiary, as applicable, and provided, howeverthat notwithstanding anything to the contrary in this Section 6.2, that no action that is specifically permitted by Parent or any Parent Subsidiary may effect one (1) securitization on customary terms in an amount not to exceed $625,000,000 (the “Parent New Securitization”).
(b) Without limiting the generality of clauses clause (a) through above, and except as set forth in Section 6.2 of the Parent Disclosure Letter, as permitted by this Agreement, as required by Law or as consented to in writing by Company (i) of Section 5.2(ii) which consent shall not be deemed a breach of this clause (iunreasonably withheld, delayed or conditioned), and (ii) agrees that between during the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1Interim Period, Parent shall not, and shall not permit any Parent Subsidiary to, directly or indirectly:
(ai) authorize amend its charter, bylaws or equivalent organizational documents;
(ii) adjust, split, combine, subdivide or reclassify any shares of capital stock or other Parent Equity Interests;
(iii) declare, set aside or pay any dividends dividend on or make any distribution with respect to its outstanding shares other distributions (whether in cash, assetsstock, property or otherwise) with respect to shares of capital stock of Parent or other Parent Equity Interests, except for (A) the declaration and payment by Parent of quarterly dividends in accordance with past practice for the period up to the Closing Date (including the portion of any month in which the Closing occurs) in an amount not to exceed $0.20 per Parent Common Share per quarter, (B) the declaration and payment of dividends or other distributions by the Parent Operating Partnership in an amount not to exceed $0.20 per Parent OP Unit per quarter, and (C) dividends or other distributions by any Parent Subsidiary (other than by the Parent Operating Partnership), in accordance with the terms of the organizational documents of such Parent Subsidiary; provided, however, that, notwithstanding anything herein to the contrary, Parent and any Parent Subsidiary shall be permitted to make (or increase) dividends or distributions, including under Sections 858 or 860 of the Code, reasonably necessary for Parent to maintain its status as a REIT under the Code or applicable state Law and/or avoid or reduce the imposition of any entity-level income or excise Tax under the Code or applicable state Law;
(iv) redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, directly or indirectly, any capital stock or other securities Parent Equity Interests, except any Parent OP Units in accordance with the terms of the Parent Operating Partnership Agreement;
(v) (A) grant any Person any right or option to acquire any Parent Equity Interests, (B) issue, deliver or sell any additional capital stock or other Parent Equity Interests or (C) enter into any Contract with respect to the sale, voting or registration of any capital stock or other Parent Equity Interests; provided, however, that Parent may issue Parent Common Shares upon the vesting or exercise of any Parent Equity Awards outstanding as of the date hereof in accordance with the terms and conditions thereof as in effect on the date hereof; provided, further, Parent Subsidiaries may issue equity solely to form special purpose entities that will be wholly owned directly or indirectly by Parent as may be reasonably required for the completion of a Parent Permitted Acquisition;
(vi) acquire or agree to acquire (including by merger, consolidation or acquisition of stock, equity interests or assets) any real property, personal property (other than personal property at a total cost of less than $2,000,000 in the aggregate), non-performing loans, corporation, partnership, limited liability company, other business organization or any division or material amount of assets thereof; provided, however, that any wholly owned Parent Subsidiary shall be permitted to acquire real property (via acquisition of the fee interest or the equity interest in the entity which owns the fee interest) in the ordinary course of business consistent with past practice with an aggregate value of up to $30,000,000 per month (each such acquisition, together with any other acquisitions identified on Section 6.2 of the Parent Disclosure Letter, a “Parent Permitted Acquisition”);
(vii) sell, pledge, assign, transfer, dispose of or encumber, or effect a deed in lieu of foreclosure with respect to, any Parent Owned Property or other Parent tangible assets of Parent or any Parent SubsidiariesSubsidiary, except (A) pledges and encumbrances on property and assets in the ordinary course of business consistent with past practices and that would not be material to any Parent Owned Property, and (B) with respect to any tangible property or assets with a net book value of less than $20,000,000 per month in the aggregate;
(viii) incur, create, assume, refinance, replace or prepay any Indebtedness for borrowed money or issue or amend the terms of any Indebtedness or other debt securities or assume, guarantee or endorse, or otherwise become responsible (whether directly, contingently or otherwise) for the Indebtedness of any other Person (other than a wholly owned Parent Subsidiary), except (A) Indebtedness under Parent’s existing revolving credit facilities for working capital purposes in the ordinary course of business consistent with past practice (including to the extent necessary to pay dividends permitted under this Agreement) in an aggregate amount not to exceed $100,000,000 per quarter, or (B) unsecured, unsubordinated Indebtedness to or among Parent and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice practice;
(ix) make any loans, advances or capital contributions to, or investments in, any other Person (including to any of its officers, directors, affiliates, agents or consultants), make any change in its existing borrowing or lending arrangements for or on behalf of such Persons, or enter into any “keep well” or similar agreement to maintain the financial condition of another entity, other than (A) by Parent or a wholly owned Parent Subsidiary to Parent or another a wholly owned Parent Subsidiary, (B) loans or advances required to be made under any of the existing Parent Leases, Parent Residential Leases or ground leases affecting the Parent Properties, or (C) loans or advances to non-affiliate borrowers in the ordinary course of business with a principal amount of up to $1,000,000 (any such loan also constituting a Parent Permitted Acquisition);
(bx) splitenter into, combinerenew, reduce materially modify or reclassify any of its issued or unissued sharesamend, terminate, or issue waive, release, compromise or authorize assign any rights or claims under, any Parent Material Contract (or any contract that, if existing as of the date hereof, would be a Parent Material Contract), other than (A) any termination or renewal in accordance with the terms of such existing Parent Material Contract that occur automatically without any action by Parent or any Parent Subsidiary, (B) the entry into any modification or amendment of, or waiver or consent under, any mortgage, deed of trust, deed to secure debt, similar agreement, or related agreement to which Parent or any Parent Subsidiary is a party as required or necessitated by this Agreement or the Transactions; provided, however, that any such modification, amendment, waiver or consent does not increase the principal amount thereunder or otherwise adversely affect Parent, any Parent Subsidiary or Company in any material respect, (C) as necessary to comply with the terms of this Agreement or (D) modifications, amendments, terminations, waivers, releases, compromises or assignments of rights or claims, in each case that are not material and are made in the ordinary course of business and consistent with past practices;
(xi) waive, release, assign, commence, settle or compromise any pending or threatened Legal Proceeding (A) of or against Parent or Parent Subsidiaries or (B) involving any present, former or purported holder or group of holders of the Parent Common Shares, that in the case of (A) or (B), (1) requires payment by Parent of an amount in excess of $1,000,000 in the aggregate or that would require the issuance of any other securities Parent Common Shares, (2) entails the incurrence of any obligation or liability of Parent in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation excess of such transactionamount, including costs or revenue reductions or obligations that would impose any material restrictions on the business or operations of Parent or Parent Subsidiaries, (3) imposes any material non-monetary relief or an admission of material liability or wrong doing or that would result in any supplement, modification to or amendment of the terms of (a) the Contribution Agreement or any agreement or document relating to the Transactions of which neither the Company, any Company Investor nor their respective affiliates is party or (b) any Parent Material Contract that would not otherwise be permitted pursuant to sub-clause (x) of this Section 6.2(b);
(cxii) authorize fail to maintain all financial books and records in all material respects in accordance with GAAP (or announce an intention any interpretation thereof concurred with by Parent’s independent auditors) or make any material change to authorizeits methods of accounting in effect at December 31, 2014, except as required by a change in GAAP (or any interpretation thereof concurred with by Parent’s independent auditors) or in applicable Law, or enter into agreements providing formake any change with respect to accounting policies, any acquisitions of a substantial equity interest in unless required by GAAP or a substantial portion of the assets of any Person SEC or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, disclosed in any case, would reasonably be expected Parent SEC Document filed prior to prevent or materially delay or impede the consummation of the Transactionsdate hereof;
(dxiii) amend the Parent Governing Documents or permit Merger Sub or enter into any Significant Subsidiary new line of Parent to adopt any amendments to its governing documentsbusiness;
(exiv) issueform any new funds, deliver, grant, sell, pledge, dispose of joint ventures or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities non-traded real estate investment trusts or other equity interest pooled investment vehicles;
(xv) waive, release, assign any material rights or claims or make any payment, direct or indirect, of any liability of Parent or any Parent Subsidiary before the same comes due in accordance with its terms, other than in the ordinary course of business consistent with past practice;
(xvi) except as otherwise required pursuant to any written agreement or Benefit Plan as in existence on the date hereof or as otherwise required hereunder, (A) hire or terminate (other than termination for cause) any employee, officer, executive officer or director of Parent or any Parent Subsidiary or promote or appoint any securities convertible into Person to a position of executive officer or exchangeable for director of Parent or any such sharesParent Subsidiary, voting securities or equity interest(B) increase, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or accelerate the vesting or settlement payment of, compensation or other benefits payable or provided to Parent’s directors or executive officers, or (C) enter into, materially amend or adopt any Benefit Plan; provided, however, that clauses (A) through (C) above shall not restrict any payment permitted by Section 4.01(k) of the Contribution Agreement;
(xvii) take or fail to take any action, which action or failure would reasonably be expected to cause (A) Parent Equity Awardsto fail to qualify as a REIT or (B) any Parent Subsidiary to cease to be treated as any of (x) a partnership or disregarded entity for United States federal income tax purposes or (y) a REIT, a Qualified REIT Subsidiary or a Taxable REIT Subsidiary under the applicable provisions of Section 856 of the Code, as the case may be;
(xviii) (A) make, change or rescind any material election relating to Taxes, (iiB) transactions between change a material method of Tax accounting, (C) amend any material Tax Return, (D) settle or compromise any material federal, state, local or foreign Tax liability, audit, claim or assessment, (E) enter into any material closing agreement related to Taxes, (F) knowingly surrender any right to claim any material Tax refund, or (G) give or request any waiver of a statute of limitation with respect to any material Tax Return, except in each case as reasonably necessary to (1) comply with Law or (2) (x) preserve Parent’s qualification as a REIT under the Code or (y) to qualify or preserve the status of any Parent and Subsidiary as a wholly owned disregarded entity or partnership for United States federal income tax purposes or as a REIT, Qualified REIT Subsidiary or a Taxable REIT Subsidiary under the applicable provisions of Section 856 of the Code, as the case may be;
(xix) adopt a plan of merger, complete or partial liquidation or resolutions providing for or authorizing such merger, liquidation or a dissolution, consolidation, recapitalization or bankruptcy reorganization, except in connection with a Parent Permitted Acquisition;
(xx) amend or modify the engagement letters entered into with the Parent Financial Advisor or the Persons listed on Section 5.26 of the Parent Disclosure Letter, in a manner adverse to Parent, any Parent Subsidiary or between wholly owned Parent SubsidiariesCompany, (iii) issuances of Parent Equity Awards, (iv) or engage other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than financial advisers in connection with the Financing; orTransactions;
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (ivxxi) other acquisitions than as permitted clause (vi) above, make or commit to make any recurring capital expenditures that are in excess of shares of Parent Stock for an amount not exceeding $100,000,000 15,000,000 per quarter in the aggregate;
(gxxii) make take any action under the Parent Governing Documents or change any material Tax electionotherwise (including by resolution) that would give dissenters’, change any Tax accounting period for purposes of a material Tax appraisal or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating similar rights to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for Common Shares with respect to the purpose of revoking Merger or varying the authority of the directors of Parent to allot Parent Stockother Transactions; or
(ixxiii) agreeauthorize, in writing or otherwiseenter into any contract, agreement or binding commitment or arrangement to take do any of the foregoing actionsforegoing. Notwithstanding anything to the contrary set forth in this Agreement, nothing in this Agreement shall prohibit Parent from taking any action, at any time or from time to time, that in the reasonable judgment of the Parent Board of Trustees, upon advice of counsel to Parent, is reasonably necessary for Parent to maintain its qualification as a REIT under the Code for any period or portion thereof ending on or prior to the Merger Effective Time, including making dividend or other distribution payments to shareholders of Parent in accordance with this Agreement or otherwise. If Parent proposes any such action, it shall notify Company as soon as reasonably practicable prior to the taking of such action.
Appears in 2 contracts
Sources: Merger Agreement (Starwood Waypoint Residential Trust), Merger Agreement (Colony Capital, Inc.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between (a) From and after the date execution of this Agreement and until the earlier of the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, except as required by Law, or as expressly contemplated or permitted elsewhere in this Agreement, or as set forth in Section 5.2 of the Parent Disclosure Letter, or with the prior written consent of the Company (such consent not to be unreasonably withheld, conditioned or delayed), Parent shall, and shall cause each of its Subsidiaries to, conduct its business in the ordinary course of business in all material respects; provided, however, that no action by Parent or its Subsidiaries with respect to matters specifically addressed by any provision of Section 5.2(b) shall be deemed a breach of this sentence unless such action would constitute a breach of such relevant provision of Section 5.2(b).
(b) At all times from and after the execution of this Agreement until the earlier of the Effective Time and the date, if any, on which this Agreement is terminated pursuant to Section 8.1, except as required by Law, or as expressly contemplated or permitted elsewhere in this Agreement, or as set forth in Section 5.2 of the Parent Disclosure Letter, or as required to fulfill its obligations under any Parent Tax Sharing Agreement or any ruling received from, or agreement entered into with, any Tax authority (in each case, (x) prior to the date of this Agreement or (y) after the date of this Agreement in accordance with the terms of this Agreement), or any action necessary to resolve or settle any Tax audit, litigation or similar proceeding, or with the prior written consent of the Company (such consent not to be unreasonably withheld, conditioned or delayed), Parent:
(i) shall not, and shall not permit any Parent Subsidiary of its Subsidiaries that is not wholly owned to:
(a) , authorize or pay any dividends on or make any distribution with respect to its the outstanding shares in its capital (whether in cash, assets, stock shares or other securities of Parent or Parent its Subsidiaries), except (A) regular quarterly cash dividends on the Parent Shares and Parent Equity Awards of not more than $0.205 per share per quarter, consistent with past practice as to timing of declaration, record date and payment date and (B) dividends and distributions paid or made on a pro rata basis by Parent its Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiarybusiness;
(bii) shall not, and shall not permit any of its Subsidiaries to, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation, dissolution, consolidation, restructuring, recapitalization or other reorganization, in each case, except for any such transaction involving only the direct or indirect wholly owned Subsidiaries of Parent (other than Merger Sub);
(iii) shall not, and shall not permit any of its Subsidiaries to, split, combine, reduce combine or reclassify any of its issued or unissued sharesshares of capital in issue, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, shares in its sharescapital, in each case, except for any such transaction by a wholly owned Subsidiary of Parent Subsidiary which remains a wholly owned Subsidiary of the Parent Subsidiary after consummation of such transaction;
(civ) authorize shall not, and shall not permit any of its Subsidiaries to, (A) grant any Parent Equity Awards or announce an intention any other equity-based awards (other than as permitted by Section 5.2 of the Parent Disclosure Letter) or non-equity based long-term incentive awards, (B) increase the compensation, bonus or pension, welfare, severance or other benefits to authorizebe paid or provided to any employee of Parent or any of its Subsidiaries who is a participant in the Change of Control Severance Plan for Certain U.S. Officers and Executives, (C) enter into any employment, change of control, severance or retention agreement with any director, officer or employee of Parent or any of its Subsidiaries, other than (1) employment agreements terminable on less than thirty (30) days’ notice without penalty or liability and (2) employment agreements with employees in non-U.S. jurisdictions, in the case of each of subclauses (1) and (2), entered into in the ordinary course of business and consistent with past practice and applicable Law, (D) terminate the employment of any “executive officer”, within the meaning of Rule 3b-7 of the Exchange Act of Parent, other than for cause, (E) amend any performance targets with respect to any outstanding bonus or equity awards, (F) amend the funding obligation or contribution rate of any Parent Benefit Plan or change any underlying assumptions used to calculate benefits payable under any Parent Benefit Plan (except as may be required by GAAP or other applicable accounting standard), (G) establish, adopt, enter into, amend or terminate a Parent Benefit Plan or any other plan, trust, fund, policy or arrangement for the benefit of any current or former directors, officers or employees or any of their beneficiaries, other than (1) amendments in the ordinary course of business consistent with past practice that neither contravene the other covenants set forth in this Section 5.2(b)(iv) nor materially increase the cost to Parent of maintaining such Parent Benefit Plan or other plan, trust, fund, policy or arrangement) or (2) entering into third-party Contracts for the provision of services to such Parent Benefit Plans, including benefit administration, or (H) take any action to accelerate the vesting or payment, or fund or in any way secure the payment, of compensation or benefits under any Parent Benefit Plan, except, in the case of each of subclauses (A) through (H) of this Section 5.2(b)(iv), (x) in the ordinary course of business consistent with past practice, upon five (5) business days’ prior written notice to the Company, (y) as required by existing written agreements or Parent Benefit Plans in effect as of the date of this Agreement, or (z) as otherwise required by applicable Law;
(v) shall not, and shall not permit any of its Subsidiaries to, hire any officer, Band 1 executive or functional Band 2 executive or above, other than (A) employees hired pursuant to offers of employment outstanding on the date hereof, (B) employees hired or promoted to fill open positions in the ordinary course of business, consistent with past practice, or (C) for positions described on Section 5.2(b)(v) of the Parent Disclosure Letter;
(vi) shall not, and shall not permit any of its Subsidiaries to, make any change in financial accounting policies or procedures or any of its methods of reporting income, deductions or other material items for financial accounting purposes, except as required by GAAP, applicable Law or SEC policy;
(vii) shall not, and shall not permit any of its Subsidiaries to, enter into agreements providing forwith respect to or consummate (other than pursuant to Contracts in effect as of the date hereof that have been previously disclosed to the Company prior to the date hereof), any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case thereof (whether by merger, consolidation, business combination, acquisition of stock or assets or formation of a joint venture or otherwise thatsimilar agreements), in any each case, except (A) in respect of any transactions between or among Parent and its wholly owned Subsidiaries or among Parent’s wholly owned Subsidiaries, or (B) for amounts (including assumption of liabilities) that do not exceed $250,000,000 individually or $500,000,000 in the aggregate, unless, in the case of each of subclauses (A) and (B), such transaction would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(dviii) shall not amend the Parent Memorandum and Articles of Association (other than the Parent Governing Documents or Amendment), and shall not permit Merger Sub or any of its Significant Subsidiary of Parent Subsidiaries to adopt any material amendments to its governing organizational documents;
(eix) shall not, and shall not permit any of its Subsidiaries to, issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any sharesshares in its capital, voting securities or other equity interest in the Parent or any Parent Subsidiary Subsidiaries or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such sharesshares in its capital, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock stock-based performance units, or take any action to cause to be vested or exercisable any otherwise unvested or unexercisable Parent Equity Award under any existing Parent Equity Plan (except as otherwise provided by the express terms of any Parent Benefit Plan outstanding on the date hereof and in accordance with their present terms), other than (iA) issuances of Parent Shares in respect of any exercise of Parent stock options Share Options or the vesting or settlement of Parent Equity AwardsAwards outstanding on the date hereof and in accordance with their present terms or permitted to be granted after the date hereof in accordance with the terms of this Agreement, (iiB) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances grants of Parent Equity Awards, in each case, as may be permitted by Section 5.2(b)(iv)(A), (ivC) other issuances of shares withholding of Parent Stock for Shares to satisfy Tax obligations pertaining to the exercise of Parent Share Options or the vesting or settlement of Parent Equity Awards or to satisfy the exercise price with respect to Parent Share Options or to effectuate an amount not exceeding $100,000,000 in the aggregate optionee direction upon exercise, (D) stock fund transactions under Parent Benefit Plans that are qualified or supplemental savings plans and (vE) other than in connection with the Financing; ortransactions among Parent and its wholly owned Subsidiaries or among Parent’s wholly owned Subsidiaries;
(fx) shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (iA) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto or (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iiiB) transactions between the among Parent and a its wholly owned Parent Subsidiary Subsidiaries or between among Parent’s wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregateSubsidiaries;
(gxi) make shall not, and shall not permit any of its Subsidiaries to, (I) redeem, repurchase, prepay (other than prepayments of revolving loans), defease, incur, assume, endorse, guarantee or change otherwise become liable for or modify in any material Tax electionrespects the terms of any indebtedness for borrowed money or issue or sell any debt securities or calls, change options, warrants or other rights to acquire any Tax accounting period for purposes of a material Tax debt securities (directly, contingently or material method of Tax accountingotherwise), file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxesincluding off-balance sheet arrangements, except for (A) any transactions among Parent and its wholly owned Subsidiaries, (B) guarantees of indebtedness for borrowed money of Parent Subsidiaries or guarantees by Parent Subsidiaries of indebtedness for borrowed money of Parent or any Parent Subsidiary, which indebtedness is incurred in compliance with this Section 5.2(b)(xi), (C) issuances of commercial paper by Parent or any of its Subsidiaries backed by the existing credit facilities of Parent or the Parent Subsidiaries as in effect on the date of this Agreement, (D) borrowings under existing credit facilities of Parent or its Subsidiaries as in effect on the date of this Agreement solely to fund operating expenses in the ordinary course of business, agree (E) repayments of indebtedness at the stated maturity of such indebtedness and required amortization or mandatory prepayments, (F) indebtedness for borrowed money incurred to replace, renew, extend or refinance any existing indebtedness for borrowed money of Parent or any of its Subsidiaries, in each case in an extension or waiver amount not to exceed the amount of the statute of limitations with respect to a material indebtedness replaced, renewed, extended or refinanced (plus interest and premium, if any, thereon and the amount of Taxes, enter into any “closing agreement” within reasonable refinancing fees and expenses incurred in connection therewith) and on terms that are no less favorable to Parent or such Subsidiary than the meaning of Section 7121 terms of the Code indebtedness replaced, renewed, extended or refinanced, or (G) indebtedness for borrowed money not to exceed $100,000,000 in aggregate principal amount and with maturities of one hundred eighty (180) days or less that may be incurred or repaid by Parent or any of its Subsidiaries other than in accordance with subclauses (A) – (F), in each case of subclauses (B), (C), (F) and (G), that do not (1) require the Company or any of its Subsidiaries to guarantee, grant liens on their respective properties or assets or otherwise provide, directly or indirectly, credit or collateral support, whether prior to or after the Effective Time, for such indebtedness or securities (or any similar provision of state, localrights to acquire such securities), or non-U.S. Law(2) with respect to contain any material Taxrepresentations, warranties, covenants or events of default, or surrender any right other terms or conditions, in each case, that would apply, or would reasonably be expected to claim a material Tax refundapply, to the Company, any of its Subsidiaries or any of their respective properties or assets, whether prior to or after the Effective Time; provided that nothing contained in this Section 5.2(b)(xi) shall prohibit Parent and its Subsidiaries from making guarantees or obtaining letters of credit or surety bonds for the benefit of commercial counterparties in the ordinary course of business, or (II) incur, assume, endorse, guarantee or otherwise become liable for any indebtedness or borrowed money or issue or sell any debt securities or calls, options, warrants or other rights to acquire any debt securities (directly, contingently or otherwise) that would (1) require the Company or any of its Subsidiaries to guarantee, grant liens on their respective properties or assets or otherwise provide, directly or indirectly, credit or collateral support, whether prior to or after the Effective Time, for such indebtedness or securities (or rights to acquire such securities), or (2) contain any representations, warranties, covenants or events of default, or any other terms or conditions, in each case, that would apply, or would reasonably be expected to apply, to the Company, any of its Subsidiaries or any of their respective properties or assets, whether prior to or after the Effective Time;
(hxii) convene shall not, and shall not permit any meeting of its Subsidiaries to, make any loans to any other Person involving in excess of $200,000,000 in the holders aggregate (including any loans to non-wholly owned Subsidiaries, joint ventures or third parties), of which no more than $50,000,000 may be made to third parties, except for loans among Parent and its wholly owned Subsidiaries or among Parent’s wholly owned Subsidiaries;
(xiii) shall not, and shall not permit any of its Subsidiaries to, sell, lease, license, transfer, exchange, swap or otherwise dispose of, or subject to any Lien (other than Parent Permitted Liens), any of its material properties or assets (including shares in the capital of its or their Subsidiaries), except (A) in the case of Liens, as required in connection with any indebtedness permitted to be incurred pursuant to Section 5.2(b)(xi), but only to the extent such indebtedness is incurred to replace, renew, extend, refinance or refund any existing indebtedness currently subject to a Lien of no greater amount, (B) for (1) dispositions of inventory and obsolete equipment in the ordinary course of business and (2) sales of goods and services in the ordinary course of business, (C) for transactions involving less than $100,000,000 individually or $300,000,000 in the aggregate, (D) for non-exclusive licenses to contractors of Parent Stock or its Subsidiaries for purposes of enabling such contractors to provide services to Parent or its Subsidiaries, as applicable, in the purpose ordinary course of revoking business, (E) for non-exclusive licenses of Intellectual Property in the ordinary course of business or varying the authority of the directors of (F) for transactions among Parent to allot Parent Stock; orand its wholly owned Subsidiaries or among Parent’s wholly owned Subsidiaries;
(ixiv) agreeshall not, and shall not permit any of its Subsidiaries to, compromise or settle any material claim, litigation, investigation or proceeding (other than any claim, litigation, investigation, audit or other proceeding in respect of Taxes), in writing each case made or otherwise, to take pending against Parent or any of the foregoing actions.it
Appears in 2 contracts
Sources: Merger Agreement (TYCO INTERNATIONAL PLC), Merger Agreement (Johnson Controls Inc)
Conduct of Business by Parent Pending the Closing. Parent agrees that that, between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Time, except (a) as set forth in Section 5.2 of the Parent Disclosure LetterSchedule, (b) as specifically required permitted or contemplated by any other provision of this Agreement, (c) Agreement or as required by applicable Law or (d) as consented to the regulations or requirements of the Nasdaq, unless the Company shall otherwise agree in writing by the Company (which consent shall not be unreasonably withheld, delayed withheld or conditioneddelayed), Parent (i) shall will, and shall will cause each Parent Subsidiary to, (A) conduct its business in all material respects operations in the ordinary course of business substantially consistent with past practice, including by using practice and (B) use its reasonable best efforts to preserve substantially intact its business organization, goodwill and their present business organizations and to preserve its and their present relationships with Governmental Entities and with its material customers, suppliers material suppliers, key employees and other Persons with whom it and they have material business relations; providedregulatory authorities. Without limiting the foregoing, howeverexcept as set forth in Section 5.2 of the Parent Disclosure Schedule, that no action that is specifically as permitted or contemplated by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date other provision of this Agreement and the Effective Time or as required by applicable Law or the date, if any, on which this Agreement is terminated pursuant to Section 8.1regulations or requirements of the Nasdaq, Parent shall not, and shall not permit any Parent Subsidiary to:, between the date of this Agreement and the Effective Time, directly or indirectly, do, or agree to do, any of the following without the prior written consent of the Company (which consent shall not be unreasonably withheld or delayed):
Section 5.2.1 amend its articles of incorporation or bylaws or equivalent organizational documents;
Section 5.2.2 issue or authorize the issuance of any shares of Parent Common Stock or securities convertible or exchangeable or exercisable for any shares of Parent Common Stock, or any options, warrants or other rights of any kind to acquire any shares of Parent Common Stock, other than (a) authorize the authorization or pay issuance of Parent Common Stock or securities convertible or exchangeable or exercisable for any dividends shares of Parent Common Stock, or any options, warrants or other rights of any kind to acquire any shares of Parent Common Stock to the employees or directors of Parent or the Parent Subsidiaries in connection with compensation and benefits arrangements, including in connection with salary stock arrangements in effect on the date of this Agreement (which may be continued at their current levels through the Effective Time at Parent’s sole discretion), (b) without limiting the generality of the preceding clause, the authorization or make issuance of Parent Common Stock upon the exercise of Parent Options or warrants outstanding on the date hereof (including the TARP Warrant), (c) the authorization or issuance of Parent Common Stock as may be necessary or desirable to obtain the consent or approval of any distribution Governmental Authority with respect to its outstanding shares the Merger and the transactions contemplated hereby, or as may be otherwise necessary or desirable to maintain an appropriate amount of regulatory capital in connection with the consummation of the Merger and the transactions contemplated hereby, (whether d) the authorization or issuance of Parent Common Stock in cashaccordance with the provisions of Article II in connection with the consummation of the Merger, assetsand (e) to the extent permitted under Section 5.2.6;
Section 5.2.3 sell, stock pledge, dispose of, transfer, lease, license, guarantee or other securities encumber, or authorize the sale, pledge, disposition, transfer, lease, license, guarantee or encumbrance of, any material property or assets of Parent or any Parent Subsidiaries)Subsidiary, except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent business;
Section 5.2.4 declare, set aside, make or pay any dividend or other distribution (whether payable in cash, stock, property or a combination thereof), with past practice or respect to any of its capital stock other than (A) dividends paid by a wholly owned Parent Subsidiary to Parent or another any other wholly owned Parent Subsidiary or (B) quarterly dividends at or below the rate paid to shareholders in 2011;
Section 5.2.5 other than in the case of a wholly owned Parent Subsidiary;
(b) split, reclassify, combine, reduce split, subdivide or reclassify redeem, purchase or otherwise acquire, directly or indirectly (other than cashless exercise of Parent Options), any of its issued capital stock, other Equity Interests or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transactionsecurities;
Section 5.2.6 acquire (c) authorize or announce an intention to authorizeincluding, or enter into agreements providing forwithout limitation, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, or acquisition of stock or assets) any interest in any person or any assets or formation in any transaction that would require the approval of a joint venture or otherwise thatBanking Authority, other than acquisitions pursuant to which the consideration to be paid by the Parent and the Parent Subsidiaries therefor, in any casethe aggregate, is less than $250,000,000 (in cash or securities of Parent) that would not reasonably be expected to impede or delay the receipt of any Necessary Governmental Approval in any material respect;
Section 5.2.7 take any action that would prevent or the Merger from qualifying as a reorganization within the meaning of Section 368(a) of the Code;
Section 5.2.8 take any action that would be reasonably likely to materially delay or impede the consummation effectiveness of the TransactionsRegistration Statement;
Section 5.2.9 settle or compromise any pending or threatened suit, action or claim relating to the transactions contemplated hereby;
Section 5.2.10 (dA) amend incur, assume or prepay any long-term or short-term debt or issue any debt securities, except for borrowings or prepayments under existing lines of credit or in the ordinary course of business and refinancing of existing indebtedness (it being understood that incurrence or prepayment of indebtedness in the ordinary course of business of Parent Governing Documents Bank includes deposits, FHLB borrowings, repurchase agreements and similar liabilities in the ordinary course of Parent Bank’s business consistent with past practice) and except for borrowings solely for the purpose of satisfying Parent’s obligations under Sections 2.1.5 and 5.19; or permit Merger Sub (B) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for any material obligations of any other person, except for obligations of Parent or any Significant wholly owned Parent Subsidiary of Parent to adopt any amendments to its governing documentsincurred in compliance with clause (A);
(e) issueSection 5.2.11 make, deliverchange or rescind any Tax election, grantchange a Tax accounting period, selladopt or change any Tax accounting method, pledgefile any amended Tax Return, dispose of enter into any Tax closing agreement, settle any Tax claim or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in assessment relating to the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire surrender any shares in its capital or any rights, warrants or options right to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and claim a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount refund of Taxes, except in the ordinary course of business, agree consent to an extension or waiver of the statute of limitations with respect applicable to any Tax, or take any similar action, except in each case for any such actions that would not reasonably be expected to have, individually or in the aggregate, a material amount Parent Material Adverse Effect, taking into account the relative benefits of Taxes, taking any such action; or
Section 5.2.12 authorize or enter into any “closing agreement” within the meaning of Section 7121 of the Code (agreement or otherwise make any similar provision of state, local, or non-U.S. Law) with respect commitment to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take do any of the foregoing actionsforegoing.
Appears in 2 contracts
Sources: Merger Agreement (Citizens Republic Bancorp, Inc.), Merger Agreement (Firstmerit Corp /Oh/)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement hereof and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 earlier of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is validly terminated pursuant to Section 8.18.1 except as set forth in Section 5.2 of the Parent Disclosure Letter, as specifically permitted or required by this Agreement, as required by applicable Law or as consented to in writing by the Company (such consent not to be unreasonably withheld, conditioned or delayed), Parent shall not, and shall not permit any cause each Parent Subsidiary not to, directly or indirectly:
(a) authorize amend, modify, waive, rescind, change or otherwise restate the Parent Governing Documents (whether by merger, consolidation, operation of law or otherwise) in a manner that would materially and adversely affect the Company Stockholders, or adversely affect the Company Stockholders relative to other holders of Parent Class A Common Stock;
(b) authorize, declare, set aside, make or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, stock or other securities of Parent or any Parent SubsidiariesSubsidiary), except (i) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice by the Parent Subsidiaries to Parent or by a any other wholly owned Parent Subsidiary and (ii) for transactions that would require an adjustment to Parent or another wholly owned Parent Subsidiarythe Merger Consideration pursuant to Section 2.1(d) and for which the proper adjustment is made;
(bc) split, combine, subdivide, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its sharescapital stock, except for (i) any such transaction by a involving only wholly owned Parent Subsidiary Subsidiaries, and (ii) any transactions that would require an adjustment to the Merger Consideration pursuant to Section 2.1(d) and for which remains a wholly owned Parent Subsidiary after consummation of such transactionthe proper adjustment is made;
(cd) authorize adopt a plan of complete or partial liquidation or dissolution with respect to Parent, Merger Sub or any direct or indirect parent entity of Merger Sub;
(e) acquire (including by merger, consolidation or acquisition of stock or assets or any other means) or publicly announce an intention to authorizeso acquire, or enter into any agreements providing forfor any acquisitions of, any acquisitions of a substantial equity interest interests in or a substantial material portion of the assets of any Person (or any business or division thereof, in each case whether ) set forth on Section 5.2(e) of the Parent Disclosure Letter that (i) would require (A) the filing by merger, consolidation, combination, acquisition of stock Parent or assets or formation any Parent Subsidiaries of a joint venture Notification and Report Form pursuant to the HSR Act with respect to such acquisition or otherwise that(B) any pre-closing approvals, in consents, waivers or clearances under any case, Antitrust Laws of the jurisdictions set forth on Section 7.1(d)(ii) or Section 7.1(d)(iii) of the Parent Disclosure Letter with respect to such acquisition and (ii) would reasonably be expected to prevent under applicable Antitrust Law in the United States or materially delay in the jurisdictions specified in Section 7.1(d)(ii) or impede the consummation Section 7.1(d)(iii) of the Transactions;
Parent Disclosure Letter to (dand actually does) amend cause material additional substantive review of the Merger that would prevent (A) any waiting period (or extensions thereof) applicable to the Transactions under the HSR Act from expiring or terminating prior to the Outside Date or (B) Parent or Purchaser from obtaining, prior to the Outside Date, any of the required pre-closing approvals, consents, waivers or clearances applicable to the Transactions under any Antitrust Laws of the jurisdictions set forth on Section 7.1(d)(ii) or Section 7.1(d)(iii) of the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary Disclosure Letter; provided that in no event shall a breach of Parent to adopt any amendments to its governing documents;
(ethis Section 5.2(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable constitute a “willful breach” for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financingpurpose under this Agreement; or
(f) directly agree or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agreeauthorize, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Merger Agreement (Zoom Video Communications, Inc.), Merger Agreement
Conduct of Business by Parent Pending the Closing. Parent agrees that that, between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Time, except (ai) as set forth in Section 5.2 6.02 of the Parent Disclosure LetterSchedule, (bii) for any actions taken by Parent relating to any other acquisitions or business combinations (including, without limitation, the Nectarine Merger) or (iii) as specifically required expressly contemplated by any other provision of this Agreement, (c) as required by Law or (d) as consented to in writing by unless the Company shall otherwise agree in writing, (which consent x) the respective businesses of Parent and the Parent Subsidiaries shall be conducted only in, and Parent and the Parent Subsidiaries shall not be unreasonably withheldtake any action except in, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using practice and (y) Parent shall use all reasonable best efforts to preserve intact its keep available the services of such of the current officers, significant employees and their present business organizations consultants of Parent and the Parent Subsidiaries and to preserve its the current relationships of Parent and their present relationships the Parent Subsidiaries with Governmental Entities and with such of the corporate partners, customers, suppliers and other Persons persons with whom it which Parent or any Parent Subsidiary has significant business relations in order to preserve substantially intact its business organization. By way of amplification and they have material business relations; providednot limitation, however, that no action that is specifically permitted by any of clauses (a) through except (i) as set forth in Section 6.02 of Section 5.2(ii) shall be deemed a breach of this clause (i)the Parent Disclosure Schedule, and (ii) agrees that for any actions taken by Parent relating to any other acquisitions or business combinations (including, without limitation, the Nectarine Merger) or (iii) as expressly contemplated by any other provision of this Agreement, neither Parent nor any Parent Subsidiary shall, between the date of this Agreement and the Effective Time Time, directly or indirectly, do, or agree to do, any of the datefollowing without the prior written consent of the Company, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and consent shall not permit any Parent Subsidiary tobe unreasonably withheld or delayed:
(a) authorize amend or otherwise change its certificate of incorporation or bylaws or equivalent organizational documents;
(b) declare, set aside, make or pay any dividends on dividend or make any distribution other distribution, payable in cash, stock, property or otherwise, with respect to any of its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries)capital stock, except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned that any Parent Subsidiary may pay dividends or make other distributions to Parent or another wholly owned any other Parent Subsidiary;
(bc) splitreclassify, combine, reduce split, subdivide or reclassify any of its issued or unissued sharesredeem, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture purchase or otherwise thatacquire, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in of its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregatestock;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 2 contracts
Sources: Agreement and Plan of Merger and Reorganization (Sun Healthcare Group Inc), Agreement and Plan of Merger and Reorganization (Sun Healthcare Group Inc)
Conduct of Business by Parent Pending the Closing. Parent covenants and agrees that that, between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Time, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) Schedules or as specifically required expressly contemplated by any other provision of this Agreement, (c) Agreement or as required by applicable Law (provided, that if Parent or (d) as consented any member of the Parent Group is required by applicable Law to take an action in writing conflict with this Section 5.2, Parent will, to the extent permitted by Law, provide the Company with written notice in advance of taking such action), unless the Company provides prior written consent (which consent shall will not be unreasonably withheld, delayed or conditioned), Parent (i) shall will conduct and shall cause each member of the Parent Subsidiary to, Group to conduct its business in all material respects operations in the ordinary course of business consistent with past practice, including by using and use commercially reasonable best efforts to (i) preserve substantially intact its business organization, (ii) keep available the services of its executive officers and their present key employees on commercially reasonable terms, (iii) maintain in effect all Parent Permits, (iv) remain in compliance in all material respects with the Parent Treasury Restrictions and (v) maintain satisfactory relationships of the Parent Group with any persons with which the Parent Group has material business organizations relations and to preserve its and their present relationships with Governmental Entities that have jurisdiction over its business and with customersoperations. Without limiting the foregoing, suppliers and as an extension thereof, except as set forth in Section 5.2 of the Parent Disclosure Schedule or as expressly contemplated by any other Persons with whom it and they have material business relations; provision of this Agreement or as required by applicable Law (provided, howeverthat if Parent or any other member of the Parent Group is required by applicable Law to take an action in conflict with this Section 5.2, that no action that is specifically Parent will, to the extent permitted by any Law, provide the Company with written notice in advance of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (itaking such action), and (ii) agrees that Parent will not, between the date of this Agreement and the Effective Time Time, directly or indirectly, do, or agree to do, or permit any other member of the dateParent Group to do, if anyor agree to do, on any of the following without the prior written consent of the Company (which this Agreement is terminated pursuant consent will not be unreasonably withheld, delayed or conditioned, except with respect to Section 8.15.2(a), Parent shall not(b), (d), (e) and shall not permit any Parent Subsidiary to:(h), which may be granted or withheld in the Company’s sole discretion):
(a) amend the certificate of incorporation or by-laws of Parent;
(b) issue, sell, pledge, dispose of, grant, transfer or encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, or pay encumbrance of, any dividends on shares of capital stock of, or make other Equity Interests in, any distribution with respect to its outstanding member of Parent Group of any class, or securities convertible into, or exchangeable or exercisable for, any shares (whether in cash, assets, of such capital stock or other securities Equity Interests, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or other Equity Interests or such convertible or exchangeable securities, or any other ownership interest (including any such interest represented by Contract right), of any member of Parent Group, other than (i) the issuance of Shares upon the vesting of Parent RSU Awards outstanding as of the date hereof in accordance with their terms, (ii) the issuance of Shares upon the exercise of the Parent Options, (iii) the issuance of Shares upon the exercise of the Parent Warrants, (iv) the issuance or transfer of Equity Interests of a member of Parent Subsidiaries)Group to another member of Parent Group or (v) as set forth on Section 5.2(b) of the Company Disclosure Schedule;
(c) sell, except dividends and distributions paid pledge, abandon, dispose of, transfer, lease, license or made on a pro rata basis by encumber (other than pursuant to Permitted Liens) any material Trademarks or material property or assets of Parent Subsidiaries Group (other than non-exclusive grants of licenses in Intellectual Property Rights in the ordinary course of business consistent with past practice business), except pursuant to, or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiaryas required by, Contracts in effect as of the date of this Agreement;
(bd) splitdeclare, set aside, make or pay any dividend or other distribution (whether payable in cash, stock, property or a combination thereof) with respect to any of Parent’s capital stock or enter into any agreement with respect to the voting or registration of its capital stock;
(e) reclassify, combine, reduce split, subdivide or reclassify amend the terms of, or redeem, purchase or otherwise acquire, directly or indirectly, any of its issued Parent’s capital stock, other Equity Interests or unissued sharesany other securities, or issue authorize or authorize propose the issuance of any other securities in respect of, in lieu of or in substitution for, for shares of its sharescapital stock or other securities, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary cashless settlements and purchases of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize Common Stock in connection with the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options Options or the vesting or settlement of any Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary Award or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than to fund any Tax obligations in connection with the Financing; ortherewith;
(f) directly merge or indirectlyconsolidate with any Person or adopt a plan of complete or partial liquidation or resolutions providing for a complete or partial liquidation, purchasedissolution, redeem restructuring, recapitalization or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregatereorganization;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except other than in the ordinary course of business, agree acquire (including by merger, consolidation, or acquisition of stock or assets) any interest in any Person or any division thereof or any assets in an amount in excess of $5,000,000 individually or $15,000,000 in the aggregate, other than the planned purchase of aircraft and associated equipment pursuant to an extension or waiver Contracts in force on the date hereof as set forth in Section 5.1(g) of the statute Parent Disclosure Schedule;
(h) enter into any new line of limitations business;
(i) other than in the ordinary course of business, (i) repurchase, prepay or incur any indebtedness for borrowed money or issue any debt securities, or issue or sell options, warrants, calls or other rights to acquire any debt securities of any member of Parent Group, other than (A) for the financing of aircraft or associated equipment (including engines) pursuant to the Parent Aircraft Finance Contracts or which Parent is otherwise contractually obligated as of the date hereof to purchase or lease, and any pre-delivery deposits with respect to the foregoing, (B) under any Credit Card Contract, (C) in connection with the refinancing of any indebtedness or debt securities of Falcon or, in connection with Closing, Saturn in a principal amount not greater than the amount so refinanced or (D) in connection with Parent’s obligations at Closing under this Agreement, or (ii) assume, guarantee or endorse, or otherwise become liable or responsible for similar obligations contemplated in clauses (i) and (ii) of any Person for borrowed money;
(j) other than in the ordinary course of business or as otherwise required in connection Parent’s or its Affiliates’ contractual or legal obligation to negotiate in good faith with a labor union, (i) enter into or amend any collective bargaining agreement; provided, that, Parent shall use commercially reasonable efforts to keep the Company reasonably informed of material amount communications between any member of TaxesParent Group and a labor union in connection with any such negotiation or collective bargaining agreement, or (ii) implement any early retirement or separation program, or any program providing early retirement window benefits or announce or plan any such action or program for the future;
(k) enter into, terminate or materially amend any Parent Related Party Transaction;
(l) compromise, settle or agree to settle any Proceeding, other than any compromise, settlement or agreement in the ordinary course of business for the payment of monetary damages (and compliance with confidentiality and other similar customary provisions) by Parent of $5,000,000 or less as its sole remedy;
(m) (i) make, change, or revoke any material Tax election, (ii) settle or compromise any claim, assessment, audit, proceeding, or other controversy, or enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. foreign Law) with in respect to of material Taxes, (iii) adopt or change any material TaxTax accounting method or period, (iv) file or amend any material Tax Return or take any position on any material Tax Return filed on or after the date of this Agreement that is inconsistent with elections made or positions taken in preparing or filing similar Tax Returns in prior periods, (v) surrender any right to claim a material Tax refund, or (vi) consent to any extension or waiver of the statute of limitations applicable to any material Tax claim or assessment;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(in) agree, resolve, authorize or enter into any Contract or otherwise make any commitment, in writing or otherwise, each case to take do any of the foregoing actionsin clauses (a) through (m). Without limiting Section 5.2, nothing contained in this Agreement will give the Company, directly or indirectly, the right to control or direct the operations of the Parent Group prior to the Effective Time. Prior to the Effective Time, the Parent Group will exercise, consistent with the terms and conditions of this Agreement, including Section 5.2, complete control and supervision over its operations.
Appears in 1 contract
Conduct of Business by Parent Pending the Closing. During the period from the date of this Agreement to the Effective Time, Parent agrees that shall, and shall cause each of its Subsidiaries to, maintain its existence and carry on its business in the usual, regular and ordinary course in substantially the same manner has heretofore conducted and, to the extent consistent therewith, use all reasonable efforts to keep available the services of its current officers and employees and preserve its relationships with physicians, customers, suppliers, licensers, lessor, third party payors and others having business dealings with it. Except as set forth in Section 4.2 of the Parent Letter or as specifically permitted by any other provision of this Agreement, Parent shall not (unless required by applicable Law or stock exchange regulations), between the date of this Agreement and the Effective Time Time, directly or the timeindirectly, if anydo, at which this Agreement is terminated pursuant or agree to Section 8.1do, except (a) as set forth in Section 5.2 any of the Parent Disclosure Letterfollowing, (b) as specifically required by this Agreementwithout the prior written consent of the Company, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall will not be unreasonably withheld, delayed :
(a) amend or conditioned), otherwise change Parent's Amended and Restated Articles of Incorporation or Amended and Restated Bylaws in a manner that adversely affects the rights of holders of Parent Common Stock;
(ib) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course amend or otherwise change Sub's Certificate of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relationsIncorporation or Bylaws; provided, however, that no action Parent may amend or cause to be amended ARTICLE FOURTH of the Certificate of Incorporation of Sub to increase the total number of shares of common stock, $.01 par value per share, that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) Sub shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant have authority to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transactionissue;
(c) authorize declare, set aside, make or announce an intention pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of Parent's capital stock; or
(d) take any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would action that could reasonably be expected to prevent (x) make any of its representations or materially delay warranties contained in this Agreement that is qualified as to materiality untrue or impede incorrect, (y) make any of its representations or warranties contained in this Agreement that is not so qualified untrue or incorrect in any material respect or (z) result in any of the conditions to the Closing set forth in Article VI not being satisfied or in the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actionsbeing materially delayed.
Appears in 1 contract
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the date of the First Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.19.1, except (a) as set forth in Section 5.2 6.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing (including via email from the person named in Section 10.5 to receive notices on behalf of the Company hereunder) by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using commercially reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with customers, suppliers, Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically expressly permitted by any of clauses (a) through (ig) of Section 5.2(ii6.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the First Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.19.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except (i) Parent’s regular quarterly dividends in an amount not to exceed $0.51 per quarter and (ii) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by mergeror any mergers, consolidationconsolidations or business combinations or any acquisitions of equity or assets, combinationmergers, acquisition of stock consolidations or assets or formation of a joint venture or otherwise business combinations that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary in a manner that would be adverse to the holders of Parent to adopt any amendments to its governing documentsCompany Shares;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any sharesshares in its capital stock, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of shares of Parent Shares Common Stock in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, Awards and (iv) other issuances of shares of Parent Common Stock for an amount not exceeding $100,000,000 a number of shares equal to 2% of the outstanding shares of Parent Common Stock in the aggregate and (v) other than in connection with the Financingaggregate; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of shares of Parent Shares Common Stock tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto thereto, (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) actions set forth on Section 6.2(f) of the Parent Disclosure Schedule, (iv) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (ivv) other acquisitions of shares of Parent Common Stock for an amount not exceeding $100,000,000 a number of shares equal to 2% of the outstanding shares of Parent Common Stock in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(ig) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 1 contract
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant (a) Prior to Section 8.1Closing, except (a1) as set forth in Section 5.2 6.2(a) of the Parent Disclosure LetterSchedule, (b2) as specifically otherwise expressly provided or required by this AgreementAgreement and the Transaction Documents or as may be necessary or appropriate to implement the transactions contemplated hereby and thereby, (c3) as required by applicable Law (including any obligations as debtor in possession under the Bankruptcy Code) or as otherwise ordered by the Bankruptcy Court, (4) as required under the Plan or (d5) as consented to in writing by with the Company (which prior written consent shall not be unreasonably withheld, delayed or conditioned)of Spyglass, Parent shall, and shall cause its Subsidiaries to:
(i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects Conduct the respective businesses of the MGM Subsidiaries in the ordinary course of business consistent with past practice, including by using taking into account the financial conditions to which the MGM Companies are subject; and
(ii) Without limiting the foregoing, use reasonable best efforts to preserve intact its and their to: (A) except as set forth in Section 6.2(a)(ii)(A) of the Parent Disclosure Schedule, maintain the present business organizations operations, organization and to preserve its and their goodwill of the MGM Companies, (B) maintain the present relationships with Governmental Entities customers and with customers, suppliers of the MGM Companies and other Persons with whom it and they which any of the MGM Companies have material significant business relations; provided, however(C) maintain good relations with the employees of the MGM Companies, that no action that is specifically permitted by any (D) maintain reserves, accruals and payables in the ordinary course of clauses business and consistent with past practices, (aE) through maintain and comply in all material respects with the terms of its Parent Contracts and (iF) comply with all applicable Laws, except (in each case) for matters of non-compliance as would not reasonably be expected to have a Parent Material Adverse Effect.
(b) Prior to the Closing, except (1) as set forth in Section 6.2(b) of Section 5.2(iiParent Disclosure Schedule, (2) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of as otherwise expressly provided or required by this Agreement and the Effective Time Transaction Documents or as may be necessary or appropriate to implement the datetransactions contemplated hereby and thereby, if any(3) as required by applicable Law (including any obligations as debtor in possession under the Bankruptcy Code) or as otherwise ordered by the Bankruptcy Court, on which this Agreement is terminated pursuant to Section 8.1(4) as required under the Plan or (5) with the prior written consent of Spyglass, Parent shall not, and shall not permit any Parent Subsidiary its Subsidiaries to:
(ai) authorize Repurchase, redeem or otherwise acquire, or grant any rights or enter into any Contracts or commitments to repurchase, redeem or acquire, any outstanding shares of capital stock or other securities of, or other ownership interests in, Parent or, other than in the ordinary course of business, the MGM Companies; or declare, set aside, make or pay any dividends on dividend or make any other distribution with respect to its outstanding the capital stock or other securities or ownership interests of Parent, or, other than in the ordinary course of business, the MGM Companies;
(ii) Issue or sell any shares (whether in cash, assets, of capital stock or other securities of any of the MGM Companies or grant options, warrants, calls or other rights to purchase shares of capital stock or other securities of any of the MGM Companies;
(iii) Effect any recapitalization, reclassification or like change in the capitalization of any of the MGM Companies;
(iv) Amend the certificate of incorporation or bylaws or comparable organizational documents of any of the MGM Companies;
(v) Enter into, create, incur or assume any obligations, or enter into any agreement in any case which are other than in the ordinary course of business;
(vi) Except as set forth in Section 6.2(b)(vi) of the Parent Disclosure Schedule and except with respect to one or Parent Subsidiaries)more movies based upon “The Hobbit” franchise, except dividends and distributions paid “greenlight,” commit to or made on a pro rata basis commence the production or financing of, or acquisition of any ownership interest or Exploitation rights in or to, any theatrical motion picture(s) not already “greenlit” (or otherwise committed to or commenced) by Parent Subsidiaries any of the MGM Companies prior to the date of the Original Investment Agreement;
(vii) Except in the ordinary course of business consistent with past practice or in any transaction by a wholly owned Parent Subsidiary to Parent with its Subsidiaries, (A) sell, transfer, lease, license, encumber or another wholly owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance otherwise dispose of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of the MGM Companies or acquire any Person additional material assets; or any business (B) terminate or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactionsmaterial respect amend any Parent Contract;
(dviii) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except Except in the ordinary course of businessbusiness consistent with past practice, agree to an extension or waiver terminate the services of any employee of the statute MGM Companies or make any material change to the compensation or benefits provided to any of limitations with respect the MGM Companies’ employees;
(ix) Fail to a material amount use commercially reasonable efforts to keep in full force and effect present insurance policies or other comparable insurance benefiting the assets of Taxesany of the MGM Companies and the conduct of their respective businesses;
(x) Except as set forth in Section 6.2(b)(x) of the Parent Disclosure Schedule, enter into, create, incur or assume any obligations, or enter into any “closing agreement” within the meaning , in any case with any Affiliates or Related Parties of Section 7121 any of the Code (or MGM Companies, other than any similar provision of state, local, or non-U.S. Law) arrangements entered into in the ordinary course with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent StockSubsidiaries; or
(ixi) Enter into any contract, arrangement or understanding, or agree, in writing or otherwise, to take any of the foregoing actionsactions described in Section 6.2(b) or any action that would make any of the representations or warranties of Parent contained in this Agreement untrue or incorrect in any material respect or prevent Parent from performing or cause Parent not to perform its covenants hereunder or under any other Transaction Document to which it is a party (it being acknowledged that this clause (xi) is not intended to prohibit Parent from terminating this Agreement in accordance with Article VIII or rejecting this Agreement on the terms set forth in Section 6.8).
Appears in 1 contract
Sources: Investment Agreement
Conduct of Business by Parent Pending the Closing. Parent agrees that between (a) During the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1Interim Period, except (ai) to the extent required by Law, (ii) as set forth in Section 5.2 of the Parent Disclosure Letter, otherwise expressly required or expressly permitted by this Agreement or (biii) as specifically required by this Agreement, (c) as required by Law or (d) as may be consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall shall, and shall cause each the Parent Subsidiary Subsidiaries to, conduct its business use commercially reasonable efforts to (A) carry on their respective businesses in all material respects in the ordinary course, consistent with past practice, (B) maintain its and their material assets and properties in their current condition (normal wear and tear excepted), (C) preserve intact in all material respects their present business organizations, ongoing businesses and significant business relationships, (D) keep available the services of their present officers, and (E) preserve Parent’s status as a REIT within the meaning of the Code.
(b) Without limiting the generality of Section 7.2, during the Interim Period, except (1) to the extent required by Law, (2) as otherwise expressly required or expressly permitted by this Agreement or (3) as may be consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent shall not and shall cause its Subsidiaries, not to:
(i) amend (1) the Parent Articles or Parent Bylaws, (2) the Parent Partnership Agreement or (3) any equivalent organizational or governing documents of any Parent Subsidiary (other than the Parent Partnership), solely in the case of clause (3), in any non-de minimis respect;
(ii) split, combine, subdivide or reclassify any shares of capital stock, units or other equity securities or ownership interests of Parent or any of its Subsidiaries;
(iii) declare, set aside or pay any dividend on or make any other distributions (whether in cash, stock, property or otherwise) with respect to shares of capital stock of Parent or any of its Subsidiaries or other equity securities or ownership interests in Parent or any of its Subsidiaries, except for (A) the authorization and payment by Parent of dividends, payable quarterly in accordance with past practice for the period up to the Closing Date at a rate not to exceed a quarterly rate of $0.2725 per Parent Common Share in accordance with Section 7.7, (B) the authorization and payment by Parent of any REIT Distribution, the Special Parent Distribution and any matching distribution permitted by Section 7.6(c)(v) in connection with a REIT Distribution by the Company, in each case, in accordance with Section 7.6, (C) the authorization and payment of dividends or other distributions to Parent by the Parent Partnership or any directly or indirectly wholly owned Parent Subsidiary, (D) the regular distributions that are required to be made in respect of the Parent OP Units in connection with any dividends paid on the Parent Common Shares and (E) distributions by the Parent Partnership or any Parent Subsidiary that is not wholly owned, directly or indirectly, by Parent, in accordance with the requirements of the Parent Partnership Agreement or the organizational documents of such Parent Subsidiary, as applicable;
(iv) except as required by a Parent Benefit Plan or the Parent Partnership Agreement, redeem, purchase or otherwise acquire, or offer to redeem, purchase or otherwise acquire, any Parent Equity Interests, except from holders of (i) Parent Equity Awards in full or partial payment of any purchase price or any applicable Taxes payable by such holder upon the lapse of restrictions on, or the settlement of, such Parent Equity Awards and (ii) fractional interests of Parent Equity Interests solely with respect to the fractional interests;
(v) acquire or agree to acquire (including by merger, consolidation or acquisition of stock or assets) any real property, personal property, corporation, partnership, limited liability company, other business organization or any division or material amount of assets thereof, except (A) acquisitions by Parent, the Parent Partnership or any wholly owned Parent Subsidiary of or from an existing wholly owned Parent Subsidiary, (B) acquisitions pursuant to existing purchase rights or options set forth on Section 7.2(b)(v) of the Parent Disclosure Letter, or (C) acquisitions (i) that would not reasonably be expected to materially delay, impede or affect the consummation of the Transactions and (ii) for which the fair market value of the total consideration paid by Parent and its Subsidiaries does not exceed $5,000,000 individually or $20,000,000 in the aggregate;
(vi) sell, pledge, lease, assign, transfer, dispose of or encumber, or effect a deed in lieu of foreclosure with respect to, any property or assets, except (A) as set forth on Section 7.2(b)(vi) of the Parent Disclosure Letter, (B) pledges and encumbrances on property and assets in the ordinary course of business and that would not be material to any Parent Property or any assets of Parent or any of its Subsidiaries, (C) if the fair market value of the total consideration received by Parent and its Subsidiaries does not exceed $5,000,000 individually or $20,000,000 in the aggregate, (D) sales among Parent, the Parent Partnership and any wholly owned Parent Subsidiary and (E) sales pursuant to existing purchase rights or options set forth on Section 7.2(b)(vi) of the Parent Disclosure Letter;
(vii) incur, create, assume, refinance or replace any Indebtedness for borrowed money or assume, guarantee or endorse, or otherwise become responsible (whether directly, contingently or otherwise) for the Indebtedness for borrowed money of any other Person, except (A) Indebtedness incurred under Parent’s existing credit facilities in the ordinary course of business (including to the extent necessary to pay dividends permitted under this Agreement and to pay Indebtedness that matures), or (B) the amendment, refinancing or replacement of any existing Indebtedness of Parent or any of its Subsidiaries (i) to the extent that (1) such refinancing, substitute or replacement agreement or facility or such refinanced Indebtedness does not impose or result in additional restrictions or limitations in any material respect on Parent or its Subsidiaries (or after the Closing Date, the Surviving Entity or its Subsidiaries) as compared to the existing agreement, facility or Indebtedness so refinanced, substituted for or replaced and (2) the aggregate principal amount of such Indebtedness is not increased as a result of such refinancing (other than to the extent increased to include fees, original issue discount, expenses or other debt issuance costs in each case incurred in connection with such refinancing) or (ii) pursuant to any Pre-Merger Financing Transaction in accordance with Section 8.12, (C) Indebtedness between or among Parent, the Parent Partnership and any of its wholly-owned Subsidiaries, (D) additional guarantees to the extent required under Parent’s existing credit facilities, and (E) Indebtedness in an amount not to exceed $10,000,000;
(viii) make any material loans, advances or capital contributions to, or investments in, any other Person (including to any of its officers, directors, Affiliates, agents or consultants), make any change to its existing loans to such Persons in a manner materially adverse to Parent or any Subsidiary, in each case, in its capacity as a lender, or enter into any “keep well” or similar agreement to maintain the financial condition of another entity, other than (A) by Parent, the Parent Partnership or a wholly owned Parent Subsidiary to Parent, the Parent Partnership or a wholly owned Parent Subsidiary, (B) loans or advances made to non-Affiliate tenants in the ordinary course of business and consistent with past practice, or (C) the loans or advances set forth on Section 7.2(b)(viii) of the Parent Disclosure Letter;
(ix) except in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customersenter into, suppliers and other Persons with whom it and they have renew, materially modify, materially amend or terminate, or waive, release, compromise or assign any material business relations; providedrights or material claims under, howeverany Parent Material Contract (or any contract that, that no action that is specifically permitted by any if existing as of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement Agreement, would be a Parent Material Contract), other than (A) any termination or renewal in accordance with the terms of any existing Parent Material Contract that occur automatically without any action by Parent or any of its Subsidiaries, or (B) actions permitted under clauses (A) and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to (B) of Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:7.2(b)(vii);
(ax) authorize except in the ordinary course of business consistent with past practice, enter into, renew, materially modify, materially amend or pay terminate, or waive, release, compromise or assign any dividends on material rights or make material claims under, any distribution lease with respect to the Parent Properties, or any lease that, if existing as of the date of this Agreement, would be a lease with respect to any Parent Property, other than any termination or renewal in accordance with the terms of any existing lease that occur automatically without any action by Parent or any of its outstanding shares Subsidiaries;
(whether in cashxi) waive, assetsrelease, stock assign, settle or compromise any claim, action or Legal Proceeding, other securities than waivers, releases, assignments, settlements or compromises that (A) with respect to the payment of monetary damages, involve only the payment of monetary damages (excluding any portion of such payment payable under an existing property-level insurance policy) (x) equal to or lesser than the amounts specifically reserved with respect thereto on the most recent consolidated balance sheet of Parent and its Subsidiaries included in the Parent SEC Documents or (y) that do not exceed $5,000,000 individually or $10,000,000 in the aggregate, (B) do not involve the imposition of injunctive relief against Parent or any of its Subsidiaries or the Surviving Entity following the Effective Time, and (C) do not provide for any admission of material liability by Parent or any of its Subsidiaries);
(xii) except as required by Law or by a Parent Benefit Plan in effect as of the date of this Agreement, (A) enter into, materially amend or terminate any material Parent Benefit Plan, (B) increase the compensation or employee benefits of any employee or individual independent contractor, except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice with respect to any employee with an annual base compensation of $175,000 or less or individual independent contractor with an annual base compensation of $200,000 or less, (C) grant any awards under a Parent Equity Plan, (D) hire or terminate (other than for cause) any employee with an annual base compensation that is greater than $175,000; provided that Parent may hire any employee below the level of Vice President as a replacement hire receiving substantially similar terms of employment, (E) accelerate the vesting of any equity-based awards or other compensation or benefits, (F) enter into any new, or amend any existing, employment, severance, change in control, retention, or similar agreement or arrangements, except as set forth in Section 8.4(d) of the Parent Disclosure Letter; provided that Parent may enter into offer letters with new hires in the ordinary course of business consistent with past practice that do not provide for severance in excess of the severance set forth in Section 8.4(a) of the Parent Disclosure Letter, (G) fund any rabbi trust or (H) enter into a collective bargaining or similar agreement;
(xiii) make any material change to its methods of accounting, except as required by a change in GAAP (or any interpretation thereof) or in applicable Law, or make any change, other than in the ordinary course of business, with respect to accounting policies, unless required by GAAP or the SEC;
(xiv) enter into any Contract that would reasonably be expected to, after the Effective Time, restrict or limit in any material respect Parent or any of its Subsidiaries (including the Surviving Entity) from engaging in any business or competing in any line of business or geographic location with any person;
(xv) enter into any new line of business;
(xvi) take any action or fail to take any action which action or failure to act would reasonably be expected to cause any Governmental Entity: (a) to institute proceedings for the suspension, revocation or limitation of rights under or to refuse to issue or renew, any Parent Permit necessary to conduct its business in all material respects as now conducted, or (b) to issue a notice or Order alleging that Parent or any Parent Subsidiary may be in material violation of or materially liable under any Environmental Law;
(xvii) take any action, or fail to take any action, which would reasonably be expected to cause Parent to fail to qualify as a REIT or any of its Subsidiaries to cease to be treated as a partnership or disregarded entity for U.S. federal income tax purposes or as a Qualified REIT Subsidiary, a Taxable REIT Subsidiary or a REIT under the applicable provisions of the Code, as the case may be;
(xviii) adopt a plan of merger, complete or partial liquidation or resolutions providing for or authorizing such merger, liquidation or a dissolution, consolidation, recapitalization or bankruptcy reorganization;
(xix) make any capital expenditures or other investments except (A) in accordance with Parent’s capital expenditure plan attached to Section 7.2(b) of the Parent Disclosure Letter, (B) for ordinary course capital expenditures not to exceed $10,000,000 in the aggregate or (C) as reasonably required to satisfy any health or safety concerns at any of the Parent Properties;
(xx) except for (A) issuances by the Parent Partnership or a wholly owned Parent Subsidiary to Parent, the Parent Partnership or another wholly owned Parent Subsidiary;
, (bB) split, combine, reduce or reclassify any issuances of its issued or unissued shares, or issue or authorize Parent Common Shares pursuant to the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions settlement of a substantial equity interest in or a substantial portion Parent Equity Award that is outstanding as of the assets date of any Person this Agreement or any business or division thereofgranted after the date of this Agreement in compliance with this Agreement, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise thatcase, in any case, would reasonably be expected to prevent or materially delay or impede accordance with the consummation terms of the Transactions;
award agreement governing such Parent Equity Award or (dC) amend exchanges or conversions of Parent OP Units for Parent Common Shares pursuant to the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) Partnership Agreement, issue, deliver, grant, sell, pledge, dispose dispose, encumber or grant any Parent Common Shares or any of or encumberthe Parent Subsidiaries’ capital stock, or authorize the issuanceany options, deliverywarrants, grant, sale, pledge, disposition or encumbrance of, any shares, voting convertible securities or other equity interest in the Parent or rights of any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options kind to acquire any such shares, voting securities or equity interest Parent Common Shares or any “phantom” stockof the Parent Subsidiaries’ capital stock or other equity interests;
(xxi) purchase, “phantom” redeem, repurchase, or otherwise acquire, directly or indirectly, any shares of its capital stock rights, stock appreciation rights or stock based performance unitsother equity or voting interests of Parent or a Parent Subsidiary, other than (i) issuances the withholding of Parent Common Shares in to satisfy exercise price or withholding Tax obligations with respect of any exercise of Parent stock options or the vesting or settlement of to outstanding Parent Equity Awards, (ii) transactions between the redemption or purchase of Parent and OP Units to the extent required under the terms of the Parent Agreement, or (iii) in connection with the redemption or repurchase by a wholly owned Parent Subsidiary of its own securities (but solely to the extent such securities or between wholly equity equivalents are owned by Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregateSubsidiary);
(gxxii) permit any insurance policy naming Parent or any of the Parent Subsidiaries or directors or officers as a beneficiary or an insured or a loss payable payee, or Parent’s directors and officers liability insurance policy, to be canceled, terminated or allowed to expire unless such entity shall have obtained an insurance policy with substantially similar terms and conditions to the canceled, terminated or expired policy;
(xxiii) make (other than in the ordinary course of business), change or change rescind any material Tax election, election or change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file amend any material amended Tax Return, or settle or compromise any audit material federal, state, local or proceeding relating to a material amount of Taxesforeign income Tax liability, except in the ordinary course of businessaudit, agree to an extension claim or waiver of the statute of limitations with respect to a material amount of Taxesassessment, or enter into any “material closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, localagreement related to Taxes, or non-U.S. Law) with respect to any material Tax, or knowingly surrender any right to claim a any material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
, except in each case as necessary (i) agreeto preserve the qualification of Parent for taxation as a REIT under the Code, in writing or otherwise, (ii) to take qualify or preserve the status of any Subsidiary of the foregoing actions.Parent as a partnership or disregarded entity for U.S. federal income tax purposes or as a Qualified REIT Subsidi
Appears in 1 contract
Sources: Merger Agreement (Rayonier, L.P.)
Conduct of Business by Parent Pending the Closing. Parent agrees that between From the date of this Agreement and Execution Date until the Effective Time or the timeTime, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by unless the Company (shall otherwise consent in writing, which consent shall not be unreasonably withheld, delayed or conditioned)except as otherwise expressly permitted by or provided for in this Agreement, Parent (i) shall shall, and shall cause each Parent Subsidiary of its Subsidiaries to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using practice and in compliance in all material respects with all applicable Laws and use reasonable best efforts to preserve intact its and their present respective business organizations and goodwill. In addition to preserve its and their present relationships with Governmental Entities and with customerswithout limiting the generality of the foregoing, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically except as otherwise expressly permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of or provided for in this clause (i)Agreement, and (ii) agrees that between from the date of this Agreement and hereof until the Effective Time Time, without the prior written consent of the Company, which consent shall not be unreasonably withheld, conditioned, or the date, if any, on which this Agreement is terminated pursuant to Section 8.1delayed, Parent shall not, and shall not permit any Parent Subsidiary of its Subsidiaries to:
(a) authorize or pay , do any dividends on or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the following outside the ordinary course of business consistent with past practice practices:
(a) adopt or propose any material change in its certificate of incorporation or bylaws, except for such amendments (i) required by any applicable Law or the rules and regulations of the SEC or NASDAQ, (ii) as contemplated by the Amended Certificate of Incorporation, or (iii) that would not, individually or in the aggregate, reasonably be expected to have a wholly owned Parent Subsidiary to Parent or another wholly owned Parent SubsidiaryMaterial Adverse Effect;
(b) splitsell, combinelease, reduce pledge, or reclassify otherwise dispose of or encumber any properties or assets of Parent or its Subsidiaries, except for (i) the sale of inventory in the ordinary course of business and (ii) other transactions which would not, individually or in the aggregate, reasonably be expected to have a Parent Material Adverse Effect;
(c) authorize, recommend, propose or announce an intention to do any of the foregoing, or enter into any contract, agreement, commitment or arrangement to do any of the foregoing; (i) amend or propose to amend the certificate of incorporation or bylaws or similar governing documents of Parent or any of its issued Subsidiaries, (ii) split, combine or unissued shares, reclassify their outstanding capital stock or issue or authorize the issuance of any other securities security in respect ofor, in lieu of of, or in substitution for, shares of its sharescapital stock, except for (iii) declare, set aside, make or pay any such transaction by a wholly owned dividend or other distribution, payable in cash, stock, property or otherwise, other than the payment of any dividend on shares of Parent Series B Preferred Stock (iv) create any Subsidiary which remains a wholly owned or alter (through merger, liquidation, reorganization, restructuring or in any other fashion) the corporate structure or ownership of Parent Subsidiary after consummation or any of such transaction;
(c) authorize or announce an intention to authorizeits Subsidiaries, or (v) enter into agreements providing for, any acquisitions agreement with respect to the voting of a substantial equity interest in its capital stock or a substantial portion of the assets of any Person other securities held by Parent or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactionsits Subsidiaries;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or of, grant, encumber, or authorize the issuanceagree to issue, delivery, grant, salesell, pledge, disposition or encumbrance dispose of, grant or encumber any shares, voting securities or other equity interest in the shares of any class of capital stock of Parent or any Parent Subsidiary of its Subsidiaries, or any options, warrants or rights of any kind to acquire any shares of, their capital stock of any class or any debt or equity securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” capital stock, “phantom” stock rightsexcept that Parent may issue Parent Stock upon exercise or conversion, stock appreciation rights as applicable, of Parent Stock Options, Parent Warrants or stock based performance units, other than Parent Series B Preferred Stock outstanding on the date hereof in accordance with their present terms;
(i) issuances of Parent Shares in issue any debt securities, incur, guarantee or otherwise become contingently liable with respect to any indebtedness for borrowed money or enter into any arrangement having the economic effect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awardsforegoing, (ii) transactions between Parent and a wholly owned Parent Subsidiary make any loans, advances or between wholly owned Parent Subsidiariescapital contributions to, or investments in, any Person, or (iii) issuances of Parent Equity Awardsredeem, (iv) other issuances of purchase, acquire or offer to purchase or acquire any shares of Parent Stock its capital stock, or the capital stock of its Subsidiaries, or any options, warrants or rights to acquire any of its capital stock or any security convertible into or exchangeable for an amount not exceeding $100,000,000 in its capital stock, or the aggregate and (v) other than in connection with the Financingcapital stock of its Subsidiaries; orand
(f) directly sell, pledge, assign, dispose of, transfer, lease, securitize, or indirectlyencumber any businesses, purchase, redeem properties or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions assets of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actionsits Subsidiaries.
Appears in 1 contract
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the First Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the First Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by mergeror any mergers, consolidationconsolidations or business combinations or any acquisitions of equity or assets, combinationmergers, acquisition of stock consolidations or assets or formation of a joint venture or otherwise business combinations that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents Documents, and shall not permit US Holdco or permit the Merger Sub Subs or any Significant Subsidiary of Parent to adopt amend any amendments to its governing organizational documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, Awards and (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financingaggregate; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 1 contract
Conduct of Business by Parent Pending the Closing. Parent agrees that between (a) From and after the date execution of this Agreement and until the earlier of the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, except as may be required by Law, or as expressly contemplated or permitted elsewhere in this Agreement, or as set forth in Section 5.2 of the Parent Disclosure Letter, or with the prior written consent of the Company (such consent not to be unreasonably withheld, conditioned or delayed), Parent shall, and shall cause each of its Subsidiaries to, conduct its business in the ordinary course consistent with past practice in all material respects; provided, however, that no action by Parent or its Subsidiaries with respect to matters specifically addressed by any provision of Section 5.2(b) shall be deemed a breach of this sentence unless such action would constitute a breach of such relevant provision of Section 5.2(b).
(b) At all times from and after the execution of this Agreement until the earlier of the Effective Time and the date, if any, on which this Agreement is terminated pursuant to Section 8.1, except as may be required by Law, or as expressly contemplated or permitted elsewhere in this Agreement, or as set forth in Section 5.2 of the Parent Disclosure Letter, or with the prior written consent of the Company (such consent not to be unreasonably withheld, conditioned or delayed), Parent:
(i) shall not, and shall not permit any Parent Subsidiary of its Subsidiaries to:
(a) , authorize or pay any dividends on or make any distribution with respect to its the outstanding shares in its capital (whether in cash, assets, stock shares or other securities of Parent or Parent its Subsidiaries), except (A) cash dividends and distributions (1) paid or made on a pro rata basis by Parent its Subsidiaries in the ordinary course of business consistent with past practice (unless any such dividend or distributions would be reasonably expected to have a material adverse Tax consequence on Parent and its Subsidiaries after the Closing) or (2) to the extent declared by the Parent Board of Directors and payable pursuant to the Designations of the Terms of the Mandatory Convertible Preferred or (B) dividends and distributions paid or made by a wholly owned Parent Subsidiary (unless any such dividend or distribution would be reasonably expected to have a material adverse Tax consequence on Parent or another wholly owned Parent Subsidiaryand its Subsidiaries after the Closing);
(bii) shall not, and shall not permit any of its Subsidiaries to, split, combine, reduce combine or reclassify any of its issued or unissued sharesshares of capital in issue, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, shares in its sharescapital, except for (A) any such transaction by a wholly owned Subsidiary of Parent Subsidiary which remains a wholly owned Subsidiary of the Parent Subsidiary after consummation of such transactiontransaction (unless such transaction would be reasonably expected to have a material adverse Tax consequence on Parent and its Subsidiaries after the Closing) or (B) any issuance of Parent Shares in connection with the conversion of any Mandatory Convertible Preferred by the holder thereof in accordance with the Designations of the Terms of the Mandatory Convertible Preferred;
(ciii) authorize shall not, and shall not permit any of its Subsidiaries to, (A) grant any Parent Equity Awards or announce an intention any other equity-based awards (other than as permitted by Section 5.2(b) of the Parent Disclosure Letter) or non-equity-based long-term incentive awards, (B) increase the compensation, bonus or pension, welfare, severance or other benefits to authorizebe paid or provided to any of Parent’s or any of its Subsidiaries’ current or former directors, officers, employees, or individual consultants, (C) enter into any employment, change of control, severance or retention agreement with any director, officer or employee of Parent or any of its Subsidiaries, other than (1) employment agreements terminable on less than 30 days’ notice without penalty or liability and (2) employment agreements with employees in non-U.S. jurisdictions, in the case of each of subclauses (1) and (2), entered into in the ordinary course of business and consistent with past practice and applicable Law, and it being understood and agreed that the automatic renewal of any employment agreement shall not be prohibited by this clause (C), (D) terminate the employment of any “executive officer”, within the meaning of Rule 3b-7 of the Exchange Act of Parent, other than for cause, (E) amend any performance targets with respect to any outstanding bonus or equity awards, (F) amend the funding obligation or contribution rate of any Parent Benefit Plan or change any underlying assumptions used to calculate benefits payable under any Parent Benefit Plan (except as may be required by GAAP or other applicable accounting standard), (G) establish, adopt, enter into, amend or terminate a Parent Benefit Plan or any other plan, trust, fund, policy or arrangement for the benefit of any current or former directors, officers or employees or any of their beneficiaries, other than (1) amendments in the ordinary course of business consistent with past practice that neither contravene the other covenants set forth in this Section 5.2(b)(iii) nor materially increase the cost to Parent of maintaining such Parent Benefit Plan or other plan, trust, fund, policy or arrangement) or (2) entering into third-party Contracts for the provision of services to such Parent Benefit Plans, including benefit administration, (H) take any action to accelerate the vesting or payment, or fund or in any way secure the payment, of compensation or benefits under any Parent Benefit Plan or (I) issue or forgive any loans to directors, officers, employees, contractors or any of their respective Affiliates, except for any such issuance that would not violate the S▇▇▇▇▇▇▇-▇▇▇▇▇ Act and is consistent with past practice and policy, except, in the case of each of subclauses (A) through (I) of this Section 5.2(b)(iii) as required by existing written agreements or Parent Benefit Plans in effect as of the date of this Agreement or as otherwise required by applicable Law;
(iv) shall not, and shall not permit any of its Subsidiaries to, hire any Person for a position with a title of Vice President or above other than (A) employees hired pursuant to offers of employment outstanding on the date hereof or (B) newly hired employees filling positions that are reasonably and in good faith deemed by Parent to be essential;
(v) [reserved];
(vi) shall not, and shall not permit any of its Subsidiaries to, enter into agreements providing forwith respect to or consummate (other than pursuant to Contracts in effect as of the date hereof that have been previously disclosed to the Company prior to the date hereof), any acquisitions of a substantial an equity interest (provided that acquisitions of equity interests permitted pursuant to Section 5.2(b)(xviii) shall not be restricted by the terms of this Section 5.2(b)(vi)) in or a substantial portion of the assets of any Person or any business or division thereofthereof (including by acquisition of Intellectual Property), in each case (whether by merger, consolidation, combinationbusiness combination or licensing, acquisition of stock joint venture, collaboration, alliance, co-promotion or assets or formation of a joint venture or otherwise thatsimilar agreements), in any each case, except (A) in respect of any acquisitions by Parent or any of its wholly owned Subsidiaries of an equity interest in or the assets of any wholly owned Parent Subsidiary or any business or division thereof or any merger, consolidation, business combination or licensing, joint venture, collaboration, alliance, co-promotion or similar agreements among Parent and its wholly owned Subsidiaries or among Parent’s wholly owned Subsidiaries (unless such transaction would reasonably be expected to have a material adverse Tax consequence on Parent and its Subsidiaries after the Closing), or (B) for amounts (including assumption of liabilities) that do not exceed $300 million individually or $1 billion in the aggregate (with the valuation of any contingent consideration being determined in accordance with the valuation methodology used by Parent in connection with determining the need to make a notification under the HSR Act (without regard to whether payments are being made with respect to assets outside the United States)), unless, in each case, such transaction would reasonably be expected to prevent or materially delay or impede the consummation of the TransactionsTransactions or would be reasonably expected to have a material adverse Tax consequence on Parent and its Subsidiaries after the Closing;
(dvii) shall not, and shall not permit any of its Subsidiaries to, enter into any Contract that would, or acquire any Person that is party to a Contract that would, materially limit or otherwise materially restrict Parent or any of the Parent Subsidiaries or any of their respective Affiliates or any successor thereto or that to the knowledge of Parent would, after the Effective Time, materially limit or materially restrict Parent or any of its Subsidiaries (including the Surviving Corporation and its Subsidiaries) or any successor thereto, in each case, from engaging or competing in any material line of business or generally in any geographic area or, in the case of the pharmaceutical business, any material therapeutic, diagnostic or prophylactic area, material class or type of drugs or material mechanism of action;
(viii) shall not amend the Parent Governing Documents or Memorandum and Articles of Association, and shall not permit Merger Sub or any of its Significant Subsidiary of Parent Subsidiaries to adopt any material amendments to its governing organizational documents;
(eix) shall not, and shall not permit any of its Subsidiaries to, issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any sharesshares in its capital, voting securities or other equity interest in the Parent or any Parent Subsidiary Subsidiaries or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such sharesshares in its capital, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock stock-based performance units, or take any action to cause to be vested or exercisable any otherwise vested or unexercisable Parent Equity Award under any existing Parent Equity Plan (except as otherwise provided by the express terms of any Parent Benefit Plan outstanding on the date hereof), other than (iA) issuances of Parent Shares in respect of any exercise of Parent stock options Stock Options or the vesting or settlement of Parent Equity AwardsAwards outstanding on the date hereof or permitted to be granted after the date hereof in accordance with the terms of this Agreement, (iiB) transactions between withholding of Parent and a wholly owned Shares to satisfy Tax obligations pertaining to the exercise of Parent Subsidiary Stock Options or between wholly owned Parent Subsidiaries, (iii) issuances the vesting or settlement of Parent Equity AwardsAwards or to satisfy the exercise price with respect to Parent Stock Options or to effectuate an optionee direction upon exercise, (ivC) other issuances of shares of stock fund transactions under Parent Stock for an amount not exceeding $100,000,000 in the aggregate Benefit Plans that are qualified or supplemental savings plans and (vD) other than in connection with transactions among Parent and its wholly owned Subsidiaries or among Parent’s wholly owned Subsidiaries (unless such transaction would be reasonably expected to have a material adverse Tax consequence on Parent and its Subsidiaries after the Financing; orClosing);
(fx) shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (iA) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto or (iiB) transactions among Parent and its wholly owned Subsidiaries or among Parent’s wholly owned Subsidiaries (unless such transaction would be reasonably expected to have a material adverse Tax consequence on Parent and its Subsidiaries after the acquisition by Closing);
(xi) shall not, and shall not permit any of its Subsidiaries to, redeem, repurchase, prepay (other than prepayments of revolving loans), defease, incur, assume, endorse, guarantee or otherwise become liable for or modify in any material respects the terms of any indebtedness for borrowed money or issue or sell any debt securities or calls, options, warrants or other rights to acquire any debt securities (directly, contingently or otherwise), except for (A) any indebtedness for borrowed money or issuances or sales of any such securities, calls, options, warrants or other rights among Parent and its wholly owned Subsidiaries (unless such transaction would be reasonably expected to have a material adverse Tax consequence on Parent and its Subsidiaries after the Closing), (B) guarantees of indebtedness for borrowed money of Parent Equity Awards Subsidiaries or guarantees by Parent Subsidiaries of indebtedness for borrowed money of Parent or any Parent Subsidiary, which indebtedness is incurred in connection with the forfeiture of such awardsthis Section 5.2(b)(xi), (iiiC) transactions between issuances of commercial paper by Parent or any of its Subsidiaries backed by the existing credit facilities of Parent or the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and as in effect on the date of this Agreement, (ivD) other acquisitions of shares borrowings under existing credit facilities of Parent Stock for an amount not exceeding $100,000,000 or its Subsidiaries as in effect on the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes date of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating this Agreement solely to a material amount of Taxes, except fund operating expenses in the ordinary course of business, agree (E) (1) repayments of indebtedness at the stated maturity of such indebtedness and required amortization or mandatory prepayments or (2) repayments or redemption of indebtedness as may be necessary, in the discretion of Parent (acting reasonably), in order to an extension or waiver maintain the investment grade rating of the statute outstanding indebtedness of limitations Parent and the Parent Subsidiaries, (F) indebtedness for borrowed money incurred to replace, renew, extend or refinance any existing indebtedness for borrowed money of Parent or any of its Subsidiaries maturing on or prior to the six (6) month anniversary of the date of such refinancing, in each case in an amount not to exceed the amount of the indebtedness replaced, renewed, extended or refinanced and on terms that are no less favorable to Parent or such Subsidiary than the terms of the indebtedness replaced, renewed, extended or refinanced, (G) any indebtedness incurred prior to the Pending Parent Transaction Closing in connection with any acquisitions, mergers, business consolidations or other similar transactions permitted pursuant to Section 5.2(b)(vi) in an aggregate amount not to exceed $1 billion (which amounts shall be prepaid or repaid as promptly as reasonably practicable following the Pending Parent Transaction Closing), or (H) indebtedness for borrowed money not to exceed $250 million in aggregate principal amount that may be incurred or repaid by Parent or any of its Subsidiaries other than in accordance with subclauses (A) – (G), inclusive; provided that nothing contained herein shall prohibit Parent and its Subsidiaries from making guarantees or obtaining letters of credit or surety bonds for the benefit of commercial counterparties in the ordinary course of business consistent with past practice;
(xii) shall not, and shall not permit any of its Subsidiaries to, make any loans to any other Person involving in excess of $10 million individually or $30 million in the aggregate, except for (A) loans permitted by Section 5.2(b)(iii)(I) and (B) loans among Parent and its wholly owned Subsidiaries or among Parent’s wholly owned Subsidiaries (provided that subject to the provisions of the existing indebtedness or other agreements of Parent and its Subsidiaries, as they may be amended in accordance with the terms of this Agreement, Parent and its Subsidiaries shall not make any such loan if it would (or structure any such loan in a manner that would) be reasonably expected to have material adverse Tax consequences to Parent and its Subsidiaries after the Closing);
(xiii) shall not, and shall not permit any of its Subsidiaries to, sell, lease, license, transfer, exchange, swap, let lapse (with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (Intellectual Property only) or any similar provision of state, localotherwise dispose of, or non-U.S. Law) with respect subject to any material TaxLien (other than Parent Permitted Liens), or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of its material properties or assets (including shares in the foregoing actions.capital of its or their Subsidiaries), ex
Appears in 1 contract
Sources: Merger Agreement (Allergan PLC)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date hereof and the earlier of this Agreement and the Effective Time or the timedate, if any, at on which this Agreement is validly terminated pursuant to Section 8.110.1, except (a) as set forth in Section 5.2 7.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by applicable Law (including COVID-19 Measures), as reasonably required in response to COVID-19, or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed conditioned or conditioneddelayed), Parent (ia) shall shall, and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), practice and (iib) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any cause each Parent Subsidiary not to, directly or indirectly:
(ai) amend, modify, waive, rescind, restate or otherwise change (A) the Existing Parent Charter (other than (I) by amending the Existing Parent Charter in the form of the Parent Charter and by filing the Avian Merger Certificate, in each case as contemplated by and in accordance with this Agreement, or (II) as may be necessary to (and solely to) authorize additional equity in connection with an acquisition permitted under Section 7.2(b)(iv)(C) or in order to make ordinary course issuances of equity incentive grants), (B) the bylaws of Parent (other than by amending the Existing Parent Bylaws in the form of the Parent Bylaws in accordance with this Agreement) or (C) any Parent Subsidiary’s certificate of incorporation, bylaws or equivalent or governing organizational documents (except, in the case of HoldCo, (I) by amending the Initial HoldCo Charter in the form of the HoldCo Charter, by filing the HoldCo Amendment and by amending the Initial HoldCo Bylaws in the form of the HoldCo Bylaws as contemplated by and in accordance with this Agreement or (II) as may be necessary to (and solely to) authorize additional equity in connection with an acquisition permitted under Section 7.2(b)(iv)(C) or in order to make ordinary course issuances of equity incentive grants);
(ii) authorize, declare, set aside, make or pay any dividends on or make any distribution distributions with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, stock shares, units or other securities of Parent or any Parent SubsidiariesSubsidiary), or enter into any agreement and arrangement with respect to the voting of its capital stock, units or other equity interests, except dividends as may be necessary to (and distributions paid or made on a pro rata basis by Parent Subsidiaries solely to) authorize additional equity in the ordinary course of business consistent connection with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiaryan acquisition permitted under Section 7.2(b)(iv)(C);
(biii) split, combine, subdivide, reduce or reclassify any shares of its issued capital stock or unissued sharesother equity interests, or redeem, purchase or otherwise acquire any shares of its capital stock or other equity interests, or issue any shares of its capital stock or authorize the issuance of other equity interests or any other securities in respect of, in lieu of or in substitution for, shares of its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transactioncapital stock or other equity interests;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(eiv) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, encumber any shares, voting securities shares of its capital stock or other equity interest in the Parent or any Parent Subsidiary interests or any securities convertible into or exchangeable or exercisable for any such shares, voting securities shares or equity interestinterests, or any rights, warrants or options to acquire any such shares, voting securities shares or equity interest interests or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance unitsunits or take any action to cause to be exercisable or vested any otherwise unexercisable or unvested equity award under any existing Parent Equity Plan, other than except (iA) issuances of Parent Shares Common Stock in respect of any exercise of vested Parent stock options or Options outstanding on the vesting or settlement date hereof, in all cases in accordance with their respective terms as of Parent Equity Awardsthe date hereof, (iiB) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiariesordinary course issuances of equity incentive grants, (iiiC) issuances that do not constitute “Additional Shares of Parent Equity AwardsCommon” pursuant to Article V, Sections 4(d)(1), (iv2), (3) other or (7) of the Existing Parent Charter, and (D) issuances of shares of Parent Stock for in connection with an amount not exceeding $100,000,000 in the aggregate and acquisition permitted under Section 7.2(b)(iv)(C);
(v) enter into any binding agreement providing for, or consummate, any acquisition (including by merger, business combination, consolidation or acquisition of stock or assets or any other than means) of any equity interests in connection with the Financing; or
or assets of, or investment in (f) directly by contribution to capital, transfer of property, purchase of securities or indirectlyotherwise), purchaseany Person or any business or division thereof, redeem or otherwise acquire engage in any shares in its capital mergers, consolidations or any rights, warrants or options to acquire any such shares in its capitalbusiness combinations, except for (iA) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent supplies and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except equipment in the ordinary course of business, agree (B) capital expenditures made in the ordinary course of business or (C) acquisitions of any equity interests in or assets of any Person or any business or division thereof (x) for consideration that does not exceed $75,000,000 individually or $150,000,000 in the aggregate for all such acquisitions and (y) that would not reasonably be expected to an extension impede, interfere with, delay, postpone, adversely affect or waiver prevent the consummation of the statute Transactions;
(vi) liquidate (completely or partially), dissolve, recapitalize or effect any other similar reorganization (including any recapitalization or reorganization between or among any of limitations Parent or the Parent Subsidiaries), or adopt any plan or resolution providing for any of the foregoing;
(vii) sell, lease, assign, abandon, permit to lapse, transfer, exchange, swap or otherwise dispose of, or subject to any Lien (other than Permitted Liens), any of its material properties, rights or assets (including limited liability company interests or other equity interests of Parent or the Parent Subsidiaries and including Parent Intellectual Property), except (A) the lapse or abandonment of Parent Intellectual Property in the ordinary course of business consistent with respect past practice or otherwise in Parent’s reasonable business judgement, (B) sales (x) having a fair market value that does not exceed $75,000,000 individually or $150,000,000 in the aggregate for all such sales and (y) that would not reasonably be expected to a impede, interfere with, delay, postpone, adversely affect or prevent the consummation of the Transactions and (C) leases of real property or the lapse or termination thereof in the ordinary course of business consistent with past practice;
(viii) in each case, other than in the ordinary course of business consistent with past practice, waive, release or assign any material amount rights or claims under any Parent Material Contract;
(ix) make any material change in financial accounting policies, practices, principles or procedures or any of Taxesits methods of reporting income, deductions or other material items for financial accounting purposes, except as required by GAAP or applicable Law;
(x) enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent StockAffiliate Arrangement; or
(ixi) agree, commit or authorize, in writing or otherwise, to take any of the foregoing actions. Nothing contained in this Agreement is intended to give the Company, directly or indirectly, the right to control or direct the operations of Parent or any of the Parent Subsidiaries prior to the Effective Time in violation of applicable Antitrust Law.
Appears in 1 contract
Sources: Stock Purchase and Agreement and Plan of Merger (Reinvent Technology Partners Y)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, except (1) as required by this Agreement or any document, agreement, certificate or instrument contemplated hereby, (2) as required by Law or (3) upon written request by Parent, as consented to in writing by the Company (which consent shall not be unreasonably withheld, conditioned or delayed), Parent (i) shall not, and shall not permit any Parent Subsidiary cause each of its Subsidiaries to:
(a) authorize or pay any dividends on or make any distribution with respect to , conduct its outstanding shares (whether business in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries all material respects in the ordinary course of business consistent with past practice or and use commercially reasonable efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with customers, suppliers and other Persons with whom it and they have material business relations; provided, that no action that is specifically permitted by any of clauses (a) through (h) of this Section 6.2 shall be deemed a wholly owned breach of this clause (i), and (ii) Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;shall not, and shall not permit any of its Subsidiaries to:
(ba) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transactioncapital stock;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(db) amend the Parent Governing Documents or in a manner that would have a disproportionate adverse effect on the Holders as compared to other stockholders of Parent, and shall not permit Merger Sub or any Significant Subsidiary of Parent its Subsidiaries to adopt any material amendments to its governing documents;
(ec) issuemake, deliver, grant, sell, pledge, dispose declare or pay any dividend or other distribution on any shares of its or encumberits Subsidiaries’ capital stock, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting other securities or other equity interest in the Parent or any Parent Subsidiary or any securities obligations convertible into or exchangeable for any such shares, voting securities shares of its or equity interest, its Subsidiaries’ capital stock (except dividends paid by any of the Subsidiaries of Parent to Parent or any rightsof their wholly owned Subsidiaries);
(d) adopt a plan of complete or partial liquidation, warrants dissolution, merger, amalgamation, consolidation, restructuring, recapitalization or options to acquire other reorganization other than this Agreement;
(e) enter into any such shares, voting securities transaction or equity interest or series of related transactions with any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, of its Affiliates (other than (i) issuances any of Parent Shares in respect of any exercise of Parent stock options its Subsidiaries or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary the directors, officers or between wholly owned Parent Subsidiaries, (iii) issuances employees of Parent Equity Awards, (ivor its Subsidiaries) other issuances of shares of unless the terms are substantially as favorable as Parent Stock for or its Subsidiary would obtain in a comparable arm’s length transaction with a person that is not an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the FinancingAffiliate; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 1 contract
Sources: Merger Agreement (WillScot Corp)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the First Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or Order or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to (X) preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relationsrelations and (Y) keep available the services of the current officers and key employees of Parent and the Parent Subsidiaries; provided, however, that no action that is specifically permitted by any of clauses (a) through (ik) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the First Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except (i) quarterly cash dividends to the stockholders of the Company in an amount not in excess of $0.30 per share, consistent with past practice, and (ii) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by mergeror any mergers, consolidationconsolidations or business combinations or any acquisitions of equity or assets, combinationmergers, acquisition of stock consolidations or assets or formation of a joint venture or otherwise business combinations that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions; provided that Parent shall consult in advance with the Company with respect to any acquisition in excess of $200,000,000;
(d) amend the Parent Governing Documents (other than the Parent Charter Amendment) or permit the Merger Sub or Subs to amend any Significant Subsidiary of Parent to adopt any amendments to its governing organizational documents;
(e) make any material change in financial accounting policies or procedures or any of its methods of reporting income, deductions or other material items for financial accounting purposes, except as required by GAAP or SEC policy;
(f) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent Stock Options, any purchase rights under Parent’s employee stock options purchase plan, or the vesting or settlement of Parent Equity Awards, (ii) issuances of Parent Shares issuable pursuant to the terms of the Parent Convertible Notes or pursuant to the terms of the Parent Warrants, (iii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iiiiv) issuances of Parent Equity Awards, Awards and (ivv) other issuances of shares of Parent Stock Shares for an amount not exceeding $100,000,000 150,000,000 in the aggregate and (v) other than in connection with the Financing; oraggregate;
(fg) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto thereto, (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, and (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregateSubsidiaries;
(gh) make (except for elections made in the ordinary course of business) or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(hi) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock;
(j) enter into any joint development or similar collaboration agreement, except any such agreement that would not reasonably be expected to prevent or materially delay or impede the consummation of the Transactions; or
(ik) agree, in writing or otherwise, to take any of the foregoing actions.
Appears in 1 contract
Sources: Merger Agreement (Kla Tencor Corp)
Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement and the date of the First Effective Time or the timedate, if any, at on which this Agreement is terminated pursuant to Section 8.19.1, except (a) as set forth in Section 5.2 6.2 of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing (including via email from the person named in Section 10.5 to receive notices on behalf of the Company hereunder) by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using commercially reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with customers, suppliers, Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically expressly permitted by any of clauses (a) through (ig) of Section 5.2(ii6.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the First Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.19.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize or pay any dividends on or make any distribution with respect to its outstanding shares (whether in cash, assets, stock or other securities of Parent or Parent Subsidiaries), except (i) Parent’s regular quarterly dividends in an amount not to exceed $0.51 per quarter and (ii) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, or enter into agreements providing for, any acquisitions of a substantial an equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by mergeror any mergers, consolidationconsolidations or business combinations or any acquisitions of equity or assets, combinationmergers, acquisition of stock consolidations or assets or formation of a joint venture or otherwise business combinations that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
; Table of Contents (d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent in a manner that would be adverse to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local, or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agree, in writing or otherwise, to take any of the foregoing actions.Company Shares;
Appears in 1 contract
Sources: Agreement and Plan of Reorganization (Pharmacyclics Inc)
Conduct of Business by Parent Pending the Closing. Parent agrees that between Prior to the date of this Agreement and Closing Date, unless the Effective Time Company shall otherwise agree in writing or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 of the Parent Disclosure Letter, (b) as specifically required otherwise contemplated by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the Effective Time or the date, if any, on which this Agreement is terminated pursuant to Section 8.1, Parent shall not, and shall not permit any Parent Subsidiary to:
(a) authorize The business of Parent shall be conducted only in the ordinary course;;
(b) Parent shall not (i) directly or indirectly redeem, purchase or otherwise acquire or agree to redeem, purchase or otherwise acquire any shares of its capital stock; (ii) amend its charter or Bylaws other than to effectuate the transactions contemplated hereby; or (iii) split, combine or reclassify its capital stock or declare, set aside or pay any dividends on dividend payable in cash, stock or property or make any distribution with respect to such stock;
(c) Except as contemplated by this Agreement, Parent shall not (i) issue or agree to issue any additional shares of, or options, warrants or rights of any kind to acquire shares of, its outstanding shares capital stock other than to effectuate the transactions contemplated or permitted pursuant to this Agreement; (whether in cash, assets, stock ii) acquire or dispose of any assets other securities of Parent or Parent Subsidiaries), except dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries than in the ordinary course of business consistent (except for dispositions in connection with past practice Section 7.2(a) hereof); (iii) incur additional Indebtedness or by a wholly owned Parent Subsidiary to Parent or another wholly owned Parent Subsidiary;
(b) split, combine, reduce or reclassify any of its issued or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its shares, except for any such transaction by a wholly owned Parent Subsidiary which remains a wholly owned Parent Subsidiary after consummation of such transaction;
(c) authorize or announce an intention to authorize, liabilities or enter into agreements providing for, any acquisitions of a substantial equity interest in or a substantial portion of the assets of any Person or any business or division thereof, in each case whether by merger, consolidation, combination, acquisition of stock or assets or formation of a joint venture or otherwise that, in any case, would reasonably be expected to prevent or materially delay or impede the consummation of the Transactions;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly or indirectly, purchase, redeem or otherwise acquire any shares in its capital or any rights, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, transaction except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, ; (iv) enter into any “closing contract, agreement” within the meaning of Section 7121 of the Code (, commitment or any similar provision of state, local, or non-U.S. Law) arrangement with respect to any of the foregoing or (v) enter into any contract, agreement, commitment or arrangement to dissolve, merge, consolidate or enter into any other material Tax, business contract or surrender enter into any right to claim a material Tax refundnegotiations in connection therewith;
(hd) convene Parent will not, nor will it authorize any meeting director or authorize or permit any officer or employee or any attorney, accountant or other representative retained by them to, make, solicit, encourage any inquiries with respect to, or engage in any negotiations concerning, any Acquisition Proposal (as defined below for purposes of this paragraph). Parent will promptly advise the holders Company orally and in writing of any such inquiries or proposals (or requests for information) and the substance thereof. As used in this paragraph, “Acquisition Proposal” shall mean any proposal for a merger or other business combination involving Parent Stock or for the purpose acquisition of revoking a substantial equity interest in either of them or varying the authority any material assets of the directors either of them other than as contemplated by this Agreement. Parent will immediately cease and cause to allot Parent Stock; or
(i) agreebe terminated any existing activities, in writing discussions or otherwise, negotiations with any Person conducted heretofore with respect to take any of the foregoing actions.foregoing; and
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Conduct of Business by Parent Pending the Closing. Parent agrees that between the date of this Agreement hereof and the Effective Time or the time, if any, at which this Agreement is terminated pursuant to Section 8.1, except (a) as set forth in Section 5.2 earlier of the Parent Disclosure Letter, (b) as specifically required by this Agreement, (c) as required by Law or (d) as consented to in writing by the Company (which consent shall not be unreasonably withheld, delayed or conditioned), Parent (i) shall and shall cause each Parent Subsidiary to, conduct its business in all material respects in the ordinary course of business consistent with past practice, including by using reasonable best efforts to preserve intact its and their present business organizations and to preserve its and their present relationships with Governmental Entities and with customers, suppliers and other Persons with whom it and they have material business relations; provided, however, that no action that is specifically permitted by any of clauses (a) through (i) of Section 5.2(ii) shall be deemed a breach of this clause (i), and (ii) agrees that between the date of this Agreement and the First Effective Time or the date, if any, on which this Agreement is validly terminated pursuant to Section 8.1, except as set forth in Section 5.2 of the Parent Disclosure Letter, as specifically permitted or required by this Agreement, as required by applicable Law or as consented to in writing by the Company (such consent not to be unreasonably withheld, conditioned or delayed), Parent shall not, and shall not permit any cause each Parent Subsidiary not to, directly or indirectly:
(a) authorize amend, modify, waive, rescind, change or otherwise restate the Parent Governing Documents (whether by merger, consolidation, operation of law or otherwise) in a manner that would materially and adversely affect the Company Stockholders, or adversely affect the Company Stockholders relative to other holders of Parent Common Stock;
(b) authorize, declare, set aside, make or pay any dividends on or make any distribution with respect to its outstanding shares of capital stock or other equity interests (whether in cash, assets, stock or other securities of Parent or any Parent SubsidiariesSubsidiary), except (i) dividends and distributions paid or made on a pro rata basis by Parent Subsidiaries in the ordinary course of business consistent with past practice by the Parent Subsidiaries to Parent or by a any other wholly owned Parent Subsidiary and (ii) for transactions that would require an adjustment to Parent or another wholly owned Parent Subsidiarythe Merger Consideration pursuant to Section 2.1(d) and for which the proper adjustment is made;
(bc) split, combine, subdivide, reduce or reclassify any of its issued capital stock or unissued shares, or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for, its sharesequity interests, except for (i) any such transaction by a involving only wholly owned Parent Subsidiary Subsidiaries, and (ii) any transactions that would require an adjustment to the Merger Consideration pursuant to Section 2.1(d) and for which remains a wholly owned Parent Subsidiary after consummation of such transactionthe proper adjustment is made;
(cd) authorize liquidate (completely or partially), dissolve or adopt any plan or resolution providing for any of the foregoing, in each case, with respect to Parent, Merger Sub I or Merger Sub II;
(e) acquire (including by merger, consolidation or acquisition of stock or assets or any other means) or publicly announce an intention to authorizeso acquire, or enter into any agreements providing forfor any acquisitions of, any acquisitions of a substantial equity interest interests in or a substantial material portion of the assets of any Person (or any business or division thereof, in each case whether ) that (i) would require (A) the filing by merger, consolidation, combination, acquisition of stock Parent or assets or formation any Parent Subsidiaries of a joint venture Notification and Report Form pursuant to the HSR Act with respect to such acquisition or otherwise that(B) any pre-closing approvals, in consents, waivers or clearances under any case, Regulatory Laws of the jurisdictions set forth on Section 3.4(a) of the Company Disclosure Letter with respect to such acquisition and (ii) would reasonably be expected to prevent (A) any waiting period (or materially delay extensions thereof) applicable to the Transactions under the HSR Act from expiring or impede terminating prior to the consummation Outside Date or (B) Parent, Merger Sub I or Merger Sub II from obtaining, prior to the Outside Date, any of the Transactionsrequired pre-closing approvals, consents, waivers or clearances applicable to the Transactions under any Regulatory Laws of the jurisdictions set forth on Section 3.4(a) of the Company Disclosure Letter;
(d) amend the Parent Governing Documents or permit Merger Sub or any Significant Subsidiary of Parent to adopt any amendments to its governing documents;
(e) issue, deliver, grant, sell, pledge, dispose of or encumber, or authorize the issuance, delivery, grant, sale, pledge, disposition or encumbrance of, any shares, voting securities or other equity interest in the Parent or any Parent Subsidiary or any securities convertible into or exchangeable for any such shares, voting securities or equity interest, or any rights, warrants or options to acquire any such shares, voting securities or equity interest or any “phantom” stock, “phantom” stock rights, stock appreciation rights or stock based performance units, other than (i) issuances of Parent Shares in respect of any exercise of Parent stock options or the vesting or settlement of Parent Equity Awards, (ii) transactions between Parent and a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries, (iii) issuances of Parent Equity Awards, (iv) other issuances of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate and (v) other than in connection with the Financing; or
(f) directly take any action, or indirectlyknowingly fail to take any action, purchasewhich action or failure to act would or would be reasonably expected to prevent or impede the Mergers, redeem or otherwise acquire any shares in its capital or any rightstaken together, warrants or options to acquire any such shares in its capital, except for (i) acquisitions of Parent Shares tendered by holders of Parent Equity Awards in order to satisfy obligations to pay the exercise price and/or Tax withholding obligations with respect thereto (ii) the acquisition by the Parent of Parent Equity Awards in connection with the forfeiture of such awards, (iii) transactions between the Parent and from qualifying as a wholly owned Parent Subsidiary or between wholly owned Parent Subsidiaries and (iv) other acquisitions of shares of Parent Stock for an amount not exceeding $100,000,000 in the aggregate;
(g) make or change any material Tax election, change any Tax accounting period for purposes of a material Tax or material method of Tax accounting, file any material amended Tax Return, settle or compromise any audit or proceeding relating to a material amount of Taxes, except in the ordinary course of business, agree to an extension or waiver of the statute of limitations with respect to a material amount of Taxes, enter into any “closing agreementreorganization” within the meaning of Section 7121 368(a) of the Code Code;
(g) subject to Section 6.2, take or cause to be taken any similar provision action that would reasonably be expected to materially delay, impede or prevent the consummation of state, local, the Transactions on or non-U.S. Law) with respect to any material Tax, or surrender any right to claim a material Tax refund;before the Outside Date; or
(h) convene any meeting of the holders of Parent Stock for the purpose of revoking agree or varying the authority of the directors of Parent to allot Parent Stock; or
(i) agreeauthorize, in writing or otherwise, to take any of the foregoing actions.
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